As filed with the Securities and Exchange Commission on October 14, 1999
File No. 333-
File No. 811- 9341
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ( x )
Pre-effective Amendment No. ( )
Post-effective Amendment No. ( )
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940 ( x )
Pre-effective Amendment No. ( )
Post-effective Amendment No. ( )
(Check appropriate box or boxes)
-----------------------------
GALIC(R) OF NEW YORK SEPARATE ACCOUNT I
(Exact Name of Registrant)
GREAT AMERICAN LIFE INSURANCE COMPANY(R) OF NEW YORK
(Name of Depositor)
90 William Street
New York, New York 10038
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code:
(800) 789-6771
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Mark F. Muething, Esq.
Senior Vice President, Secretary and Director
Great American Life Insurance Company(R) of New York
90 William Street
New York, New York 10038
(Name and Address of Agent for Service)
Copy to:
John P. Gruber, Esq.
Great American Life Insurance Company(R) of New York
P. O. Box 5423
Cincinnati, Ohio 45201-5423
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Approximate date of Proposed Public Offering: As soon as practicable after the
effective date of the Registration Statement
DECLARATION REQUIRED BY RULE 24F-2(a)(1)
Pursuant to Rule 24f-2 under the Investment Company Act of 1940, the
Registrant declares that an indefinite number of its securities is being
registered under the Securities Act of 1933.
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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CROSS REFERENCE SHEET
Pursuant to Rule 495(a)
Showing Location in Part A (Prospectus),
Part B (Statement of Additional Information) and Part C (Other Information)
of Registration Statement Information Required by Form N-4
PART A
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Item of Form N-4 Prospectus Caption
1. Cover Page.................................... Cover Page
2. Definitions................................... Definitions, Glossary of Financial Terms
3. Synopsis...................................... Overview
4. Condensed Financial Information
(a) Accumulation Unit Values............... Condensed Financial Information
(b) Performance Data....................... Performance Information
(c) Financial Statements................... Financial Statements
5. General Description of Registrant, Depositor
and Portfolio Companies
(a) Depositor.............................. Great American Life Insurance Company(R)
of New York
(b) Registrant............................. The Separate Account
(c) Portfolio Companies.................... The Portfolios
(d) Portfolio Prospectuses................. The Portfolios
(e) Voting Rights.......................... Voting Rights
6. Deductions and Expenses
(a) General................................ Charges and Deductions
(b) Sales Load %........................... Contingent Deferred Sales Charge
(c) Special Purchase Plan.................. Contingent Deferred Sales Charge
(d) Commissions............................ AAG Securities, Inc.
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(e) Portfolio Expenses..................... Fee Table
(f) Operating Expenses..................... Fee Table
7. Contracts
(a) Persons with Rights.................... Persons with Rights Under a Contract;
Voting Rights
(b)(i) Allocation of Premium Payments........ Purchase Payments
(ii) Transfers............................ Transfers
(iii) Exchanges ........................... Additions, Deletions or Substitutions
(c) Changes................................ Not Applicable
(d) Inquiries.............................. How Do I Contact the Company
8. Annuity Period................................ Benefit Payment Period
9. Death Benefit................................. Death Benefit
10. Purchases and Contract Values
(a) Purchases.............................. Purchase Payments; Investment
Options--Allocations
(b) Valuation.............................. Account Value; Definitions
(c) Daily Calculation...................... Account Value; Accumulation Units;
Definitions
(d) Underwriter............................ AAG Securities, Inc.
11. Redemptions
(a) By Owner............................... Surrenders
By Annuitant........................... Not Applicable
(b) Check Delay............................ Surrenders
(c) Free Look.............................. Right to Cancel
12. Taxes......................................... Federal Tax Matters
13. Legal Proceedings............................. Legal Proceedings
14. Table of Contents for the Statement of
Additional Information........................ Statement of Additional Information
iii
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PART B
Statement of Additional
Item of Form N-4 Information Caption
15. Cover Page.................................... Cover Page
16. Table of Contents............................. Table of Contents
17. General Information and History............... General Information and History
18. Services
(a) Fees and Expenses of Registrant........ (Prospectus) Fee Table
(b) Management Contracts................... Not Applicable
(c) Custodian.............................. Not Applicable
Independent Auditors................... Experts
(d) Assets of Registrant................... Not Applicable
(e) Affiliated Person...................... Not Applicable
(f) Principal Underwriter.................. Not Applicable
19. Purchase of Securities Being Offered.......... (Prospectus) AAG Securities, Inc.
Offering Sales Load........................... (Prospectus) Contingent Deferred Sales
Charge
20. Underwriters.................................. AAG Securities, Inc.
21. Calculation of Performance Data
(a) Money Market Funded Sub-Accounts....... Money Market Sub-Account Standardized
Yield
Calculation
(b) Other Sub-Accounts..................... Not Applicable
22. Annuity Payments.............................. (Prospectus) Fixed Dollar Benefit;
Variable Dollar Benefit; (SAI) Benefit
Units--Transfer Formulas
23. Financial Statements.......................... Financial Statements
iv
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PART C
Item of Form N-4 Part C Caption
24. Financial Statements and Exhibits............. Financial Statements and Exhibits
(a) Financial Statements................... Financial Statements
(b) Exhibits............................... Exhibits
25. Directors and Officers of the Depositor....... Directors and Officers of Great American
Life Insurance Company(R) of New York
26. Persons Controlled By or Under Common Control Persons Controlled By Or Under Common
With the Registrant........................... Control With the Depositor or Registrant
27. Number of Owners.............................. Number of Owners
28. Indemnification............................... Indemnification
29. Principal Underwriters........................ Principal Underwriter
30. Location of Accounts and
Records....................................... Location of Accounts and Records
31. Management Services........................... Management Services
32. Undertakings.................................. Undertakings
Signature Page................................ Signature Page
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v
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GREAT AMERICAN LIFE INSURANCE COMPANY(R) OF NEW YORK
GALIC(R) OF NEW YORK SEPARATE ACCOUNT I
PROSPECTUS for
Individual and Group Flexible Premium Deferred Annuities
____________, 1999
This prospectus describes individual and group flexible premium deferred annuity
contracts (the "Contracts"). Great American Life Insurance Company of New York
(the "Company") is the issuer of the Contracts. The Contracts are available for
tax-qualified and non-tax-qualified annuity purchases. All Contracts qualify for
tax-deferred treatment during the Accumulation Period. The tax treatment of
annuities is discussed in the Federal Tax Matters section of this prospectus.
The Contracts offer both variable and fixed investment options. The variable
investment options under the Contracts are Sub-Accounts of GALIC(R) of New York
Separate Account I (the "Separate Account"). The Contracts currently offer 29
Sub-Accounts. Each Sub-Account is invested in shares of a registered investment
company or a portfolio thereof (each, a "Portfolio"). The Portfolios are listed
below.
Janus Aspen Series (6 Portfolios)
-Aggressive Growth Portfolio
-Worldwide Growth Portfolio
-Balanced Portfolio
-Growth Portfolio
-International Growth Portfolio
-Capital Appreciation Portfolio
Dreyfus Variable Investment Fund (4 Portfolios)
-Capital Appreciation Portfolio
-Money Market Portfolio
-Growth and Income Portfolio
-Small Cap Portfolio
The Dreyfus Socially Responsible Growth Fund, Inc.
Dreyfus Stock Index Fund
Strong Opportunity Fund II, Inc.
Strong Variable Insurance Funds, Inc. (1 Portfolio)
-Strong Mid Cap Growth Fund II
The Timothy Plan Small-Cap Variable Series
BT Insurance Funds Trust (3 Portfolios)
-EAFE(R) Equity Index Fund
-Equity 500 Index Fund
-Small Cap Index Fund
INVESCO Variable Investment Funds, Inc. (3 Portfolios)
-INVESCO VIF-Equity Income Fund
-INVESCO VIF-Total Return Fund
-INVESCO VIF-High Yield Fund
Morgan Stanley Dean Witter Universal Funds, Inc. (5 Portfolios)
-Mid Cap Value Portfolio
-Value Portfolio
-Fixed Income Portfolio
-U.S. Real Estate Portfolio
-Emerging Markets Equity Portfolio
PBHG Insurance Series Fund, Inc. (3 Portfolios)
-PBHG Growth II Portfolio
-PBHG Large Cap Growth Portfolio
-PBHG Technology & Communications Portfolio
This prospectus includes information you should know before investing in the
Contracts. This prospectus is not complete without the current prospectuses for
the Portfolios. Please keep this prospectus and the Portfolio prospectuses for
future reference.
A statement of additional information, dated _________, 1999, contains more
information about the Separate Account and the Contracts. The Company filed the
statement of additional information with the Securities and Exchange Commission.
It is part of this prospectus. For a free copy, complete and return the form on
page 39 of this prospectus, or call the Company at 1-800-789-6771. You may also
access the statement of additional information (as well as all other documents
filed with the Securities and Exchange Commission with respect to the Contracts,
the Separate Account or the Company) at the Securities and Exchange Commission's
Web site: http://www.sec.gov. The table of contents for the statement of
additional information is printed on the last page of this prospectus.
The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the adequacy of this prospectus. Any representation to
the contrary is a criminal offense.
- --------------------------------------------------------------------------------
These securities may be sold by a bank or credit union, but are not financial
institution products.
o The Contracts are Not FDIC or NCUSIF Insured
o The Contracts are Obligations of the Company and Not of the Bank or Credit
Union
o The Bank or Credit Union Does Not Guarantee the Company's Obligations Under
the Contracts
o The Contracts Involve Investment Risk and May Lose Value
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-1-
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TABLE OF CONTENTS
Page
DEFINITIONS.................................................................4
OVERVIEW....................................................................5
What is the Separate Account?............................................5
What Are the Contracts?..................................................5
How Do I Purchase or Cancel a Contract?..................................5
Will Any Penalties or Charges Apply If I Surrender a Contract?...........5
What Other Charges and Deductions Apply to the Contract?.................5
How Do I Contact the Company?............................................5
FEE TABLE...................................................................6
Owner Transaction Expenses...............................................6
Separate Account Annual Expenses.........................................6
Portfolio Annual Expenses (After Expense Reimbursement)
for Year Ended 12/31/98..................................................6
Examples.................................................................8
CONDENSED FINANCIAL INFORMATION............................................12
Financial Statements....................................................12
Performance Information.................................................13
Yield Data.............................................................13
Total Return Data......................................................13
Other Performance Measures.............................................13
THE PORTFOLIOS.............................................................14
Janus Aspen Series......................................................14
Dreyfus Portfolios......................................................15
Strong Portfolios.......................................................16
BT Insurance Funds Trust................................................16
INVESCO Variable Investment Funds, Inc..................................17
PBHG Insurance Series Fund, Inc.........................................17
Morgan Stanley Dean Witter Universal Funds, Inc.........................18
The Timothy Plan Small-Cap Variable Series..............................18
Additions, Deletions, or Substitutions..................................19
Voting Rights...........................................................19
GREAT AMERICAN LIFE INSURANCE COMPANY(R)OF NEW YORK .......................20
THE SEPARATE ACCOUNT.......................................................20
AAG SECURITIES, INC........................................................20
CHARGES AND DEDUCTIONS.....................................................21
Charges and Deductions By the Company...................................21
Contingent Deferred Sales Charge ("CDSC")..............................21
Contract Maintenance Fee...............................................22
Transfer Fee...........................................................22
Administration Charge..................................................22
Mortality and Expense Risk Charge......................................23
Premium Taxes..........................................................23
Discretionary Waivers of Charges.......................................23
Expenses of the Portfolios.............................................23
THE CONTRACTS..............................................................24
Right to Cancel.........................................................24
Persons With Rights Under a Contract....................................24
ACCUMULATION PERIOD........................................................25
Account Statements......................................................25
2
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Account Value...........................................................25
Purchase Payments.......................................................27
Investment Options--Allocations.........................................27
Transfers...............................................................28
Surrenders..............................................................30
Contract Loans..........................................................31
Termination.............................................................31
BENEFIT PAYMENT PERIOD.....................................................32
Annuity Benefit.........................................................32
Death Benefit...........................................................32
Settlement Options......................................................32
Form of Settlement Option..............................................33
Calculation of Fixed Dollar Benefit Payments...........................33
Calculation of Variable Dollar Benefit Payments........................34
FEDERAL TAX MATTERS........................................................35
Tax Deferral On Annuities...............................................35
Tax-Qualified Plans.....................................................36
Individual Retirement Annuities........................................36
Roth IRAs..............................................................36
Tax-Sheltered Annuities................................................36
Pension and Profit Sharing Plans.......................................36
Governmental Deferred Compensation Plans...............................36
Nonqualified Deferred Compensation Plans................................36
Summary of Income Tax Rules.............................................37
GLOSSARY OF FINANCIAL TERMS................................................38
THE REGISTRATION STATEMENT.................................................39
OTHER INFORMATION..........................................................39
Year 2000...............................................................39
Legal Proceedings.......................................................39
STATEMENT OF ADDITIONAL INFORMATION........................................40
3
<PAGE>
DEFINITIONS
The capitalized terms defined on this page will have the meanings given to them
when used in this prospectus. Other terms which may have a specific meaning
under the Contracts, but which are not defined on this page, will be explained
as they are used in this prospectus.
- --------------------------------------------------------------------------------
Account Value: The value of a Contract during the Accumulation Period. It is
equal to the sum of the value of the owner's interest in the Sub-Accounts and
the owner's interest in the fixed account options.
Accumulation Period: The period during which purchase payments are invested
according to the investment options elected and accumulated on a tax-deferred
basis. The Accumulation Period ends when a Contract is annuitized or surrendered
in full, or on the Death Benefit Valuation Date.
Accumulation Unit: A share of a Sub-Account that an owner purchases during the
Accumulation Period.
Accumulation Unit Value: The value of an Accumulation Unit at the end of a
Valuation Period. See the Glossary of Financial Terms on page 37 of this
prospectus for an explanation of how Accumulation Unit Values are calculated.
Benefit Payment Period: The period during which either annuity benefit or death
benefit payments are paid under a settlement option. The Benefit Payment Period
begins on the first day of the first payment interval in which a benefit payment
will be paid.
Benefit Unit: A share of a Sub-Account that is used to determine the amount of
each variable dollar benefit payment after the first variable dollar benefit
payment during the Benefit Payment Period.
Benefit Unit Value: The value of a Benefit Unit at the end of a Valuation
Period. See the Glossary of Financial Terms on page 37 of this prospectus for an
explanation of how Benefit Unit Values are calculated.
Death Benefit Valuation Date: The date the death benefit is valued. It is the
date that the Company receives both proof of the death of the owner and
instructions as to how the death benefit will be paid. If instructions are not
received within one year of the date of death, the Death Benefit Valuation Date
will be one year after the date of death. The Death Benefit Valuation Date may
never be later than five years after the date of death.
Net Asset Value: The price computed by or for each Portfolio, no less frequently
than each Valuation Period, at which the Portfolio's shares or units are
redeemed in accordance with the rules of the Securities and Exchange Commission.
Net Investment Factor: The factor that represents the percentage change in the
Accumulation Unit Values and Benefit Unit Values from one Valuation Period to
the next. See the Glossary of Financial Terms on page 37 of this prospectus for
an explanation of how the Net Investment Factor is calculated.
Valuation Date: A day on which Accumulation Unit Values and Benefit Unit Values
can be calculated. Each day the New York Stock Exchange is open for business is
a Valuation Date.
Valuation Period: The period starting at the close of regular trading on the New
York Stock Exchange on any Valuation Date and ending at the close of trading on
the next succeeding Valuation Date.
4
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OVERVIEW
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What is the Separate Account?
The Separate Account is a unit investment trust registered with the Securities
and Exchange Commission under the Investment Company Act of 1940. The Separate
Account is divided into Sub-Accounts, each of which is invested in one of the
Portfolios listed on page 1 of this prospectus. If you choose a variable
investment option, you are investing in the Sub-Accounts, not directly in the
Portfolios.
What Are the Contracts?
The Contracts are individual and group deferred annuities, which are insurance
products. The Contracts are sold with either a standard or an enhanced fee
structure, as described in the Fee Table on page 6 of this prospectus. The
Contracts are available in both tax-qualified and non-tax-qualified forms, both
of which qualify for tax-deferred investment status. See the Federal Tax Matters
section beginning on page 34 of this prospectus for more information about tax
qualifications and taxation of annuities in general. During the Accumulation
Period, the amounts you contribute can be allocated among any of the 29 variable
investment options and five fixed account options. The variable investment
options are the Sub-Accounts of the Separate Account, each of which is invested
in a Portfolio. The owner bears the risk of any investment gain or loss on
amounts allocated to the Sub-Accounts. The fixed account options earn a fixed
rate of interest declared by the Company, which will be no less than 3% per
year. The Company guarantees amounts invested in the fixed account options and
the earnings thereon so long as those amounts remain in the fixed account.
During the Benefit Payment Period, payments can be allocated between variable
dollar benefit and fixed dollar benefit options. If a variable dollar benefit is
selected, Benefit Units can be allocated to any of the same Sub-Accounts that
are available during the Accumulation Period.
How Do I Purchase or Cancel a Contract?
The requirements to purchase a Contract are explained in The Contracts section
beginning on page 23 of this prospectus. You may purchase a Contract only
through a licensed securities representative. You may cancel a Contract within
twenty days after you receive it (or longer if the Contract is purchased to
replace an existing Contract.) You will bear the risk of investment gain or loss
on any amounts allocated to the Sub-Accounts prior to cancellation. The right to
cancel does not apply to group Contracts, although the right to cancel does
apply to certificates issued under a group contract. The right to cancel is
described in the Right to Cancel section on page 23 of this prospectus.
Will Any Penalties or Charges Apply If I Surrender a Contract?
A contingent deferred sales charge ("CDSC") may apply to amounts surrendered
depending on the timing and amount of the surrender. The maximum CDSC is 7% for
each purchase payment. The CDSC percentage decreases by 1% annually to 0% after
seven years from the date of receipt of each purchase payment. Surrender
procedures and the CDSC are described in the Surrenders section beginning on
page 29 of this prospectus. A penalty tax may also be imposed at the time of a
surrender depending on your age and other circumstances of the surrender. Tax
consequences of a surrender are described in the Federal Tax Matters section on
page 34 of this prospectus. The right to surrender may be restricted under
certain tax-qualified plans.
What Other Charges and Deductions Apply to the Contract?
Other than the CDSC, the Company will charge the fees and charges listed below
unless the Company waives the fee or charge as discussed in the Charges and
Deductions section beginning on page 20 of this prospectus:
o a transfer fee for certain transfers between investment options;
o an annual contract maintenance fee, which is assessed only against
investments in the Sub-Accounts;
o a mortality and expense risk charge, which is an expense of the Separate
Account and charged against all assets in the Sub-Accounts (this charge may
never be waived);
o an administration charge, which is an expense of the Separate Account and
charged against all assets in the Sub-Accounts; and
o possible premium taxes (where taxes apply, they may never be waived)
In addition to charges and deductions under the Contracts, the Portfolios incur
expenses that are passed through to owners. Portfolio expenses for the fiscal
year ending December 31, 1998 are included in the Fee Table on page 6 of this
prospectus and are described in the prospectuses and statements of additional
information for the Portfolios.
How Do I Contact the Company?
Any questions or inquiries should be directed to the Company's Administrative
Office, P.O. Box 5423, Cincinnati, Ohio 45201-5423, (800) 789-6771. Please
include the Contract number and the owner's name.
5
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FEE TABLE
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Owner Transaction Expenses
Maximum Contingent Deferred Sales Charge (applies to purchase payments only) 7%
Transfer Fee (applies to transfers in excess of 12 in any contract year) $25
Annual Contract Maintenance Fee (not assessed against fixed account options) $30
Separate Account Annual Expenses
(As a percentage of the average value of the owner's interest in the Sub-Accounts)
</TABLE>
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Standard Enhanced Enchanced
Contracts Contracts Contracts with
Administration
Charge Waived
Mortality and Expense Risk Charge 1.25% 0.95% 0.95%
Administration Charge 0.15% 0.15% 0.00%
----- ----- -----
Total Separate Account Annual Expenses 1.40% 1.10% 0.95%
</TABLE>
Portfolio Annual Expenses (After Expense Reimbursement) for Year Ended 12/31/98
(As a percentage of Portfolio average net assets)
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Sub-Account Management Other Total
Fees Expenses Expenses
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<S> <C> <C> <C>
Janus A.S.-Aggressive Growth Portfolio 0.72 0.03 0.75
Janus A.S.-Worldwide Growth Portfolio 0.65 0.07 0.72
Janus A.S.-Balanced Portfolio 0.72 0.02 0.74
Janus A.S.-Growth Portfolio 0.65 0.03 0.68
Janus A.S.-International Growth Portfolio 0.66 0.20 0.86
Janus A.S.-Capital Appreciation Portfolio 0.70 0.22 0.92
Dreyfus V.I.F.-Capital Appreciation Portfolio 0.75 0.06 0.81
Dreyfus V.I.F.-Money Market Portfolio 0.50 0.06 0.56
Dreyfus V.I.F.-Growth and Income Portfolio 0.75 0.03 0.78
Dreyfus V.I.F.-Small Cap Portfolio 0.75 0.02 0.77
The Dreyfus Socially Responsible Growth Fund, Inc. 0.75 0.05 0.80
Dreyfus Stock Index Fund 0.25 0.01 0.26
Strong Opportunity Fund II, Inc. 1.00 0.16 1.16
Strong Variable Insurance Funds, Inc.-Strong Mid Cap Growth Fund II 1.00 0.20 1.20
BT Insurance Funds Trust-EAFE(R)Equity Index Fund 0.00 0.65 0.65
BT Insurance Funds Trust-Equity 500 Index Fund 0.00 0.30 0.30
BT Insurance Funds Trust-Small Cap Index Fund 0.00 0.45 0.45
INVESCO VIF-Equity Income Fund 0.75 0.18 0.93
INVESCO VIF-Total Return Fund 0.75 0.42 1.17
INVESCO VIF-High Yield Fund 0.60 0.47 1.07
Morgan Stanley Dean Witter Universal Funds, Inc.-Mid Cap Value Portfolio 0.23 0.82 1.05
Morgan Stanley Dean Witter Universal Funds, Inc.-Value Portfolio 0.08 0.77 0.85
Morgan Stanley Dean Witter Universal Funds, Inc.-Fixed Income Portfolio 0.06 0.64 0.70
Morgan Stanley Dean Witter Universal Funds, Inc.-U.S. Real Estate 0.17 0.93 1.10
Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Emerging Markets 0.00 1.95 1.95
Equity Port.
PBHG Insurance Series Fund, Inc.-PBHG Growth II Portfolio 0.85 0.35 1.20
PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth Portfolio 0.75 0.35 1.10
PBHG Insurance Series Fund, Inc.-PBHG Tech. & Comm. Portfolio 0.85 0.35 1.20
The Timothy Plan Small-Cap Variable Series 1.00 0.20 1.20
</TABLE>
6
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The purpose of the Fee Table is to assist the owner in understanding the various
costs and expenses that an owner will bear directly or indirectly. The Fee Table
reflects expenses of the Separate Account as well as of the Portfolios. The
Separate Account expenses are discussed more fully in the Charges and Deductions
section beginning on page 20 of this prospectus. The Portfolio expenses are
discussed more fully in the Portfolio prospectuses.
Premium taxes may also apply.
- -----------------------------
1 Data for each Portfolio are for its fiscal year ended December 31, 1998.
Actual expenses in future years may be higher or lower. Portfolios may have
agreements with their advisors to cap or waive fees, and/or to reduce or waive
expenses or to reimburse expenses. The specific terms of such waivers,
reductions or reimbursements are discussed in the Portfolio prospectuses. Fees
and expenses shown below are actual fees and expenses before any applicable fee
waivers or reductions or expense reimbursements.
<TABLE>
<CAPTION>
Sub-Account Management Fees Other Expenses Total
Expenses
--------------------------------------------------------------------------------- ----------------- ---------------- -------------
<S> <C> <C> <C>
Janus A.S.-Aggressive Growth Portfolio 0.72 0.03 0.75
Janus A.S.-Worldwide Growth Portfolio 0.67 0.07 0.74
Janus A.S.-Balanced Portfolio 0.72 0.02 0.74
Janus A.S.-Growth Portfolio 0.72 0.03 0.75
Janus A.S.-International Growth Portfolio 0.75 0.20 0.95
Janus A.S.-Capital Appreciation Portfolio 0.75 0.22 0.97
Dreyfus V.I.F.-Capital Appreciation Portfolio 0.75 0.06 0.81
Dreyfus V.I.F.-Money Market Portfolio 0.50 0.06 0.56
Dreyfus V.I.F.-Growth and Income Portfolio 0.75 0.03 0.78
Dreyfus V.I.F.-Small Cap Portfolio 0.75 0.02 0.77
The Dreyfus Socially Responsible Growth Fund, Inc. 0.75 0.05 0.80
Dreyfus Stock Index Fund 0.25 0.01 0.26
Strong Opportunity Fund II, Inc. 1.00 0.16 1.16
Strong Variable Insurance Funds, Inc.-Strong Mid Cap Growth Fund II 1.00 0.55 1.55
BT Insurance Funds Trust-EAFE(R)Equity Index Fund 0.45 1.21 1.66
BT Insurance Funds Trust-Equity 500 Index Fund 0.20 0.99 1.19
BT Insurance Funds Trust-Small Cap Index Fund 0.35 1.23 1.58
INVESCO VIF-Equity Income Fund 0.75 0.42 1.17
INVESCO VIF-Total Return Fund 0.75 0.49 1.24
INVESCO VIF-High Yield Fund 0.60 0.47 1.07
Morgan Stanley Dean Witter Universal Funds, Inc.-Mid Cap Value Portfolio 0.75 0.82 1.57
Morgan Stanley Dean Witter Universal Funds, Inc.-Value Portfolio 0.55 0.77 1.32
Morgan Stanley Dean Witter Universal Funds, Inc.-Fixed Income Portfolio 0.40 0.64 1.04
Morgan Stanley Dean Witter Universal Funds, Inc.-U.S. Real Estate Portfolio 0.80 0.93 1.73
Morgan Stanley Dean Witter Universal Funds, Inc.-Emerging Markets Equity Port. 1.25 2.20 3.45
PBHG Insurance Series Fund, Inc.-PBHG Growth II Portfolio 0.85 0.69 1.54
PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth Portfolio 0.75 0.78 1.53
PBHG Insurance Series Fund, Inc.-PBHG Tech. & Comm. Portfolio 0.85 0.71 1.56
The Timothy Plan Small-Cap Variable Series 1.00 1.90 2.90
</TABLE>
7
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<TABLE>
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Examples Example #1--Assuming Surrender Example #2--Assuming No Surrender
Standard Contracts
If the owner surrenders his or If the owner does not surrender
her Contract at the end of the his or her Contract, or if it is
applicable time period, the annuitized, the following
following expenses would be expenses would be charged on a
charged on a $1,000 investment: $1,000 investment at the end of
the applicable time period:
- --------------------------------------------------------- --------------------------------- ----------------------------------
Sub-Account 1 Year 3 Years 5 Years 10 Years 1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------- ------- -------- -------- ------- -------- -------- ------- --------
<S> <C> <C> <C> <C>
Janus A.S.-Aggressive Growth Portfolio $93 $125 $23 $75
Janus A.S.-Worldwide Growth Portfolio $93 $124 $23 $74
Janus A.S.-Balanced Portfolio $93 $125 $23 $75
Janus A.S.-Growth Portfolio $92 $123 $22 $73
Janus A.S.-International Growth Portfolio $94 $129 $24 $79
Janus A.S.-Capital Appreciation Portfolio $95 $130 $25 $80
Dreyfus V.I.F.-Capital Appreciation Portfolio $94 $127 $24 $77
Dreyfus V.I.F.-Money Market Portfolio $91 $119 $21 $69
Dreyfus V.I.F.-Growth and Income Portfolio $94 $126 $24 $76
Dreyfus V.I.F.-Small Cap Portfolio $93 $126 $23 $76
The Dreyfus Socially Responsible Growth Fund, Inc. $94 $127 $24 $77
Dreyfus Stock Index Fund $88 $109 $18 $59
Strong Opportunity Fund II, Inc. $97 $138 $27 $88
Strong Variable Insurance Funds, Inc.-Strong Mid Cap $98 $139 $28 $89
Growth Fund II
BT Insurance Funds Trust-EAFE(R)Equity Index Fund $92 $122 $22 $72
BT Insurance Funds Trust-Equity 500 Index Fund $89 $110 $19 $60
BT Insurance Funds Trust-Small Cap Index Fund $90 $115 $20 $65
INVESCO VIF-Equity Income Fund $95 $131 $25 $81
INVESCO VIF-Total Return Fund $97 $138 $27 $88
INVESCO VIF-High Yield Fund $98 $139 $28 $89
Morgan Stanley Dean Witter Universal Funds, Inc.-Mid $96 $135 $26 $85
Cap Value Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Value $94 $128 $24 $78
Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Fixed $93 $123 $23 $73
Income Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-U.S. $97 $136 $27 $86
Real Estate Portfolio
Morgan Stanley Dean Witter Universal Funds, $105 $163 $35 $113
Inc.-Emerging Markets Equity
PBHG Insurance Series Fund, Inc.-PBHG Growth II $98 $139 $28 $89
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth $97 $136 $27 $86
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Tech. & Comm. $98 $139 $28 $89
Portfolio
The Timothy Plan Small-Cap Variable Series $98 $139 $28 $89
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
Enhanced Contracts Example #1--Assuming Surrender Example #2--Assuming No Surrender
If the owner surrenders his or If the owner does not surrender
her Contract at the end of the his or her Contract, or if it is
applicable time period, the annuitized, the following
following expenses would be expenses would be charged on a
charged on a $1,000 investment: $1,000 investment at the end of
the applicable time period:
- --------------------------------------------------------- --------------------------------- ----------------------------------
Sub-Account 1 Year 3 Years 5 Years 10 Years 1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------- ------- -------- -------- ------- -------- -------- ------- --------
<S> <C> <C> <C> <C>
Janus A.S.-Aggressive Growth Portfolio $90 $115 $20 $65
Janus A.S.-Worldwide Growth Portfolio $90 $114 $20 $64
Janus A.S.-Balanced Portfolio $90 $115 $20 $65
Janus A.S.-Growth Portfolio $89 $113 $19 $63
Janus A.S.-International Growth Portfolio $91 $119 $21 $69
Janus A.S.-Capital Appreciation Portfolio $92 $121 $21 $71
Dreyfus V.I.F.-Capital Appreciation Portfolio $91 $117 $21 $67
Dreyfus V.I.F.-Money Market Portfolio $89 $109 $18 $59
Dreyfus V.I.F.-Growth and Income Portfolio $90 $116 $20 $66
Dreyfus V.I.F.-Small Cap Portfolio $90 $116 $20 $66
The Dreyfus Socially Responsible Growth Fund, Inc. $91 $117 $21 $67
Dreyfus Stock Index Fund $85 $99 $15 $49
Strong Opportunity Fund II, Inc. $94 $129 $24 $79
Strong Variable Insurance Funds, Inc.-Strong Mid Cap $95 $130 $25 $80
Growth Fund II
BT Insurance Funds Trust -EAFE(R)Equity Index Fund $89 $112 $19 $62
BT Insurance Funds Trust -Equity 500 Index Fund $86 $101 $16 $51
BT Insurance Funds Trust -Small Cap Index Fund $87 $105 $17 $55
INVESCO VIF-Equity Income Fund $92 $121 $22 $71
INVESCO VIF-Total Return Fund $94 $129 $24 $79
INVESCO VIF-High Yield Fund $95 $130 $25 $80
Morgan Stanley Dean Witter Universal Funds, Inc.-Mid $93 $125 $23 $75
Cap Value Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Value $91 $119 $21 $69
Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Fixed $90 $114 $20 $64
Income Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-U.S. $94 $127 $24 $77
Real Estate Portfolio
Morgan Stanley Dean Witter Universal Funds, $153 $32 $103
Inc.-Emerging Markets Equity $102
PBHG Insurance Series Fund, Inc.-PBHG Growth II $95 $130 $25 $80
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth $94 $127 $24 $77
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Tech. & Comm. $95 $130 $25 $80
Portfolio
The Timothy Plan Small-Cap Variable Series $95 $130 $25 $80
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
Enhanced Contracts Example #1--Assuming Surrender Example #2--Assuming No Surrender
If the owner surrenders his or If the owner does not surrender
her Contract at the end of the his or her Contract, or if it is
applicable time period, the annuitized, the following
following expenses would be expenses would be charged on a
charged on a $1,000 investment: $1,000 investment at the end of
the applicable time period:
- --------------------------------------------------------- --------------------------------- ----------------------------------
Sub-Account 1 Year 3 Years 5 Years 10 years 1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------- ------- -------- -------- ------- -------- -------- ------- --------
<S> <C> <C> <C> <C>
Janus A.S.-Aggressive Growth Portfolio $89 $113 $19 $63
Janus A.S.-Worldwide Growth Portfolio $89 $112 $19 $62
Janus A.S.-Balanced Portfolio $89 $113 $19 $63
Janus A.S.-Growth Portfolio $89 $111 $19 $61
Janus A.S.-International Growth Portfolio $91 $117 $21 $67
Janus A.S.-Capital Appreciation Portfolio $91 $119 $21 $69
Dreyfus V.I.F.-Capital Appreciation Portfolio $90 $115 $20 $65
Dreyfus V.I.F.-Money Market Portfolio $88 $107 $18 $57
Dreyfus V.I.F.-Growth and Income Portfolio $90 $114 $20 $64
Dreyfus V.I.F.-Small Cap Portfolio $90 $114 $20 $64
The Dreyfus Socially Responsible Growth Fund, Inc. $90 $115 $20 $65
Dreyfus Stock Index Fund $84 $97 $14 $47
Strong Opportunity Fund II, Inc. $94 $126 $24 $76
Strong Variable Insurance Funds, Inc.-Strong Mid Cap $94 $128 $24 $78
Growth Fund II
BT Insurance Funds Trust -EAFE(R)Equity Index Fund $88 $110 $18 $60
BT Insurance Funds Trust -Equity 500 Index Fund $85 $98 $15 $48
BT Insurance Funds Trust -Small Cap Index Fund $86 $103 $16 $53
INVESCO VIF-Equity Income Fund $91 $119 $21 $69
INVESCO VIF-Total Return Fund $94 $127 $24 $77
INVESCO VIF-High Yield Fund $94 $128 $24 $78
Morgan Stanley Dean Witter Universal Funds, Inc.-Mid $93 $123 $23 $73
Cap Value Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Value $90 $116 $20 $66
Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Fixed $89 $111 $19 $61
Income Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-U.S. $93 $124 $23 $74
Real Estate Portfolio
Morgan Stanley Dean Witter Universal Funds, $151 $32 $101
Inc.-Emerging Markets Equity $102
PBHG Insurance Series Fund, Inc.-PBHG Growth II $94 $128 $24 $78
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth $93 $124 $23 $74
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Tech. & Comm. $94 $128 $24 $78
Portfolio
The Timothy Plan Small-Cap Variable Series $94 $128 $24 $78
</TABLE>
9
<PAGE>
Enhanced Contracts with Administration Charge Waived
<TABLE>
<CAPTION>
Example #1--Assuming Surrender Example #2--Assuming No Surrender
If the owner surrenders his or If the owner does not surrender
her Contract at the end of the his or her Contract, or if it is
applicable time period, the annuitized, the following
following expenses would be expenses would be charged on a
charged on a $1,000 investment: $1,000 investment at the end of
the applicable time period:
- --------------------------------------------------------- --------------------------------- ----------------------------------
Sub-Account 1 Year 3 Years 5 Years 10 Years 1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------- ------- -------- -------- ------- -------- -------- ------- --------
<S> <C> <C> <C> <C>
Janus A.S.-Aggressive Growth Portfolio $89 $110 $20 $60
Janus A.S.-Worldwide Growth Portfolio $88 $109 $18 $59
Janus A.S.-Balanced Portfolio $89 $110 $19 $60
Janus A.S.-Growth Portfolio $88 $108 $18 $58
Janus A.S.-International Growth Portfolio $90 $114 $20 $64
Janus A.S.-Capital Appreciation Portfolio $90 $116 $20 $66
Dreyfus V.I.F.-Capital Appreciation Portfolio $89 $112 $19 $62
Dreyfus V.I.F.-Money Market Portfolio $87 $104 $17 $54
Dreyfus V.I.F.-Growth and Income Portfolio $89 $111 $19 $61
Dreyfus V.I.F.-Small Cap Portfolio $89 $111 $19 $61
The Dreyfus Socially Responsible Growth Fund, Inc. $89 $112 $19 $62
Dreyfus Stock Index Fund $84 $94 $14 $44
Strong Opportunity Fund II, Inc. $93 $124 $23 $74
Strong Variable Insurance Funds, Inc.-Strong Mid Cap $93 $125 $23 $75
Growth Fund II
BT Insurance Funds Trust-EAFE(R)Equity Index Fund $88 $107 $18 $57
BT Insurance Funds Trust-Equity 500 Index Fund $84 $96 $14 $46
BT Insurance Funds Trust-Small Cap Index Fund $86 $101 $16 $51
INVESCO VIF-Equity Income Fund $90 $116 $20 $66
INVESCO VIF-Total Return Fund $93 $124 $23 $74
INVESCO VIF-High Yield Fund $93 $125 $23 $75
Morgan Stanley Dean Witter Universal Funds, Inc.-Mid $92 $120 $22 $70
Cap Value Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Value $90 $114 $20 $64
Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-Fixed $88 $109 $18 $59
Income Portfolio
Morgan Stanley Dean Witter Universal Funds, Inc.-U.S. $92 $122 $22 $72
Real Estate Portfolio
Morgan Stanley Dean Witter Universal Funds, $101 $149 $31 $99
Inc.-Emerging Markets Equity
PBHG Insurance Series Fund, Inc.-PBHG Growth II $93 $125 $23 $75
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth $92 $122 $22 $72
Portfolio
PBHG Insurance Series Fund, Inc.-PBHG Tech. & Comm. $93 $125 $23 $75
Portfolio
The Timothy Plan Small-Cap Variable Series $93 $125 $23 $75
The examples are not indicative of past or future expenses or annual rates of return of any Portfolio. Actual expenses and annual
rates of return may be more or less than those assumed in the examples. The contract maintenance fee is included in the examples as
a charge of $1. The examples assume the reinvestment of all dividends and distributions, no transfers among Sub-Accounts or between
the fixed account options and the Sub-Accounts and a 5% annual rate of return. The charge of $1 for the contract maintenance fee is
based on an estimated average Account Value of $30,000 for the current fiscal year. The examples do not include charges for premium
taxes.
</TABLE>
10
<PAGE>
Financial Statements The financial statements and reports of independent
auditors for the Company are included in the statement of additional
information.
11
<PAGE>
Performance Information From time to time, the Company may advertise yields
and/or total returns for the Sub-Accounts. These figures are based on historical
information and are not intended to indicate future performance. Performance
data and a more detailed description of the methods used to determine yield and
total return are included in the statement of additional information.
Yield Data The "yield" of the money market Sub-Account refers to the annualized
income generated by an investment in that Sub-Account over a specified seven-day
period. The "effective yield" of the money market Sub-Account is the same as the
"yield" except that it assumes reinvestment of the income earned in that
Sub-Account. The effective yield will be slightly higher than the yield because
of the compounding effect of this assumed reinvestment. The Company does not
advertise yields for any Sub-Account other than the money market Sub-Account.
Total Return Data The Company may advertise two types of total return data:
"average annual total return" and "cumulative total return." Average annual
total return is presented in both standardized and non-standardized form.
"Standardized" total return data reflects the deduction of all charges that
apply to all Contracts of that type, except for premium taxes. The contingent
deferred sales charge ("CDSC") reflected in standardized total return is the
percentage CDSC that would apply at the end of the period presented assuming the
purchase payment was received on the first day of the period presented.
"Non-standardized" total return data does not reflect the deduction of CDSCs and
contract maintenance fees. Cumulative total return data is currently presented
only in non-standardized form.
Total return data that does not reflect the CDSC and other charges will be
higher than the total return realized by an investor who incurs the charges.
"Average annual total return" is either hypothetical or actual return data that
reflects performance of a Sub-Account for a one year period or for an average of
consecutive one year periods. If average annual total return data is
hypothetical, it reflects performance for a period of time before the Separate
Account commenced operations. When a Sub-Account has been in operation for one,
five and ten years, average annual total return will be presented for these
periods, although other periods may be presented as well.
"Cumulative total return" is either hypothetical or actual return data that
reflects the performance of a Sub-Account from the beginning of the period
presented to the end of the period presented. If cumulative total return data is
hypothetical, it reflects performance for a period of time before the Separate
Account commenced operations.
Other Performance Measures The Company may include in reports and promotional
literature rankings of the Sub-Accounts, the Separate Account or the Contracts,
as published by any service, company, or person who ranks separate accounts or
other investment products on overall performance or other criteria. Examples of
companies that publish such rankings are Lipper Analytical Services, Inc.,
VARDS, IBC/Donoghue's Money Fund Report, Financial Planning Magazine, Money
Magazine, Bank Rate Monitor, Standard & Poor's Indices, Dow Jones Industrial
Average, and Morningstar.
The Company may also:
o compare the performance of a Sub-Account with applicable indices and/or
industry averages;
o present performance information that reflects the effects of tax-deferred
compounding on Sub-Account investment returns;
o compare investment return on a tax-deferred basis with currently taxable
investment return;
o illustrate investment returns by graphs, charts, or otherwise.
12
<PAGE>
THE PORTFOLIOS
<TABLE>
<CAPTION>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
The Separate Account is currently divided into 29 Sub-Accounts. Each Sub-Account is invested in a Portfolio. Each Portfolio has its
own investment objectives and policies. The current Portfolio prospectuses which accompany this prospectus contain additional
information concerning the investment objectives and policies of each Portfolio, the investment advisory services and administrative
services of each Portfolio and the charges of each Portfolio. There is no assurance that the Portfolios will achieve their stated
objectives. You should read the Portfolio prospectuses carefully before making any decision concerning the allocation of purchase
payments to, or transfers among, the Sub-Accounts.
All dividends and capital gains distributed by the Portfolios are reinvested by the Separate Account and reflected in Accumulation
Unit Values. Portfolio dividends and net capital gains are not distributed to owners.
The Securities and Exchange Commission does not supervise the management or the investment practices and/or policies of any of the
Portfolios. The Portfolios are available only through insurance company separate accounts and certain qualified retirement plans.
Though a Portfolio may have a name and/or investment objectives which are similar to those of a publicly available mutual fund,
and/or may be managed by the same investment advisor that manages a publicly available mutual fund, the performance of the Portfolio
is entirely independent of the performance of any publicly available mutual fund. Neither the Company nor the Portfolios make any
representations or assurances that the investment performance of any Portfolio will be the same or similar to the investment
performance of any publicly available mutual fund.
Janus Aspen Series
Advisor: Aggressive Growth Portfolio
Janus Capital Corporation A nondiversified portfolio that seeks long-term growth of capital by investing primarily
in common stocks with an emphasis on securities issued by medium-sized companies.
Advisor: Worldwide Growth Portfolio
Janus Capital Corporation A diversified portfolio that seeks long-term growth of capital by investing primarily in
common stocks of foreign and domestic issuers. International investing may present special
risks, including currency fluctuations and social and political developments. For further
discussion of the risks associated with international investing, please see the attached
Janus Aspen Series prospectus.
Advisor: Balanced Portfolio
Janus Capital Corporation A diversified portfolio that seeks long-term growth of capital balanced by current
income. The Portfolio normally invests 40-60% of its assets in securities selected
primarily for their growth potential and 40-60% of its assets in securities selected
primarily for their income potential.
Advisor: Growth Portfolio
Janus Capital Corporation A diversified portfolio that seeks long-term growth of capital by investing primarily in
common stocks, with an emphasis on companies with larger market capitalizations.
Advisor: International Growth Portfolio
Janus Capital Corporation A diversified portfolio that seeks long-term growth of capital by investing primarily in
common stocks of foreign issuers. International investing may present special risks,
including currency fluctuations and social and political developments. For further
discussion of the risks associated with international investing, please see the attached
Janus Aspen Series prospectus.
Advisor: Capital Appreciation Portfolio
Janus Capital Corporation A nondiversified portfolio that seeks long-term growth of capital by investing primarily
in common stocks of issuers of any size.
13
<PAGE>
Dreyfus Portfolios
Advisor: Dreyfus Variable Investment Fund-Capital Appreciation Portfolio
The Dreyfus Corporation The Capital Appreciation Portfolio's primary investment objective is to provide long-term
capital growth consistent with the preservation of capital. Current income is a secondary
Sub-Advisor: goal. It seeks to achieve its goals by investing in common stocks.
Fayez Sarofim & Co.
Advisor: Dreyfus Variable Investment Fund-Money Market Portfolio
The Dreyfus Corporation The Money Market Portfolio's goal is to provide as high a level of current income as is
consistent with the preservation of capital and the maintenance of liquidity. This
Portfolio invests in short-term money market instruments. An investment in the Money
Market Portfolio is neither insured nor guaranteed by the U.S. Government. There can be no
assurance that the Money Market Portfolio will be able to maintain a stable net asset
value of $1.00 per share.
Advisor: Dreyfus Variable Investment Fund-Growth and Income Portfolio
The Dreyfus Corporation The Growth and Income Portfolio's goal is to provide long-term capital growth, current
income and growth of income, consistent with reasonable investment risk. This Portfolio
invests primarily in equity securities, debt securities and money market instruments of
domestic and foreign issuers.
Advisor: Dreyfus Variable Investment Fund-Small Cap Portfolio
The Dreyfus Corporation The Small Cap Portfolio's goal is to maximize capital appreciation. This Portfolio invests
primarily in common stocks of domestic and foreign issuers. This Portfolio seeks companies
characterized by new or innovative products or services which should enhance prospects for
growth in future earnings.
Advisor: The Dreyfus Socially Responsible Growth Fund, Inc.
The Dreyfus Corporation The Dreyfus Socially Responsible Growth Fund, Inc.'s primary goal is to provide capital
growth. It seeks to achieve this goal by investing principally in common stocks, or
Sub-Advisor: securities convertible into common stock, of companies which, in the opinion of the
NCM Capital Management Group, Inc. Portfolio's management, not only meet traditional investment standards, but also show
evidence that they conduct their business in a manner that contributes to the enhancement
of the quality of life in America. Current income is a secondary goal.
Advisor: Dreyfus Stock Index Fund
The Dreyfus Corporation The Dreyfus Stock Index Fund's investment objective is to provide investment results that
correspond to the price and yield performance of publicly traded common stocks in the
Index Manager: aggregate, as represented by the Standard & Poor's 500 Composite Stock Price Index. The
Mellon Equity Associates (an affiliate Stock Index Fund is neither sponsored, endorsed, sold or promoted by, nor affiliated with,
of Dreyfus) Standard & Poor's Corporation or The McGraw-Hill Companies, Inc.
14
<PAGE>
Strong Portfolios
Advisor: Strong Opportunity Fund II, Inc.
Strong Capital Management, Inc. The investment objective of the Strong Opportunity Fund II is to seek capital growth. It
currently emphasizes medium-sized companies that the Portfolio's adviser believes are
under-researched and attractively valued.
Advisor: Strong Variable Insurance Funds, Inc.-Strong Mid Cap Growth Fund II
Strong Capital Management, Inc. The investment objective of the Strong Mid Cap Growth Fund II is to seek capital growth.
It invests primarily in equity securities that the Portfolio's adviser believes have
above-average growth prospects. This Portfolio was formerly called the Strong Growth Fund
II.
BT Insurance Funds Trust
Advisor: EAFE(R) Equity Index Fund
Bankers Trust Company The EAFE(R)Equity Index Fund seeks to replicate as closely as possible (before deduction of
expenses) the total return of the Europe, Australia, Far East Index (the "EAFE(R)Index"), a
capitalization-weighted index containing approximately 1,100 equity securities of
companies located outside the United States. The Portfolio will be invested primarily in
equity securities of business enterprises organized and domiciled outside the United
States or for which the principal trading market is outside the United States.
Statistical methods will be employed to replicate the EAFE(R)Index by buying most of the
EAFE(R)Index securities. Securities purchased for the Portfolio will generally, but not
necessarily, be traded on a foreign securities exchange.
Advisor: Equity 500 Index Fund
Bankers Trust Company The Equity 500 Index Fund seeks to replicate as closely as possible (before deduction of
expenses) the total return of the Standard & Poor's 500 Composite Stock Price Index (the
"S&P 500"), an index emphasizing large-capitalization stocks. The Portfolio will include
the common stock of those companies included in the S&P 500, other than the Bankers Trust
Corporation, selected on the basis of computer generated statistical data, that are deemed
representative of the industry diversification of the entire S&P 500.
Advisor: Small Cap Index Fund
Bankers Trust Company The Small Cap Index Fund seeks to replicate as closely as possible (before deduction of
expenses) the total return of the Russell 2000 Small Stock Index (the "Russell 2000"), an
index consisting of 2,000 small-capitalization common stocks. The Portfolio will include
the common stock of companies included in the Russell 2000, on the basis of
computer-generated statistical data, that are deemed representative of the industry
diversification of the entire Russell 2000.
15
<PAGE>
INVESCO Variable Investment Funds, Inc.
Advisor: INVESCO VIF -Equity Income Fund
INVESCO Funds Group, Inc. The primary goal of the INVESCO VIF- Equity Income Fund is to seek high current
income. The Portfolio normally invests at least 65% of its assets in dividend paying
common and preferred stocks. This Portfolio was formerly called the Industrial Income
Portfolio.
Advisor: INVESCO VIF -Total Return Fund
INVESCO Funds Group, Inc. The investment objective of the INVESCO VIF-Total Return Fund is to seek a high total
return on investment through capital appreciation and current income. The INVESCO
VIF-Total Return Fund seeks to accomplish its objective by investing in a combination of
equity securities (consisting of common stocks and, to a lesser degree, securities
convertible into common stock) and fixed income securities.
Advisor: INVESCO VIF -High Yield Fund
INVESCO Funds Group, Inc. The investment objective of the INVESCO VIF-High Yield Fund is to seek a high level of
current income by investing substantially all of its assets in lower rated debt
securities and preferred stocks, including securities issued by foreign companies. The
Portfolio pursues its investment objective through investment in a variety of long-term,
intermediate-term, and short-term bonds. Potential capital appreciation is a factor in the
selection of investments, but is secondary to the Portfolio's primary objective. For
further discussion of the risks associated with investment in lower rated bonds, please
see the attached INVESCO Variable Investment Funds, Inc. prospectus.
PBHG Insurance Series Fund, Inc.
Advisor: PBHG Growth II Portfolio
Pilgrim Baxter & Associates, Ltd. The investment objective of the PBHG Insurance Series Growth II Portfolio is to seek
capital appreciation. The Portfolio invests primarily in common stocks and convertible
securities of small and medium sized growth companies (market capitalization or annual
revenues between $500 million and $10 billion) that, in the adviser's opinion, are
considered to have an outlook for strong earnings growth and potential for significant
capital appreciation.
Advisor: PBHG Large Cap Growth Portfolio
Pilgrim Baxter & Associates, Ltd. The investment objective of the PBHG Insurance Series Large Cap Growth Portfolio is to
seek long-term growth of capital. The Portfolio invests primarily in common stocks of
large capitalization companies (market capitalization in excess of $1 billion) that, in
the adviser's opinion, are considered to have an outlook for strong growth in earnings and
potential for capital appreciation.
Advisor: PBHG Technology & Communications Portfolio
Pilgrim Baxter & Associates, Ltd. The investment objective of the PBHG Insurance Series Technology & Communications
Portfolio is to seek long-term growth of capital. Current income is incidental to the
Portfolio's objective. The Portfolio invests primarily in common stocks of companies
which rely extensively on technology or communications in their product development or
operations, or which are expected to benefit from technological advances and improvements,
and that may be experiencing exceptional growth in sales and earnings driven by technology
or communications-related products and services.
16
<PAGE>
Morgan Stanley Dean Witter Universal Funds, Inc.
Advisor: Mid Cap Value Portfolio
Miller Anderson & Sherrerd, LLP (an The Mid Cap Value Portfolio seeks above-average total return over a market cycle of three
indirect wholly owned subsidiary of to five years by investing in common stocks and other equity securities of issuers with
Morgan Stanley Dean Witter & Co.) equity capitalizations in the range of the companies represented in the S&P MidCap 400
Index. Such range is currently $500 million to $6 billion.
Advisor: Value Portfolio
Miller Anderson & Sherrerd, LLP (an The investment objective of the Value Portfolio is to seek above-average total return over
indirect wholly owned subsidiary of a market cycle of three to five years by investing primarily in a diversified portfolio of
Morgan Stanley Dean Witter & Co.) common stocks and other equity securities deemed by the adviser to be undervalued in
comparison with the stock market as a whole, as measured by the S&P 500 Index.
Advisor: Fixed Income Portfolio
Miller Anderson & Sherrerd, LLP (an The investment objective of the Fixed Income Portfolio is to seek above-average total
indirect wholly owned subsidiary of return over a market cycle of three to five years by investing primarily in a diversified
Morgan Stanley Dean Witter & Co.) portfolio of fixed income securities, including securities issued by the U.S. Government
and its Agencies, Corporate Bonds, Mortgage-Backed Securities, Foreign Bonds, other Fixed
Income Securities and Derivatives, and to a limited extent junk bonds.
Advisor: U.S. Real Estate Portfolio
Morgan Stanley Dean Witter Investment The investment objective of the U.S. Real Estate Portfolio is above-average current income
Management Inc. (a wholly owned and long-term capital appreciation by investing primarily in equity securities of U.S. and
subsidiary of Morgan Stanley Dean non-U.S. companies engaged in the U.S. real estate industry, including Real Estate
Witter & Co.) Investment Trusts (REITs).
Advisor: Emerging Markets Equity Portfolio
Morgan Stanley Dean Witter Investment The investment objective of the Emerging Markets Equity Portfolio is long-term capital
Management Inc. (a wholly owned appreciation by investing primarily in equity securities of emerging market country
subsidiary of Morgan Stanley Dean issuers with a focus on those with strong earnings growth prospects.
Witter & Co.)
The Timothy Plan Small-Cap Variable Series
Advisor: The Timothy Plan Small-Cap Variable Series
Timothy Partners, Ltd. The primary investment objective of The Timothy Plan Small-Cap Variable Series is to seek
long-term capital growth, with a secondary objective of current income. The Portfolio
shall seek to achieve its objectives while abiding by ethical standards established for
investments by the Portfolio. The securities in which the Portfolio shall be precluded
from investing, by virtue of the Portfolio's ethical standards, are referred to as
excluded securities. This Portfolio was formerly called The Timothy Plan Variable Series.
</TABLE>
17
<PAGE>
Additions, Deletions, or Substitutions
The Company may add or delete Sub-Accounts at any time, or may substitute one
Portfolio for another, at any time. The Company does not guarantee that any of
the Sub-Accounts or any of the Portfolios will always be available for
allocation of purchase payments or transfers. In the event of any substitution
or change, the Company may make such changes in the Contract as may be necessary
or appropriate to reflect such substitution or change.
Additions, deletions or substitutions of Sub-Accounts or Portfolios may be due
to an investment decision by the Company, or due to an event not within the
Company's control, such as liquidation of a Portfolio or an irreconcilable
conflict of interest between the Separate Account and another insurance company
which offers a Portfolio. The Portfolio prospectuses describe the possibility of
material conflict of interest in greater detail.
If the Company eliminates a Sub-Account or substitutes the shares of another
investment company for the shares of any Portfolio, the Company will first
obtain approval of the New York State Insurance Department and The Securities
and Exchange Commission to the extent requred by the Investment Company Act of
1940 ("1940 Act"), or other applicable law. The Company will also notify owners
before it eliminates a Sub-Account or substitutes a Portfolio.
New Sub-Accounts may be established when, in the sole discretion of the Company,
marketing, tax, investment or other conditions so warrant. Any new Sub-Accounts
will be made available to existing owners on a basis to be determined by the
Company.
If deemed to be in the best interests of persons having voting rights under the
Contracts, the Separate Account may be operated as a management company under
the 1940 Act or any other form permitted by law, may be de-registered under the
1940 Act in the event such registration is no longer required, or may be
combined with one or more separate accounts.
Voting Rights
To the extent required by law, all Portfolio shares held in the Separate Account
will be voted by the Company at regular and special shareholder meetings of the
respective Portfolios in accordance with instructions received from persons
having voting interests in the corresponding Sub-Account. During the
Accumulation Period, the Company will vote Portfolio shares according to
instructions of owners, unless the Company is permitted to vote shares in its
own right.
The number of votes that an owner may vote will be calculated separately for
each Sub-Account. The number will be determined by applying the owner's
percentage interest, if any, in a particular Sub-Account to the total number of
votes attributable to that Sub-Account.
The owner's percentage interest and the total number of votes will be determined
as of the record date established by that Portfolio for voting purposes. Voting
instructions will be solicited by written communication in accordance with
procedures established by the respective Portfolios.
The Company will vote or abstain from voting shares for which it receives no
timely instructions and shares it holds as to which owners have no beneficial
interest (including shares held by the Company as reserves for benefit
payments*). The Company will vote or abstain from voting such shares in
proportion to the voting instructions it receives from owners of all Contracts
participating in the Sub-Account.
Each person or entity having a voting interest in a Sub-Account will receive
proxy material, reports and other material relating to the appropriate
Portfolio. The Portfolios are not required to hold annual or other regular
meetings of shareholders.
*Neither the owner nor payee has any interest in the Separate Account during the
Benefit Payment Period. Benefit Units are merely a measure of the amount of the
payment the Company is obligated to pay on each payment date.
18
<PAGE>
GREAT AMERICAN LIFE INSURANCE COMPANY(R) OF NEW YORK
- --------------------------------------------------------------------------------
Great American Life Insurance Company of New York (the "Company") is a stock
life insurance company. It was incorporated under the laws of the State of New
York in 1963. The Company is principally engaged in the sale of variable and
fixed annuity policies, traditional life, supplemental health and long term care
insurance. The home office of the Company is located at 90 William Street, New
York, New York 10038.
The Company is a wholly owned subsidiary of Great American Life Insurance
Company(R) which is a wholly owned subsidiary of American Annuity Group(R),
Inc., ("AAG") a publicly traded insurance holding company (NYSE: AAG). AAG is in
turn indirectly controlled by American Financial Group, Inc., a publicly traded
holding company (NYSE: AFG).
The Company may from time to time publish in advertisements, sales literature
and reports to owners the ratings and other information assigned to it by one or
more independent rating organizations such as A.M. Best Company, Standard &
Poor's, and Duff & Phelps. The purpose of the ratings is to reflect the
financial strength and/or claims-paying ability of the Company. Each year A.M.
Best Company reviews the financial status of thousands of insurers, culminating
in the assignment of Best's Ratings. These ratings reflect A.M. Best Company's
opinion of the relative financial strength and operating performance of an
insurance company in comparison to the norms of the life/health insurance
industry. Ratings of the Company do not reflect the investment performance of
the Separate Account or the degree of risk associated with an investment in the
Separate Account.
THE SEPARATE ACCOUNT
- --------------------------------------------------------------------------------
GALIC(R) of New York Separate Account I was established by the Company as an
insurance company separate account under the laws of the State of New York on
May 7, 1999, pursuant to resolution of the Company's Board of Directors. The
Separate Account is registered with the Securities and Exchange Commission under
the 1940 Act as a unit investment trust. However, the Securities and Exchange
Commission does not supervise the management or the investment practices or
policies of the Separate Account.
The assets of the Separate Account are owned by the Company, but they are held
separately from the other assets of the Company. Under New York law, the assets
of a separate account are not chargeable with liabilities incurred in any other
business operation of the Company. Income, gains and losses incurred on the
assets in the Separate Account, whether realized or not, are credited to or
charged against the Separate Account, without regard to other income, gains or
losses of the Company. Therefore, the investment performance of the Separate
Account is entirely independent of the investment performance of the Company's
general account assets or any other separate account maintained by the Company.
The assets of the Separate Account will be held for the exclusive benefit of
owners of, and the persons entitled to payment under, the Contracts offered by
this prospectus and all other contracts that invest in the Separate Account.
AAG SECURITIES, INC.
- --------------------------------------------------------------------------------
AAG Securities, Inc. ("AAGS"), an affiliate of the Company, is the principal
underwriter and distributor of the Contracts. AAGS is a wholly owned subsidiary
of AAG. AAGS is registered with the Securities and Exchange Commission as a
broker-dealer and is a member of the National Association of Securities Dealers,
Inc. ("NASD"). Its principal offices are located at 250 East Fifth Street,
Cincinnati, Ohio 45202. The Company pays AAGS for acting as underwriter
according to the terms of a distribution agreement.
AAGS sells Contracts through its registered representatives. In addition, AAGS
may enter into sales agreements with other broker-dealers to solicit
applications for the Contracts through its registered representatives. These
broker-dealers are registered with the Securities and Exchange Commission and
are members of the NASD. All registered representatives who sell the Contracts
are appointed by the Company as insurance agents and are authorized under
applicable state insurance regulations to sell variable annuities.
The Company or AAGS may pay commissions to registered representatives of AAGS
and other broker-dealers of up to 8.5%% of purchase payments made under the
Contracts. These commissions are reduced by one-half for Contracts issued to
owners over age 80. When permitted by state law and in exchange for lower
initial commissions, AAGS and/or the Company may pay trail commissions to
registered representatives of AAGS and to other broker-dealers. Trail
commissions are not expected to exceed 1% of the Account Value of a Contract on
an annual basis. To the extent permitted under current law, the Company and/or
AAGS may pay production, persistency and managerial bonuses as well as other
promotional incentives, in cash or other compensation, to registered
representatives of AAGS and/or other broker-dealers.
19
<PAGE>
CHARGES AND DEDUCTIONS
- --------------------------------------------------------------------------------
Charges and Deductions By the Company
There are two types of charges and deductions by the Company. There are charges
assessed to the Contract which are reflected in the Account Value of the
Contract, but not in Accumulation Unit Values (or Benefit Unit Values). These
charges are the contingent deferred sales charge, the annual contract
maintenance fee, premium taxes where applicable and transfer fees. There are
also charges assessed against the Separate Account. These charges are reflected
in the Accumulation Unit Values (and Benefit Unit Values) of the Sub-Accounts.
These charges are the mortality and expense risk charge and the administration
charge.
The Company will never charge more to a Contract than the fees and charges
described below, even if its actual expenses exceed the total fees and charges
collected. If the fees and charges collected by the Company exceed the actual
expenses it incurs, the excess will be profit to the Company and will not be
returned to owners.
Notwithstanding the above, the Company reserves the right to increase the amount
of the transfer fee in the future, and/or to charge fees for the automatic
transfer programs described in the Transfers section beginning on page 27 of
this prospectus, and/or for the systematic withdrawal program described in the
Surrenders section on page 29 of this prospectus, if in the Company's
discretion, it determines such charges are necessary to offset the costs of
administering transfers or systematic withdrawals.
Contingent Deferred Sales Charge ("CDSC")
Purpose of Charge Offset expenses incurred by the Company in the sale of
the Contracts, including commissions paid and costs of
sales literature.
Amount of Charge Up to 7% of each purchase payment depending on number of
years elapsed since receipt of the purchase payment.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
===================================== ====== ====== ====== ====== ======= ====== ====== ======
Number of full years elapsed
between date of receipt of purchase 0 1 2 3 4 5 6 7 or
payment and date request for more
surrender received
===================================== ====== ====== ====== ====== ======= ====== ====== ======
CDSC as a percentage of purchase
payment surrendered 7% 6% 5% 4% 3% 2% 1% 0%
===================================== ====== ====== ====== ====== ======= ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
When Assessed On partial or full surrenders of purchase payments during Accumulation
Period.
Assessed Against What Purchase payments only, not earnings. See the Surrenders section of this
prospectus for information on order of withdrawal of earnings and purchase
payments.
Waivers o Free withdrawal privilege. See the Surrenders section for information.
o In the Company's discretion where the Company incurs reduced sales and
servicing expenses
o Upon separation from service if Contract issued with employer plan
endorsement or deferred compensation endorsement
o If Contract is issued with a tax sheltered annuity endorsement (and
without an employer plan endorsement): (i) upon separation from service if
owner has attained age 55 and Contract has been in force for at least
seven years; or (ii) after Contract has been in force fifteen years or
more.
o If the Social Security Administration determines after the Contract is
issued that the owner is "disabled" as that term is defined in the Social
Security Act of 1935, as amended.
o Successor Owner endorsement. See the Account Value section for
information.
o Where required to satisfy state law.
20
<PAGE>
Contract Maintenance Fee
Purpose of Charge Offset expenses incurred in issuing the Contracts and in maintaining the
Contracts and the Separate Account.
Amount of Charge $30.00 per year.
When Assessed During the Accumulation Period, the charge is deducted on each anniversary of
the effective date of the Contract, and at time of full surrender. During the
Benefit Payment Period a portion of the charge is deducted from each variable
dollar benefit payment.
Assessed Against What Amounts invested in the Sub-Accounts. During the Accumulation Period, the
charge is deducted pro-rata from the Sub-Accounts in which the Contract has an
interest on the date of the charge. During the Benefit Payment Period, a
pro-rata portion of the annual charge is deducted from each benefit payment
from the variable account. The charge is not assessed against the fixed
account options.
Waivers o During Accumulation Period if the Account Value is at least $40,000 on
the date of the charge (individual contracts only).
o During Benefit Payment Period if the amount applied to a variable
dollar benefit is at least $40,000 (individual contracts only).
o In the Company's discretion where the Company incurs reduced sales and
servicing expenses.
o During Benefit Payment Period where required to satisfy state law.
Transfer Fee
Purpose of Charge Offset cost incurred in administering the Contracts.
Amount of Charge $25 for each transfer in excess of 12 in any contract year. The Company
reserves the right to change the amount of this charge at any time.
When Assessed During Accumulation Period.
Assessed Against What Deducted from amount transferred.
Waivers Currently, the transfer fee does not apply to transfers associated with the
dollar cost averaging, interest sweep and portfolio rebalancing programs.
Transfers associated with these programs do not count toward the 12 free
transfers permitted in a contract year. The Company reserves the right to
eliminate this waiver at any time.
Administration Charge
Purpose of Charge Offset expenses incurred in administering the Contracts and the Separate
Account.
Amount of Charge Daily charge equal to .000411% of the daily Net Asset Value for each
Sub-Account, which corresponds to an annual effective rate of 0.15%.
When Assessed During the Accumulation Period and during the Benefit Payment Period if a
variable dollar benefit is elected.
Assessed Against What Amounts invested in the Sub-Accounts. Not assessed against the fixed account
options.
Waivers May be waived or reduced in the Company's discretion where the Company incurs
reduced sales and servicing expenses.
21
<PAGE>
Mortality and Expense Risk Charge
Purpose of Charge Compensation for bearing certain mortality and expense risks under the
Contract. Mortality risks arise from the Company's obligation to pay benefit
payments during the Benefit Payment Period and to pay the death benefit. The
expense risk assumed by the Company is the risk that the Company's actual
expenses in administering the Contracts and the Separate Account will exceed
the amount recovered through the contract maintenance fees, transfer fees and
administration charges.
Amount of Charge Daily charge equal to .003403% of the daily Net Asset Value for each
Sub-Account, which corresponds to an effective annual rate of 1.25%. The
Company estimates that the mortality risk component of this charge is 0.75%
and the expense risk component is 0.50%. Contracts with the 1.25% mortality
and expense risk charge are referred to as "Standard Contracts."
When Assessed During the Accumulation Period, and during the Benefit Payment Period if a
variable dollar benefit is elected.
Assessed Against What Amounts invested in the Sub-Accounts. Not assessed against the fixed account
options.
Waivers When the Company expects to incur reduced sales and servicing expenses, it may
issue a Contract with a reduced mortality and expense risk charge. These
Contracts are referred to as "Enhanced Contracts." The mortality and expense
risk charge under an Enhanced Contract is a daily charge of 0.002590% of the
daily Net Asset Value for each Sub-Account, which corresponds to an effective
annual rate of 0.95%. The Company estimates that for Enhanced Contracts, the
mortality risk component of this charge is 0.75% and the expense risk
component is 0.20%.
</TABLE>
Premium Taxes
Certain state and local governments impose premium taxes. These taxes currently
range up to 5.0% depending upon the jurisdiction. The Company will deduct any
applicable premium taxes from the Account Value either upon the death,
surrender, annuitization, or at the time purchase payments are made, but no
earlier than when the Company incurs a tax liability under state law.
Discretionary Waivers of Charges
The Company will look at the following factors to determine if it will waive a
charge, in part or in full, due to reduced sales and servicing expenses: (1) the
size and type of the group to which sales are to be made; (2) the total amount
of purchase payments to be received; and (3) any prior or existing relationship
with the Company. The Company would expect to incur reduced sales and servicing
expenses in connection with Contracts offered to employees of the Company, its
subsidiaries and/or affiliates. There may be other circumstances, of which the
Company is not presently aware, which could result in reduced sales and
servicing expenses. In no event will the Company waive a charge where such
waiver would be unfairly discriminatory to any person.
Expenses of the Portfolios
In addition to charges and deductions by the Company, there are Portfolio
management fees and administration expenses which are described in the
prospectus and statement of additional information for each Portfolio. The
actual Portfolio fees and expenses for the prior calendar year are included in
the Fee Table on page 6 of this prospectus. Portfolio expenses, like Separate
Account expenses, are reflected in Accumulation Unit Values (or Benefit Unit
Values).
22
<PAGE>
THE CONTRACTS
- --------------------------------------------------------------------------------
Each Contract is an agreement between the Company and the owner. Values,
benefits and charges are calculated separately for each Contract. In the case of
a group Contract, the agreement is between the group owner and the Company. An
individual participant under a group Contract will receive a certificate of
participation, which is evidence of the participant's interest in the group
Contract. A certificate of participation is not a contract. Values, benefits and
charges are calculated separately for each certificate issued under a Contract.
The description of Contract provisions in this prospectus applies to the
interests of certificate owners, except where otherwise noted.
Right to Cancel
The owner of an individual Contract may cancel it before midnight of the
twentieth day following the date the owner receives the Contract. If purchased
to replace an existing Contract, the Owner may cancel it on or before midnight
of the sixtieth day after the Owner receives it. For a valid cancellation, the
Contract must be returned to the Company, and written notice of cancellation
must be given in person, or to the agent who sold the Contract or by mail by
that deadline. If mailed, the return of the Contract or the notice is effective
on the date it is postmarked, with the proper address and with postage paid. If
the owner cancels the Contract within the applicable time period, the Contract
will be void and the Company will refund either the purchase payment(s) in full,
or for a replacement contract, plus or minus any investment gains or losses
under the Contract as of the Valuation Period during which the returned contract
is received by the company. The right to cancel applies to participants in group
Contracts.
Persons With Rights Under a Contract
Owner: The owner is the person with authority to exercise rights and receive
benefits under the Contract (e.g., make allocations among investment options,
elect settlement option, designate annuitant, beneficiary and payee). An owner
must ordinarily be a natural person, or a trust or other legal entity holding a
contract for the benefit of a natural person. In the case of a group Contract,
the participant will have the rights of an owner unless restricted by the terms
of an employer plan. Ownership of a non-tax-qualified Contract may be
transferred, but transfer may have adverse tax consequences. Ownership of a
tax-qualified Contract may not be transferred.
Joint Owners: There may be joint owners of a non-tax-qualified Contract. Joint
owners may each exercise transfer rights and make purchase payment allocations
independently. All other rights must be exercised by joint action. A surviving
joint owner who is not the spouse of a deceased owner may not become a successor
owner, but will be deemed to be the beneficiary of the death benefit which
becomes payable on the death of the first owner to die, regardless of any
beneficiary designation.
Successor Owner: The surviving spouse of a deceased
owner may become a successor owner if the surviving spouse was either the joint
owner or sole surviving beneficiary under the Contract. In order for a spouse to
become a successor owner, the owner must make an election prior to the owner's
death, or the surviving spouse must make an election within one year of the
owner's death.
Annuitant: The annuitant is the person whose life is the
measuring life for life contingent annuity benefit payments. The annuitant is
the same person as the owner under a tax-qualified contract. The owner may
designate an annuitant under a non-tax-qualified Contract.
Beneficiary: The person entitled to receive the death benefit. The owner may
designate the beneficiary, except that a surviving joint owner will be deemed to
be the beneficiary regardless of any designation. If no beneficiary is
designated, and there is no surviving joint owner, the owner's estate will be
the beneficiary. The beneficiary will be the measuring life for life contingent
death benefit payments.
Payee: Under a tax-qualified Contract, the owner-annuitant is the payee of
annuity benefits. Under a non-tax-qualified Contract, the owner may designate
the payee of annuity benefits. Irrevocable naming of a payee other than the
owner can have adverse tax consequences. During the Benefit Payment Period, the
beneficiary is the payee.
Assignee: Under a tax-qualified Contract, assignment is not permitted. The owner
of a non-tax-qualified Contract may assign most of his/her rights or benefits
under a Contract. Assignment of rights or benefits may have adverse tax
consequences.
23
<PAGE>
ACCUMULATION PERIOD
- --------------------------------------------------------------------------------
Each Contract allows for an Accumulation Period during which purchase payments
are invested according to the owner's instructions. During the Accumulation
Period, the owner can control the allocation of investments through telephone
transfers or through the following investment programs offered by the Company:
dollar cost averaging, portfolio rebalancing and interest sweep. These programs
and telephone transfer procedures are described in the Transfers section
beginning on page 27 of this prospectus. The owner can access the Account Value
during the Accumulation Period through surrenders, systematic withdrawal, or
contract loans if available. These withdrawal features are described more fully
in the Surrenders and Contract Loans sections on pages 29 and 30 of this
prospectus.
Account Statements
During the Accumulation Period, the Company will provide a report of the
investments held in the Separate Account, the number of Accumulation Units under
the Contract and the Contract's Account Value, and any other information
required by law, at least once each contract year. The Company will confirm
receipt of any purchase payments made after the initial purchase payment in
quarterly statements of account activity.
Account Value
The value of a Contract during the Accumulation Period is referred to as the
"Account Value." The Account Value at any given time is the sum of: (1) amounts
invested in the fixed investment options plus the fixed rate(s) of interest
earned on those amounts as of that time; and (2) the value of the owner's
interest in the Sub-Accounts as of that time. The value of the owner's interest
in the Sub-Accounts at any time is equal to the sum of the number of
Accumulation Units for each Sub-Account attributable to that Contract multiplied
by the Accumulation Unit Value for the applicable Sub-Account at the end of the
preceding Valuation Period. The Account Value at any time is net of any charges,
deductions, surrenders, and/or outstanding loans incurred prior to or as of the
end of that Valuation Period.
Accumulation Units
Amounts allocated or transferred to a Sub-Account are converted into
Accumulation Units. The number of Accumulation Units credited is determined by
dividing the dollar amount directed to the Sub-Account by the Accumulation Unit
Value for that Sub-Account as of the end of the Valuation Period in which the
amount allocated is received by the Company, or as of the end of the Valuation
Period in which the transfer is made.
Accumulation Units will be canceled as of the end of the Valuation Period during
which one of the following events giving rise to cancellation occurs:
o transfer from a Sub-Account
o full or partial surrender from the Sub-Accounts
o payment of a death benefit
o application of the amounts in the Sub-Accounts to a settlement option
o deduction of the contract maintenance fee
o deduction of any transfer fee
Successor Owner Endorsement
If the Contract is modified by the Successor Owner endorsement, and the
surviving spouse of a deceased owner becomes a successor owner of the Contract,
the Account Value will be stepped-up to equal the death benefit which otherwise
would have been payable, as of what would have been the Death Benefit Valuation
Date. In addition, contingent deferred sales charges will be waived on the
entire stepped-up Account Value as of that date, but will apply to any purchase
payments applied to the Contract after that date.
For purposes of determining what would have been the Death Benefit Valuation
Date, the election to become successor owner will be deemed to be instructions
as to the form of death benefit. The election to become successor owner must be
made within one year of the date of the owner's death.
24
<PAGE>
Purchase Payments
Purchase payments may be made at any time during the Accumulation Period. The
current restrictions on purchase payment amounts are as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Tax-Qualified Non-Tax-Qualified
- -------------------------------------------------------- -------------------------- ---------------------------
- -------------------------------------------------------- -------------------------- ---------------------------
Minimum single purchase payment $2,000 $5,000
- -------------------------------------------------------- -------------------------- ---------------------------
- -------------------------------------------------------- -------------------------- ---------------------------
Minimum monthly under periodic payment program $50 $100
- -------------------------------------------------------- -------------------------- ---------------------------
- -------------------------------------------------------- -------------------------- ---------------------------
Minimum additional payments $50 $50
- -------------------------------------------------------- -------------------------- ---------------------------
- -------------------------------------------------------- -------------------------- ---------------------------
Maximum single purchase payment $500,000 without $500,000 without Company
Company approval approval
</TABLE>
The Company reserves the right to increase or decrease the minimum allowable
single purchase payment or minimum purchase payment under a periodic payment
program, or the minimum allowable additional purchase payment, at its discretion
and at any time, where permitted by law.
Each purchase payment will be applied by the Company to the credit of the
owner's account. If the application form is in good order, the Company will
apply the initial purchase payment to an account for the owner within two
business days of receipt of the purchase payment. If the application form is not
in good order, the Company will attempt to get the application form in good
order within five business days. If the application form is not in good order at
the end of this period, the Company will inform the applicant of the reason for
the delay and that the purchase payment will be returned immediately unless he
or she specifically consents to the Company keeping the purchase payment until
the application form is in good order. Once the application form is in good
order, the purchase payment will be applied to the owner's account within two
business days.
Each additional purchase payment is credited to a Contract as of the Valuation
Date on which the Company receives the purchase payment. If the purchase payment
is allocated to a Sub-Account, it will be applied at the Accumulation Unit Value
calculated at the end of the Valuation Period in which that Valuation Date
occurs.
Investment Options--Allocations
Purchase payments can be allocated in whole percentages to any of the available
Sub-Accounts or fixed account options. See The Portfolios section beginning on
page 13 of this prospectus for a listing and description of the currently
available Sub-Accounts. The currently available fixed account options are as
follows:
Fixed Accumulation Account Option
One Year Guaranteed Interest Rate Option
Three Year Guaranteed Interest Rate Option
Five Year Guaranteed Interest Rate Option
Seven Year Guaranteed Interest Rate Option
The current restrictions on allocations are as follows:
<TABLE>
<CAPTION>
<S> <C>
Tax-Qualified and Non-Tax-Qualified
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Minimum allocation to any Sub-Account $10
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Minimum allocation to fixed accumulation account $10
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Minimum allocation to fixed account guarantee option $2,000
No amounts may be allocated to a guarantee period
option which would extend beyond the owner's 85th
birthday or 5 years after the effective date of the
Contract, if later.
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Allocation during right to cancel period No current restrictions, but the Company reserves
the right to require that purchase payment(s) be
allocated to the money market Sub-Account or to the
fixed accumulation account option during the right
to cancel period.
</TABLE>
25
<PAGE>
Interests in the fixed account options are not securities and are not registered
with the Securities and Exchange Commission. Amounts allocated to the fixed
account options will receive a stated rate of interest of at least 3% per year.
Amounts allocated to the fixed account options and interest credited to the
fixed account options are guaranteed by the Company. Interests in the
Sub-Accounts are securities registered with the Securities and Exchange
Commission. The owner bears the risk of investment gain or loss on amounts
allocated to the Sub-Accounts.
Principal Guarantee Program
An owner may elect to have the Company allocate a portion of a purchase payment
to the seven-year guaranteed interest rate option such that, at the end of the
seven-year guarantee period, that account will grow to an amount equal to the
total purchase payment (so long as there are no surrenders or loans from the
Contract). The Company determines the portion of the purchase payment that must
be allocated to the seven-year guarantee option such that, based on the interest
rate then in effect, that account will grow to equal the full amount of the
purchase payment after seven years. The remainder of the purchase payment will
be allocated according to the owner's instructions. The minimum purchase payment
eligible for the principal guarantee program is $5,000.
Renewal of Fixed Account Guarantee Options
At the end of a guarantee period, and for 30 days preceding the end of such
guarantee period, the owner may elect to allocate the amount maturing to any of
the available investment options under the Contract. If the owner does not make
a reallocation election, the amount maturing will be allocated to the guarantee
period option with the same number of years as the period expiring, or the next
shortest period as may be required to comply with the restriction on allocation
to guarantee period options as described in the Investment Options-Allocations
section on page 26 of this prospectus. If a guarantee period is unavailable due
to this restriction, the amount maturing will be allocated to the fixed
accumulation account option.
Transfers
During the Accumulation Period, an owner may transfer amounts between
Sub-Accounts, among fixed account options, and/or between Sub-Accounts and fixed
account options.
The current restrictions on transfers are as follows:
<TABLE>
<CAPTION>
<S> <C>
Tax-Qualified and Non-Tax-Qualified
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Minimum transfer from any Sub-Account $500 or balance of Sub-Account, if less
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Minimum transfer from fixed account option $500 or balance of fixed account option, if less
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Minimum transfer to fixed account guarantee option $2,000
No amounts may be transferred to a guarantee period
option which would extend beyond the owner's 85th
birthday or 5 years after the effective date of the
Contract, if later.
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Maximum transfer from fixed account option other than During any contract year, 20% of the fixed account
fixed account guarantee option which is maturing option's value as of the most recent contract
anniversary.
- -------------------------------------------------------- ------------------------------------------------------
- -------------------------------------------------------- ------------------------------------------------------
Transfers from fixed account options o May not be made prior to first contract
anniversary.
o Amounts transferred from fixed account
options to Sub-Accounts may not be transferred
back to fixed account options for a period of 90
days from the date of the original transfer.
</TABLE>
A transfer is effective on the Valuation Date during which the Company receives
the request for transfer, and will be processed at the Accumulation Unit Value
for the end of the Valuation Period in which that Valuation Date occurs.
26
<PAGE>
Automatic Transfer Programs
During the Accumulation Period, the Company offers the automatic transfer
services described below. To enroll in one of these programs, you will need to
complete the appropriate authorization form, which you can obtain from the
Company by calling 1-800-789-6771.
Currently, the transfer fee does not apply to dollar cost averaging, portfolio
rebalancing, or interest sweep transfers, and transfers under these programs
will not count toward the twelve transfers permitted under the Contract without
a transfer fee charge. However, the Company reserves the right to impose a fee
in such amount as the Company may then determine to be reasonable for
participation in automatic transfer programs.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Service Description Minimum Account Limitations/Notes
Requirements
- ----------------------------- --------------------------- -------------------------- ---------------------------
- ----------------------------- --------------------------- -------------------------- ---------------------------
Dollar Cost Averaging Automatic transfers from Source of funds must be Dollar cost averaging
There are risks involved in the money market at least $10,000. transfers may not be made
switching between Sub-Account to any other to any of the fixed
investments available under Sub-Account(s), or from Minimum transfer per account options. The
the Contract. Dollar cost the fixed accumulation month is $500. When dollar cost averaging
averaging requires regular account option to any balance of source of transfers will take place
investment changes Sub-Account(s), on a funds falls below $500, on the last Valuation
regardless of fluctuating monthly or quarterly entire balance will be Date of each calendar
price levels and does not basis. allocated according to month or quarter as
guarantee profits or dollar cost averaging requested by the owner.
prevent losses in a instructions.
declining market. You
should consider your
financial ability to
continue dollar cost
averaging transfers through
periods of changing price
levels.
- ----------------------------- --------------------------- -------------------------- ---------------------------
- ----------------------------- --------------------------- -------------------------- ---------------------------
Portfolio Rebalancing Automatically transfer Minimum Account Value of Transfers will take place
amounts between the $10,000. on the last Valuation
Sub-Accounts and the Date of each calendar
fixed accumulation quarter. Portfolio
account option to rebalancing will not be
maintain the percentage available if the dollar
allocations selected by cost averaging program or
the owner. an interest sweep from
the fixed accumulation
account option is being
utilized.
- ----------------------------- --------------------------- -------------------------- ---------------------------
- ----------------------------- --------------------------- -------------------------- ---------------------------
Interest Sweep Automatic transfers of Balance of each fixed Interest sweep transfers
the income from any fixed account option selected will take place on the
account option(s) to any must be at least last Valuation Date of
Sub-Account(s). $5,000. Maximum each calendar quarter.
transfer from each
fixed account option
selected is 20% of
such fixed account
option's value per
year. Amounts
transferred under the
interest sweep program
will reduce the 20%
maximum transfer
amount otherwise
allowed.
</TABLE>
27
<PAGE>
Telephone Transfers
An owner may place a request for all or part of the Account Value to be
transferred by telephone. All transfers must be in accordance with the terms of
the Contract. Transfer instructions are currently accepted on each Valuation
Date between 9:30 a.m. and 4:00 p.m. Eastern Time at (800) 789-6771. Once
instructions have been accepted, they may not be rescinded; however, new
telephone instructions may be given the following day.
The Company will not be liable for complying with telephone instructions which
the Company reasonably believes to be genuine, or for any loss, damage, cost or
expense in acting on such telephone instructions. The owner or person with the
right to control payments will bear the risk of such loss. The Company will
employ reasonable procedures to determine that telephone instructions are
genuine. If the Company does not employ such procedures, the Company may be
liable for losses due to unauthorized or fraudulent instructions. These
procedures may include, among others, tape recording telephone instructions.
Termination of Transfer Programs
The owner may terminate any of the automatic transfer programs at any time, but
must give the Company at least 30 days notice to change any automatic transfer
instructions that are already in place. Termination and change instructions will
be accepted by telephone at (800) 789-6771. The Company may impose an annual fee
or increase the current annual fee, as applicable, for any of the foregoing
services in such amount(s) as the Company may then determine to be reasonable
for participation in the service, as permitted by applicable law.
Surrenders
An owner may surrender a Contract either in full or in part during the
Accumulation Period. A contingent deferred sales charge ("CDSC") may apply on
surrender. The restrictions and charges on surrenders are as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
Tax-Qualified Non-Tax-Qualified
- --------------------------------------------------------- --------------------------- --------------------------
- --------------------------------------------------------- ------------------------------------------------------
Minimum amount of partial surrender $500
- --------------------------------------------------------- ------------------------------------------------------
- --------------------------------------------------------- ------------------------------------------------------
Minimum remaining Account Value after partial surrender $500
- --------------------------------------------------------- ------------------------------------------------------
- --------------------------------------------------------- --------------------------- --------------------------
Amount available for surrender (valued as of end of Account Value less Account Value less
Valuation Period in which request for surrender is applicable CDSC, subject applicable CDSC, subject
received by the Company) to tax law or employer to employer plan
plan restrictions on restrictions on
withdrawals withdrawals
- --------------------------------------------------------- --------------------------- --------------------------
- --------------------------------------------------------- ------------------------------------------------------
Tax penalty for early withdrawal Up to 10% of Account Value before age 59 1/2
- --------------------------------------------------------- ------------------------------------------------------
- --------------------------------------------------------- ------------------------------------------------------
Contract maintenance fee on full surrender $30 (no CDSC applies)
- --------------------------------------------------------- ------------------------------------------------------
- --------------------------------------------------------- ------------------------------------------------------
Contingent deferred sales charge ("CDSC") Up to 7% of purchase payments
- --------------------------------------------------------- ------------------------------------------------------
- --------------------------------------------------------- ------------------------------------------------------
- --------------------------------------------------------- ------------------------------------------------------
Order of withdrawal for purposes of CDSC (order may be First from accumulated earnings (no CDSC applies)
different for tax purposes) and then from purchase payments on "first-in,
first-out" basis (CDSC may apply)
</TABLE>
A full surrender will terminate the Contract. Partial surrenders are withdrawn
proportionally from all Sub-Accounts and fixed account options in which the
Contract is invested on the date the Company receives the surrender request,
unless the owner requests that the surrender be withdrawn from a specific
investment option. A surrender is effective on the Valuation Date during which
the Company receives the request for surrender, and will be processed at the
Accumulation Unit Value for the end of the Valuation Period in which that
Valuation Date occurs. Payment of a surrendered amount may be delayed if the
amount surrendered was paid to the Company by a check that has not yet cleared.
Surrenders from a fixed account option may be delayed for up to six months after
receipt of a surrender request as allowed by state law. Surrenders from the
Sub-Accounts may be delayed during any period the New York Stock Exchange is
closed or trading is restricted, or when the Securities and Exchange Commission
either: 1) determines that there is an emergency which prevents valuation or
disposal of securities held in the Separate Account; or 2) permits a delay in
payment for the protection of security holders.
28
<PAGE>
Free Withdrawal Privilege
The Company will waive the CDSC on full or partial surrenders during the first
contract year, on an amount equal to not more than 10% of all purchase payments
received. During the second and succeeding contract years, the Company will
waive the CDSC on an amount equal to not more than the greater of: (a)
accumulated earnings (Account Value in excess of purchase payments); or (b) 10%
of the Account Value as of the last contract anniversary.
If the free withdrawal privilege is not exercised during a contract year, it
does not carry over to the next contract year. The free withdrawal privilege may
not be available under some group Contracts.
Systematic Withdrawal
During the Accumulation Period, an owner may elect to automatically withdraw
money from the Contract. The Account Value must be at least $10,000 in order to
make a systematic withdrawal election. The minimum monthly amount that can be
withdrawn is $100. Systematic withdrawals will be subject to the contingent
deferred sales charge to the extent the amount withdrawn exceeds the free
withdrawal privilege. The owner may begin or discontinue systematic withdrawals
at any time by request to the Company, but at least 30 days notice must be given
to change any systematic withdrawal instructions that are currently in place.
The Company reserves the right to discontinue offering systematic withdrawals at
any time. Currently, the Company does not charge a fee for systematic withdrawal
services. However, the Company reserves the right to impose an annual fee in
such amount as the Company may then determine to be reasonable for participation
in the systematic withdrawal program.
Before electing a systematic withdrawal program, you should consult with a
financial advisor. Systematic withdrawal is similar to annuitization, but will
result in different taxation of payments and potentially different amount of
total payments over the life of the Contract than if annuitization were elected.
Contract Loans
The Company may make loans to owners of tax-qualified Contracts. Any such loans
will be secured with an interest in the Contract, and the collateral for the
loan will be moved to the fixed accumulation account option and earn a fixed
rate of interest applicable to loan collateral. Loan amounts and repayment
requirements are subject to provisions of the Internal Revenue Code, and default
on a loan will result in a taxable event. You should consult a tax adviser prior
to exercising loan privileges. Loan provisions are described in the loan
endorsement to the Contract.
A loan, whether or not repaid, will have a permanent effect on the Account Value
of a Contract because the collateral cannot be allocated to the Sub-Accounts or
fixed account guarantee periods. The longer the loan is outstanding, the greater
the effect is likely to be. The effect could be favorable or unfavorable. If the
investment results are greater than the rate being credited on collateral while
the loan is outstanding, the Account Value will not increase as rapidly as it
would if no loan were outstanding. If investment results are below that rate,
the Account Value will be higher than it would have been if no loan had been
outstanding.
Termination
The Company reserves the right to terminate any Contract or any participant's
interest in a group Contract at any time during the Accumulation Period if 1) no
Purchase Payments have been paid for three (3) consecutive years and 2) the
Account Value is less than $2,000. In that case, the Contract will be
involuntarily surrendered and the Company will pay the owner the amount which
would be due the owner on a full surrender.
29
<PAGE>
BENEFIT PAYMENT PERIOD
- --------------------------------------------------------------------------------
Annuity Benefit
An owner may designate the date that annuity payments will begin, and may change
the date up to 30 days before annuity payments are scheduled to begin. Unless
the Company agrees otherwise, the first day of a Benefit Payment Period in which
annuity payments are paid cannot be later than the contract anniversary
following the 85th birthday of the eldest owner, or five years after the
effective date of the Contract, whichever is later, but in no event will it be
later than the owner's 90th birthday.
The amount applied to a settlement option will be the Account Value as of the
end of the Valuation Period immediately preceding the first day of the Benefit
Payment Period. The owner may select any form of settlement option which is
currently available. The standard forms of settlement options are described in
the Settlement Options section beginning on page 31 of this prospectus.
If the owner has not previously made an election as to the form of settlement
option, the Company will contact the owner to ascertain the form of settlement
option to be paid. If the owner does not select a settlement option, such as a
specific fixed dollar benefit payment, a variable dollar benefit payment, or a
combination of a variable and fixed dollar benefit payment, the Company will
apply the Account Value to a fixed dollar benefit for the life of the annuitant
with 120 monthly payments assured, as described in the Settlement Options
section beginning on page 31 of this prospectus.
Death Benefit
A death benefit will be paid under a Contract if the owner dies during the
Accumulation Period. If a surviving spouse becomes a successor owner of the
Contract, the death benefit will be paid on the death of the successor owner if
he or she dies during the Accumulation Period.
The death benefit will be an amount equal to the largest of the following three
amounts:
o The Account Value on the Death Benefit Valuation Date
o The total purchase payment(s), with interest at three percent (3%) per year
through the Death Benefit Valuation Date or the owner's 80th birthday if
earlier, compounded annually, less any partial surrenders and any contingent
deferred sales charges that applied to those amounts
o The largest Account Value on any contract anniversary after the fourth
contract anniversary and prior to the Death Benefit Valuation Date or the
owner's 80th birthday if earlier, less any partial surrenders and any
contingent deferred sales charges that applied to those amounts
Any applicable premium taxes or other taxes not previously deducted, and any
outstanding loans, will be deducted from the death benefit amount described
above.
An owner may elect the form of payment of the death benefit at any time before
his or her death. The form of payment may be a lump sum, or any available form
of settlement option. The standard forms of settlement options are described in
the Settlement Options section beginning on page 31 of this prospectus. If the
owner does not make an election as to the form of death benefit, the beneficiary
may make an election within one year after the owner's death. If no election as
to form of settlement option is made, the Company will apply the death benefit
to a fixed dollar benefit for a period certain of 48 months. The first day of
the Benefit Payment Period in which a death benefit is paid may not be more than
one year after the owner's death; the day a death benefit is paid in a lump sum
may not be more than five years after the owner's date of death.
Settlement Options
When a Contract is annuitized, or when a death benefit is applied to a
settlement option, the Account Value or the death benefit, as the case may be,
is surrendered to the Company in exchange for a promise to pay a stream of
benefit payments for the duration of the settlement option selected. Benefit
payments may be calculated and paid: (1) as a variable dollar benefit; (2) as a
fixed dollar benefit; or (3) as a combination of both. The stream of payments,
whether variable dollar or fixed dollar, is an obligation of the Company's
general account. However, only the amount of fixed dollar benefit payments is
guaranteed by the Company. The owner (or payee) bears the risk that any variable
dollar benefit payment may be less than the initial variable dollar benefit
payment, or that it may decline to zero, if Benefit Unit Values for that payment
decrease sufficiently. Transfers between a variable dollar benefit and a fixed
dollar benefit are not permitted, but transfers of Benefit Units among
Sub-Accounts are permitted once each 12 months after a variable dollar benefit
has been paid for at least 12 months. The formulas for transferring Benefit
Units among Sub-Accounts during the Benefit Payment Period are set forth in the
statement of additional information.
30
<PAGE>
Form of Settlement Option
The Company will make periodic payments in any form of settlement option that is
acceptable to it at the time of an election. The standard forms of settlement
options are described below. Payments under any settlement option may be in
monthly, quarterly, semi-annual or annual payment intervals. If the amount of
any regular payment under the form of settlement option elected would be less
than $50, an alternative form of settlement option will have to be elected. The
Company, in its discretion, may require benefit payments to be made by direct
deposit or wire transfer to the account of a designated payee.
The Company may modify minimum amounts, payment intervals and other terms and
conditions at any time without prior notice to owners. If the Company changes
the minimum amounts, the Company may change any current or future payment
amounts and/or payment intervals to conform with the change. More than one
settlement option may be elected if the requirements for each settlement option
elected are satisfied. Once payment begins under a settlement option, the
settlement option may not be changed or commuted.
The dollar amount of benefit payments will vary with the frequency of the
payment interval and the duration of the payments. Generally, each payment in a
stream of payments will be lesser in amount as the frequency of payments
increases, or as the length of the payment period increases, because more
payments will be paid. For life contingent settlement options, each payment in
the stream of payments will generally be lesser in amount as the life expectancy
of the annuitant or beneficiary increases because more payments are expected to
be paid.
Income for a Fixed Period: The Company will make periodic payments at the end of
each payment interval for a fixed period of 5 to 30 years. (Periods of 1-4 years
are available for death benefit settlement options only.)
Life Annuity with Payments for at Least a Fixed Period: The Company will make
periodic payments at the beginning of each payment interval for a fixed period,
or until the death of the person on whose life benefit payments are based if he
or she lives longer than the fixed period.
Joint and One-Half Survivor Annuity: The Company will make periodic payments at
the beginning of each payment interval until the death of the primary person on
whose life benefit payments are based; thereafter, the Company will make
one-half of the periodic payment until the death of the secondary person on
whose life benefit payments are based.
Life Annuity: The Company will make periodic payments at the beginning of each
payment interval until the death of the person on whose life benefit payments
are based.
Calculation of Fixed Dollar Benefit Payments
Fixed dollar benefit payments are determined by multiplying the amount applied
to the fixed dollar benefit (expressed in thousands of dollars and after
deduction of any fees and charges, loans, or applicable premium taxes) by the
amount of the payment per $1,000 of value which the Company is currently paying
for settlement options of that type. Fixed dollar benefit payments will remain
level for the duration of the Benefit Payment Period. The fixed dollar benefit
available under a Contract will not be less than the benefit that would be
provided by the application of the Account Value to purchase any single
consideration immediate annuity contract offered by us at the time to the same
class of annuitants.
The Company guarantees minimum fixed dollar benefit payment factors based on
1983 annuity mortality tables for individuals or groups, as applicable, with
interest at 3% per year, compounded annually, and using tables for blended lives
(60% female/40%) male. The minimum monthly payments per $1,000 of value for the
Company's standard settlement options are set forth in tables in the Contracts.
Upon request, the Company will provide minimum monthly payments for ages or
fixed periods not shown in the settlement option tables.
31
<PAGE>
Calculation of Variable Dollar Benefit Payments
The first variable dollar benefit payment is the amount it would be if it were a
fixed dollar benefit payment calculated at the Company's minimum guaranteed
settlement option factors, reduced by a pro rata portion of the contract
maintenance fee, equal to the amount of the fee divided by the number of
payments to be made over a 12-month period.
The amount of each subsequent variable dollar benefit payment will reflect the
investment performance of the Sub-Account(s) selected and may vary from payment
to payment. For example, because the first benefit payment includes a 3% rate of
interest, subsequent benefit payments will be less than the first payment if the
net investment performance of the applicable Sub-Accounts is less than 3%.
The amount of each subsequent payment is the sum of the payment due for each
Sub-Account selected, less a pro rata portion of the contract maintenance fee,
as described above. The payment due for a Sub-Account equals the shares for that
Sub-Account, which are the Benefit Units, times their value, which is the
Benefit Unit Value for that Sub-Account as of the end of the fifth Valuation
Period preceding the due date of the payment.
The number of Benefit Units for each Sub-Account selected is determined by
allocating the amount of the first variable dollar benefit payment (before
deduction of the pro rata portion of the contract maintenance fee) among the
Sub-Account(s) selected in the percentages indicated by the owner (or payee).
The dollar amount allocated to a Sub-Account is divided by the Benefit Unit
Value for that Sub-Account as of the first day of the Benefit Payment Period.
The result is the number of Benefit Units that the Company will pay for that
Sub-Account at each payment interval. The number of Benefit Units for each
Sub-Account remains fixed during the Benefit Payment Period, except as a result
of any transfers among Sub-Accounts. An explanation of how Benefit Unit Values
are calculated is included in the Glossary of Financial Terms on page 37 of this
prospectus.
32
<PAGE>
FEDERAL TAX MATTERS
- --------------------------------------------------------------------------------
This section provides a general description of federal income tax considerations
relating to the Contracts. The purchase of a Contract may have federal estate
and gift tax consequences in addition to income tax consequences. Estate and
gift taxation is not discussed in this prospectus or in the statement of
additional information. State taxation is not discussed in this prospectus or in
the statement of additional information.
The tax information provided in the prospectus and statement of additional
information should not be used as tax advice. Federal income tax laws are
subject to interpretation by the IRS and may be changed by future legislation.
You should consult a competent tax advisor to discuss how current tax laws
affect your particular situation.
Tax Deferral On Annuities
Internal Revenue Code ("IRC") Section 72 governs taxation of annuities in
general. The income earned during the Accumulation Period of a Contract is
generally not includable in income until it is withdrawn. In other words, a
Contract is a tax-deferred investment. The Contracts must meet certain
requirements in order to qualify for tax-deferred treatment under IRC Section
72. These requirements are discussed in the statement of additional information.
In addition, tax deferral is not available for a Contract when the owner is not
a natural person unless the Contract is part of a tax-qualified plan or the
owner is a mere agent for a natural person. For a nonqualified deferred
compensation plan, this rule means that the employer as owner of the Contract
will generally be taxed currently on any increase in the Account Value, although
the plan itself may provide a tax deferral to the participating employee. For a
group nonqualified Contract where the owner has no rights over the separate
interests, this rule is applied to each participant who is not a natural person.
33
<PAGE>
Tax-Qualified Plans
Annuities may also qualify for tax-deferred treatment under other IRC provisions
governing tax-qualified retirement plans. These provisions include IRC Sections
401 (pension and profit sharing plans), 403(b) (tax-sheltered annuities), 408
and 408A (individual retirement annuities), and 457(g) (governmental deferred
compensation). Contributions to a tax-qualified Contract are typically made with
pre-tax dollars, while contributions to a non-tax-qualified Contract are
typically made from after-tax dollars, though there are exceptions in either
case. Tax-qualified Contracts may also be subject to restrictions on withdrawals
which do not apply to non-tax-qualified Contracts. These restrictions may be
imposed by the IRC or by an employer plan. Following is a brief description of
the types of tax-qualified retirement plans for which the Contracts are
available.
Individual Retirement Annuities
IRC Sections 219 and 408 permit individuals or their employers to contribute to
an individual retirement program known as an "Individual Retirement Annuity" or
"IRA". Under applicable limitations, certain amounts may be contributed to an
IRA that are deductible from an individual's gross income. Employers also may
establish a Simplified Employee Pension (SEP) Plan or Savings Incentive Match
Plan for Employees (SIMPLE) to provide IRA contributions on behalf of their
employees.
Roth IRAs
IRC Section 408A permits certain individuals to contribute to a Roth IRA.
Contributions are not deductible. Tax-free distributions may be made after five
years once the owner attains age 59 1/2, becomes disabled, or dies, or for
qualified first-time homebuyer expenses.
Tax-Sheltered Annuities
IRC 403(b) of the Code permits the purchase of "tax-sheltered annuities" by
public schools and certain charitable, religious, educational and scientific
organizations described in IRC Section 501(c)(3). These qualifying employers may
make contributions to the Contracts for the benefit of their employees. Subject
to certain limits, such contributions are not includable in the gross income of
the employee until the employee receives distributions under the Contract.
Amounts attributable to contributions made under a salary reduction agreement
cannot be distributed until the employee attains age 59 1/2, separates from
service, becomes disabled, incurs a hardship, or dies.
Pension and Profit Sharing Plans
IRC Section 401 permits employers to establish various types of retirement plans
for employees, and permits self-employed individuals to establish retirement
plans for themselves and their employees. These retirement plans may permit the
purchase of annuity contracts to accumulate retirement savings under the plans.
Purchasers of a Contract for use with such plans should seek competent advice
regarding the suitability of the proposed plan documents and the Contract for
their specific needs.
Governmental Deferred Compensation Plans
State and local government employers may purchase annuity contracts to fund
deferred compensation plans for the benefit of their employees under IRC Section
457(g).
Nonqualified Deferred Compensation Plans
Governmental and other tax-exempt employers may invest in annuity contracts in
connection with nonqualified deferred compensation plans established for the
benefit of their employees under IRC Section 457 (other than 457(g)). Other
employers may invest in annuity contracts in connection with nonqualified
deferred compensation plans established for the benefit of their employees. In
most cases, these plans are designed so that contributions made for the benefit
of the employees generally will not be includable in the employees' gross income
until distributed from the plan. In these situations, the Contract is usually
owned by the employer and is subject to the claims of its general creditors.
34
<PAGE>
Summary of Income Tax Rules
The following chart summarizes the basic income tax rules governing
tax-qualified and non-tax-qualified Contracts:
<TABLE>
<CAPTION>
<S> <C> <C>
- --------------------------- ------------------------------------------- ------------------------------------------
Tax-Qualified Plans Basic Non-Tax-Qualified Contracts
Nonqualified Deferred Compensation Plans
- --------------------------- ------------------------------------------- ------------------------------------------
- --------------------------- ------------------------------------------- ------------------------------------------
Plan Types o IRCss.401 (Pension and Profit o IRCss.72 only
Sharing)
o IRC ss.403 (Tax-Sheltered Annuities)
o IRC ss.408 (IRA, SIMPLE IRA)
o IRC ss.408A (Roth IRA)
o IRC ss.457
o Nonqualified Deferred Compensation
- --------------------------- ------------------------------------------- ------------------------------------------
- --------------------------- ------------------------------------------- ------------------------------------------
Who May Purchase Contract Natural person, employer, or employer Anyone. Non-natural person may purchase
plan. Nonqualified deferred compensation but will generally lose tax-deferred
plans will generally lose tax-deferred status.
status.
- --------------------------- ------------------------------------------- ------------------------------------------
- --------------------------- ------------------------------------------- ------------------------------------------
Taxation of Surrenders If there is an after-tax "investment in Account Value in excess of investment in
the contract," a pro-rata portion of the contract is taxable. Generally, the
amount surrendered is taxable based on "investment in the contract" will equal
ratio of "investment in the contract" to the sum of all purchase payments.
Account Value. Usually, 100% of Surrenders are deemed to come from
distributions from a qualified plan will earnings first, and purchase payments
be taxed because there was no after-tax last.
contribution and therefore no "investment
in the contract." Qualified For a Contract purchased as part of an
distributions fromss.408A Roth IRA may be IRC Section 1035 exchange which includes
completely tax-free. contributions made before August 14,
1982 ("pre-TEFRA contributions") partial
Surrenders prior to age 59 1/2 may be withdrawals are not taxable until the
subject to 10% or greater tax penalty pre-TEFRA contributions have been
depending on the type of qualified plan. returned.
Surrenders from tax-qualified Contracts The taxable portion of any surrenders
may be restricted by the Internal Revenue prior to age 59 1/2 may be subject to a
Code or by the terms of a retirement plan. 10% tax penalty.
- --------------------------- ------------------------------------------- ------------------------------------------
- --------------------------- --------------------------------------------------------------------------------------
Taxation of Benefit May vary depending on type of settlement option selected, but generally, for fixed
Payments (annuity benefit dollar benefit payments, a pro-rata portion of each payment equal to [100% -
payments or death benefit (investment in contract/total expected payments)] is subject to income tax. For
payments) variable dollar benefit payments, a specific dollar amount of each payment is
taxable, as predetermined by a pro-rata formula, rather than subjecting a percentage
of each payment to taxation. Once the investment in the contract has been
recovered, the full amount of each benefit payment is taxable. Qualified
distributions from a ss.408A Roth IRA may be completely tax-free.
- --------------------------- --------------------------------------------------------------------------------------
- --------------------------- --------------------------------------------------------------------------------------
Taxation of Lump Sum Taxed to recipient generally in same manner as full surrender. Tax penalties do not
Death Benefit Payment apply to death benefit distributions.
- --------------------------- --------------------------------------------------------------------------------------
- --------------------------- ------------------------------------------- ------------------------------------------
Assignment of Assignment and transfer of ownership Generally, deferred earnings become
Contract/Transfer of generally not permitted. taxable to transferor at time of
Ownership transfer and transferee receives an
investment in the contract equal to the
Account Value at that time. Gift tax
consequences not discussed herein.
- --------------------------- ------------------------------------------- ------------------------------------------
- --------------------------- ------------------------------------------- ------------------------------------------
Withholding Eligible rollover distributions fromss.401 Generally, payee may elect to have taxes
and ss.403(b) Contracts subject to 20% withheld or not.
mandatory withholding on taxable portion
unless direct rollover. Section 457 plan
benefits and nonqualified deferred
compensation plan benefits subject to
wage withholding. For all other
payments, payee may elect to have taxes
withheld or not.
- --------------------------- ------------------------------------------- ------------------------------------------
</TABLE>
35
<PAGE>
GLOSSARY OF FINANCIAL TERMS
- --------------------------------------------------------------------------------
The following financial terms explain how the variable portion of the Contracts
are valued. Read these terms in conjunction with the Definitions on page 4 of
this prospectus.
Accumulation Unit Value: The initial Accumulation Unit Value for each
Sub-Account other than the money market Sub-Account was set at $10. The initial
Accumulation Unit Value for the money market Sub-Account was set at $1. The
initial Accumulation Unit Value for a Sub-Account was established at the
inception date of the Separate Account, or on the date the Sub-Account was
established, if later. The Company establishes distinct Accumulation Unit Values
for Contracts with different Separate Account fee structures, as described in
the Fee Table.
After the initial Accumulation Unit Value is established, the Accumulation Unit
Value for a Sub-Account at the end of each Valuation Period is the Accumulation
Unit Value at the end of the previous Valuation Period multiplied by the Net
Investment Factor for that Sub-Account for the current Valuation Period.
A Net Investment Factor of 1 produces no change in the Accumulation Unit Value
for that Valuation Period. A Net Investment Factor of more than 1 or less than 1
produces an increase or a decrease, respectively, in the Accumulation Unit Value
for that Valuation Period.
Benefit Unit Value: The initial Benefit Unit Value for a Sub-Account will be set
equal to the Accumulation Unit Value for that Sub-Account at the end of the
first Valuation Period in which a variable dollar benefit is established by the
Company. The Company will establish distinct Benefit Unit Values for Contracts
with different Separate Account fee structures, as described in the Fee Table.
The Benefit Unit Value for a Sub-Account at the end of each Valuation Period
after the first is the Benefit Unit Value at the end of the previous Valuation
Period multiplied by the Net Investment Factor for that Sub-Account for the
current Valuation Period, and multiplied by a daily investment factor
(0.99991781) for each day in the Valuation Period. The daily investment factor
reduces the previous Benefit Unit Value by the daily amount of the assumed
interest rate (3% per year, compounded annually) which is already incorporated
in the stream of variable dollar benefit payments.
Net Investment Factor: The Net Investment Factor for any Sub-Account for any
Valuation Period is determined by dividing NAV2 by NAV1 and subtracting a factor
representing the mortality and expense risk charge and the administration charge
deducted from the Sub-Account during that Valuation Period, where:
NAV1 is equal to the Net Asset Value for the Portfolio for the preceding
Valuation Period; and
NAV2 is equal to the Net Asset Value for the Portfolio for the current Valuation
Period plus the per share amount of any dividend or net capital gain
distributions made by the Portfolio during the current Valuation Period, and
plus or minus a per share charge or credit if the Company adjusts its tax
reserves due to investment operations of the Sub-Account or changes in tax law.
In other words, the Net Investment Factor represents the percentage change in
the total value of assets invested by the Separate Account in a Portfolio. That
percentage is then applied to Accumulation Unit Values and Benefit Unit Values
as described in the discussion of those terms in this section of the prospectus.
36
<PAGE>
THE REGISTRATION STATEMENT
- --------------------------------------------------------------------------------
The Company filed a Registration Statement with the Securities and Exchange
Commission under the Securities Act of 1933 relating to the Contracts offered by
this prospectus. This prospectus does not constitute the complete Registration
Statement. The Registration Statement contains further information relating to
the Company and the Contracts. Statements in this prospectus discussing the
content of the Contracts and other legal instruments are summaries. The actual
documents are filed as exhibits to the Registration Statement. For a complete
statement of the terms of the Contracts or any other legal document, refer to
the appropriate exhibit to the Registration Statement. The Registration
Statement and the exhibits thereto may be inspected and copied at the office of
the Securities and Exchange Commission, located at 450 Fifth Street, N.W.,
Washington, D.C., and may also be accessed at the Securities and Exchange
Commission's Web site http:\\www.sec.gov. The registration number for the
Registration Statement is 333-.
OTHER INFORMATION
- --------------------------------------------------------------------------------
Year 2000
The Company is in the process of testing software used in the administration of
variable contracts so that its computer systems will function properly with
respect to dates in the year 2000 and beyond. This testing is expected to be
completed in the third quarter of 1999. Should software modifications fail to
function as expected, the resulting disruption could have a material adverse
effect on operations of the Company. The Portfolios' preparations for the year
2000 are described in the Portfolio prospectuses. The operations of the Company
could be materially adversely affected by the inability of the Portfolios to
function properly in the Year 2000.
Legal Proceedings
The Company is involved in various kinds of routine litigation which, in
management's judgment, are not of material importance to the Company's assets or
the Separate Account. There are no pending legal proceedings against the
Separate Account or AAG Securities, Inc.
37
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
A statement of additional information is available which contains more details
concerning the subjects discussed in this prospectus. The following is the table
of contents for the statement of additional information:
Page
GREAT AMERICAN LIFE INSURANCE COMPANY(R) OF NEW YORK..........................3
General Information and History...............................................3
State Regulation......................................................3
SERVICES......................................................................3
Safekeeping of Separate Account Assets................................3
Records and Reports...................................................3
Experts...............................................................3
DISTRIBUTION OF THE CONTRACTS.................................................3
CALCULATION OF PERFORMANCE INFORMATION........................................4
Money Market Sub-Account Standardized Yield Calculation...............4
Average Annual Total Return Calculation...............................5
Cumulative Total Return Calculation...................................5
*Other Performance Measures...........................................6
BENEFIT UNITS-TRANSFER FORMULAS...............................................7
FEDERAL TAX MATTERS...........................................................8
Taxation of Separate Account Income...................................8
Tax Deferred Status of Non-Qualified Contracts........................8
FINANCIAL STATEMENTS..........................................................9
Copies of the statement of additional information dated October 5, 1999 are
available without charge. To request a copy, please clip this coupon on the
dotted line below, enter your name and address in the spaces provided below, and
mail to the Administrative Office of the Company at: Great American Life
Insurance Company(R) of New York, P.O. Box 5423, Cincinnati, Ohio 45201-5423.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Name: ---------------------------------------------------------
Address: ---------------------------------------------------------
City: ---------------------------------------------------------
State: ---------------------------------------------------------
Zip. ---------------------------------------------------------
38
<PAGE>
GREAT AMERICAN LIFE INSURANCE COMPANY(R) OF NEW YORK
GALIC(R) OF NEW YORK SEPARATE ACCOUNT I
STATEMENT OF ADDITIONAL INFORMATION for
Individual and Group Flexible Premium Deferred Annuities
This statement of additional information supplements the current prospectus for
the Individual and Group Flexible Premium Deferred Annuity Contracts
(collectively, the "Contracts") offered by Great American Life Insurance Company
of New York. This statement of additional information is not a prospectus and
should be read only in conjunction with the prospectus for the applicable
Contract. Terms used in this statement of additional information have the same
meaning as in the prospectus.
A copy of the prospectus dated October 5, 1999, as supplemented from time to
time, may be obtained free of charge by writing to Great American Life Insurance
Company of New York, Administrative Office, P.O. Box 5423, Cincinnati, Ohio
45201-5423. Terms used in the current prospectuses for the Contracts are
incorporated in this statement of additional information.
1
<PAGE>
TABLE OF CONTENTS
Page
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK...........................3
GENERAL INFORMATION AND HISTORY..........................................3
STATE REGULATION.........................................................3
SERVICES....................................................................3
SAFEKEEPING OF SEPARATE ACCOUNT ASSETS...................................3
RECORDS AND REPORTS......................................................3
EXPERTS..................................................................3
DISTRIBUTION OF THE CONTRACTS...............................................3
CALCULATION OF PERFORMANCE INFORMATION......................................4
MONEY MARKET SUB-ACCOUNT STANDARDIZED YIELD CALCULATION..................4
AVERAGE ANNUAL TOTAL RETURN CALCULATION..................................5
CUMULATIVE TOTAL RETURN CALCULATION......................................5
OTHER PERFORMANCE MEASURES...............................................6
BENEFIT UNITS--TRANSFER FORMULAS............................................7
FEDERAL TAX MATTERS.........................................................8
TAXATION OF SEPARATE ACCOUNT INCOME......................................8
TAX DEFERRAL ON NONQUALIFIED CONTRACTS...................................8
FINANCIAL STATEMENTS........................................................9
2
<PAGE>
GREAT AMERICAN LIFE INSURANCE COMPANY(R) OF NEW YORK
- --------------------------------------------------------------------------------
General Information and History
Great American Life Insurance Company of New York (the "Company"), formerly
known as Old Republic Life Insurance Company of New York, is a stock life
insurance company incorporated under the laws of the State of New York in 1963.
The name change occurred in the state of domicile on April 2, 1999. The Company
is principally engaged in the sale of variable and fixed annuity policies,
traditional life, supplemental health and long term care insurance.
The Company was acquired on February 17, 1999 by Great American Life Insurance
Company(R) ("GALIC"), an Ohio corporation, which is 100% owned by American
Annuity Group(R), Inc. ("AAG"), a Delaware corporation that is a publicly traded
insurance holding company. Great American(R) Insurance Company ("GAIC"), an Ohio
corporation owns more than 80% of the common stock of AAG. GAIC is a multi-line
insurance carrier and a wholly owned subsidiary of Great American(R) Holding
Company ("GAHC"), an Ohio corporation. GAHC is a wholly owned subsidiary of
American Financial Corporation ("AFC"), an Ohio corporation. AFC is a wholly
owned subsidiary of American Financial Group, Inc. ("AFG"), an Ohio corporation
that owns 1% of the common stock of AAG. AFG is a publicly traded holding
company which is engaged, through its subsidiaries, in financial businesses that
include annuities, insurance and portfolio investing, and non-financial
businesses.
State Regulation
The Company is subject to the insurance laws and regulations of the jurisdiction
where it is licensed to operate. The availability of certain Contract rights and
provisions depends on state approval and/or filing and review processes in such
jurisdiction. Where required by law or regulation, the Contracts will be
modified accordingly.
SERVICES
- --------------------------------------------------------------------------------
Safekeeping of Separate Account Assets
Title to assets of the Separate Account is held by the Company. The Separate
Account assets are segregated from the Company's general account assets. Records
are maintained of all purchases and redemptions of Portfolio shares held by each
of the Sub-Accounts.
Title to assets invested in the fixed account options is held by the Company
together with the Company's general account assets.
Records and Reports
All records and accounts relating to the fixed account options and the Separate
Account will be maintained by the Company. As presently required by the
provisions of the Investment Company Act of 1940, as amended ("1940 Act"), and
rules and regulations promulgated thereunder which pertain to the Separate
Account, reports containing such information as may be required under the 1940
Act or by other applicable law or regulation will be sent to each owner of an
individual Contract and to each group Contract owner semi-annually at the
owner's last known address.
Experts
The statutory-basis financial statements of the Company appearing in this
statement of additional information have been audited by Ernst & Young LLP,
independent auditors, as set forth in their reports thereon appearing elsewhere
herein, and are included in reliance upon such reports given upon the authority
of such firm as experts in accounting and auditing.
DISTRIBUTION OF THE CONTRACTS
- --------------------------------------------------------------------------------
The offering of the Contracts is expected to be continuous. Although the Company
does not anticipate discontinuing the offering of the Contracts, the Company
reserves the right to discontinue offering any one or more of the Contracts.
3
<PAGE>
CALCULATION OF PERFORMANCE INFORMATION
- --------------------------------------------------------------------------------
Money Market Sub-Account Standardized Yield Calculation
In accordance with rules and regulations adopted by the Securities and Exchange
Commission, the Company computes the money market Sub-Account's current
annualized yield for a seven-day period in a manner which does not take into
consideration any realized or unrealized gains or losses on shares of the money
market Portfolio or on its portfolio securities. This current annualized yield
is calculated according to the following formula:
YIELD = (BASE PERIOD RETURN/7)*365
Where:
BASE PERIOD RETURN = The percentage (or net) change in the Accumulation
Unit Value for the money market Sub-Account ("AUV")
over a 7 day period determined as follows:
AUV at end of 7 day period - AUV at beginning of 7 day period
AUV at beginning of 7 day period
Because the Net Asset Value of the money market Portfolio rarely deviates from
1.000000 per unit, the change in the Accumulation Unit Value for the money
market Sub-Account (the numerator of the above fraction) is ordinarily
attributable exclusively to dividends paid and reinvested over the 7 day period
less mortality and expense risk and administration charges deducted from the
Sub-Account over the 7 day period. Because of the deductions for mortality and
expense risk and administration charges, the yield for the money market
Sub-Account of the Separate Account will be lower than the yield for the money
market Portfolio or any comparable substitute funding vehicle.
The Securities and Exchange Commission also permits the Company to disclose the
effective yield of the money market Sub-Account for the same seven-day period,
which is yield determined on a compounded basis. The effective yield is
calculated according to the following formula:
EFFECTIVE YIELD = [(BASE PERIOD RETURN + 1) 365/7] - 1
The yield on amounts held in the money market Sub-Account normally will
fluctuate on a daily basis. Therefore, the disclosed yield for any given past
period is not an indication or representation of future yields. The money market
Sub-Account's actual yield is affected by changes in interest rates on money
market securities, average portfolio maturity of the money market Portfolio or
substitute funding vehicle, the types and quality of portfolio securities held
by the money market Portfolio or substitute funding vehicle, and operating
expenses. IN ADDITION, THE YIELD FIGURES DO NOT REFLECT THE EFFECT OF ANY
CONTINGENT DEFERRED SALES CHARGE OR CONTRACT MAINTENANCE FEES THAT MAY BE
APPLICABLE ON SURRENDER UNDER ANY CONTRACT.
4
<PAGE>
Average Annual Total Return Calculation
The Company may from time to time disclose average annual total returns for one
or more of the Sub-Accounts for various periods of time. Average annual total
return quotations are computed by finding the average annual compounded rates of
return over one-, five- and ten-year periods that would equal the initial amount
invested to the ending redeemable value, according to the following formula:
P(1 + T)n = ERV
Where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = "ending redeemable value" of a hypothetical $1,000
payment made at the beginning of the one-, five- or
ten-year period at the end of the one-, five- or ten-year
period (or fractional portion thereof)
Average annual total return may be presented in either standardized or
nonstandardized form. Average annual total return data may be either actual
return or hypothetical return. It will be hypothetical if it reflects
performance for a period of time before the Separate Account commenced
operations. The ERV for standardized data reflects the deduction of all
recurring fees, such as contract maintenance fees, contingent deferred sales
charges, mortality and expense risk charges, and administration charges, which
are charged to all Contracts of that type. The ERV for nonstandardized data
reflects the deduction of mortality and expense risk charges and administration
charges, but not contract maintenance fees or contingent deferred sales charges.
Non-standardized performance data will be advertised only if the requisite
standardized performance data is also disclosed.
Cumulative Total Return Calculation
The Company may from time to time disclose cumulative total return for various
periods of time. Cumulative total return reflects the performance of a
Sub-Account over the entire period presented. Cumulative total return may be
either actual return or hypothetical return. It will be hypothetical if it
reflects performance for a period of time before the Separate Account commenced
operations. Cumulative total return is calculated using the following formula:
CTR = (ERV/P) - 1
Where:
CTR = the cumulative total return net of Sub-Account recurring
charges, other than the contract maintenance fee, for the
period
ERV = ending redeemable value of a hypothetical $1,000 payment
at the beginning of the one-, five- or ten-year period at
the end of the one-, five- or ten-year period (or
fractional portion thereof)
P = a hypothetical initial payment of $1,000
Although cumulative total return can be presented in either standardized or
non-standardized form, the Company currently advertises only non-standardized
cumulative total return, which assumes a contingent deferred sales charge of 0%,
and no contract maintenance fee. Non-standardized cumulative total return can
only be advertised if standardized average annual total return is also
disclosed.
5
<PAGE>
Other Performance Measures
Any of the Contracts may be compared in advertising materials to certificates of
deposit ("CDs") or other investments issued by banks or other depository
institutions. Variable annuities differ from bank investments in several
respects. For example, variable annuities may offer higher potential returns
than CDs. However, unless you have elected to invest in only the fixed account
options, the Company does not guarantee your return. Also, none of your
investments under the Contract, whether allocated to the fixed account options
or to a Sub-Account, are FDIC-insured.
Advertising materials for any of the Contracts may, from time to time, address
retirement needs and investing for retirement, the usefulness of a tax-qualified
retirement plan, saving for college, or other investment goals. Advertising
materials for any of the Contracts may discuss, generally, the advantages of
investing in a variable annuity and the Contracts' particular features and their
desirability and may compare Contract features with those of other variable
annuities and investment products of other issuers. Advertising materials may
also include a discussion of the balancing of risk and return in connection with
the selection of investment options under the Contracts and investment
alternatives generally, as well as a discussion of the risks and attributes
associated with the investment options under the Contracts. A description of the
tax advantages associated with the Contracts, including the effects of
tax-deferral under a variable annuity or retirement plan generally, may be
included as well. Advertising materials for any of the Contracts may quote or
reprint financial or business publications and periodicals, including model
portfolios or allocations, as they relate to current economic and political
conditions, management and composition of the underlying Portfolios, investment
philosophy, investment techniques, the desirability of owning the Contract and
other products and services offered by the Company or AAG Securities, Inc.
("AAGS").
The Company or AAGS may provide information designed to help individuals
understand their investment goals and explore various financial strategies. Such
information may include: information about current economic, market and
political conditions; materials that describe general principles of investing,
such as asset allocation, diversification, risk tolerance and goal setting;
questionnaires designed to help create a personal financial profile; worksheets
used to project savings needs based on assumed rates of inflation and
hypothetical rates of return; and alternative investment strategies and plans.
Ibbotson Associates of Chicago, Illinois ("Ibbotson"), provides historical
returns of the capital markets in the United States, including common stocks,
small capitalization stocks, long-term corporate bonds, intermediate-term
government bonds, long-term government bonds, Treasury bills, the U.S. rate of
inflation (based on the Consumer Price Index), and combinations of various
capital markets. The performance of these capital markets is based on the
returns of different indices.
Advertising materials for any of the Contracts may use the performance of these
capital markets in order to demonstrate general risk-versus-reward investment
scenarios. Performance comparisons may also include the value of a hypothetical
investment in any of these capital markets. The risk associated with the
security types in any capital market may or may not correspond directly to those
of the Sub-Accounts and the Portfolios. Advertising materials may also compare
performance to that of other compilations or indices that may be developed and
made available in the future.
In addition, advertising materials may quote various measures of volatility and
benchmark correlations for the Sub-Accounts and the respective Portfolios and
compare these volatility measures and correlations with those of other separate
accounts and their underlying funds. Measures of volatility seek to compare a
Sub-Account's, or its underlying Portfolio's, historical share price
fluctuations or total returns to those of a benchmark. Measures of benchmark
correlation indicate how valid a comparative benchmark may be. All measures of
volatility and correlation are calculated using averages of historical data.
6
<PAGE>
BENEFIT UNITS--TRANSFER FORMULAS
- --------------------------------------------------------------------------------
Transfers of a Contract owner's Benefit Units between Sub-Accounts during the
Benefit Payment Period are implemented according to the following formulas:
(1) The number of Benefit Units to be transferred from a given
Sub-Account is BU1(trans).
(2) The number of the Contract owner's Benefit Units remaining in such
Sub-Account (after the transfer)
= UNIT1 - BU1(trans).
(3) The number of Benefit Units transferred to the new Sub-Account is
BU2(trans). BU2(trans) = BU1(trans) * BUV1/BUV2.
(4) The number of the Contract owner's Benefit Units in the new
Sub-Account (after the transfer) = UNIT2 + BU2(trans).
(5) Subsequent variable dollar benefit payments will be based on the
number of the Contract owner's Benefit Units in each Sub-Account
(after the transfer) as of the next variable dollar benefit
payment's due date.
Where:
BU1(trans) is the number of the Contract owner's Benefit Units
transferred from a given Sub-Account.
BUV1 is the Benefit Unit Value of the Sub-Account from which the
transfer is being made as of the end of the Valuation Period in
which the transfer request was received. BU2(trans) is the number
of the Contract owner's Benefit Units transferred into the new
Sub-Account.
BUV2 is the Benefit Unit Value of the Sub-Account to which the
transfer
is being made as of the end of the Valuation Period in which the
transfer request was received.
UNIT1 is the number of the Contract owner's Benefit Units in the
Sub-Account from which the transfer is being made, before the
transfer.
UNIT2 is the number of the Contract owner's Benefit Units in the
Sub-Account to which the transfer is being made, before the
transfer.
7
<PAGE>
FEDERAL TAX MATTERS
- --------------------------------------------------------------------------------
The following discussion supplements the discussion of federal tax matters in
the prospectuses for the Contracts. This discussion is general and is not
intended as tax advice. Federal income tax laws or the interpretation of those
laws by the Internal Revenue Service may change at any time.
Taxation of Separate Account Income
The Company is taxed as a life insurance company under Part I of Subchapter L of
the Internal Revenue Code ("IRC"). Since the Separate Account is not an entity
separate from the Company, and its operations form a part of the Company, it
will not be taxed separately as a "regulated investment company" under
Subchapter M of the IRC. Investment income and realized capital gains are
automatically applied to increase reserves under the Contracts. Under existing
federal income tax law, the Company believes that it will not be taxed on the
Separate Account investment income and realized net capital gains to the extent
that such income and gains are applied to increase the reserves under the
Contracts.
Accordingly, the Company does not anticipate that it will incur any federal
income tax liability attributable to the Separate Account and, therefore, the
Company does not intend to make provisions for any such taxes. However, if
changes in the federal tax laws or interpretations thereof result in the Company
being taxed on income or gains attributable to the Separate Account, then the
Company may impose a charge against the Separate Account (with respect to some
or all Contracts) in order to set aside provisions to pay such taxes.
In certain circumstances, owners of individual variable annuity contracts and
participants under group variable annuity contracts may be considered the
owners, for federal income tax purposes, of the assets of the separate accounts
used to support their contracts. In those circumstances, income and gains from
the separate account assets would be included in the owner's gross income. The
Internal Revenue Service has stated in published rulings that a variable
contract owner will be considered the owner of separate account assets if the
owner possesses incidents of ownership in those assets, such as the ability to
exercise investment control over the assets.
The Treasury Department has also announced, in connection with the issuance of
regulations concerning diversification, that those regulations "do not provide
guidance concerning the circumstances in which investor control of the
investments of a segregated asset account may cause the investor (i.e., the
owner or participant), rather than the insurance company, to be treated as the
owner of the assets in the account." This announcement also stated that guidance
would be issued by way of regulations or rulings on the "extent to which
policyholders may direct their investments to particular sub-accounts without
being treated as owners of the underlying assets." As of the date of this
statement of additional information, no guidance has been issued.
The ownership rights under the Contracts are similar to, but different in
certain respects from, those described by the Internal Revenue Service in
rulings in which it was determined that contract owners were not owners of
separate account assets. For example, the owner of a Contract has more
flexibility in allocating purchase payments and Account Value than was
contemplated in the rulings. These differences could result in an owner or
participant being treated as the owner of a pro rata portion of the assets of
the Separate Account and/or Fixed Account. In addition, the Company does not
know what standards will be set forth, if any, in the regulations or rulings
which the Treasury Department has stated it expects to issue. The Company
therefore reserves the right to modify the Contracts as necessary to attempt to
prevent an owner or participant from being considered the owner of a pro rata
share of the assets of the Separate Account.
Tax Deferral On Nonqualified Contracts
Section 817(h) of the Code requires that with respect to nonqualified Contracts,
the investments of the Portfolios be "adequately diversified" in accordance with
Treasury regulations in order for the Contracts to qualify as annuity contracts
under federal tax law. The Separate Account, through the Portfolios, intends to
comply with the diversification requirements prescribed by the Treasury in Reg.
Sec. 1.817-5, which affect how the Portfolios' assets may be invested. Failure
of a Portfolio to meet the diversification requirement would result in loss of
tax deferred status to owners of nonqualified Contracts.
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The financial statements of the Company included in this statement of additional
information should be considered only as bearing on the ability of the Company
to meet its obligations under the Contracts. They should not be considered as
bearing on the investment performance of the assets held in the Separate
Account.
8
<PAGE>
PART C
Other Information
Item 24. Financial Statements and Exhibits
(a) Financial Statements
All required financial statements to be included in Parts A or B of
this Registration Statement will be filed with a subsequent
pre-effective amendment.
(b) Exhibits
All Exhibits are filed herewith or will be filed in a subsequent
pre-effective amendment, as indicated.
(1) Resolution of the Board of Directors of Great American Life
Insurance Company(R) of New York authorizing establishment of
GALIC of New York Separate Account I.*
(2) Not Applicable.
(3) (a) Distribution Agreement between Great American Life
Insurance Company of New York and AAG Securities, Inc.*
(4) Individual and Group Contract Forms and Endorsements*
(a) Form of Qualified Individual Flexible Premium Deferred
Variable Annuity Contract.
(b) Form of Non-Qualified Individual Flexible Deferred
Variable Annuity Contract.
(c) Form of Loan Endorsement to Individual Contract.
(d) Form of Non-Qualified Loan Endorsement to Individual
Contract.
(e) Form of Tax Sheltered Annuity Endorsement to Individual
Contract.
(f) Form of Employer Plan Endorsement to Individual Contract.
(g) Form of Individual Retirement Annuity Endorsement to
Individual Contract.
(h) Form of SIMPLE IRA Endorsement to Individual Contract.
(i) Form of Group Flexible Premium Deferred Variable Annuity
Contract.
(j) Form of Certificate of Participation under a Group
Flexible Premium Deferred Variable Annuity Contract.
1
<PAGE>
(k) Form of Loan Endorsement to Group Contract.
(l) Form of Loan Endorsement to Certificate of Participation
under a Group Contract.
(m) Form of Tax Sheltered Annuity Endorsement to Group
Contract.
(n) Form of Tax Sheltered Annuity Endorsement to Certificate
of Participation under a Group Contract.
(o) Form of Qualified Pension, Profit Sharing and Annuity
Plan Endorsement to Group Contract.
(p) Form of Qualified Pension, Profit Sharing and Annuity
Plan Endorsement to Certificate of Participation under a
Group Contract.
(q) Form of Qualified Pension, Profit Sharing and Annuity
Plan Endorsement to Individual Contract.
(r) Form of Employer Plan Endorsement to Group Contract.
(s) Form of Employer Plan Endorsement to Certificate of
Participation under a Group Contract.
(t) Form of Deferred Compensation Endorsement to Group
Contract.
(u) Form of Deferred Compensation Endorsement to Certificate
of Participation under a Group Contract.
(v) Form of Roth IRA Endorsement to Group Contract.
(w) Form of Roth IRA Endorsement to Qualified Individual
Contract.
(x) Form of Roth IRA Endorsement to Certificate of
Participation under a Group Contract
(y) Form of Governmental Section 457 Plan Endorsement to
Group Contract.
(z) Form of Governmental Section 457 Plan Endorsement to
Certificate of Participation under a Group Contract.
(aa) Form of Governmental Section 457 Plan Endorsement to
Qualified Individual Contract.
(bb) Form of Successor Owner Endorsement to Qualified Group
Contract.
(cc) Form of Successor Owner Endorsement to Certificate of
Participation under a Group Contract.
(dd) Form of Individual Retirement Annuity Endorsement to
Group Contract.
2
<PAGE>
(ee) Form of Individual Retirement Annuity Endorsement to
Certificate of Participation under a Group Contract.
(ff) Form of SIMPLE Individual Retirement Annuity Endorsement
to Group Contract.
(gg) Form of SIMPLE Individual Retirement Annuity Endorsement
to Certificate of Participation under a Group Contract.
(hh) Form of Successor Owner Endorsement to Individual
Contract.
(5) (a) Form of Application for Individual Flexible Premium
Deferred Annuity Contract and Certificate of
Participation under a Group Contract.*
(b) Form of Application for Group Flexible Premium Deferred
Annuity Contract.*
(6) (a) Declaration of Intention and Charter of Old Republic Life
Insurance Company of New York, as filed with the State of
New York on December 23, 1963.
(i) Certificate of Amendment of the Charter of Old
Republic Life Insurance Company of New York to
change the name of the corporation to Great
American Life Insurance Company of New York, as
approved by the State of New York on April 2, 1999.
(b) Restated By-laws of Old Republic Life Insurance Company
of New York, as amended.
(7) Not Applicable.
(8) (a) Participation Agreement between Great American Life
Insurance Company of New York and Dreyfus Variable
Investment Fund, Dreyfus Life and Annuity Index Fund,
Inc. (dba Dreyfus Stock Index Fund), and The Dreyfus
Socially Responsible Growth Fund, Inc.*
(i) Service Agreement between Great American Life
Insurance Company of New York and The Dreyfus
Corporation.*
3
<PAGE>
(b) Participation Agreement between Great American Life
Insurance Company of New York and Janus Aspen Series.*
(i) Letter Agreement between Great American Life
Insurance Company of New York and Janus Capital
Corporation.*
(c) Participation Agreement between Great American Life
Insurance Company of New York and Strong Variable
Insurance Funds, Inc., Strong Opportunity Fund II, Inc.
and Strong Capital Management.*
(i) Letter Agreement between Great American Life
Insurance Company of New York and Strong Variable
Insurance Funds, Inc., Strong Opportunity Fund II,
Inc. and Strong Capital Management.*
(d) Participation Agreement between Great American Life
Insurance Company of New York, INVESCO Variable
Investment Funds, Inc. and INVESCO Funds Group, Inc.*
(i) Letter Agreement between Great American Life
Insurance Company of New York and INVESCO Funds
Group, Inc.*
(e) Participation Agreement between Great American Life
Insurance Company of New York and Morgan Stanley
Universal Funds, Inc.
(f) Participation Agreement between Great American Life
Insurance Company of New York and PBHG Insurance Series
Fund, Inc.*
(g) Service Agreement between Great American Life Insurance
Company of New York and American Annuity Group, Inc.*
(h) Agreement between AAG Securities, Inc. and AAG Insurance
Agency, Inc.
(i) Investment Services Agreement between Great American Life
Insurance Company of New York and American Annuity
GroupSM, Inc.*
(j) Service Agreement between Great American Life Insurance
Company of New York and Pilgrim Baxter & Associates, Ltd.
(k) Service Agreement between Great American Life Insurance
Company of New York and Morgan Stanley Asset Management,
Inc.
(l) Service Agreement between Great American Life Insurance
Company of New York and Janus Capital Corporation.*
(m) Participation Agreement between The Timothy Plan, Timothy
Partners, Ltd. and Great American Life Insurance Company
of New York.*
(i) Letter Agreement between The Timothy Plan and Great
American Life Insurance Company of New York.*
(n) Participation Agreement between BT Insurance Funds Trust
and Great American Life Insurance Company of New York.
4
<PAGE>
(o) Service Agreement between Bankers Trust Company and Great
American Life Insurance Company of New York.
(9) Opinion and Consent of Counsel
(10) Consent of Independent Auditors
(11) No financial statements are omitted from Item 23.
(12) Not Applicable
(13) Not Applicable
(14) Not Applicable
(15) Powers of Attorney
* Filed herewith
- ------------------
5
<PAGE>
Item 25. Directors and Officers of the Depositor
Principal Positions and Offices
Name Business Address With the Company
Robert A. Adams (1) President, Director
Stephen C. Lindner (1) Director
William J. Maney, II (1) Senior Vice President and
Assistant Treasurer, Director
James M. Mortensen (1) Executive Vice President,
Director
Mark F. Muething (1) Senior Vice President and
Secretary, Director
Jeffrey S. Tate (1) Director
Charles K. McManus (1) Vice President
Michael J. O'Connor (1) Director
Lynn E. Laswell (1) Vice President, Treasurer and
Controller
Vincent J. Graneri (1) Vice President and Chief Actuary
Charles R. Scheper (1) Director
Keith A. Jensen (1) Director
(1) P.O. Box 5423, Cincinnati, Ohio 45201-5423.
Item 26. Persons Controlled by or Under Common Control With the Depositor
or Registrant
The Depositor, Great American Life Insurance Company of New York is a wholly
owned subsidiary of Great American Life Insurance Company, which is a wholly
owned subsidiary of American Annuity Group,SM Inc. The Registrant, GALIC of New
York Separate Account I, is a segregated asset account of Great American Life
Insurance Company of New York.
The following chart shows the affiliations among Great American Life Insurance
Company of New York and its parent, subsidiary and affiliated entities.
6
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
AMERICAN FINANCIAL GROUP, INC. % OF STOCK OWNED
(1)
| STATE OF DATE OF BY IMMEDIATE
| DOMICILE INCORPORATION PARENT COMPANY NATURE OF BUSINESS
|
|_AFC Holding Company Ohio 12/09/1994 100 Holding Company
|_AHH Holdings, Inc. Florida 12/27/1995 49 Holding Company
|_Columbia Financial Company Florida 10/26/1993 100 Real Estate Holding Company
|_American Heritage Holding Corporation Delaware 11/02/1994 100 Home Builder
|_Heritage Homes Realty, Inc. Florida 07/20/1993 100 Home Sales
|_Southeast Title, Inc. Florida 05/16/1995 100 Title Company
|_Heritage Home Finance Corporation Florida 02/10/1994 100 Finance Company
|_American Financial Capital Trust I Delaware 09/14/1996 100 Statutory Business Trust
|_American Financial Corporation Ohio 11/15/1955 100 Holding Company
|_AFC Coal Properties, Inc. Ohio 12/18/1996 100 Real Estate Holding Company
|_American Financial Corporation Ohio 08/27/1963 100 Inactive
|_American Money Management Corporation Ohio 03/01/1973 100 Investment Management
|_American Money Management Netherland - 05/10/1985 100 Securities Management
International, N.V Antilles
|_American Premier Underwriters, Inc. Pennsylvania 00/00/1846 100 (2) Diversified
|_The Ann Arbor Railroad Company Michigan 09/21/1895 99 Inactive
|_The Associates of the Jersey Company New Jersey 11/10/1804 100 Inactive
|_Cal Coal, Inc. Illinois 05/30/1979 100 Inactive
|_GAI (Bermuda) Ltd. Bermuda 04/06/1998 100 Holding Company
|_GAI Insurance Company, Ltd. Bermuda 09/18/1989 100 Reinsurance Company
|_The Indianapolis Union Railway Indiana 11/19/1872 100 Inactive
Company
|_Lehigh Valley Railroad Company Pennsylvania 04/21/1846 100 Inactive
|_The New York and Harlem Railroad New York 04/25/1831 97 Inactive
Company
|_The Owasco River Railway, Inc. New York 06/02/1881 100 Inactive
|_PCC Real Estate, Inc. New York 12/15/1986 100 Holding Company
|_PCC Chicago Realty Corp. New York 12/23/1986 100 Real Estate Developer
|_PCC Gun Hill Realty Corp. New York 12/18/1985 100 Real Estate Developer
|_PCC Michigan Realty, Inc. Michigan 11/09/1987 100 Real Estate Developer
|_PCC Scarsdale Realty Corp. New York 06/01/1986 100 Real Estate Developer
|_Scarsdale Depot Associates, L.P. Delaware 05/05/1989 80 Real Estate Developer
|_Penn Central Energy Management Delaware 05/11/1987 100 Energy Operations Manager
Company
|_Pennsylvania Company Delaware 12/05/1958 100 Holding Company
|_Atlanta Casualty Company Ohio 06/13/1972 100 (2) Property/Casualty Insurance
|_American Premier Insurance Indiana 11/30/1989 100 Property/Casualty Insurance
Company
|_Atlanta Reserve Insurance Ohio 12/07/1998 100 Property/Casualty Insurance
Company
|_Atlanta Specialty Insurance Ohio 02/06/1974 100 Property/Casualty Insurance
Company
|_Atlanta Casualty Group, Inc. Georgia 04/01/1977 100 Insurance Agency
|_Atlanta Casualty General Texas 03/15/1961 100 Managing General Agency
Agency, Inc.
|_Atlanta Insurance Brokers, Georgia 02/06/1971 100 Insurance Agency
Inc.
|_Treaty House, Ltd. (d/b/a Mr. Nevada 11/02/1971 100 Insurance Premium Finance
Budget)
|_Penn Central U.K. Limited United Kingdom 10/28/1992 100 Insurance Holding Company
|_Insurance (GB) Limited United Kingdom 05/13/1992 100 Property/Casualty Insurance
7
<PAGE>
|_AFC Holding Company
|_American Financial Corporation % OF STOCK OWNED
(1)
|_American Premier Underwriters, Inc. STATE OF DATE OF BY IMMEDIATE
|_Pennsylvania Company DOMICILE INCORPORATION PARENT COMPANY NATURE OF BUSINESS
|_Delbay Corporation Delaware 12/27/1962 100 Inactive
|_Great Southwest Corporation Delaware 10/25/1978 100 Real Estate Developer
|_World Houston, Inc. Delaware 05/30/1974 100 Real Estate Developer
|_Hangar Acquisition Corp. Ohio 10/06/1995 100 Aircraft Investment
|_Infinity Insurance Company Indiana 07/09/1955 100 Property/Casualty Insurance
|_Infinity Agency of Texas, Inc. Texas 07/15/1992 100 Managing General Agency
|_The Infinity Group, Inc. Indiana 07/22/1992 100 Services Provider
|_Infinity National Insurance Indiana 08/05/1992 100 Property/Casualty Insurance
Company
|_Infinity Select Insurance Company Indiana 06/11/1991 100 Property/Casualty Insurance
|_Leader Insurance Company Ohio 03/20/1963 100 Property/Casualty Insurance
|_American Commonwealth Texas 07/23/1963 100 Real Estate Development
Development Company
|_ACDC Holdings Corporation Texas 05/04/1981 100 Real Estate Development
|_Budget Insurance Premiums, Inc. Ohio 02/14/1964 100 Premium Finance Company
|_Leader Group, Inc. Ohio 12/12/1997 100 Services Provider
|_Leader Managing General Agency, Texas 05/19/1989 100 Managing General Agency
Inc.
|_Leader National Agency, Inc. Ohio 04/05/1963 100 Brokering Agent
|_Leader National Agency of Texas, Texas 01/25/1994 100 Managing General Agency
Inc.
|_Leader Preferred Insurance Ohio 11/07/1994 100 Property/Casualty Insurance
Company
|_Leader Specialty Insurance Indiana 03/10/1994 100 Property/Casualty Insurance
Company
|_TICO Insurance Company Ohio 06/03/1980 100 Property/Casualty Insurance
|_PCC Technical Industries, Inc. California 03/07/1955 100 Holding Company
|_ESC, Inc. California 11/02/1962 100 Connector Accessories
|_Marathon Manufacturing Delaware 11/18/1983 100 Holding Company
Companies, Inc.
|_Marathon Manufacturing Company Delaware 12/07/1979 100 Inactive
|_PCC Maryland Realty Corp. Maryland 08/18/1993 100 Real Estate Holding Company
|_Penn Camarillo Realty Corp. California 11/24/1992 100 Real Estate Holding Company
|_Penn Towers, Inc. Pennsylvania 08/01/1958 100 Inactive
|_Republic Indemnity Company of California 12/05/1972 100 Workers' Compensation
Insurance
America
|_Republic Indemnity Company of California 10/13/1982 100 Workers' Compensation
Insurance
California
|_Republic Indemnity Medical California 03/25/1996 100 Medical Bill Review
Management, Inc.
|_Risico Management Corporation Delaware 01/10/1989 100 Risk Management
|_Windsor Insurance Company Indiana 11/05/1987 100 (2) Property/Casualty Insurance
|_American Deposit Insurance Oklahoma 12/28/1966 100 Property/Casualty Insurance
Company
|_Granite Finance Co., Inc. Texas 11/09/1965 100 Premium Financing
|_Coventry Insurance Company Ohio 09/05/1989 100 Property/Casualty Insurance
|_El Aguila Compania de Seguros, Mexico 11/24/1994 100 (2) Property/Casualty Insurance
S.A. de C.V.
|_Financiadora De Primas Condor Mexico 03/06/1998 99 Premium Finance Company
S.A. de C.V.
|_Moore Group Inc. Georgia 12/19/1962 100 Insurance Holding Company/
Agency
|_Casualty Underwriters, Inc. Georgia 10/01/1954 51 Insurance Agency
|_Dudley L. Moore Insurance, Inc. Louisiana 03/30/1978 beneficial Insurance Agency
interest
|_Hallmark General Insurance Oklahoma 06/16/1972 beneficial Insurance Agency
Agency, Inc. interest
|_Windsor Group, Inc. Georgia 05/23/1991 100 Insurance Holding Company
|_Regal Insurance Company Indiana 11/05/1987 100 Property/Casualty Insurance
|_Texas Windsor Group, Inc. Texas 06/23/1988 100 Insurance Agency
8
<PAGE>
|_AFC Holding Company
|_American Financial Corporation
|_American Premier Underwriters, Inc. % OF STOCK OWNED
(1)
| STATE OF DATE OF BY IMMEDIATE
| DOMICILE INCORPORATION PARENT COMPANY NATURE OF BUSINESS
|_Pennsylvania-Reading Seashore Lines New Jersey 06/14/1901 66.67 Inactive
|_Pittsburgh and Cross Creek Railroad Pennsylvania 08/14/1970 83 Inactive
Company
|_PLLS, Ltd. Washington 05/14/1990 100 Insurance Agency
|_Premier Lease & Loan Services Washington 12/27/1983 100 Insurance Agency
Insurance Agency, Inc.
|_Premier Lease & Loan Services of Washington 02/28/1991 100 Insurance Agency
Canada, Inc.
|_Terminal Realty Penn Co. District of 09/23/1968 100 Inactive
Columbia
|_United Railroad Corp. Delaware 11/25/1981 100 Inactive
|_Detroit Manufacturers Railroad Michigan 01/30/1902 82 Inactive
Company
|_Waynesburg Southern Railroad Company Pennsylvania 09/01/1966 100 Inactive
|_Chiquita Brands International, Inc. New Jersey 03/30/1999 36.48 (2) Production/Processing/
(and subsidiaries) Distribution
| of Food Products
|_Dixie Terminal Corporation Ohio 04/23/1970 100 Commercial Leasing
|_Fairmont Holdings, Inc. Ohio 12/15/1983 100 Holding Company
|_FWC Corporation Ohio 03/16/1983 100 Financial Services
|_Great American Insurance Company Ohio 03/07/1872 100 Property/Casualty Insurance
|_Agricultural Excess and Surplus Delaware 02/28/1979 100 Excess & Surplus Lines
Insurance Company Insurance
|_Agricultural Insurance Company Ohio 03/23/1905 100 Property/Casualty Insurance
|_American Alliance Insurance Company Ohio 09/11/1945 100 Property/Casualty Insurance
|_American Annuity Group, Inc. Delaware 05/15/1987 82.73 (2) Holding Company
|_AAG Holding Company, Inc. Ohio 09/11/1996 100 Holding Company
|_American Annuity Group Capital Delaware 09/13/1996 100 Financing Vehicle
Trust I
|_American Annuity Group Capital Delaware 03/11/1997 100 Financing Vehicle
Trust II
|_American Annuity Group Capital Delaware 05/27/1997 100 Financing Vehicle
Trust III
|_Great American Life Insurance Ohio 12/15/1959 100 Life Insurance Company
Company
|_American Retirement Life Ohio 05/12/1978 100 Life Insurance Company
Insurance Company
|_Annuity Investors Life Ohio 11/31/1981 100 Life Insurance Company
Insurance Company
|_CHATBAR, Inc. Massachusetts 11/02/1993 100 Hotel Operator
|_Driskill Holdings, Inc. Texas 06/07/1995 beneficial interest Hotel Management
|_GALIC Brothers, Inc. Ohio 11/12/1993 80 Real Estate Management
|_Great American Life Assurance Ohio 08/10/1967 100 Life Insurance Company
Company
|_Great American Life Children's Ohio 08/06/1998 beneficial interest Charitable Foundation
Foundation
|_Great American Life Insurance New York 12/23/1963 100 Life Insurance Company
Company of New York
|_Loyal American Life Insurance Ohio 05/18/1955 100 Life Insurance Company
Company
|_ADL Financial Services, Inc. North Carolina 09/10/1970 100 Marketing Services
|_Purity Financial Corporation Florida 12/21/1991 100 Marketing Services
|_Prairie National Life South Dakota 02/11/1976 100 Life Insurance Company
Insurance Company
|_Skipjack Marina Corporation Maryland 06/24/1999 100 Marine Operator
|_AAG Insurance Agency, Inc. Kentucky 12/06/1994 100 Life Insurance Agency
|_AAG Insurance Agency of Massachusetts 05/25/1995 100 Insurance Agency
Massachusetts, Inc.
|_AAG Securities, Inc. Ohio 12/10/1993 100 Broker-Dealer
|_American Data Source India Private India 09/03/1997 99 Software Development
Limited
|_American Memorial Marketing Washington 06/19/1980 100 Inactive
Services, Inc.
9
<PAGE>
AMERICAN FINANCIAL GROUP, INC.
|_AFC Holding Company
|_American Financial Corporation % OF STOCK OWNED
(1)
|_Great American Insurance Company STATE OF DATE OF BY IMMEDIATE
|_American Annuity Group, Inc. DOMICILE INCORPORATION PARENT COMPANY NATURE OF BUSINESS
|
|_Consolidated Financial Michigan 09/10/1985 100 Financial Planning
Corporation
|_CSW Management Services, Inc. Texas 06/27/1985 100 Inactive
|_GALIC Disbursing Company Ohio 05/31/1994 100 Payroll Servicer
|_Great American Life Assurance Puerto Rico 07/01/1964 99 Life Insurance Company
Company
of Puerto Rico, Inc.
|_Keyes-Graham Insurance Agency, Massachusetts 12/23/1987 100 Insurance Agency
Inc.
|_Laurentian Credit Services Delaware 10/07/1994 100 Inactive
Corporation
|_Laurentian Marketing Services, Delaware 12/23/1987 100 Inactive
Inc.
|_Laurentian Securities Corporation Delaware 01/30/1990 100 Inactive
|_Lifestyle Financial Investments, Ohio 12/29/1993 100 Marketing Services
Inc.
|_Lifestyle Financial Ohio 03/07/1994 beneficial interest Life Insurance Agency
Investments Agency of Ohio, Inc.
|_Lifestyle Financial Indiana 02/24/1994 100 Life Insurance Agency
Investments of Indiana, Inc.
|_Lifestyle Financial Kentucky 10/03/1994 100 Insurance Agency
Investments of Kentucky, Inc.
|_Lifestyle Financial Minnesota 06/10/1985 100 Insurance Agency
Investments of the Northwest, Inc.
|_Lifestyle Financial North Carolina 07/13/1994 100 Insurance Agency
Investments of the Southeast, Inc.
|_Loyal Marketing Services, Inc. Alabama 07/20/1990 100 Marketing Services
|_New Energy Corporation Indiana 01/08/1997 49 Holding Company
|_Retirement Resource Group, Inc. Indiana 02/07/1995 100 Insurance Agency
|_AAG Insurance Agency of Texas, Texas 06/02/1995 100 Life Insurance Agency
Inc.
|_RRG of Alabama, Inc. Alabama 09/22/1995 100 Life Insurance Agency
|_RRG of Ohio, Inc. Ohio 02/20/1996 beneficial interest Insurance Agency
|_SPELCO (UK) Ltd. United Kingdom 00/00/0000 99 Inactive
|_SWTC, Inc. Delaware 00/00/0000 100 Inactive
|_SWTC Hong Kong Ltd. Hong Kong 00/00/0000 100 Inactive
|_Technomil Ltd. Delaware 00/00/0000 100 Inactive
|_American Custom Insurance Services, Ohio 07/27/1983 100 Management Holding Company
Inc.
|_American Custom Insurance Services California 05/18/1992 100 Insurance Agency & Brokerage
California, Inc.
|_Eden Park Insurance Brokers, Inc. California 02/13/1990 100 Wholesale Brokerage for
Surplus Lines
|_Professional Risk Brokers, Inc. Illinois 03/01/1990 100 Insurance Agency
|_Professional Risk Brokers Massachusetts 04/19/1994 100 Surplus Lines Brokerage
Insurance, Inc.
|_Professional Risk Brokers of Connecticut 07/09/1992 100 Insurance Agency & Brokerage
Connecticut, Inc.
|_Professional Risk Brokers of Ohio, Ohio 12/17/1986 100 Insurance Agency and
Inc. Brokerage
|_Smith, Evans and Schmitt, Inc. California 08/05/1988 100 Insurance Agency
|_American Custom Insurance Services Illinois 07/08/1992 100 Underwriting Office
Illinois, Inc.
|_American Dynasty Surplus Lines Delaware 01/12/1982 100 Excess & Surplus Lines
Insurance Company Insurance
|_American Empire Surplus Lines Delaware 07/15/1977 100 Excess & Surplus Lines
Insurance Company Insurance
|_American Empire Insurance Company Ohio 11/26/1979 100 Property/Casualty Insurance
|_American Signature Underwriters, Ohio 04/08/1996 100 Insurance Agency
Inc.
|_Specialty Underwriters, Inc. Texas 05/19/1976 100 Insurance Agency
|_Fidelity Excess and Surplus Ohio 06/30/1987 100 Property/Casualty Insurance
Insurance Company
10
<PAGE>
AMERICAN FINANCIAL GROUP, INC.
|_AFC Holding Company
|_American Financial Corporation % OF STOCK OWNED
(1)
|_Great American Insurance Company STATE OF DATE OF BY IMMEDIATE
| DOMICILE INCORPORATION PARENT COMPANY NATURE OF BUSINESS
|
|_American Financial Enterprises, Connecticut 00/00/1871 100 (2) Closed End Investment
Inc. Company
|_American Insurance Agency, Inc. Kentucky 07/27/1967 100 Insurance Agency
|_American National Fire Insurance New York 08/22/1947 100 Property/Casualty Insurance
Company
|_American Special Risk, Inc. Illinois 12/29/1981 100 Insurance Broker/Managing
General Agency
|_American Spirit Insurance Company Indiana 04/05/1988 100 Property/Casualty Insurance
|_Aviation Specialty Managers, Inc. Texas 09/07/1965 100 Texas Managing General
Agency
|_Aviation Specialty Services, Inc. Texas 04/06/1995 100 (2) Texas Local Recording Agency
|_Brothers Property Corporation Ohio 09/08/1987 80 Real Estate Investment
|_Brothers Cincinnatian Corporation Ohio 01/25/1994 100 Hotel Manager
|_Brothers Landing Corporation Louisiana 02/24/1994 100 Real Estate Holding Corp.
|_Brothers Pennsylvanian Pennsylvania 12/23/1994 100 Real Estate Holding Corp.
Corporation
|_Brothers Port Richey Corporation Florida 12/06/1993 100 Apartment Manager
|_Brothers Property Management Ohio 09/25/1987 100 Real Estate Management
Corporation
|_Brothers Railyard Corporation Texas 12/14/1993 100 Apartment Manager
|_Contemporary American Insurance Illinois 04/16/1996 100 Property/Casualty Insurance
Company
|_Crop Managers Insurance Agency, Kansas 08/09/1989 100 Insurance Agency
Inc.
|_Dempsey & Siders Agency, Inc. Ohio 05/09/1956 100 Insurance Agency
|_Eagle American Insurance Company Ohio 07/01/1987 100 Property/Casualty Insurance
|_Eden Park Insurance Company Indiana 01/08/1990 100 Special Risk Surplus Lines
|_FCIA Management Company, Inc. New York 09/17/1991 79 Servicing Agent
|_The Gains Group, Inc. Ohio 01/26/1982 100 Marketing of Advertising
|_Global Premier Finance Company Ohio 08/25/1998 100 Premium Finance Company
|_Great American Insurance Agency, Ohio 04/20/1999 100 Insurance Agency
Inc.
|_Great American Lloyd's, Inc. Texas 08/02/1983 100 Attorney-in-Fact - Texas
Lloyd's Company
|_Great American Lloyd's Insurance Texas 10/09/1979 beneficial Lloyd's Plan Insurer
Company interest
|_Great American Management Ohio 12/05/1974 100 Data Processing and
Services, Inc. Equipment Leasing
|_American Payroll Services, Inc. Ohio 02/20/1987 100 Payroll Services
|_Great American Re Inc. Delaware 05/14/1971 100 Reinsurance Intermediary
|_Great American Risk Management, Ohio 04/21/1980 100 Insurance Risk Management
Inc.
|_Great Texas County Mutual Texas 04/29/1954 beneficial Property/Casualty Insurance
Insurance Company interest
|_Grizzly Golf Center, Inc. Ohio 11/08/1993 100 Operate Golf Courses
|_Homestead Snacks Inc. California 03/02/1979 100 (2) Meat Snack Distribution
|_Giant Snacks, Inc. Delaware 07/06/1989 100 Meat Snack Distribution
|_Key Largo Group, Inc. Florida 07/28/1981 100 Land Developer & Resort
Operator
|_Key Largo Group Utility Company Florida 11/26/1984 100 Water & Sewer Utility
|_Mid-Continent Casualty Company Oklahoma 02/26/1947 100 Property/Casualty Insurance
|_Mid-Continent Insurance Company Oklahoma 08/13/1992 100 Property/Casualty Insurance
|_Oklahoma Surety Company Oklahoma 08/05/1968 100 Property/Casualty Insurance
|_National Interstate Corporation Ohio 01/26/1989 52.15 Holding Company
|_Hudson Indemnity, Ltd. Cayman Islands 06/12/1996 100 Property/Casualty Insurance
11
<PAGE>
AMERICAN FINANCIAL GROUP, INC.
|_AFC Holding Company % OF STOCK OWNED
(1)
|_American Financial Corporation STATE OF DATE OF BY IMMEDIATE
|_Great American Insurance Company DOMICILE INCORPORATION PARENT COMPANY NATURE OF BUSINESS
|_National Interstate Corporation
|_
|_American Highways Insurance California 05/05/1994 100 Insurance Agency
Agency, Inc.
|_American Highways Insurance Ohio 06/29/1999 100 Insurance Agency
Agency, Inc.
|_Explorer Insurance Agency, Inc. Ohio 07/17/1997 beneficial interest Insurance Agency
|_National Interstate Insurance Texas 06/07/1989 beneficial interest Insurance Agency
Agency of Texas, Inc.
|_National Interstate Insurance Ohio 02/13/1989 100 Insurance Agency
Agency, Inc.
|_National Interstate Insurance Ohio 02/10/1989 100 Property/Casualty Insurance
Company
|_Safety, Claims & Litigation Pennsylvania 06/23/1995 100 Claims Third Party
Services, Inc. Administrator
|_Sims Insurance Services, Inc. Hawaii 03/17/1999 100 Insurance Agency
|_OBGC Corporation Florida 11/23/1977 80 Real Estate Development
|_Pointe Apartments, Inc. Minnesota 06/24/1993 100 Real Estate Holding Corp.
|_Premier Dealer Services, Inc. Illinois 06/24/1998 100 Third Party Administrator
|_Seven Hills Insurance Agency, Inc. Ohio 12/22/1997 100 Insurance Agency
|_Seven Hills Insurance Company New York 06/30/1932 100 Property/Casualty
Reinsurance
|_Stonewall Insurance Company Alabama 02/00/1866 100 Property/Casualty Insurance
|_Stone Mountain Professional Georgia 08/07/1995 100 Insurance Agency
Liability Agency, Inc.
|_Tamarack American, Inc. Delaware 06/10/1986 100 Management Holding Company
|_Timberglen Limited United Kingdom 10/28/1992 100 Investments
|_Transport Insurance Company Ohio 05/25/1976 100 Property/Casualty Insurance
|_Instech Corporation Texas 09/02/1975 100 Claim & Claim Adjustment
Services
|_Transport Insurance Agency, Inc. Texas 08/21/1989 beneficial Insurance Agency
interest
|_Transport Underwriters Association California 05/11/1945 100 Holding Company/Agency
|_Worldwide Insurance Company Missouri 10/01/1991 100 Property/Casualty Insurance
|_Worldwide Direct Auto Insurance Kentucky 11/13/1961 100 Property/Casualty Insurance
Company
|_Worldwide Casualty Insurance Kentucky 02/17/1981 100 Property/Casualty Insurance
Company
|_One East Fourth, Inc. Ohio 02/03/1964 100 Commercial Leasing
|_PCC 38 Corp. Illinois 12/23/1996 100 Real Estate Holding Company
|_Pioneer Carpet Mills, Inc. Ohio 04/29/1976 100 Carpet Manufacturing
|_TEJ Holdings, Inc. Ohio 12/04/1984 100 Real Estate Holdings
|_Three East Fourth, Inc. Ohio 08/10/1966 100 Commercial Leasing
|_American Financial General Corporation Texas 09/14/1998 100 Holding Company
|_American General Financial Corporation Texas 09/14/1998 100 Holding Company
</TABLE>
(1) Except Director's Qualifying Shares.
(2) Total percentage owned by parent shown
and by other affiliated company(ies).
12
<PAGE>
Item 27. Number of Contract Owners
As of September 1, 1999 there were no Individual Contract Owners and no
participants in Standard or Enhanced Group Contracts
Item 28. Indemnification
(a) The By-Laws of Great American Life Insurance Company of New York provide
in Article IV as follows:
The corporation shall indemnify any person made or
threatened to be made, a party to any action, suit
or proceeding or investigation . . . by reason of
the fact that he . . . was a director of the
corporation, or was serving at the request of the
corporation as a director of another corporation,
partnership, joint venture, trust or other
enterprise (all such persons being referred to
hereinafter as an "Agent"). . . .
Insofar as indemnification for liability arising under the Securities Act of
1933 ("1933 Act") may be permitted to directors, officers and controlling
persons of the Depositor pursuant to the foregoing provisions, or otherwise, the
Depositor has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
1933 Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Depositor of expenses incurred or paid by the director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Depositor will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the 1933 Act and
will be governed by the final adjudication of such issue.
(b) The directors and officers of Great American Life Insurance Company of New
York are covered under a Directors and Officers Reimbursement Policy. Under the
Reimbursement Policy, directors and officers are indemnified for loss arising
from any covered claim by reason of any Wrongful Act in their capacities as
directors or officers, except to the extent the Company has indemnified them. In
general, the term "loss" means any amount which the directors or officers are
legally obligated to pay for a claim for Wrongful Acts. In general, the term
"Wrongful Acts" means any breach of duty, neglect, error, misstatement,
misleading statement, omission or act by a director or officer while acting
individually or collectively in their capacity as such claimed against them
solely by reason of their being directors and officers. The limit of liability
under the program is $20,000,000 for the policy year ending September 1, 2000.
The primary policy under the program is with National Union Fire Insurance
Company of Pittsburgh, PA in the name of American Premier Underwriters, Inc.
Item 29. Principal Underwriter
AAG Securities, Inc. is the underwriter and distributor of the Contracts as
defined in the Investment Company Act of 1940 ("1940 Act").
13
<PAGE>
(a) AAG Securities, Inc. acts as a principal underwriter, depositor, sponsor or
investment adviser for two affiliated investment companies Annuity Investors(R)
Variable Account A and Annuity Investors(R) Variable Account B, in addition to
GALIC of New York Separate Account I.
(b) Directors and Officers of AAG Securities, Inc.
Name and Principal Position with
Business Address AAG Securities, Inc.
- ------------------ --------------------
Thomas K. Liguzinski (1) Chief Executive Officer and Director
Charles K. McManus (1) Senior Vice President
Mark F. Muething (1) Vice President, Secretary and Director
William J. Maney, II (1) Director
Jeffrey S. Tate (1) Director
James L. Henderson (1) President
Christopher Grysen (1) Vice President and Chief Compliance Officer
James T. McVey Vice President
William C. Bair, Jr. (1) Treasurer
Thomas E. Mischell (1) Assistant Treasurer
Fred J. Runk (1) Assistant Treasurer
(1) 250 East Fifth Street, Cincinnati, Ohio 45202
(c) Not applicable.
Item 30. Location of Accounts and Records
All accounts and records required to be maintained by Section 31(a) of the 1940
Act and the rules under it are maintained by Lynn E. Laswell, Vice President,
Treasurer and Controller of the Company, at the Administrative Offices of the
Company.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) Registrant undertakes that it will file a post-effective amendment to this
registration statement as frequently as necessary to ensure that the audited
financial statements in the registration statement are never more than 16 months
old for so long as payments under the variable annuity contracts may be
accepted.
(b) Registrant undertakes that it will include either (1) as part of any
application to purchase a Contract offered by the Prospectus, a space that an
applicant can check to request a Statement of Additional Information, or (2) a
post card or similar written communication affixed to or included in the
Prospectus that the applicant can remove to send for a Statement of Additional
Information.
(c) Registrant undertakes to deliver any Prospectus and Statement of Additional
Information and any financial statements required to be made available under
this Form promptly upon written or oral request to the Company at the address or
phone number listed in the Prospectus.
(d) The Company represents that the fees and charges deducted under the
Contract, in the aggregate, are reasonable in relation to the services rendered,
the expenses expected to be incurred and the risks assumed by the Company.
14
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act
of 1940, the Registrant certifies that it has caused this Registration Statement
to be signed on its behalf by the undersigned in the City of Cincinnati, State
of Ohio on the day of October 5, 1999.
GALIC of New York SEPARATE ACCOUNT I
(REGISTRANT)
By: /s/ Robert Allen Adams
Robert Allen Adams
Chairman of the Board, President
and Director, Great American Life
Insurance Company of New York
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
(DEPOSITOR)
By: /s/ Robert Allen Adams
Robert Allen Adams
Chairman of the Board, President
and Director
As required by the Securities Act of 1933, this Registration Statement
has been signed by the following persons in the capacities and on the dates
indicated.
/s/ Robert Allen Adams Principal Executive October 5, 1999
- ------------------------------ Officer, Director
Robert Allen Adams
/s/ Lynn Edward Laswell Principal Financial October 5, 1999
- ------------------------------ Officer
Lynn Edward Laswell
/s/ Lynn Edward Laswell Principal Accounting October 5, 1999
- ----------------------------- Officer
Lynn Edward Laswell
15
<PAGE>
/s/ Stephen Craig Lindner Director October 5, 1999
- -----------------------------
Stephen Craig Lindner
/s/ William Jack Maney, II Director October 5, 1999
- -----------------------------
William Jack Maney, II
/s/ James Michael Mortensen Director October 5, 1999
- -----------------------------
James Michael Mortensen
/s/ Mark Francis Muething Director October 5, 1999
- -----------------------------
Mark Francis Muething
/s/ Jeffrey Scott Tate Director October 5, 1999
- -----------------------------
Jeffrey Scott Tate
/s/ Charles Scheper Director October 5, 1999
- -----------------------------
Charles Scheper
/s/ Michael J. O'Connor Director October 5, 1999
- -----------------------------
Michael J. O'Connor
/s/ Keith A. Jensen Director October 5, 1999
- -----------------------------
Keith A. Jensen
16
<PAGE>
EXHIBIT INDEX
All Exhibits are filed herewith or will be filed in a subsequent pre-effective
amendment, as indicated.
(1) Resolution of the Board of Directors of Great American Life Insurance
Company(R) of New York authorizing establishment of GALIC of New York
Separate Account I.*
(2) Distribution Agreement between Great American Life Insurance Company of
New York and AAG Securities, Inc.*
(3) Individual and Group Contract Forms and Endorsements*
a) Form of Qualified Individual Flexible Premium Deferred Variable
Annuity Contract.
b) Form of Non-Qualified Individual Flexible Deferred Variable
Annuity Contract.
c) Form of Loan Endorsement to Individual Contract.
d) Form of Non-Qualified Loan Endorsement to Individual Contract
e) Form of Tax Sheltered Annuity Endorsement to Individual Contract.
f) Form of Employer Plan Endorsement to Individual Contract.
g) Form of Individual Retirement Annuity Endorsement to Individual
Contract.
h) Form of SIMPLE IRA Endorsement to Individual Contract.
i) Form of Group Flexible Premium Deferred Variable Annuity Contract.
j) Form of Certificate of Participation under a Group Flexible
Premium Deferred Variable Annuity Contract.
17
<PAGE>
k) Form of Loan Endorsement to Group Contract.
l) Form of Loan Endorsement to Certificate of Participation under a
Group Contract.
m) Form of Tax Sheltered Annuity Endorsement to Group Contract.
n) Form of Tax Sheltered Annuity Endorsement to Certificate of
Participation under a Group Contract
o) Form of Qualified Pension, Profit Sharing and Annuity Plan
Endorsement to Group Contract.
p) Form of Qualified Pension, Profit Sharing and Annuity Plan
Endorsement to Certificate of Participation under a Group Contract
q) Form of Qualified Pension, Profit Sharing and Annuity Plan
Endorsement to Individual Contract.
r) Form of Employer Plan Endorsement to Group Contract.
s) Form of Employer Plan Endorsement to Certificate of Participation
under a Group Contract.
t) Form of Deferred Compensation Endorsement to Group Contract.
u) Form of Deferred Compensation Endorsement to Certificate of
Participation under a Group Contract
v) Form of Roth IRA Endorsement to Group Contract
w) Form of Roth IRA Endorsement to Qualified Individual Contract.
x) Form of Roth IRA Endorsement to Certificate of Participation under
a Group Contract.
y) Form of Governmental Section 457 Plan Endorsement to Group
Contract.
z) Form of Governmental Section 457 Plan Endorsement to Certificate
of Participation under a Group Contract.
aa) Form of Governmental Section 457 Plan Endorsement to Qualified
Individual Contract.
bb) Form of Successor Owner Endorsement to Qualified Group Contract
cc) Form of Successor Owner Endorsement to Certificate of
Participation under a Group Contract.
dd) Form of Individual Retirement Annuity Endorsement to Group
Contract.
ee) Form of Individual Retirement Annuity Endorsement to Certificate
of Participation under a Group Contract.
ff) Form of SIMPLE Individual Retirement Annuity Endorsement to Group
Contract.
18
<PAGE>
gg) Form of SIMPLE Individual Retirement Annuity Endorsement to
Certificate of Participation under a Group Contract.
hh) Form of Successor Owner Endorsement to Individual Contract
(4) (a) Form of Application for Individual Flexible Premium Deferred
Annuity Contract and Certificate of Participation under a Group
Contract.*
(b) Form of Application for Group Flexible Premium Deferred Annuity
Contract.*
(5) (a) Declaration of Intention and Charter of Old Republic Life
Insurance Company of New York, as filed with the State of New York
on December 23, 1963.
(i) Certificate of Amendment of the Charter of Old Republic Life
Insurance Company of New York to change the name of the
corporation to Great American Life Insurance Company of New
York, as approved by the State of New York on April 2, 1999.
(b) Restated By-laws of Old Republic Life Insurance Company of New
York, as amended.
(6) (a) Participation Agreement between Great American Life Insurance
Company of New York and Dreyfus Variable Investment Fund, Dreyfus
Life and Annuity Index Fund, Inc. (dba Dreyfus Stock Index Fund),
and The Dreyfus Socially Responsible Growth Fund, Inc.*
(i) Service Agreement between Great American Life Insurance
Company of New York and The Dreyfus Corporation.*
(b) Participation Agreement between Great American Life Insurance
Company of New York and Janus Aspen Series.*
(i) Letter Agreement between Great American Life Insurance
Company of New York and Janus Capital Corporation.*
(c) Participation Agreement between Great American Life Insurance
Company of New York and Strong Variable Insurance Funds, Inc.,
Strong Opportunity Fund II, Inc. and Strong Capital Management.*
(i) Letter Agreeement between Great American Life Insurance
Company of New York and Strong Variable Insurance Funds, Inc.,
Strong Opportunity Fund II, Inc. and Strong Capital Management.*
19
<PAGE>
(d) Participation Agreement between Great American Life Insurance
Company of New York and INVESCO Variable Investment Funds, Inc.
and INVESCO Funds, Inc.*
(i) Letter Agreement between Great American Life Insurance
Company and INVESCO Funds Group, Inc.*
(e) Participation Agreement between Great American Life Insurance
Company of New York and Morgan Stanley Universal Funds, Inc.
(f) Participation Agreement between Great American Life Insurance
Company of New York and PBHG Insurance Series Fund, Inc.*
(g) Service Agreement between Great American Life Insurance Company of
New York and American Annuity Group, Inc.*
(h) Agreement between AAG Securities, Inc. and AAG Insurance Agency,
Inc.
(i) Investment Service Agreement between Great American Life Insurance
Company of New York and American Annuity Group, Inc.*
(j) Service Agreement between Great American Life Insurance Company of
New York and Pilgrim Baxter & Associates, Ltd.
(k) Service Agreement between Great American Life Insurance Company of
New York and Morgan Stanley Asset Management, Inc.
(l) Service Agreement between Great American Life Insurance Company
and Janus Capital Corporation.*
(m) Participation Agreement between The Timothy Plan Variable Series,
Timothy Partners, Ltd. and Great American Life Insurance Company
of New York.*
(i) Service Agreement between The Timothy Plan and Great American
Life Insurance Company of New York.*
20
<PAGE>
(n) Participation Agreement between BT Insurance Funds Trust and Great
American Life Insurance Company of New York.
(o) Service Agreement between Bankers Trust Company and Great American
Life Insurance Company of New York.
(7) Opinion and Consent of Counsel
(8) Consent of Independent Auditors
(9) Powers of Attorney
- -----------------
* Filed herewith.
CERTIFICATE OF RESOLUTION
I, MARK F. MUETHING, certify that I am a duly elected and acting Secretary of
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK, a New York corporation, (the
"Company"), and do hereby further certify that the attached is a true and
correct copy of resolutions adopted by the Board of Directors of the Company on
May 7, 1999 and that such resolutions have not been amended, modified or
rescinded and remain in full force and effect on the date hereof.
* * *
IN WITNESS WHEREOF, I have set my hand and affixed the seal of GREAT AMERICAN
LIFE INSURANCE COMPANY OF NEW YORK this 7th day of May, 1999.
/s/-----------------------------------
Mark F. Muething,
Senior Vice President andSecretary
[SEAL]
<PAGE>
ACTION TAKEN IN WRITING BY ALL MEMBERS OF THE
BOARD OF DIRECTORS OF
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
PURSUANT TO SECTION 708
OF THE
NEW YORK BUSINESS CORPORATION LAW
The undersigned, being all of the Directors of Great American Life
Insurance Company of New York, a New York corporation (the
"Corporation"), do hereby adopt the following resolutions by unanimous
written consent pursuant to Section 708 of the New York Business
Corporation Law on May 7, 1999.
WHEREAS, Chapter 28, Section 4240 of the Consolidated Laws of New York
permits the establishment of one or more separate accounts;
WHEREAS, it is desired that the Corporation have a funding vehicle for
its variable annuity contracts;
NOW, THEREFORE, BE IT
RESOLVED, that pursuant to Chapter 28, Section 4240 of the Consolidated
Laws of New York, a separate account referred to herein as "GALIC of
New York Separate Account I" ("Separate Account I") is hereby
established and empowered to:
a. to the extent required by the Investment Company Act of 1940,
register under such Act and make applications for such
exemptions or orders under such provisions thereof as may
appear to be necessary or desirable;
b. to the extent required by the Securities Act of 1933, effect
one or more registrations thereunder and, in connection with
such registrations, file one or more registration statements
thereunder, or amendments thereto, including any documents or
exhibits required as a part thereof;
c. provide for the sale of contracts issued by the Corporation as
the officers of the Corporation may deem necessary and
appropriate, to the extent such contracts provide for
allocation of amounts to Separate Account I;
d. provide for custodial or depository arrangements for assets
allocated to Separate Account I as the officers of the
Corporation may deem necessary and appropriate including self
custodianship and safekeeping arrangements by the Corporation;
e. select an independent public accountant to audit the books and
records of Separate Account I;
f. invest or reinvest the assets of Separate Account I in
securities issued by one or more investment companies
registered under the Investment Company Act of 1940 or other
appropriate securities, as the officers of the Corporation may
designate;
g. divide Separate Account I into divisions and subdivisions with
each division or subdivision investing in shares of designated
investment companies or portfolios or classes thereof or other
appropriate securities; and
h. perform such additional functions and take such additional
action as may be necessary or desirable to carry out the
foregoing and the intent and purpose thereof;
FURTHER RESOLVED, that the assets of Separate Account I shall be
derived solely from (a) sale of variable annuity products, (b) funds
corresponding to dividend accumulation with respect to investment of such
assets, and (c) advances made by the Corporation in connection with the
operation of Separate Account I;
FURTHER RESOLVED, that pursuant to Article 42, Section 4240 of the New
York Statues, the assets of Separate Account I shall be legally segregated and
that part of the assets of Separate Account I with a value equal to the reserves
and other variable annuity contract liabilities shall not be chargeable with the
liabilities arising out of any other business of the Corporation;
FURTHER RESOLVED, that this Corporation shall maintain in Separate
Account I assets with a fair market value at least equal to the statutory
valuation reserves for the variable annuity contracts;
FURTHER RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized in their discretion as they may deem appropriate from
time to time in accordance with applicable laws and regulations (a) to modify or
eliminate any such divisions or subdivisions, (b) to change the designation of
Separate Account I to another designation, (c) to designate further any division
or subdivision thereof, and d) to deregister Separate Account I under the
Investment Company Act of 1940 and to deregister the contracts or units of
interest thereunder under the Securities Act of 1933;
FURTHER RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized to invest cash from the Corporation's general account
in Separate Account I or in any division thereof as may be deemed necessary or
appropriate to facilitate the commencement of Separate Account I's operations or
to meet any minimum capital requirements under the Investment Company Act of
1940, and to transfer cash or securities from time to time between the
Corporation's general account and Separate Account I as deemed necessary or
appropriate so long as such transfers are not prohibited by law and are
consistent with the terms of the variable annuity contracts issued by the
Corporation providing for allocations to Separate Account I;
FURTHER RESOLVED, that the income, gains, and losses (whether or not
realized) from assets allocated to Separate Account I shall, in accordance with
any variable annuity contracts issued by the Corporation providing for
allocations to Separate Account I, be credited to or charged against such
Separate Account without regard to the other income, gains, or losses of the
Corporation;
FURTHER RESOLVED, that authority is hereby delegated to the Chief
Executive Officer or the President of the Corporation to adopt procedures
providing for, among other things, criteria by which the Corporation shall
institute procedures to provide for a pass-through of voting rights to the
owners of variable annuity contracts issued by the Corporation providing for
allocation to Separate Account I with respect to the shares of any investment
companies which are held in Separate Account I;
FURTHER RESOLVED, that the officers of the Corporation are authorized
and directed, with the assistance of accountants, legal counsel, and other
consultants, to prepare and execute any necessary agreements to enable Separate
Account I to invest or reinvest the assets of Separate Account I in securities
issued by any investment companies registered under the Investment Company Act
of 1940, or other appropriate securities as the officers of the Corporation may
designate pursuant to the provisions of the variable annuity contracts issued by
the Corporation providing for allocations to Separate Account I;
FURTHER RESOLVED, the fiscal year of Separate Account I shall end on
the 31st day of December each year;
FURTHER RESOLVED, that the officers of the Corporation, with the
assistance of accountants, legal counsel, and other consultants, are authorized
to prepare, execute, and file all periodic reports required under the Investment
Company Act of 1940 and the Securities Exchange Act of 1934;
FURTHER RESOLVED, that the Corporation may register under the
Securities Act of 1933 variable annuity contracts, or units of interest
thereunder, under which amounts will be allocated by the Corporation to Separate
Account I to support reserves for such contracts and, in connection therewith,
that the officers of the Corporation be, and each of them hereby is, authorized,
with the assistance of accountants, legal counsel, and other consultants, to
prepare, execute, and file with the Securities and Exchange Commission, in the
name and on behalf of the Corporation, registration statements under the
Securities Act of 1933, including prospectuses, supplements, exhibits, and other
documents relating thereto, and amendments to the foregoing, in such form as the
officer executing the same may deem necessary or appropriate;
<PAGE>
FURTHER RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized, with the assistance of accountants, legal counsel,
and other consultants, to take all actions necessary to register Separate
Account I as a unit investment trust under the Investment Company Act of 1940
and to take such related actions as they deem necessary and appropriate to carry
out the foregoing;
FURTHER RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized to prepare, execute, and file, with the assistance of
accountants, legal counsel, and other consultants, with the Securities and
Exchange Commission applications and amendments thereto for such exemptions from
or orders under the Investment Company Act of 1940, and to request from the
Securities and Exchange Commission no action and interpretative letters as they
may from time to time deem necessary or desirable;
FURTHER RESOLVED, that the General Counsel of the Corporation is hereby
appointed as agent for service under any such registration statement and is duly
authorized to receive communications and notices from the Securities and
Exchange Commission with respect thereto and to exercise powers given to such
agent by the Securities Act of 1933 and the rules thereunder, and any other
necessary acts;
FURTHER RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized, with the assistance of accountants, legal counsel,
and other consultants, to effect in the name of and on behalf of the Corporation
all such registrations, filings, and qualifications under blue sky or other
applicable securities laws and regulations and under insurance securities laws
and insurance laws and regulations of such states and other jurisdictions, as
they may deem necessary or appropriate with respect to the Corporation and with
respect to any variable annuity contracts under which amounts will be allocated
by the Corporation to Separate Account I to support reserves for such contracts;
such authorization shall include registration, filing and qualification of the
Corporation and of said contracts, as well as registration, filing, and
qualification of officers, employees, and agents of the Corporation as brokers,
dealers, agents, salesmen, or otherwise; and such authorization shall also
include, in connection therewith, authority to prepare, execute, acknowledge,
and file all such applications, applications for exemptions, certificates,
affidavits, covenants, consents to service of process, and other instruments and
to take all such action as the officer executing the same or taking such action
may deem necessary or desirable; and
<PAGE>
FURTHER RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized to execute and deliver all such documents and papers
and to do or cause to be done all such acts and things as they may deem
necessary or desirable to carry out the foregoing resolutions and the intent and
purpose thereof.
Signed this 7th day of May, 1999.
<PAGE>
- -------------------------------------- ------------------------------------
Robert A. Adams, Director Keith A. Jensen, Director
- -------------------------------------- ------------------------------------
S. Craig Lindner, Director James M. Mortensen, Director
- -------------------------------------- ------------------------------------
William J. Maney, Director Charles R. Scheper, Director
- -------------------------------------- ------------------------------------
Mark F. Muething, Director Jeffrey S. Tate, Director
- --------------------------------------
Michael J. O'Connor, Director
DISTRIBUTION AGREEMENT
AGREEMENT dated as of February 17, 1999, by and between GREAT AMERICAN
LIFE INSURANCE COMPANY of NEW YORK ("GALIC of NY"), a New York insurance
company, and AAG SECURITIES, INC. ("AAGS"), an Ohio corporation.
WITNESSETH:
WHEREAS, AAGS is a broker-dealer that engages in the distribution of
investment products; and
WHEREAS, AAGS, together with AAG INSURANCE AGENCY, INC. and certain
affiliated insurance agencies ("AAGI"), an insurance agency that is affiliated
with AAGS, desires to distribute variable annuity contracts and variable life
insurance contracts (collectively, "variable insurance products") offered by
GALIC of NY; and
WHEREAS, GALIC of NY desires to issue certain variable insurance
products described more fully below to the public through AAGS acting as the
principal underwriter and AAGI acting as the principal insurance agent for such
products;
NOW, THEREFORE, in consideration of their mutual promises, GALIC of NY
and AAGS hereby agree as follows:
1. Additional Definitions.
a. Contracts -- The class or classes of variable annuity contracts
set forth on Schedule 1 to this Agreement as in effect at the time
this Agreement is executed, and such other classes of variable
insurance products that may be added to Schedule 1 from time to
time in accordance with Section 14.b of this Agreement, and
including any riders to such contracts and any other contracts
offered in connection therewith. For this purpose and under this
Agreement generally, a "class of Contracts" shall mean those
Contracts issued by GALIC of NY on the same policy form or forms
and covered by the same Registration Statement.
<PAGE>
b. Registration Statement -- At any time that this Agreement is in
effect, each currently effective registration statement, or
currently effective post-effective amendment thereto, relating to
a class of Contracts, including financial statements included in,
and all exhibits to, such registration statement or post-effective
amendment. For purposes of Section 12 of this Agreement, the term
"Registration Statement" means any document which is or at any
time was a Registration Statement within the meaning of this
Section 1.b.
c. Prospectus -- The prospectus and statement of additional
information, if any, included within a Registration Statement,
except that, if the most recently filed prospectus and statement
of additional information filed pursuant to Rule 497 under the
1933 Act subsequent to the date on which a Registration Statement
became effective differs from the prospectus and statement of
<PAGE>
additional information included within such Registration Statement
at the time it became effective, the term "Prospectus" shall refer
to the most recently filed prospectus and statement of additional
information filed under Rule 497 under the 1933 Act, from and
after the date on which they each shall have been filed. For
purposes of Section 12 of this Agreement, the term "any
Prospectus" means any document which is or at any time was a
Prospectus within the meaning of this Section 1.c.
d. Fund -- An investment company which is included in the Variable
Account and is an investment alternative under a Contract.
e. Variable Account -- A separate account supporting a class or
classes of Contracts and specified on Schedule 2 as in effect at
the time this Agreement is executed, or as it may be amended from
time to time in accordance with Section 14.b of this Agreement.
f. 1933 Act -- The Securities Act of 1933, as amended.
g. 1934 Act -- The Securities Exchange Act of 1934, as amended.
h. 1940 Act -- The Investment Company Act of 1940, as amended.
i. SEC -- The Securities and Exchange Commission.
j. NASD -- The National Association of Securities Dealers, Inc.
<PAGE>
k. Regulations -- The rules and regulations promulgated by the SEC
under the 1933 Act, the 1934 Act and the 1940 Act as in effect at
the time this Agreement is executed or thereafter promulgated.
l. Distributor -- A person registered as a broker-dealer and licensed
as a life insurance agent or affiliated with a person so licensed,
and authorized to distribute the Contracts pursuant to a sales
agreement as provided for in Section 2 of this Agreement.
m. Intermediary Distributor -- A Distributor authorized to recruit
other persons to become Distributors pursuant to a sales agreement
as provided for in Section 2 of this Agreement.
n. Affiliate -- With respect to a person, any other person
controlling, controlled by, or under common control with, such
person.
o. Representative -- When used with reference to AAGS, AAGI, a
Distributor or GALIC of NY, an individual who is an associated
person, as that term is defined in the 1934 Act, thereof.
p. Application -- An application for a Contract.
q. Premium -- A payment made under a Contract by an applicant or
purchaser to purchase benefits under the Contract.
<PAGE>
r. Customer Service Center -- GALIC of NY Annuity Service Center, 250
East Fifth Street, Cincinnati, Ohio 45202, or such other location
as may be designated in writing from time to time by GALIC of NY.
s. Agent's Manual -- The Agent's Manual attached hereto as Exhibit B.
2. Distribution Activities
a. Authority GALIC of NY authorizes AAGS on an exclusive basis, and
AAGS accepts such authority, subject to the registration
requirements of the 1933 Act and the 1940 Act and the provisions
of the 1934 Act, to be the distributor and principal underwriter
of the Contracts. GALIC of NY hereby authorizes AAGS to solicit
Applications and Premiums directly from customers and prospective
customers and to select all persons who will be authorized to
engage in solicitation activities with respect to the Contracts,
such selection activity to include the recruitment and appointment
of third parties as Distributors which in turn may be authorized
as Intermediary Distributors to engage in solicitation activities
involving the solicitation of Applications and Premiums directly
from customers and prospective customers and/or as Intermediary
Distributors to recruit other third parties to act as
Distributors, in each case as AAGS and AAGI may in their sole
discretion so provide or limit. AAGS shall enter into separate
written sales agreements with such Distributors. Such sales
agreements shall be substantially in the form attached to this
Agreement as Exhibit A, but may include such additional or
alternative terms and conditions that are not otherwise
inconsistent with this Agreement, subject to GALIC of NY's review
and prior written consent, which consent shall not be unreasonably
withheld.
<PAGE>
AAGS is hereby vested with power and authority to select and
recommend AAGS Representatives, and to authorize a Distributor to
select and recommend Distributor Representatives, for appointment
as agents of GALIC of NY, and only Representatives so recommended
by AAGS or a Distributor shall become agents of GALIC of NY with
authority to engage in solicitation activities with respect to the
Contracts. AAGS shall be solely responsible for background
investigations of the AAGS Representatives to determine their
qualifications, good character, and moral fitness to sell the
Contracts. GALIC of NY shall appoint in the appropriate states or
jurisdictions such selected and recommended agents, provided that
GALIC of NY reserves the right, which right shall not be exercised
unreasonably, to refuse to appoint as agent any AAGS
Representative or Distributor Representative, or, once appointed,
to terminate the same at any time with or without cause. No other
individuals, persons or entities shall have authority to engage in
solicitation activities with respect to the Contracts, unless
expressly approved in writing by AAGS, in its sole discretion,
except to the extent permitted by the following paragraph.
<PAGE>
AAGS shall use its best efforts to market the Contracts
actively, directly or through Distributors, subject to applicable
material market and regulatory conditions.
AAGS and AAGS Representatives shall not have authority, and
shall not grant authority to Distributors or Distributor
Representatives, on behalf of GALIC of NY: to make, alter or
discharge any Contract or other contract entered into pursuant to
a Contract; to waive any Contract forfeiture provision; to extend
the time of paying any Premium; or to receive any monies or
Premiums (except for the sole purpose of forwarding monies or
Premiums to GALIC of NY). AAGS shall not expend, nor contract for
the expenditure of, the funds of GALIC of NY. AAGS shall not
possess or exercise any authority on behalf of GALIC of NY other
than that expressly conferred on AAGS by this Agreement.
b. Solicitation Activities, Applications and Premiums
Solicitation activities shall be subject to applicable laws and
regulations, the Agent's Manual, and the rules set forth herein.
(1) GALIC of NY shall forward to AAGS Applications and other
materials for use by AAGS and the Distributors in their
solicitation activities with respect to the Contracts. GALIC
of NY shall notify AAGS in writing of those states or
jurisdictions which require delivery of a statement of
additional information with a prospectus to a prospective
purchaser.
(2) AAGS shall require that AAGS Representatives appointed by
GALIC of NY as agents not make recommendations to an applicant
to purchase a Contract in the absence of reasonable grounds to
believe that the purchase of the Contract is suitable for the
applicant. While not limited to the following, a determination
of suitability shall be based on information supplied to an
AAGS Representative after a reasonable inquiry concerning the
applicant's insurance and investment objectives and financial
situation and needs.
(3) All Premiums paid by check or money order that are collected
by AAGS or any AAGS Representative shall be remitted promptly
in full, together with any Applications, forms and any other
required documentation, to the Customer Service Center. Checks
or money orders in payment of Premiums shall be drawn to the
order of "Great American Life Insurance
<PAGE>
Company of New York." Premiums may be transmitted by wire
order from AAGS to the Customer Service Center in accordance
with the procedures set forth in the Agent's Manual. If any
Premium is held at any time by AAGS, AAGS shall hold such
Premium in a fiduciary capacity and such Premium shall be
remitted promptly to GALIC of NY. All such Premiums, whether
by check, money order or wire, shall be the property of GALIC
of NY.
(4) AAGS acknowledges that GALIC of NY shall have the
unconditional right to reject, in whole or in part, any
Application. In the event an Application is rejected, any
Premium submitted therewith shall be returned by GALIC of NY
to the applicant. GALIC of NY shall notify AAGS and, if
applicable, the Distributor who submitted the Application, of
such action. In the event that a purchaser exercises his right
to cancel under his Contract, any amount to be refunded as
provided in such Contract shall be so refunded to the
purchaser by GALIC of NY. GALIC of NY shall notify AAGS and,
if applicable, the Distributor who solicited the Contract, of
such action.
(5) AAGS shall not encourage a prospective applicant to surrender
or exchange an insurance contract in order to
<PAGE>
purchase a Contract, nor shall AAGS encourage any
Contractholder to surrender or exchange a Contract in order to
purchase another insurance contract. AAGS shall require,
through all sales agreements entered into pursuant to Section
2.a of this Agreement, that each Distributor likewise agree
not to encourage a prospective applicant to surrender or
exchange any insurance contract in order to purchase a
Contract, nor to encourage a Contractholder to surrender or
exchange a Contract in order to purchase another insurance
contract.
c. Independent Contractor
AAGS shall act as an independent contractor in the performance of
its duties and obligations under this Agreement and nothing herein
contained shall constitute AAGS or AAGS Representatives or
employees or the Distributors or their respective Representatives
or employees as employees of GALIC of NY in connection with the
distribution of the Contracts.
d. Supervision and 1934 Act Compliance
AAGS shall train, supervise and be solely responsible for the
conduct of AAGS Representatives in their solicitation of
<PAGE>
Applications and Premiums, and shall supervise their compliance
with applicable rules and regulations of any securities regulatory
agencies that have jurisdiction over variable insurance product
activities. AAGS understands and acknowledges that neither it nor
its Representatives is authorized by GALIC of NY to give any
information or make any representation in regard to a class of
Contracts in connection with the offer or sale of such class of
Contracts that is not in accordance with the then-currently
effective Prospectus or for such class of Contracts or in the
then-currently effective prospectus or statement of additional
information for the Funds, or in current advertising materials for
such class of Contracts authorized by GALIC of NY.
GALIC of NY, as agent for AAGS, shall confirm to each
applicant for and purchaser of a Contract in accordance with Rule
10b-10 under the 1934 Act acceptance of Premiums and such other
transactions as are required by Rule 10b-10 or administrative
interpretations thereunder. GALIC of NY shall maintain and
preserve such books and records with respect to such confirmations
in conformity with the requirements of Rules 17a-3 and 17a-4 under
the 1934 Act to the extent such requirements apply. GALIC of NY
shall maintain all such books and records and hold such books and
records on behalf of and as agent for AAGS whose property they are
and shall remain, and acknowledges that such books and records are
<PAGE>
at all times subject to inspection by the SEC in accordance with
Section 17(a) of the 1934 Act, the NASD and any state agency which
has jurisdiction.
3. Marketing Materials
GALIC of NY shall be primarily responsible for the design
and preparation of all promotional, sales and advertising material
relating to the Contracts. It is understood that as a general
matter GALIC of NY shall initiate and design all forms of
promotional, sales and advertising material for the Contracts.
Prior to any use with members of the public, the following
procedures shall be observed:
a. GALIC of NY shall provide to AAGS copies of all promotional, sales
and advertising material developed by GALIC of NY for AAGS' review
and written approval, and AAGS shall be given a reasonable amount
of time to complete its review.
b. If any such promotional, sales or advertising material names a
Fund or a Fund's investment adviser, GALIC of NY shall then
furnish such material to such Fund or such Fund's distributor, and
approval shall be obtained from such Fund or such Fund's
distributor before use.
c. The parties shall respond on a prompt and timely basis in
approving any such material and shall act reasonably in connection
therewith.
<PAGE>
d. AAGS shall be responsible for filing such material it develops, as
required, with the NASD and any state securities regulatory
authorities.
e. GALIC of NY shall be responsible for filing all promotional, sales
or advertising material, as required, with any state insurance
regulatory authorities.
f. The parties shall notify each other expeditiously of any comments
provided by the NASD or any securities or insurance regulatory
authority on such material, and will cooperate expeditiously in
resolving and implementing any comments, as applicable.
4. Compensation and Expenses
a. GALIC of NY shall pay commissions to AAGS on Premiums paid under
Contracts sold pursuant to this Agreement and any sales agreements
entered into pursuant to Section 2 of this Agreement in the
amounts set forth on Schedule 2. AAGS shall be responsible for all
tax reporting information which AAGS is required to provide under
applicable tax law to its agents, Representatives or employees
with respect to the Contracts.
b. With respect to this Agreement, GALIC of NY shall be obligated to
pay all expenses in connection with:
(1) the preparation and filing of each Registration Statement
(including each pre-effective and post-effective amendment
<PAGE>
thereto) and the preparation and filing of each Prospectus
(including any preliminary and each definitive Prospectus);
(2) the preparation, underwriting, issuance and administration of
the Contracts;
(3) any registration, qualification or approval of the Contracts
for offer and sale required under the securities, blue-sky
laws or insurance laws of the states and other jurisdictions
in the Territory;
(4) the expenses of printing the Prospectuses and the Contracts
and the Funds (any supplements thereto) for distribution to
prospective customers;
(5) all registration fees for the Contracts payable to the SEC and
the NASD;
(6) the printing of definitive Prospectuses for the Contracts and
any supplements thereto for distribution to existing
Contractowners;
c. AAGS shall be obligated to pay the following expenses related to
its distribution of the Contracts:
(1) the compensation of AAGS Representatives and employees and any
Distributors;
(2) expenses associated with the initial licensing and training of
AAGS Representatives and other employees involved in the
distribution of the Contracts;
(3) the costs of any promotional, sales and advertising material
that AAGS develops for its use in connection with the sale of
<PAGE>
the Contracts; and
(4) any other expenses incurred by AAGS or its Representatives or
employees for the purpose of carrying out the obligations of
AAGS hereunder.
d. Other than as specifically provided in this Agreement, GALIC of NY
shall pay all expenses that it incurs in connection with this
Agreement and AAGS shall pay all expenses that it incurs in
connection with this Agreement; it being understood that neither
AAGS nor AAGI shall be responsible for any expenses relating to
the Contracts or the processing of Contracts, Premiums or
Applications, including without limitation any expenses incurred
in connection with the return of Premiums solicited by
Distributors for Applications rejected or not timely received by
GALIC of NY, or relating to any of the matters or acts
contemplated by this Agreement, except to the extent expressly set
forth herein.
5. Representations and Warranties of GALIC of NY
GALIC of NY represents and warrants to AAGS, on the
effective date of each Registration Statement for the Contracts
(or for each class of Contracts) and at each time that AAGS sells
<PAGE>
a Contract and, with respect to Sections 5.g., 5.i., and 5.j.
below, also on the date of this Agreement, as follows:
a. Such Registration Statement has been declared effective by the SEC
or has become effective in accordance with the Regulations.
b. Such Registration Statement and the related Prospectus comply in
all material respects with the provisions of the 1933 Act and the
1940 Act and the Regulations, and neither the Registration
Statement nor the Prospectus contains an untrue statement of a
material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, in light of the circumstances in which they were made;
provided, however, that none of the representations and warranties
in this Section 5.b. shall apply to statements or omissions from a
Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to GALIC of NY in writing by
AAGS expressly for use in such Registration Statement.
c. GALIC of NY has not received any notice from the SEC with respect
to such Registration Statement pursuant to Section 8(e) of the
1940 Act and no stop order under the 1933 Act has been issued and
no proceeding therefor has been instituted or threatened by the
SEC.
<PAGE>
d. The auditors who certified the financial statements included in
such Registration Statement and the related Prospectus are
independent public auditors as required by the 1933 Act and the
Regulations.
e. The financial statements included in such Registration Statement
present fairly the respective financial positions of GALIC of NY
and the Variable Account (as applicable) at the dates indicated;
and such financial statements have been prepared in conformity
with generally accepted accounting principles in the United States
applied on a consistent basis.
f. Subsequent to the respective dates as of which information is
given in such Registration Statement or the related Prospectus,
there has not been any material adverse change in the condition,
financial or otherwise, of GALIC of NY or the Variable Account (as
applicable) which would cause such information to be materially
misleading.
g. GALIC of NY has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of New
York with full power and authority to own, lease and operate its
properties and conduct its business in the manner described in
<PAGE>
such Registration Statement, is duly qualified to transact the
business of a life insurance company, and is in good standing, in
New York and each other state or jurisdiction in which the
Contracts will be offered for sale.
h. The form of the Contracts has been approved to the extent required
by the New York Insurance Commissioner and by the governmental
agency responsible for regulating insurance companies in each
other state or jurisdiction in which the Contracts will be offered
for sale.
i. The execution and delivery of this Agreement and the consummation
of the transactions contemplated herein have been duly authorized
by all necessary corporate action by GALIC of NY, and when so
executed and delivered this Agreement shall be the valid and
binding obligation of GALIC of NY enforceable in accordance with
its terms. The consummation of the transactions contemplated by
this Agreement, and the fulfillment of the terms of this
Agreement, shall not conflict with, result in any breach of any of
<PAGE>
the terms and provisions of, or constitute (with or without notice
or lapse of time) a default under, the articles of incorporation
or code of regulations of GALIC of NY, or any indenture,
agreement, mortgage, deed of trust, or other instrument to which
GALIC of NY is a party or by which it is bound, or violate any
law, or, to the best of GALIC of NY's knowledge, any order, rule
or regulation applicable to GALIC of NY of any court or of any
federal or state regulatory body, administrative agency or any
other governmental instrumentality having jurisdiction over GALIC
of NY or any of its properties.
j. No consent, approval, authorization or order of any court or
governmental authority or agency is required for the issuance or
sale of the Contracts or for the consummation of the transactions
contemplated by this Agreement, that has not been obtained.
k. GALIC of NY has filed with the SEC all statements and other
documents required for registration under the provisions of the
1940 Act and the Regulations thereunder, of the Variable Account
supporting the Contracts, and such registration has been effected;
further, there are no contracts or documents of GALIC of NY which
are required to be filed as exhibits to such Registration
Statement by the 1933 Act, the 1940 Act or the Regulations which
have not been so filed.
l. GALIC of NY has obtained all exemptive or other orders of the SEC
necessary to make the public offering and consummate the sale of
such Contracts pursuant to this Agreement and to permit the
operation of the Variable Account supporting such Contracts as
contemplated in the related Prospectus.
<PAGE>
m. Such class of Contracts has been duly authorized by GALIC of NY
and conforms to the descriptions thereof in the Registration
Statement for such class of Contracts and the related Prospectus
and, when issued as contemplated by such Registration Statement,
shall constitute legal, validly issued and binding obligations of
GALIC of NY in accordance with their terms.
6. Undertakings of GALIC of NY
a. GALIC of NY shall use its best efforts:
(1) to maintain the registration of the Contracts with the SEC and
any state securities commissions of any state or other
jurisdiction in which the Contracts will be offered for sale
where the securities or blue-sky laws of such state or other
jurisdiction require registration of the Contracts, including
without limitation using its best efforts to prevent a stop
order from being issued or if a stop order has been issued to
cause such stop order to be withdrawn;
(2) to gain approval of the Contract forms where required under
the insurance laws and regulations of each state or other
jurisdiction in which the Contracts will be offered for sale;
and
(3) to keep such registrations and approvals in effect thereafter
so long as the Contracts are outstanding.
b. GALIC of NY shall take all action required to cause the Contracts
to comply, and to continue to comply, as annuity contracts and as
registered securities under applicable laws and regulations, and
to cause each Registration Statement and each related Prospectus
to comply, and to continue to comply, with:
(1) all applicable federal laws and regulations; and
(2) all applicable laws and regulations of each state and other
jurisdiction in which the Contracts will be offered for sale.
c. GALIC of NY shall notify AAGS immediately or in any event as soon
as possible under the circumstances:
(1) When a Registration Statement has become effective or any
post-effective amendment with respect to a Registration
Statement becomes effective thereafter;
(2) Of any request by the SEC for any amendment to a Registration
Statement, for any supplement to a Prospectus, or for
additional information;
(3) Of any event which makes any material statement made in a
Registration Statement or a Prospectus untrue in any material
<PAGE>
respect or results in a material omission in a Registration
Statement or a Prospectus;
(4) Of the issuance by the SEC of any stop order with respect to a
Registration Statement or any amendment thereto, or the
initiation of any proceedings for that purpose or for any
other purpose relating to the registration and/or offering of
the Contracts;
(5) In which states or jurisdictions registration of the Contracts
is required under the securities or blue-sky laws, and when
such registration(s) have become effective;
(6) In which states or jurisdictions approval of the Contract
forms is required under the applicable insurance laws and
regulations, and when such approvals have been obtained; and
(7) In what states or jurisdictions the Contracts may not be
lawfully sold.
d. GALIC of NY shall furnish to AAGS without charge promptly after
filing five (5) complete copies of each Registration Statement and
any pre-effective or post-effective amendment thereto, including
financial statements and all exhibits not incorporated therein by
reference.
e. Schedule 3 attached to this Agreement is a list provided by GALIC
<PAGE>
of NY of all states and jurisdictions in which the Contracts can
lawfully be offered as of the date of this Agreement. GALIC of NY
shall promptly notify AAGS of any change on Schedule 3.
f. GALIC of NY shall provide AAGS, without charge, with as many
copies of each Prospectus (and any amendments or supplements to
such Prospectus) as AAGS may reasonably request.
g. GALIC of NY shall timely file all required reports, statements and
amendments required to be filed by or for GALIC of NY and each
Variable Account under the 1933 Act, the 1934 Act, and/or the 1940
Act or the Regulations and under applicable state insurance
statutes and regulations.
h. GALIC of NY shall deliver to AAGS, as soon as practicable after it
becomes available, the Quarterly Statements, Annual Statement for
GALIC of NY and for each Variable Account in the form filed with
the State of New York.
i. GALIC of NY shall provide AAGS access to such records, officers
and employees of GALIC of NY at reasonable times as is necessary
to enable AAGS to fulfill its obligation, as the underwriter under
the 1933 Act for the Contracts, to perform due diligence and to
use reasonable care.
<PAGE>
j. GALIC of NY shall have the responsibility for maintaining the
appointment records of all agents appointed by GALIC of NY to
distribute the Contracts.
7. Conditions to Obligations of AAGS
The obligations of AAGS hereunder are subject to the accuracy of the
representations and warranties of GALIC of NY contained in this
Agreement, to the performance by GALIC of NY of its obligations
hereunder, and to the condition that prior to the time that AAGS begins
offering the Contracts and each time, during the period in which AAGS
is offering the Contracts, that an amendment to a Registration
Statement becomes effective, AAGS shall have received an officer's
certificate executed by a senior executive officer of GALIC of NY to
the effect that the representations and warranties set forth in Section
5 of this Agreement are true and correct;
8. Representations and Warranties of AAGS
AAGS represents and warrants to GALIC of NY, on the date hereof and at
each time that AAGS sells a Contract, as follows:
a. AAGS has taken all actions including, without limitation, those
necessary under its articles of incorporation, code of regulations
and applicable state corporate law, necessary to authorize the
execution, delivery and performance of this Agreement and all
transactions contemplated hereunder.
<PAGE>
b. AAGS is and shall remain registered during the term of this
Agreement as a broker-dealer under the 1934 Act, is a member with
the NASD, and is duly registered under applicable state securities
laws.
c. AAGS shall solicit, and shall instruct Distributors to solicit,
sales of the Contracts only in those states or jurisdictions
listed on Schedule 3 as in effect at the time of solicitation.
d. AAGS is and shall remain during the term of this Agreement in
compliance with Section 9(a) of the 1940 Act.
9. Undertakings of AAGS
a. All solicitation and sales activities engaged in by AAGS and the
AAGS Representatives in regard to the Contracts shall be in
compliance with all applicable federal and state securities laws
and regulations, as well as all applicable insurance laws and
regulations. No AAGS Representative shall solicit the sale of a
Contract unless at the time of such solicitation such individual
is:
(1) Properly licensed by the NASD and all other applicable state
insurance and securities regulatory authorities; and
(2) Appointed as an insurance agent of GALIC of NY except as may
be otherwise agreed to by GALIC of NY.
<PAGE>
b. Neither AAGS nor any AAGS Representative shall give any
information or make any representation in regard to a class of
Contracts in connection with the offer or sale of such class of
Contracts that is not in accordance with the then-currently
effective Prospectus for such class of Contracts, or in the
then-currently effective prospectus or statement of additional
information for a Fund, or in current advertising materials for
such class of Contracts authorized by GALIC of NY.
c. Neither AAGS nor any AAGS Representative shall offer, attempt to
offer, or solicit Applications for the Contracts or deliver the
Contracts, in any state or other jurisdiction as to which GALIC of
NY has notified AAGS in accordance with Section 6.c.(7) of this
Agreement that such Contracts may not legally be sold or offered
for sale.
10. Records
GALIC of NY and AAGS each shall maintain such accounts, books and other
documents as are required to be maintained by each of them by
applicable laws and regulations and shall preserve such accounts, books
and other documents for the periods prescribed by such laws and
<PAGE>
regulations. The accounts, books and records of GALIC of NY, the
Variable Account(s) and AAGS as to all transactions hereunder shall be
maintained so as to clearly and accurately disclose the nature and
details of the transactions, including such accounting information as
necessary to support the reasonableness of the amounts paid by GALIC of
NY hereunder. Each party or designee thereof shall have the right to
inspect and audit such accounts, books and records of the other party
during normal business hours upon reasonable written notice to the
other party. Each party shall keep confidential all information
obtained pursuant to such an inspection or audit, and shall disclose
such information to third parties only upon receipt of written
authorization from the other party, except as required by law.
11. Examinations, Investigations and Proceedings
a. Cooperation
GALIC of NY and AAGS shall cooperate fully in any insurance
regulatory examination or investigation or proceeding or judicial
proceeding arising in connection with the offering, sale or
distribution of the Contracts distributed under this Agreement.
Further, GALIC of NY and AAGS shall cooperate fully in any
securities regulatory investigation or proceeding or judicial
proceeding with respect to GALIC of NY, AAGS, their Affiliates and
<PAGE>
their agents, Representatives or employees to the extent that such
investigation or proceeding is in connection with the offering,
sale or distribution of the Contracts distributed under this
Agreement. Without limiting the foregoing, GALIC of NY and AAGS
shall notify each other promptly of any customer complaint or
notice of any regulatory investigation or proceeding or judicial
proceeding received by either party with respect to GALIC of NY,
AAGS or any of their Affiliates, agents, Representatives or
employees or which may affect GALIC of NY's issuance of any
Contract marketed under this Agreement.
b. Customer Complaint
In the case of a customer complaint, AAGS and GALIC of NY shall
cooperate in investigating such complaint and any response by
either party to such complaint shall be sent to the other party
for written approval not less than five business days prior to its
being sent to the customer or any regulatory authority, except
that if a more prompt response is required, the proposed response
shall be communicated by telephone or facsimile. In any event,
neither party shall release any such response without the other
party's prior written approval. GALIC of NY shall maintain all
complaint records by applicable regulations and applicable
insurance laws and regulations. AAGS shall maintain all records
required by the rules and regulations of the NASD.
12. Indemnification
a. By GALIC of NY
GALIC of NY shall indemnify and hold harmless AAGS and each
<PAGE>
person who controls or is associated with AAGS within the meaning
of such terms under the federal securities laws, and any officer,
director, employee or agent of the foregoing, against any and all
losses, claims, damages or liabilities, joint or several
(including any investigative, legal and other expenses reasonably
incurred in connection with, and any amounts paid in settlement
of, any action, suit or proceeding or any claim asserted), to
which AAGS and/or any such person may become subject, under any
statute or regulation, any NASD rule or interpretation, at common
law or otherwise, insofar as such losses, claims, damages or
liabilities:
(1) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact or omission or alleged
omission to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, in light of the circumstances in which they were
made, contained in any (i) Registration Statement or in any
Prospectus; or (ii) blue-sky application or other document
executed by GALIC of NY specifically for the purpose of
qualifying any or all of the Contracts for sale under the
<PAGE>
securities laws of any jurisdiction; provided that GALIC of NY
shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based
upon, an untrue statement or alleged untrue statement or
omission or alleged omission made in reliance upon information
furnished in writing to GALIC of NY by AAGS specifically for
use in the preparation of any such Registration Statement or
any such blue-sky application or any amendment thereof or
supplement thereto; or.
(2) result because of the terms of any Contract or because of any
breach by GALIC of NY of any provision of this Agreement or of
any Contract or which proximately result from any activities
of GALIC of NY's officers, directors, employees or agents or
their failure to take any action in connection with the sale,
processing or administration of the Contracts; or
(3) result from any breach of any representation or warranty made
by GALIC of NY in this Agreement.
This indemnification agreement shall be in addition to any liability
that GALIC of NY may otherwise have; provided, however, that no person
shall be entitled to indemnification pursuant to this provision if such
loss, claim, damage or liability is due to the willful misfeasance, bad
faith, gross negligence or reckless disregard of duty by the person
<PAGE>
seeking indemnification.
b. By AAGS
AAGS shall indemnify and hold harmless GALIC of NY and each person who
controls or is associated with GALIC of NY within the meaning of such
terms under the federal securities laws, and any officer, director,
employee or agent of the foregoing, against any and all losses, claims,
damages or liabilities, joint or several (including any investigative,
legal and other expenses reasonably incurred in connection with, and
any amounts paid in settlement of, any action, suit or proceeding or
any claim asserted), to which GALIC of NY and/or any such person may
become subject under any statute or regulation, and NASD rule or
interpretation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities:
(1) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact or omission or alleged
omission to state a material fact required to be stated
therein or necessary in order to make the statements therein
not misleading, in light of the circumstances in which they
were made, contained in any (i) Registration Statement or in
any Prospectus (ii) blue-sky application or other document
executed by GALIC of NY specifically for the purpose of
<PAGE>
qualifying any or all of the Contracts for sale under the
securities laws of any jurisdiction; in each case to the
extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission made
in reliance upon information furnished in writing to GALIC of
NY by AAGS specifically for use in the preparation of any such
Registration Statement or any such blue-sky application or any
amendment thereof or supplement thereto, or
(2) result because of any use by AAGS or any AAGS Representative
of promotional, sales or advertising material not authorized
by GALIC of NY or any verbal or written misrepresentations by
AAGS or any AAGS Representative or any unlawful sales
practices concerning the Contracts by AAGS or any AAGS
Representative under federal securities laws or NASD
regulations, but not including state insurance laws compliance
with which is a responsibility of GALIC of NY under this
Agreement or otherwise; or
(3) result from any claims by agents or Representatives or
employees of AAGS for commissions or other compensation or
remuneration of any type; or
<PAGE>
(4) result from any breach by AAGS or any AAGS Representative of
any provision of this Agreement or any breach of any
representation or warranty made by AAGS in this Agreement.
This indemnification shall be in addition to any liability that AAGS
may otherwise have; provided, however, that no person shall be entitled
to indemnification pursuant to this provision if such loss, claim,
damage or liability is due to the willful misfeasance, bad faith, gross
negligence or reckless disregard of duty by the person seeking
indemnification.
c. General
After receipt by a party entitled to indemnification ("indemnified
party") under this Section 12 of notice of the commencement of any
action, if a claim in respect thereof is to be made against any person
obligated to provide indemnification under this Section 12
("indemnifying party"), such indemnified party shall notify the
indemnifying party in writing of the commencement thereof as soon as
practicable thereafter, provided that the omission to so notify the
indemnifying party shall not relieve the indemnifying party from the
liability under this Section 12, except to the extent that the omission
results in a failure of actual notice to the indemnifying party and
such indemnifying party is damaged solely as a result of this failure
to give such notice. The indemnifying party, upon the request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the
fees and disbursements of such counsel related to such proceeding. In
any such proceeding, any indemnified party shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless ( 1) the
indemnifying party and the indemnified party shall have mutually agreed
to the retention of such counsel or (2) the named parties to any such
proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. The indemnifying party
shall not be liable for any settlement of any proceeding effected
without its written consent but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party
shall indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment.
The indemnification provisions contained in this Section 12 shall
remain operative in full force and effect, regardless of (1) any
<PAGE>
investigation made by or on behalf of GALIC of NY or by or on behalf of
any controlling person thereof, (2) delivery of any Contracts and
Premiums therefor, and (3) any termination of this Agreement. A
successor by law of GALIC of NY or AAGS, as the case may be, shall be
entitled to the benefits of the indemnification provisions contained in
this Section 11.
13. Termination
a. This Agreement shall be effective upon execution by the parties
hereto and will remain in effect unless terminated, as provided in
this Section 13.
b. This Agreement shall terminate automatically if it is assigned by
a party without the prior written consent of the other party.
c. This Agreement may be terminated at the option of either party to
this Agreement upon the other party's material breach of any
provision of this Agreement or of any representation made in this
Agreement, unless such breach has been cured within 10 days after
receipt of notice of breach from the non-breaching party.
d. Upon termination of this Agreement all authorizations, rights and
obligations shall cease except: (1) the obligation to settle
accounts hereunder, including commissions on Premiums subsequently
received for Contracts in effect at the time of termination or
<PAGE>
issued pursuant to Applications received by GALIC of NY prior to
termination; and (2) the obligations contained in Sections 4, 6,
10, 11 and 12 hereof.
14. Miscellaneous
a. Binding Effect
Each party represents that the execution and delivery of this
Agreement and the consummation of the transactions contemplated
herein have been duly authorized by all necessary corporate action
by such party and when so executed and delivered this Agreement
shall be the valid and binding obligation of such party
enforceable in accordance with its terms. This Agreement shall be
binding on and shall inure to the benefit of the respective
successors and assigns of the parties hereto of the respective
successors and assigns of the parties hereto provided that neither
party shall assign this Agreement or any rights or obligations
hereunder without the prior written consent of the other party.
b. Amendment of Schedules
The parties to this Agreement may amend Schedules 1, 2 and 3 to
this Agreement from time to time to reflect additions of or
changes in any class of Contracts, Commissions or jurisdictions in
which Contracts may be offered and sold. The provisions of this
Agreement shall be equally applicable to each such class of
Contracts that may be added to the Schedules, unless the context
<PAGE>
otherwise requires. Any other change in the terms or provisions of
this Agreement shall be by written agreement between GALIC of NY
and AAGS.
c. Rights, Remedies, etc. are Cumulative
The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies
and obligations, at law or in equity, which the parties hereto are
entitled to under state and federal laws. Failure of either party
to insist upon strict compliance with any of the conditions of
this Agreement shall not be construed as a waiver of any of the
conditions, but the same shall remain in full force and effect. No
waiver of any of the provisions of this Agreement shall be deemed,
or shall constitute, a waiver of any other provisions, whether or
not similar, nor shall any waiver constitute a continuing waiver.
d. Notices.
All notices hereunder are to be made in writing and shall be
given:
If to GALIC of NY, to:
Great American Life Insurance Company of New York
250 East Fifth Street, 10th Floor
Cincinnati, Ohio 45202
Attention: General Counsel
If to AAGS, to:
AAG Securities, Inc.
250 East Fifth Street, 10th Floor
Cincinnati, Ohio 45202
Attention: President
<PAGE>
or such other address as such party may hereafter specify in
writing. Each such notice to a party shall be either hand
delivered or transmitted by registered or certified United States
mail with return receipt requested, and shall be effective upon
delivery.
e. Arbitration
Any controversy or claim arising out of relating to this
Agreement, or the breach hereof, shall be settled by arbitration
in the forum jointly selected by GALIC of NY and AAGS (but if
applicable law requires some other forum, then such other forum)
in accordance with the Commercial Arbitration Rules of the
American Arbitration Association, and judgment upon the award
rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof.
f. Interpretation; Jurisdiction
This Agreement constitutes the whole agreement between the parties
thereto with respect to the subject matter hereof, and supersedes
all prior oral or written understandings, agreements or
negotiations between the parties with respect to such subject
matter. No prior writings by or between the parties with respect
to the subject matter hereof shall be used by either party in
connection with the interpretation of any provision of this
Agreement. This Agreement shall be construed and its provisions
interpreted under and in accordance with the internal laws of the
State of Ohio without giving effect to principles of conflict of
laws.
<PAGE>
g. Severability
This is a severable Agreement. In the event that any provision of
this Agreement would require a party to take action prohibited by
applicable federal or state law or profit a party from taking
action required by applicable federal or state law, then it is the
intention of the parties hereto that such provision shall be
enforced to the extent permitted under the law, and, in any event,
that all other provisions of this Agreement shall remain valid and
duly enforceable as if the provision at issue had never been a
part hereof.
h. Section and Other Headings
The headings in this Agreement are included for convenience of
reference only and in no way define or delineate any of the
provisions hereof or otherwise affect their construction or
effect.
i. Counterparts
This Agreement may be executed in two or more counterparts, each
of which taken together shall constitute one and the same
instrument.
j. Regulation
This Agreement shall be subject to the provisions of the 1933 Act,
1934 Act and 1940 Act and the Regulations and the rules and
regulations of the NASD, from time to time in effect, including
such exemptions from the 1940 Act as the SEC may grant, and the
terms hereof shall be interpreted and construed in accordance
therewith.
IN WITNESS WHERE of, each party hereto represents that the officer signing this
Agreement on the party's behalf is duly authorized to execute this Agreement;
and the parties hereto have caused this Agreement to be duly executed by such
authorized officers on the date specified below.
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
By: --------------------------------------
Name: --------------------------------------
Title: --------------------------------------
AAG SECURITIES, INC.
By: --------------------------------------
Name: --------------------------------------
Title: --------------------------------------
<PAGE>
Schedule 1
Contracts Subject to Distribution Agreement
<TABLE>
<CAPTION>
================================= --------------------- ----------------------- =================================================
Contract Marketing NamePolicy Form Numbers
Endorsement Description
Numbers Of Endorsement
================================= --------------------- ----------------------- =================================================
<S> <C> <C> <C>
Commodore Navigator NY3332G99 NY3443GE99 IRA Endorsement For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3453GE99 Tax Sheltered Annuity Endorsement For Group
Master Contract
================================= --------------------- ----------------------- =================================================
" NY3463GE99 Qualified Loan Endorsement For Group Master
Contract
================================= --------------------- ----------------------- =================================================
" NY3483GE99 ROTH IRA Endorsement for Group Master contract
================================= --------------------- ----------------------- =================================================
" NY3349GE99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3513GE99 SIMPLE IRA Endorsement for Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3523GE99 Section 457 Governmental Plan Endorsement for
Group Master
================================= --------------------- ----------------------- =================================================
" NY3533GE99 Section 457(f) Governmental Plan Endorsement
For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3553GE99 Successor Owner Endorsement For Group Master
Contract
================================= --------------------- ----------------------- =================================================
NY3333C99 NY3444CE99 IRA Endorsement For Group Master Contract
- --------------------------------- --------------------- ----------------------- -------------------------------------------------
" NY3454CE99 Tax Sheltered Annuity Endorsement For
Certificate of Participation
- --------------------------------- --------------------- ----------------------- -------------------------------------------------
<PAGE>
================================= --------------------- ----------------------- =================================================
" NY3464CE99 Qualified Loan Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3484CE99 ROTH IRS Endorsement for Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3494CE99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3514CE99 SIMPLE IRA Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3524CE99 Section 457 Governmental Plan Endorsement For
Certificate of Participation
================================= --------------------- ----------------------- =================================================
" NY3534CE99 Section 457(f) Governmental Plan Endorsement
For Certificate of Participation
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" NY3554CE99 Successor Owner Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
NY3383Q99 NY3583E99 IRA Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3593E99 Tax Sheltered Annuity Endorsement For
Individual Qualified Contract
================================= --------------------- ----------------------- =================================================
" NY3603E99 Qualified Loan Endorsement For Individual
Qualified Contract
================================= --------------------- ----------------------- =================================================
NY3383Q99 NY3623E99 ROTH IRA Endorsement For Individual Qualified
Contract
<PAGE>
================================= --------------------- ----------------------- =================================================
" NY3633E99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3643E99 Employer Plan Endorsement For Individual
Qualified Contract
================================= --------------------- ----------------------- =================================================
" NY3653E99 SIMPLE IRA Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3663E99 Section 457 Governmental Plan Endorsement For
Individual Qualified Contract
================================= --------------------- ----------------------- =================================================
NY3382NQ99 NY3683E99 Successor Owner Endorsement For Individual
Contract
================================= --------------------- ----------------------- =================================================
" NY3703E99 Unisex Endorsement For Individual Nonqualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3604E99 Nonqualified Loan Endorsement For Individual
Nonqualified Contract
================================= --------------------- ----------------------- =================================================
Commodore Independence NY3342G99 NY3443GE99 Master Group Contract
================================= --------------------- ----------------------- =================================================
" NY3453CE99 Tax Sheltered Annuity Endorsement For Group
Master Contract
================================= --------------------- ----------------------- =================================================
" NY3463GE99 Qualified Loan Endorsement For Group Master
Contract
================================= --------------------- ----------------------- =================================================
" NY3483GE99 ROTH IRS Endorsement For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3493GE99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3513GE99 SIMPLE IRA Endorsement For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3523GE99 Section 457 Governmental Plan Endorsement For
Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3533GE99 Section 457(f) Governmental Plan Endorsement
For Group Master Contract
================================= --------------------- ----------------------- =================================================
NY3343C99 NY3444CE99 IRA Endorsement For Certificate of Participation
================================= --------------------- ----------------------- =================================================
" NY3454CE99 Tax Sheltered Annuity Endorsement For
Certificate of participation
================================= --------------------- ----------------------- =================================================
" NY3464CE99 Qualified Loan Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3484CE99 ROTH IRA Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3494CE99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3514CE99 SIMPLE IRA Endorsement For Certificate of
Participation
================================= --------------------- ----------------------- =================================================
" NY3524CE99 Section 457 Governmental Plan Endorsement For
Certificate of Participation
================================= --------------------- ----------------------- =================================================
" NY3534CE99 Section 457(f) Governmental Plan Endorsement
For Certificate of Participation
================================= --------------------- ----------------------- =================================================
NY3385Q99 NY3583E99 IRA Endorsement For Individual Qualified
Contract
<PAGE>
================================= --------------------- ----------------------- =================================================
" NY3593E99 Tax Sheltered Annuity Endorsement For
Individual Qualified Contract
================================= --------------------- ----------------------- =================================================
" NY3603E99 Qualified Loan Endorsement For Individual
Qualified Contract
================================= --------------------- ----------------------- =================================================
NY3384NQ99 NY3604E99 Nonqualified Loan Endorsement For Individual
Nonqualified Contract
================================= --------------------- ----------------------- =================================================
NY3385Q99 NY3623E99 ROTH IRA Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3633E99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3643E99 Employer Plan Endorsement For Individual
Qualified Contract
================================= --------------------- ----------------------- =================================================
" NY3653E99 SIMPLE IRA Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3663E99 Section 457 Governmental Plan Endorsement For
Individual Qualified Contract
================================= --------------------- ----------------------- =================================================
NY3383Q99 NY3683E99 Successor Owner Endorsement For Individual
Contract
================================= --------------------- ----------------------- =================================================
Commodore Advantage NY3334GMA99 Group Mater Application
================================= --------------------- ----------------------- =================================================
NY3352G99 NY3443GE99 IRA Endorsement For Group Master Contract
================================= --------------------- ----------------------- =================================================
" NY3453GE99 Tax Sheltered Annuity Endorsement For Group
Master Contract
================================= --------------------- ----------------------- =================================================
NY3387Q99 NY3583E99 IRA Endorsement For Individual Qualified
Contract
================================= --------------------- ----------------------- =================================================
" NY3593E99 Tax Sheltered Annuity Endorsement For
individual Qualified Contract
================================= --------------------- ----------------------- =================================================
" NY3603E99 Qualified Loan Endorsement For Individual
Qualified Contract
================================= --------------------- ----------------------- =================================================
NY3386NQ99 NY3604E99 Nonqualified Loan Endorsement For Individual
Nonqualified Contract
================================= --------------------- ----------------------- =================================================
NY3387Q99 NY3633E99 Qualified Pension, Profit Sharing & Annuity
Plan Endorsement For Individual Qualified
Contract
- --------------------------------- --------------------- ----------------------- =================================================
NY3387Q99 NY3643E99 Employer Plan Endorsement For Individual
Qualified Contract
- --------------------------------- --------------------- ----------------------- =================================================
- --------------------------------- --------------------- ----------------------- =================================================
NY3387Q99 NY3653E99 SIMPLE IRA Endorsement For Individual Qualified
Contract
- --------------------------------- --------------------- ----------------------- =================================================
</TABLE>
<PAGE>
Schedule 2
Commissions
<PAGE>
Schedule 3
STATE OF NEW YORK
NY3383Q99
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Individual Flexible Premium Deferred Variable Annuity Contract
TWENTY DAY EXAMINATION-RIGHT TO CANCEL
You may cancel this contract ("Contract") by returning it and giving us written
notice of cancellation. You have until midnight of the twentieth day following
the date you receive this Contract. If you cancel this Contract within twenty
days after you receive it, the Contract will be void and we will refund the
Purchase Payments in full, plus or minus any investment gains or losses under
the Contract. If this Contract was purchased to replace an existing contract and
if you cancel this Contract after the twentieth day and on or before midnight of
the sixitieth day after you receive it, we will refund the Purchase Payments in
full, plus or minus any investment gains or losses under the Contract. Upon such
refund, the Contract shall be void. This Contract must be returned to us and the
required notice must be given in person, or to the agent who sold it to you, or
by mail. If by mail, the return of the Contract or the notice is effective on
the date it is postmarked, with the proper address and with postage paid
As you read through this Contract, please note that the words "we", "us", "our",
and "Company" refer to Great American Life Insurance Company of New York. The
words "you" and "your" refer to the Owner.
This is a deferred variable annuity contract. It is a legally binding agreement
between you and us.
PLEASE READ YOUR CONTRACT WITH CARE.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
Nonparticipating - No Dividends
Tax-Qualified
BENEFIT PAYMENTS AND OTHER VALUES DESCRIBED IN THIS CONTRACT, WHEN BASED ON THE
INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, MAY INCREASE OR DECREASE AND ARE
NOT GUARANTEED AS TO FIXED DOLLAR AMOUNTS. NO MINIMUM CONTRACT VALUE IS
GUARANTEED, EXCEPT FOR AMOUNTS IN THE FIXED ACCOUNT.
After a Variable Dollar Benefit is elected, the annual rate of return earned on
the assets of the Sub-Accounts must be equal to or exceed 3% for the Variable
Dollar Benefit payments not to decrease.
<PAGE>
CONTRACT SPECIFICATIONS
OWNER: JOHN DOE
AGE OF OWNER AS OF CONTRACT EFFECTIVE DATE: 35
CONTRACT NUMBER: 000000000
CONTRACT EFFECTIVE DATE: APRIL 01, 1999
ANNUITY COMMENCEMENT DATE: APRIL 01, 2034
SEPARATE ACCOUNT: GALIC of New York Separate Account I
Following is a list of the Funds in which the currently available Sub-Accounts
invest:
[Janus Aspen Series Aggressive Growth Portfolio]
[Janus Aspen Series Worldwide Growth Portfolio]
[Janus Aspen Series Balanced Portfolio]
[Janus Aspen Series Growth Portfolio]
[Janus Aspen Series International Growth Portfolio]
[Dreyfus Variable Investment Fund-Capital Appreciation Portfolio]
[Dreyfus Variable Investment Fund-Money Market Portfolio]
[Dreyfus Variable Investment Fund-Growth and Income Portfolio]
[Dreyfus Variable Investment Fund-Small Cap Portfolio]
[The Dreyfus Socially Responsible Growth Fund, Inc.]
[Dreyfus Stock Index Fund]
[Strong Opportunity Fund II]
[Strong Mid Cap Growth Fund II]
[The Timothy Plan Variable Series]
[INVESCO VIF-Equity Income Fund]
[INVESCO VIF-Total Return Fund]
[INVESCO VIF-High Yield Fund]
[Morgan Stanley Dean Witter Universal Funds, Inc.- U.S. Real Estate Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Value Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Emerging Markets Equity
Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Fixed Income Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Mid Cap Value Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Growth II Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Technology & Communications Portfolio]
<PAGE>
FIXED ACCOUNT:
Following is a list of the currently available Fixed Account options, with
guarantee periods as may be applicable:
Fixed Accumulation Account Option
Fixed Account Option One-Year Guarantee Period
Fixed Account Option Three-Year Guarantee Period
Fixed Account Option Five-Year Guarantee Period
Fixed Account Option Seven-Year Guarantee Period
The guaranteed rate of interest for the Fixed Account options is three percent
(3%) per year, compounded annually.
<PAGE>
MINIMUM MONTHLY PERIODIC PURCHASE PAYMENT: $50
MINIMUM ADDITIONAL PURCHASE PAYMENTS: $50
MINIMUM SINGLE PURCHASE PAYMENT: $2,000
MAXIMUM PURCHASE PAYMENT: $500,000, without Home Office approval.
TRANSFER FEE: $25 per transfer in excess of twelve (12) in any Contract Year.
CONTINGENT DEFERRED SALES CHARGE: An amount deducted on each partial or full
surrender of a Purchase Payment, as follows:
Number of full years elapsed between the Contingent Deferred Sales Charge as
date oFreceipt of a Purchase Payment and a percentage of the associated
date Written Request for surrender is Purchase Payment surrendered
received
- ----------------------------------------- -----------------------------------
0 7%
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7+ 0%
Please see the SURRENDERS section of this Contract for additional information.
FREE WITHDRAWAL PRIVILEGE:
Contract Year Applicable Percentage
1 10% of all Purchase Payments received
2 and thereafter Greater of: (a) Accumulated Earnings; or (b)
10% of Account Value as of last Contract
Anniversary
Please see the SURRENDERS section of this Contract for additional information.
CONTRACT MAINTENANCE FEE: $30 Annually
MORTALITY AND EXPENSE RISK CHARGE: A charge equal to an effective annual rate of
1.25% of the daily Net Asset Value of the Sub-Accounts.
<PAGE>
ADMINISTRATION CHARGE: A charge equal to an effective annual rate of 0.15% of
the daily Net Asset Value of the
- ---------------------
Sub-Accounts.
TERMINATION: We reserve the right to terminate this Contract at any time prior
to the Annuity Commencement Date if 1) no Purchase Payments have been paid for
three (3) consecutive years and 2) the Account Value is less than $2,000. We
will then pay you the Account Value of this Contract as of the end of the
Valuation Period in which the Contract is terminated.
INQUIRIES: For information, or to make a complaint, call or write:
Variable Annuity Service Center
Great American Life Insurance Company of New York
Post Office Box 5423
Cincinnati, Ohio 45201-5423
1-800-789-6771
<PAGE>
TABLE OF CONTENTS Page
- ------------------------------------------------------------------------------
Definitions................................................................7
General Provisions.........................................................9
Entire Contract.........................................................9
Changes -- Waivers......................................................9
Nonparticipating........................................................9
Misstatement............................................................9
Required Reports........................................................9
Exclusive Benefit.......................................................9
State Law..............................................................10
Claims of Creditors....................................................10
Company Liability......................................................10
Voting Rights..........................................................10
Incontestability.......................................................10
Discharge of Liability.................................................10
Purchase Payments.........................................................10
Purchase Payments......................................................10
Allocation of Purchase Payments........................................10
No Termination.........................................................10
Fixed Account.............................................................11
Fixed Account..........................................................11
Fixed Account Options................................................11
Interest Credited....................................................11
Renewal..............................................................11
Fixed Account Value....................................................11
Separate Account..........................................................12
General Description....................................................12
Sub-Accounts of the Separate Account...................................12
Valuation of Assets....................................................12
Variable Account Value.................................................12
Accumulation Unit Value................................................13
Transfers.................................................................13
Fees and Charges..........................................................14
Mortality and Expense Risk Charge......................................14
Administration Charge..................................................14
Contract Maintenance Fee...............................................14
Surrenders................................................................14
Surrenders.............................................................14
Surrender Value........................................................14
Contingent Deferred Sales Charge.......................................14
Free Withdrawal Privilege..............................................15
Deferral of Payment....................................................15
Ownership Provisions......................................................15
Ownership of Separate Account..........................................15
Owner..................................................................15
Transfer and Assignment................................................16
Successor Owner........................................................16
Community Property.....................................................16
Beneficiary Provisions....................................................16
Beneficiary............................................................16
Change of Beneficiary..................................................16
Benefit on Annuity Commencement Date......................................16
Annuity Commencement Date..............................................16
Annuity Benefit Payments...............................................17
Form of Annuity Benefit................................................17
Benefit on Death of Owner.................................................17
Death Benefit..........................................................17
Death Benefit Amount...................................................18
Transfers After Death..................................................18
Death Benefit Commencement Date........................................18
Form of Death Benefit..................................................18
Settlement Options........................................................19
Conditions.............................................................19
Benefit Payments.......................................................19
Fixed Dollar Benefit...................................................19
Betterment Of Rates....................................................20
Variable Dollar Benefit................................................20
Limitation on Election of Settlement Option............................20
Settlement Option Computations.........................................20
Available Settlement Options...........................................21
Settlement Option Tables...............................................21
<PAGE>
NY3383Q99
DEFINITIONS
Account(s): The Sub-Account(s) and/or the Fixed Account options.
Account Value: The aggregate value of your interest in the Sub-Account(s) and
the Fixed Account options as of the end of any Valuation Period. The value of
your interest in all Sub-Accounts is the "Variable Account Value," and the value
of your interest in all Fixed Account options is the "Fixed Account Value."
Accumulated Earnings: The Account Value in excess of Purchase Payments received
by us and which have not been returned to you.
Accumulation Period: The period prior to the applicable Commencement Date.
Accumulation Unit: A unit of measure used to calculate the value(s) of the
Sub-Account(s) prior to the applicable Commencement Date.
Administrative Office: The home office of the Company or any other place of
business which we may designate for administration.
Age: Age as of most recent birthday.
Annuitant: A natural person whose life is used to determine the duration of
annuity payments involving life contingencies.
Annuity Benefit: Periodic payments under a settlement option, which commence on
or after the Annuity Commencement Date.
Annuity Commencement Date: The first day of the first Payment Interval for which
an Annuity Benefit payment is to be made under a settlement option.
Beneficiary: A person entitled to the Death Benefit under the Contract upon the
death of an Owner.
Benefit Payment: The Annuity Benefit or Death Benefit payable under a settlement
option. Variable Dollar Benefit payments may vary in amount. Fixed Dollar
Benefit payments remain constant except under certain joint and survivor
settlement options.
Benefit Payment Period: The period starting with the Commencement Date during
which Benefit Payments are to be made under this Contract.
Benefit Unit: A unit of measure used to determine the dollar value of any
Variable Dollar Benefit payments after the first Benefit Payment is made by us.
Code: The Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder.
Commencement Date: The Annuity Commencement Date if an Annuity Benefit is
payable under this Contract, or the Death Benefit Commencement Date if a Death
Benefit is payable under this Contract.
Contract Anniversary: An annual anniversary of the Contract Effective Date.
Contract Effective Date: The date shown on the Contract Specifications page.
Contract Year: Any period of twelve (12) months, commencing on the Contract
Effective Date and on each Contract Anniversary thereafter.
Death Benefit: The benefit described in the Benefit on Death of Owner section of
this Contract.
Death Benefit Commencement Date: The first day of the first Payment Interval for
which a Death Benefit payment is to be made under a settlement option, or the
date a Death Benefit is to be paid in a lump sum.
Death Benefit Valuation Date: The date that Due Proof of Death has been received
by us and the earlier to occur of:
1) our receipt of a Written Request with instructions as to the form of
Death Benefit; or
2) the Death Benefit Commencement Date.
Due Proof of Death: Any of the following:
1) certified copy of a death certificate;
2) certified copy of a decree of a court of competent jurisdiction as to
the finding of death; or
3) any other proof satisfactory to us.
Fund: A management investment company or portfolio thereof, registered under the
Investment Company Act of 1940, in which a Sub-Account of the Separate Account
invests.
Net Asset Value: The amount computed by an investment company, no less
frequently than each Valuation Period, as the price at which its shares or
units, as the case may be, are redeemed in accordance with the rules of the
Securities and Exchange Commission.
Owner: The person identified as such on the Contract Specifications page.
Payment Interval: A monthly, quarterly, annual or other regular interval during
the Benefit Payment Period.
Person Controlling Payments: The "Person Controlling Payments" means the
following, as the case may be:
1) with respect to Annuity Benefit payments, you as Owner; and
2) with respect to Death Benefit payments,
a) the Beneficiary; or
b) if the Beneficiary is deceased, the payee.
Purchase Payment: A contribution amount paid to us in consideration for this
Contract, after the deduction of any and all of the following which may apply:
1) any fee charged by the person remitting payments for you;
2) premium taxes; and/or
3) other taxes.
Separate Account: An account, which may be an investment company, which is
established and maintained by the Company pursuant to the laws of the State of
New York.
Sub-Account: The Separate Account is divided into Sub-Accounts, each of which
invests in the shares of a designated Fund.
Valuation Period: The period commencing at the close of regular trading on the
New York Stock Exchange on any Valuation Date, and ending at the close of
trading on the next succeeding Valuation Date. "Valuation Date" means each day
on which the New York Stock Exchange is open for business.
Written Request: Information provided, or a request made, that is complete and
satisfactory to us, that is sent to us on our form or in a manner satisfactory
to us, and that is received by us at our Administrative Office. A Written
Request is subject to any payment made or any action we take before we receive
it. The Company will deem a Written Request a standing order which may be
modified or revoked only by a subsequent Written Request, when permitted by the
terms of this Contract. You may be required to return this Contract to us in
connection with a Written Request.
<PAGE>
GENERAL PROVISIONS
Entire Contract
We have issued this Contract to the Owner identified on the Contract
Specifications page. This Contract is an individual flexible premium deferred
variable annuity contract. This Contract is restricted by endorsement as
required to obtain favorable tax treatment under the Code, and is not valid
without the requisite endorsement(s) being attached. This Contract, its
endorsements, and the application, if any, form the entire Contract between you
and us.
Changes - Waivers
No changes or waivers of the terms of this Contract are valid unless made in
writing by our President, Vice President, or Secretary. No agent or other person
not named above has authority to change or waive any provision of this Contract.
We reserve the right both to administer and to change the provisions of this
Contract to conform to any applicable laws, regulations or rulings issued by a
governmental agency.
In any event, the Company reserves the right to add or delete Fixed Account
options and Sub-Accounts, to substitute shares of a different Fund or different
class or series of a Fund for shares held in a Sub-Account, to merge or combine
Sub-Accounts, to merge or combine the Separate Account with any other separate
account of the Company, to transfer the assets of the Separate Account to
another life insurance company by means of a merger or reinsurance, to convert
the Separate Account into a managed separate account, and to de-register the
Separate Account under the Investment Company Act of 1940. Any such change will
be made in accordance with applicable insurance and securities laws and after
obtaining any necessary approvals, including those of the New York State
Insurance Department and the Securities and Exchange Commission. Any such change
will not reduce benefits due under this Contract.
Nonparticipating
This Contract does not pay dividends or share in the Company's divisible
surplus.
Misstatement
If the age of a person on whose life Benefit Payments are based is misstated,
the payments or other benefits under this Contract shall be adjusted to the
amount which would have been payable based on the correct age. If we made any
underpayments based on any misstatement, the amount of any underpayment with
interest at the rate of six percent (6%) per year shall be immediately paid in
one sum. In addition to any other remedies that may be available at law or at
equity, we may deduct any overpayments made, with interest at the rate of six
percent (6%) per year, from any succeeding payment(s) due under this Contract.
Required Reports
At least once each Contract Year, we will send you one or more statements
reporting the investments held in the Separate Account, the number of
Accumulation Units under your Contract and your Account Value as of the most
recent calendar quarter, and any other information required by law, until the
first to occur of the following:
1) the date this Contract is fully surrendered;
2) the Annuity Commencement Date; or
3) the Death Benefit Commencement Date.
The report will be mailed to your last known address. The reported values will
be based on the information in our possession at the time the report is prepared
by us. We may adjust the reported values at a later date if that information
proves to be incorrect or has changed.
Exclusive Benefit
This Contract is for the exclusive benefit of you and your Beneficiaries. Your
interest under this Contract is nonforfeitable by us.
<PAGE>
State Law
All factors, values, benefits and reserves under this Contract will not be less
than those required by the law of the state in which this Contract is delivered.
Claims of Creditors
To the extent allowed by law, your Contract and all values and benefits under it
are not subject to the claims of creditors or to legal process.
Company Liability
We will not incur any liability or be responsible for any failure, in whole or
in part, by you or by any person having rights or benefits arising out of or
related to this Contract, to comply with any applicable laws, regulations or
rulings issued by a governmental agency.
Voting Rights
To the extent required by law, we will vote all shares of the Funds held in the
Separate Account, at regular and special shareholder meetings of the Funds. The
shares will be voted in accordance with instructions received from you, or if
applicable, from the Person Controlling Payments. If there is a change in the
law which permits us to vote the shares of the Funds without such instructions,
then we reserve the right to do so.
Incontestability
This Contract shall not be contestable by us.
Discharge of Liability
Upon payment of any partial or full surrender, or any Benefit Payment, we shall
be discharged from all liability to the extent of each such payment.
PURCHASE PAYMENTS
Purchase Payments
One or more Purchase Payments may be paid to us at any time before the Annuity
Commencement Date, so long as:
1) you are still living; and
2) this Contract has not been fully surrendered.
The initial Purchase Payment must be paid to us on or before the Contract
Effective Date. Each Purchase Payment must be paid to us at our Administrative
Office, and is subject to any minimums or maximums shown on the Contract
Specifications page. Upon request, we will provide you with a receipt as proof
of payment.
Allocation of Purchase Payments
We will allocate Purchase Payments to the Fixed Account options and/or to the
Sub-Accounts according to the instructions we receive by Written Request.
Allocations must be made in whole percentages. The minimum Purchase Payment
amount that can be allocated to a Fixed Account option other than the Fixed
Accumulation Account is $2,000.
No Termination
Except as stated elsewhere in this Contract, this Contract will not be
terminated by us due to failure to make additional Purchase Payments.
<PAGE>
FIXED ACCOUNT
Fixed Account
The Fixed Account is part of the Company's general account. The values of the
Fixed Account are not dependent upon the investment performance of the
Sub-Accounts.
Fixed Account Options. The Fixed Account options available as of the Contract
Effective Date are listed on the Contract Specifications page. Different Fixed
Account options may be offered by us at any time.
Interest Credited. The guaranteed rate of interest for the Fixed Account options
is three percent (3%) per year, compounded annually. We may, at any time, pay a
current interest rate as declared by our Board of Directors for any of the Fixed
Account options that is higher than the guaranteed rate.
The interest rate initially credited to each Purchase Payment allocated to the
Fixed Accumulation Account Option will not be changed any sooner than twelve
(12) months following the date on which that Purchase Payment was received;
thereafter, the interest rate credited will not be changed more frequently than
once per calendar quarter. In the case of transfers from other Fixed Account
options or the Sub-Accounts to the Fixed Accumulation Account option, the
interest rate will not be changed more frequently than once per calendar
quarter.
The interest rate credited to amounts allocated to the Fixed Account options
other than the Fixed Accumulation Account Option will not be changed during the
duration of the applicable guarantee period.
Renewal. The following provisions apply to all Fixed Account options except the
Fixed Accumulation Account Option.
At the end of a guarantee period, and for the thirty (30) days immediately
preceding the end of such guarantee period, you may elect a new option to
replace the Fixed Account option that is then expiring. The entire amount
maturing may be re-allocated to any of the then-current options under this
Contract (including the various Sub-Accounts within the Separate Account),
except that a Fixed Account option with a guarantee period that would extend
past the Annuity Commencement Date may not be selected. In particular, in the
case of renewals occurring within one (1) year of such Commencement Date, the
only Fixed Account option available is the Fixed Accumulation Account Option.
If you do not specify a new Fixed Account option in accordance with the
preceding paragraph, you will be deemed to have selected the same Fixed Account
option as is expiring, so long as the guarantee period of such option does not
extend beyond the Annuity Commencement Date. In the event that such a period
would extend beyond the Annuity Commencement Date, you will be deemed to have
selected the Fixed Account option with the longest available guarantee period
that expires prior to the Annuity Commencement Date, or, failing that, the Fixed
Accumulation Account Option.
Any renewal of a Fixed Account option under this Renewal provision will be
effective on the day after the expiration of the guarantee period that is then
expiring.
Fixed Account Value
The Fixed Account Value for this Contract at any time is equal to:
1) the Purchase Payment(s) allocated to the Fixed Account; plus
2) amounts transferred to the Fixed Account; plus
3) interest credited to the Fixed Account; less
4) any charges, surrenders, deductions, amounts transferred from the Fixed
Account or other adjustments made as described elsewhere in this
Contract.
<PAGE>
SEPARATE ACCOUNT
General Description
The variable benefits under this Contract are provided through the Separate
Account. The Separate Account is registered with the Securities and Exchange
Commission as a unit investment trust under the Investment Company Act of 1940.
The income, if any, and any gains or losses, realized or unrealized, on the
Separate Account will be credited to or charged against the amounts allocated to
such account without regard to other income, gains, or losses of the Company.
The amounts allocated to the Separate Account and the accumulations thereon
remain the property of the Company, but that portion of the assets of the
Separate Account that is equal to the reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account is not chargeable with liabilities arising out of any other business of
the Company. The Company is not, and does not hold itself out to be, a trustee
in respect of such amounts.
We have the right to transfer to our general account, in our sole discretion and
at any time without prior written notice, any assets of the Separate Account
which are in excess of the required reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account.
Sub-Accounts of the Separate Account
The assets of the Separate Account are divided into Sub-Accounts. The
Sub-Accounts available as of the Contract Effective Date are listed on the
Contract Specifications page. Each Sub-Account invests exclusively in shares of
an underlying Fund as shown on the Contract Specifications page. Any amounts of
income and any gains on the shares of a Fund will be reinvested in additional
shares of that Fund at its Net Asset Value.
Valuation of Assets
Shares of Funds held by each Sub-Account will be valued at their Net Asset Value
at the end of each Valuation Period, as reported by each such Fund.
Variable Account Value
Purchase Payment(s) may be allocated among and, as described elsewhere in this
Contract, Account values may be transferred to the various Sub-Accounts within
the Separate Account. For each Sub-Account, the Purchase Payment(s) or amounts
transferred are converted into Accumulation Units. The number of Accumulation
Units credited is determined by dividing the dollar amount directed to each
Sub-Account by the value of the Accumulation Unit for that Sub-Account at the
end of the Valuation Period during which the Purchase Payment(s) or transferred
amount is received.
The following events will result in the cancellation of an appropriate number of
Accumulation Units of a Sub-Account:
1) transfer from a Sub-Account;
2) full or partial surrender of the Variable Account Value;
3) payment of a Death Benefit;
4) application of the Variable Account Value to a settlement option;
5) deduction of the Contract Maintenance Fee; or
6) deduction of any Transfer Fee.
Accumulation Units will be canceled as of the end of the Valuation Period during
which the Company receives a Written Request regarding the event giving rise to
such cancellation, or an applicable Commencement Date, or the end of the
Valuation Period on which the Contract Maintenance Fee or Transfer Fee is due,
as the case may be.
The Variable Account Value for this Contract at any time is equal to the sum of
the number of Accumulation Units for each Sub-Account attributable to this
Contract multiplied by the Accumulation Unit Value for each Sub-Account at the
end of the preceding Valuation Period.
<PAGE>
Accumulation Unit Value
The initial Accumulation Unit Value for each Sub-Account, with the exception of
the Money Market Sub-Account, was set at $10.00. The initial Accumulation Unit
Value for the Money Market Sub-Account was set at $1.00. Thereafter, the
Accumulation Unit Value at the end of each Valuation Period is the Accumulation
Unit Value at the end of the previous Valuation Period multiplied by the Net
Investment Factor, as described below.
The Net Investment Factor is a factor applied to measure the investment
performance of a Sub-Account from one Valuation Period to the next. Each
Sub-Account has a Net Investment Factor for each Valuation Period which may be
greater or less than one. Therefore, the Accumulation Unit Value for each
Sub-Account may increase or decrease. The Net Investment Factor for any
Sub-Account for any Valuation Period is determined by dividing (1) by (2) and
subtracting (3) from the result, where:
1) is equal to:
a) the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the applicable Valuation Period; plus
b) the per share amount of any dividend or net capital gain
distributions made by the Fund held in the Sub-Account, if the
"ex-dividend" date occurs during the applicable Valuation Period;
plus or minus
c) a per share charge or credit for any taxes reserved for, which is
determined by the Company to have resulted from the investment
operations of the Sub-Account;
2) is the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the immediately preceding Valuation Period;
and
3) is the factor representing the Mortality and Expense Risk Charge and
the Administration Charge deducted from the Sub-Account for the number
of days in the applicable Valuation Period.
TRANSFERS
Prior to the applicable Commencement Date, you may transfer amounts in a
Sub-Account to a different Sub-Account and/or one or more of the Fixed Account
options.
After the first Contract Anniversary, and prior to the applicable Commencement
Date, you may transfer amounts from any Fixed Account option to any other Fixed
Account option and/or one or more of the Sub-Accounts. If a transfer is being
made from a Fixed Account option pursuant to the Renewal provision of this
Contract, then the entire amount of that Fixed Account option subject to renewal
at that time may be transferred. In any other case, transfers from any Fixed
Account option are subject to a cumulative limit during each Contract Year of
twenty percent (20%) of the Fixed Account option's value as of the most recent
Contract Anniversary.
Amounts previously transferred from Fixed Account options to the Sub-Accounts
may not be transferred back to the Fixed Account options for a period of ninety
(90) days from the date of transfer.
The minimum transfer amount for any transfer is $500. The number of transfers
per year over which we will charge a Transfer Fee on each additional transfer,
and the amount of the Transfer Fee, are shown on the Contract Specifications
page.
<PAGE>
FEES AND CHARGES
Mortality and Expense Risk Charge
The Mortality and Expense Risk Charge is shown on the Contract Specifications
page and is deducted daily from each Sub-Account. This deduction is made to
compensate the Company for assuming the mortality and expense risks under this
Contract.
Administration Charge
The Administration Charge is shown on the Contract Specifications page and is
deducted daily from each Sub-Account. This deduction is made to reimburse the
Company for expenses incurred in the administration of this Contract and the
Separate Account.
Contract Maintenance Fee
The Contract Maintenance Fee ("Fee") is shown on the Contract Specifications
page and is deducted as of the Valuation Period next following each Contract
Anniversary prior to the applicable Commencement Date. In addition, the full
annual Fee will be deducted at the time of a full surrender. The Fee will be
allocated to each Sub-Account in the same proportion as each Sub-Account's value
is to the total Variable Account Value as of the end of such Valuation Period.
The Fee does not apply to the Fixed Account.
After the applicable Commencement Date, if a Variable Dollar Benefit is elected,
the Fee will be deducted pro-rata from each Benefit Payment and will result in a
reduction in the amount of such payment.
The Fee may be waived in whole or in part in our sole discretion if:
1) during the Accumulation Period, the Account Value is at least $40,000
on the date the charge is made; or
2) during the Benefit Payment Period, the amount applied to a Variable
Dollar Benefit is at least $40,000.
SURRENDERS
Surrenders
You may surrender this Contract in full for the Surrender Value, or, partial
surrenders may be made for a lesser amount, by Written Request at any time prior
to the Annuity Commencement Date. The amount of any partial surrender must be at
least $500. If a partial surrender would reduce your Account Value to less than
$500, we will treat the surrender request as a request for full surrender.
Surrenders will be deemed to be withdrawn first from the portion of the Account
Value that represents your Accumulated Earnings and then from Purchase Payments.
For purposes of this Contract, Purchase Payments are deemed to be withdrawn on a
"first-in, first out" (FIFO) basis.
The amount available for surrender will be the Surrender Value at the end of the
Valuation Period in which the Written Request is received.
Surrender Value
The Surrender Value at any time is an amount equal to:
1) the Account Value as of the end of the applicable Valuation Period;
less
2) any applicable Contingent Deferred Sales Charge; less
3) any outstanding loans; and less
4) any applicable premium tax or other taxes not previously deducted.
On full surrender, a full Contract Maintenance Fee will also be deducted as part
of the calculation of the Surrender Value.
Contingent Deferred Sales Charge
A full or partial surrender may be subject to a Contingent Deferred Sales Charge
as set forth on the Contract Specifications page. The Contingent Deferred Sales
Charge applies to and is calculated separately for each Purchase Payment.
The Contingent Deferred Sales Charge may be waived in whole or in part in our
sole discretion, if:
1) the Contract is issued with a tax sheltered annuity endorsement (and
without an employer plan endorsement): (i) upon separation from service if
the Owner has attained age 55 and the Contract has been in force for at
least seven (7) years; or (ii) after the contract has been in force fifteen
(15) years or more; or
2) the Social Security Administration determines after the Contract is issued
that the owner is "disabled" as defined in the Social Security Act of 1935,
as amended; or
3) the Contract is issued with a Successor Owner endorsement.
Surrenders will result in the cancellation of Accumulation Units from each
applicable Sub-Account(s) and/or a reduction of your Fixed Account Value and a
reduction in your Death Benefit amount. In the case of a full surrender, this
Contract will be terminated.
Free Withdrawal Privilege
Subject to the provisions of this Contract, we will waive the Contingent
Deferred Sales Charge, to the extent applicable, on full or partial surrenders
as follows:
1) during the first Contract Year, on an amount equal to not more than the
applicable percentage (shown on the Contract Specifications page) of
all Purchase Payments received; and
2) during the second and succeeding Contract Years, on an amount equal to
the greater of:
a) Accumulated Earnings; or
b) not more than the applicable percentage (shown on the Contract
Specifications page) of the Account Value as of the last Contract
Anniversary.
The Free Withdrawal Privilege will be applied in each case to monies in the
order in which they are deemed withdrawn, as described in the Surrenders
provision of this Contract.
Deferral of Payment
The Company has the right to suspend or delay the date of payment of a partial
or full surrender of the Variable Account Value for any period:
1) when the New York Stock Exchange is closed, or when trading on the New
York Stock Exchange is restricted; or
2) when an emergency exists (as determined by the Securities and Exchange
Commission) as a result of which: a) the disposal of securities in the
Separate Account is not reasonably practicable; or b) it is not
reasonably practicable to determine fairly the value of the net assets
in the Separate Account; or
3) when the Securities and Exchange Commission so permits for the
protection of security holders.
The Company further reserves the right to delay payment of a partial or full
surrender of the Fixed Account Value for up to six (6) months after we receive
your Written Request.
OWNERSHIP PROVISIONS
Ownership of Separate Account
The Company has absolute ownership of the assets in the Separate Account. The
Company is not, and does not hold itself out to be, a trustee in respect of any
amounts under the Separate Account.
Owner
The Owner of this Contract is the person shown as Owner on the Contract
Specifications page.
So long as the Owner is a natural person, the Owner will be the Annuitant.
Unless otherwise stated, the Owner may exercise all ownership rights under this
Contract.
Transfer and Assignment
You may not transfer, sell, assign, pledge, charge, encumber or in any way
alienate your interest under this Contract.
Successor Owner
By Written Request, your spouse may, in some cases, succeed to the ownership of
this Contract after your death. Specifically, if you die and your spouse is the
sole surviving Beneficiary under this Contract, he or she will become the
Successor Owner of this Contract if:
1) you make that Written Request before your death; or
2) after your death, your spouse makes that Written Request within one (1)
year of your death and before the Death Benefit Commencement Date.
As Successor Owner, your spouse will then succeed to all rights of ownership
under this Contract except the right to name another Successor Owner.
Community Property
If you live in a community property state and have a spouse at any time while
you own this Contract, the laws of that state may vary your ownership rights.
BENEFICIARY PROVISIONS
Beneficiary
The Beneficiary is the person or persons so designated in the application, if
any, or under the Change of Beneficiary provision of this Contract. If you have
not designated a Beneficiary, or if no Beneficiary designated by you survives
you, then the Beneficiary will be your estate.
Unless you provide otherwise by Written Request, a Beneficiary will be deemed
not to have survived you if he or she dies within thirty (30) days after your
death.
A beneficiary designation may be joint or contingent or both. Unless otherwise
stated, joint Beneficiaries will be entitled to equal shares. A contingent
Beneficiary will be entitled to a benefit only if there is no surviving primary
Beneficiary.
Change of Beneficiary
An irrevocable Beneficiary may not be changed without his or her consent. Unless
you have designated an irrevocable Beneficiary, you may change your designation
of a Beneficiary at any time before the Annuity Commencement Date, effective as
of the date the Written Request is signed, subject to our receiving the Written
Request.
Any such change is subject to the following:
1) it must be made by Written Request; and
2) unless otherwise elected or required by law, it will not cancel any
settlement option election previously made.
BENEFIT ON ANNUITY COMMENCEMENT DATE
Annuity Commencement Date
The Annuity Commencement Date is shown on the Contract Specifications page. You
may change the Annuity Commencement Date by Written Request made at least thirty
(30) days prior to the date that Annuity Benefit payments are scheduled to
begin. The Annuity Commencement Date cannot be later than the Contract
Anniversary following your 85th birthday or five (5) years after the Contract
Effective Date, whichever is later, but in no event will it be later than your
90th birthday.
<PAGE>
Annuity Benefit Payments
An amount equal to the Account Value (after deduction of any fees and charges,
loans, or applicable premium tax or other taxes not previously deducted) will be
used to provide Annuity Benefit payments under this Contract commencing on or
after the Annuity Commencement Date.
Annuity Benefit payments will be made to you as payee. Any Annuity Benefit
amounts remaining payable on your death will be paid to the contingent payee
designated by you by Written Request. You will be the person on whose life any
Annuity Benefit payments are based.
If no contingent payee designated by you is surviving at the time payment is to
be made, then after your death any Annuity Benefit amounts remaining payable
will be paid to the person or persons designated as contingent payee by Written
Request by the last payee who received payments. Failing that, any such amounts
will be paid to the estate of the last payee who received payments.
Form of Annuity Benefit
Annuity Benefit payments will be Fixed Dollar Benefit payments, made monthly in
accordance with the terms of Option B with a fixed period of one hundred twenty
(120) months under the SETTLEMENT OPTIONS section of this Contract.
In lieu of that, you may elect to have Annuity Benefit payments made pursuant to
any other available settlement option under the SETTLEMENT OPTIONS section of
this Contract. Any such election must be made by Written Request before the
Annuity Commencement Date. You may change your election of a settlement option
by Written Request made at least thirty (30) days prior to the date that Annuity
Benefit payments are scheduled to begin.
BENEFIT ON DEATH OF OWNER
Death Benefit
A Death Benefit will be paid under this Contract if:
1) you die before the Annuity Commencement Date and before this Contract
is fully surrendered;
2) the Death Benefit Valuation Date has occurred; and
3) your spouse does not become the Successor Owner.
If a Death Benefit becomes payable:
1) it will be in lieu of all other benefits under this Contract; and
2) all other rights under this Contract will be terminated except for
rights related to the Death Benefit.
Death Benefit payments shall be made to the Beneficiary as payee.
The Beneficiary will be the person on whose life any Death Benefit payments
under a settlement option are based.
Any Death Benefit amounts remaining payable on the death of the Beneficiary will
be paid:
1) to any contingent payee designated by you as part of any Death Benefit
settlement option election made by you, or if none is surviving at the
time payment is to be made; then
2) to any contingent payee designated by the Beneficiary by Written
Request, or if none is surviving at the time payment is to be made;
then
3) to the estate of the last payee who received payments.
Only one Death Benefit will be paid under this Contract.
<PAGE>
Death Benefit Amount
If you die before attaining Age eighty (80) and before the Annuity Commencement
Date, the Death Benefit is an amount equal to the greatest of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), with interest at three percent (3%)
per year, compounded annually through the earlier of the Death
Benefit Valuation Date or the Contract Anniversay prior to the
date you would have attained Age eighty (80), less any partial
surrenders and any Contingent Deferred Sales Charges that applied
to those amounts; or
3) the largest Account Value on any Contract Anniversary after the
fourth Contract Anniversary and prior to the earlier of the Death
Benefit Valuation Date or the date you would have attained Age
eighty (80), less any partial surrenders after such Account Value
was determined and any Contingent Deferred Sales Charges that
applied to those amounts.
If you die after attaining Age eighty (80) and before the Annuity Commencement
Date, the Death Benefit is an amount equal to the greatest of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), with interest at three percent (3%)
per year, compounded annually through the Contract Anniversary
prior to your 80th birthday, less any partial surrenders and any
Contingent Deferred Sales Charges that applied to those amounts;
or
3) the largest Account Value on any Contract Anniversary after the
fourth Contract Anniversary and prior to the date on which you
attained Age eighty (80), less any partial surrenders after such
Account Value was determined and any Contingent Deferred Sales
Charges that applied to those amounts.
In any event, if this Contract was issued to you after Age eighty (80), and you
die before the Annuity Commencement Date, the amount of the Death Benefit will
be the greater of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), less any partial surrenders and any
Contingent Deferred Sales Charges that applied to those amounts.
As of the Death Benefit Valuation Date, the amount of the Death Benefit will be
allocated among the Sub-Accounts and Fixed Account options in the same
proportion as each Account's value is to the total Account Value as of the end
of the Valuation Period immediately preceding the Death Benefit Valuation Date.
Any applicable premium tax or other taxes not previously deducted, and any
outstanding loans, will be deducted from the Death Benefit amount described
above.
Transfers After Death
Between the Death Benefit Valuation Date and the Death Benefit Commencement
Date, the Beneficiary may transfer funds among Sub-Accounts and Fixed Account
options as described under the TRANSFERS section of this Contract.
Death Benefit Commencement Date
The Beneficiary may designate the Death Benefit Commencement Date by Written
Request within one (1) year of your death. If no designation is made, then the
Death Benefit Commencement Date will be one (1) year after your death.
Form of Death Benefit
Payments under the Death Benefit provision of this Contract will be Fixed Dollar
Benefit payments made monthly in accordance with the terms of Option A with a
period certain of forty-eight (48) months under the SETTLEMENT OPTIONS section
of this Contract.
In lieu of that, you may elect at any time before your death to have payments
under the Death Benefit provision of this Contract made in one lump sum or
pursuant to any available settlement option under the SETTLEMENT OPTIONS section
of this Contract. If you do not make any such election, the Beneficiary may make
that election at any time after your death and before the Death Benefit
Commencement Date.
You may change your election of a settlement option at any time before your
death.
If a Beneficiary elects a settlement option as noted above, he or she may change
his or her own election of a settlement option by Written Request made at least
thirty (30) days prior to the date that Death Benefit payments are scheduled to
begin.
Any election or change of election must be made by Written Request.
SETTLEMENT OPTIONS
Conditions
The amount applied to a settlement option must be at least $2,000. We will pay
you the Account Value in a lump sum on the Annuity Commencement Date if it is
less than $2,000. The amount of any Fixed Dollar Benefit payment, or the amount
of the first Variable Dollar Benefit payment, under a settlement option must be
at least $20. More than one settlement option may be elected if the requirements
for each settlement option elected are satisfied. Once payment begins under a
settlement option, the settlement option may not be changed.
All elected settlement options must comply with current applicable laws,
regulations and rulings issued by any governmental agency.
If more than one person is the payee under a settlement option, payments will be
made to the payees in equal shares, unless otherwise provided by Written
Request. No more than two persons may be initial payees under any joint and
survivor settlement option.
If payment under a settlement option depends on whether a specified person is
still alive, we may at any time require proof that such person is still living.
We will require proof of the age of any person on whose life Benefit Payments
are based.
Benefit Payments
Benefit Payments may be calculated and paid:
1) as a Fixed Dollar Benefit;
2) as a Variable Dollar Benefit; or
3) as a combination of both.
If only a Fixed Dollar Benefit is to be paid, we will transfer all of the
Account Value to the Company's general account on the applicable Commencement
Date, or on the Death Benefit Valuation Date (if applicable). Similarly, if only
a Variable Dollar Benefit is elected, we will transfer all of the Account Value
to the Sub-Accounts as of the end of the Valuation Period immediately prior to
the applicable Commencement Date; we will allocate the amount transferred among
the Sub-Accounts in accordance with a Written Request. No transfers between the
Fixed Dollar Benefit and the Variable Dollar Benefit will be allowed after the
Commencement Date. However, after the Variable Dollar Benefit has been paid for
at least twelve (12) months, the Person Controlling Payments may, no more than
once each twelve (12) months thereafter, transfer all or part of the Benefit
Units upon which the Variable Dollar Benefit is based from the Sub-Account(s)
then held, to Benefit Units in different Sub-Account(s).
If a Variable Dollar Benefit is elected, the amount to be applied under that
benefit is the Variable Account Value as of the end of the Valuation Period
immediately preceding the applicable Commencement Date. If a Fixed Dollar
Benefit is to be paid, the amount to be applied under that benefit is the Fixed
Account Value as of the applicable Commencement Date, or as of the Death Benefit
Valuation Date (if applicable).
<PAGE>
Fixed Dollar Benefit
Fixed Dollar Benefit payments are determined by multiplying the Fixed Account
Value (expressed in thousands of dollars and after deduction of any fees and
charges, loans, or applicable premium tax or other taxes not previously
deducted) by the amount of the monthly payment per $1,000 of value obtained from
the Settlement Option Table for the settlement option elected. Fixed Dollar
Benefit payments will remain level for the duration of the Benefit Payment
Period.
If at the time a Fixed Dollar Benefit is elected, we have available options or
rates on a more favorable basis than those guaranteed, the higher benefits shall
be applied and shall not change for as long as that election remains in force.
Betterment Of Rates
The Fixed Dollar Benefit available under this Contract as of the Annuity
Commencement Date or the Death Benefit Commencement Date will not be less than
the benefit that would be provided by the application of the Account Value to
purchase any single consideration immediate annuity contract offered by us at
the time to the same class of annuitants.
Variable Dollar Benefit
The first monthly Variable Dollar Benefit payment is equal to your Variable
Account Value (expressed in thousands of dollars and after deduction of any fees
and charges, loans, or applicable premium tax or other taxes not previously
deducted) as of the end of the Valuation Period immediately preceding the
applicable Commencement Date multiplied by the amount of the monthly payment per
$1,000 of value obtained from the Settlement Option Table for the Benefit
Payment option elected less the pro-rata portion of the Contract Maintenance
Fee.
The number of Benefit Units in each Sub-Account held by you is determined by
dividing the dollar amount of the first monthly Variable Dollar Benefit payment
from each Sub-Account by the Benefit Unit Value for that Sub-Account as of the
applicable Commencement Date. The number of Benefit Units remains fixed during
the Benefit Payment Period, except as a result of any transfers among
Sub-Accounts after the applicable Commencement Date.
The dollar amount of the second and any subsequent Variable Dollar Benefit
payment will reflect the investment performance of the Sub-Account(s) selected
and may vary from month to month. The total amount of the second and any
subsequent Variable Dollar Benefit payment will be equal to the sum of the
payments from each Sub-Account less a pro-rata portion of the Contract
Maintenance Fee.
The payment from each Sub-Account is found by multiplying the number of Benefit
Units held in each Sub-Account by the Benefit Unit Value for that Sub-Account as
of the end of the fifth Valuation Period preceding the due date of the payment.
The Benefit Unit Value for each Sub-Account is originally established in the
same manner as Accumulation Unit Values. Thereafter, the value of a Benefit Unit
for a Sub-Account is determined by multiplying the Benefit Unit Value as of the
end of the preceding Valuation Period by the Net Investment Factor, determined
as set forth above under the Accumulation Unit Value provision of this Contract,
for the Valuation Period just ended. The product is then multiplied by the
assumed daily investment factor (0.99991781), for the number of days in the
Valuation Period. The factor is based on the assumed net investment rate of
three percent (3%) per year, compounded annually, that is reflected in the
Settlement Option Tables.
Variable Dollar Benefit payments will not be adversely affected by actual
mortality and expense experience of the Sub-Accounts.
Limitation on Election of Settlement Option
Fixed periods shorter than five (5) years are not available, except as a Death
Benefit settlement option.
Settlement Option Computations
The 1983 Individual Annuity Mortality Table with interest at three percent (3%)
per year, compounded annually, is used to compute all guaranteed settlement
option factors, values, and benefits under this Contract.
<PAGE>
Available Settlement Options
The available settlement options are set out below.
Option A Income for a Fixed Period
We will make periodic payments for a fixed period. The first payment
will be paid as of the last day of the initial Payment Interval. The
maximum time over which payments will be made by us or money will be
held by us is thirty (30) years. The Option A Table applies to this
Option.
Option B Life Annuity with Payments for at Least a Fixed Period
We will make periodic payments for a least a fixed period. If the
person on whose life Benefit Payments are based lives longer than the
fixed period, then we will make payments until his or her death. The
first payment will be paid as of the first day of the initial Payment
Interval. The Option B Table applies to this Option.
Option C Joint and One-half Survivor Annuity
We will make periodic payments until the death of the primary person on
whose life Benefit Payments are based; thereafter, we will make
one-half (1/2) of the periodic payment until the death of the secondary
person on whose life Benefit Payments are based. The first payment will
be paid as of the first day of the initial Payment Interval. The Option
C Table applies to this Option.
Option D Life Annuity
We will make periodic payments until the death of the person on whose
life Benefit Payments are based. The first payment will be paid as of
the first day of the initial Payment Interval. The Option D Table
applies to this Option.
Option E Any Other Form
We will make periodic payments in any other form of settlement option
which is acceptable to us at the time of an election.
Settlement Option Tables
The Option Tables show the payments we will make at sample Payment Intervals for
each $1,000 applied at the guaranteed interest rate. Amounts may vary with the
Payment Interval and the age of the person on whose life Benefit Payments are
based.
OPTION A TABLE - INCOME FOR A FIXED PERIOD
Payments for fixed number of years for each $1,000
applied.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Terms of Semi-Annual Terms of Semi-Annual Terms of Semi-Annual
Payments Annual QuarterlY Monthly Payments Annual Quarterly Monthly Payments Annual Quarterly Monthly
- ------------------------------------------------------------------------------------------------------------------------------------
Years Years Years
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
6 184.60 91.62 45.64 15.18 11 108.08 53.64 26.72 8.88 16 79.61 39.51 19.68 6.54
7 160.51 79.66 39.68 13.20 12 100.46 49.86 24.84 8.26 17 75.95 37.70 18.78 6.24
8 142.46 70.70 35.22 11.71 13 94.03 46.67 23.25 7.73 18 72.71 36.09 17.98 5.98
9 128.43 63.74 31.75 10.56 14 88.53 43.94 21.89 7.28 19 69.81 34.65 17.26 5.74
10 117.23 58.18 28.98 9.64 15 83.77 41.57 20.71 6.89 20 67.22 33.36 16.62 5.53
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
OPTION B TABLE - LIFE ANNUITY
With Payments For At Least A Fixed Period
- -------- ---------------- --------------- ---------------- ----------------
60 Months 120 Months 180 Months 240 Months
- -------- ---------------- --------------- ---------------- ----------------
Age
- -------- ---------------- --------------- ---------------- ----------------
55 $4.42 $4.39 $4.32 $4.22
56 4.51 4.47 4.40 4.29
57 4.61 4.56 4.48 4.35
58 4.71 4.65 4.56 4.42
59 4.81 4.75 4.64 4.49
60 4.92 4.86 4.73 4.55
61 5.04 4.97 4.83 4.62
62 5.17 5.08 4.92 4.69
63 5.31 5.20 5.02 4.76
64 5.45 5.33 5.12 4.83
65 5.61 5.46 5.22 4.89
66 5.77 5.60 5.33 4.96
67 5.94 5.75 5.43 5.02
68 6.13 5.91 5.54 5.08
69 6.33 6.07 5.65 5.14
70 6.54 6.23 5.76 5.19
71 6.76 6.41 5.86 5.24
72 7.00 6.58 5.96 5.28
73 7.26 6.77 6.06 5.32
74 7.53 6.95 6.16 5.35
- -------- ---------------- --------------- ---------------- ----------------
OPTION C TABLE - JOINT AND ONE-HALF SURVIVOR
ANNUITY Monthly payments for each $1,000 of proceeds by
ages of persons named.*
<TABLE>
<CAPTION>
- -------------- -------------------------------------------------------------------------------------------------------
Secondary Age
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
Primary Age
60 61 62 63 64 65 66 67 68 69 70
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 $4.56 $4.58 $4.61 $4.63 $4.65 $4.67 $4.69 $4.71 $4.73 $4.75 $4.76
61 4.63 4.66 4.69 4.71 4.73 4.76 4.78 4.80 4.82 4.84 4.86
62 4.71 4.74 4.77 4.80 4.82 4.85 4.87 4.90 4.92 4.94 4.96
63 4.79 4.82 4.85 4.88 4.91 4.94 4.97 5.00 5.02 5.05 5.07
64 4.88 4.91 4.94 4.98 5.01 5.04 5.07 5.10 5.13 5.15 5.18
65 4.96 5.00 5.03 5.07 5.11 5.14 5.17 5.20 5.24 5.27 5.30
66 5.05 5.09 5.13 5.17 5.21 5.24 5.28 5.32 5.35 5.38 5.42
67 5.14 5.18 5.23 5.27 5.31 5.35 5.39 5.43 5.47 5.51 5.54
68 5.23 5.28 5.33 5.37 5.42 5.46 5.50 5.55 5.59 5.63 5.67
69 5.33 5.38 5.43 5.48 5.53 5.57 5.62 5.67 5.72 5.76 5.81
70 5.43 5.48 5.53 5.59 5.64 5.69 5.74 5.80 5.85 5.90 5.95
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
</TABLE>
*Payments after the death of the Primary Payee will be one-half (1/2) of the
amount shown.
<PAGE>
OPTION D TABLE - LIFE ANNUITY Monthly
payments for each $1,000 applied.
Age
-------------- -------------------
55 4.43
56 4.52
57 4.62
58 4.72
59 4.83
60 4.94
61 5.07
62 5.20
63 5.34
64 5.49
65 5.65
66 5.82
67 6.00
68 6.20
69 6.41
70 6.64
71 6.89
72 7.15
73 7.43
74 7.74
-------------- -------------------
<PAGE>
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Individual Flexible Premium Deferred Variable Annuity Contract
Nonparticipating - No Dividends
Tax-Qualified
<PAGE>
NY3382NQ99
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Individual Flexible Premium Deferred Variable Annuity Contract
TWENTY DAY EXAMINATION-RIGHT TO CANCEL
You may cancel this contract ("Contract") by returning it and giving us written
notice of cancellation. You have until midnight of the twentieth day following
the date you receive this Contract. If you cancel this Contract within twenty
days after you receive it, the Contract will be void and we will refund the
Purchase Payments in full, plus or minus any investment gains or losses under
the Contract. If this Contract was purchased to replace an existing contract and
if you cancel this Contract after the twentieth day and on or before midnight of
the sixitieth day after you receive it, we will refund the Purchase Payments in
full, plus or minus any investment gains or losses under the Contract. Upon such
refund, the Contract shall be void. This Contract must be returned to us and the
required notice must be given in person, or to the agent who sold it to you, or
by mail. If by mail, the return of the Contract or the notice is effective on
the date it is postmarked, with the proper address and with postage paid
As you read through this Contract, please note that the words "we", "us", "our",
and "Company" refer to Great American Life Insurance Company of New York. The
words "you" and "your" refer to the Owner, including any joint owner.
This is a deferred variable annuity contract. It is a legally binding agreement
between you and us.
PLEASE READ YOUR CONTRACT WITH CARE.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
Nonparticipating - No Dividends
Non-Tax-Qualified
BENEFIT PAYMENTS AND OTHER VALUES DESCRIBED IN THIS CONTRACT, WHEN BASED ON THE
INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, MAY INCREASE OR DECREASE AND ARE
NOT GUARANTEED AS TO FIXED DOLLAR AMOUNTS. NO MINIMUM CONTRACT VALUE IS
GUARANTEED, EXCEPT FOR AMOUNTS IN THE FIXED ACCOUNT.
After a Variable Dollar Annuity Benefit is elected, the annual rate of return
earned on the assets of the Sub-Accounts must be equal to or exceed 3% for the
Variable Dollar Benefit payments not to decrease.
<PAGE>
NY3382NQ99
CONTRACT SPECIFICATIONS
OWNER: JOHN DOE
AGE OF OWNER AS OF CONTRACT EFFECTIVE DATE: 35
JOINT OWNER:
AGE OF JOINT OWNER AS OF CONTRACT EFFECTIVE DATE:
ANNUITANT:
AGE OF ANNUITANT AS OF CONTRACT EFFECTIVE DATE:
CONTRACT NUMBER: 000000000
CONTRACT EFFECTIVE DATE: APRIL 01, 1999
ANNUITY COMMENCEMENT DATE: APRIL 01, 2034
SEPARATE ACCOUNT: GALIC of New York Separate Account I
Following is a list of the Funds in which the currently available Sub-Accounts
invest:
[Janus Aspen Series Aggressive Growth Portfolio]
[Janus Aspen Series Worldwide Growth Portfolio]
[Janus Aspen Series Balanced Portfolio]
[Janus Aspen Series Growth Portfolio]
[Janus Aspen Series International Growth Portfolio]
[Dreyfus Variable Investment Fund-Capital Appreciation Portfolio]
[Dreyfus Variable Investment Fund-Money Market Portfolio]
[Dreyfus Variable Investment Fund-Growth and Income Portfolio]
[Dreyfus Variable Investment Fund-Small Cap Portfolio]
[The Dreyfus Socially Responsible Growth Fund, Inc.]
[Dreyfus Stock Index Fund]
[Strong Opportunity Fund II]
[Strong Mid Cap Growth Fund II]
[The Timothy Plan Variable Series]
[INVESCO VIF-Equity Income Fund]
[INVESCO VIF-Total Return Fund]
[INVESCO VIF- High Yield Fund]
[Morgan Stanley Dean Witter Universal Funds, Inc. U.S. Real Estate Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Value Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Emerging Markets Equity
Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Fixed Income Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Mid Cap Value Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Growth II Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Technology & Communications Portfolio]
<PAGE>
FIXED ACCOUNT:
Following is a list of the currently available Fixed Account options, with
guarantee periods as may be applicable:
Fixed Accumulation Account Option
Fixed Account Option One-Year Guarantee Period
Fixed Account Option Three-Year Guarantee Period
Fixed Account Option Five-Year Guarantee Period
Fixed Account Option Seven-Year Guarantee Period
The guaranteed rate of interest for the Fixed Account options is three percent
(3%) per year, compounded annually.
MINIMUM MONTHLY PERIODIC PURCHASE PAYMENT: $100
MINIMUM ADDITIONAL PURCHASE PAYMENTS: $50
MINIMUM SINGLE PURCHASE PAYMENT: $5,000
MAXIMUM PURCHASE PAYMENT: $500,000, without Home Office Approval.
TRANSFER FEE: $25 per transfer in excess of twelve (12) in any Contract Year.
CONTINGENT DEFERRED SALES CHARGE: An amount deducted on each partial or full
surrender of a Purchase Payment, as follows:
<TABLE>
<CAPTION>
Number of full years elapsed between the date of Contingent Deferred Sales Charge as
receipt of a Purchase Payment and date Written a percentage of the associated
Request for surrender is received Purchase Payment surrendered
-------------------------------------------------- -------------------------------------------------
<S> <C> <C>
0 7%
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7+ 0%
</TABLE>
Please see the SURRENDERS section of this Contract for additional information.
FREE WITHDRAWAL PRIVILEGE:
Contract Year Applicable Percentage
1 10% of all Purchase Payments received
2 and thereafter Greater of: (a) Accumulated Earnings; or (b)
10% of Account Value as of last Contract Anniversary
Please see the SURRENDERS section of this Contract for additional information.
CONTRACT MAINTENANCE FEE: $30 Annually
MORTALITY AND EXPENSE RISK CHARGE: A charge equal to an effective annual rate of
1.25% of the daily Net Asset Value of the Sub-Accounts.
ADMINISTRATION CHARGE: A charge equal to an effective annual rate of 0.15% of
the daily Net Asset Value of the
- ---------------------
Sub-Accounts.
<PAGE>
TERMINATION: We reserve the right to terminate this Contract at any time prior
to the Annuity Commencement Date if 1) no Purchase Payments have been paid for
three (3) consecutive years and 2) the Account Value is less than $2,000. We
will then pay you the Account Value of this Contract as of the end of the
Valuation Period in which the Contract is terminated.
INQUIRIES: For information, or to make a complaint, call or write:
Variable Annuity Service Center
Great American Life Insurance Company of New York
Post Office Box 5423
Cincinnati, Ohio 45201-5423
1-800-789-6771
<PAGE>
- ------------------------------------------------------------------------
NY3382NQ99
TABLE OF CONTENTS Page
- -------------------------------------------------------------------------------
Definitions...................................................................7
General Provisions............................................................9
Entire Contract...........................................................9
Changes -- Waivers........................................................9
Nonparticipating..........................................................9
Misstatement..............................................................9
Required Reports..........................................................9
Exclusive Benefit.........................................................9
State Law................................................................10
Claims of Creditors......................................................10
Company Liability........................................................10
Voting Rights............................................................10
Incontestability.........................................................10
Discharge of Liability...................................................10
Purchase Payments............................................................10
Purchase Payments........................................................10
Allocation of Purchase Payments..........................................10
No Termination...........................................................10
Fixed Account................................................................11
Fixed Account............................................................11
Fixed Account Options..................................................11
Interest Credited......................................................11
Renewal................................................................11
Fixed Account Value......................................................11
Separate Account.............................................................12
General Description......................................................12
Sub-Accounts of the Separate Account.....................................12
Valuation of Assets......................................................12
Variable Account Value...................................................12
Accumulation Unit Value..................................................13
Transfers....................................................................13
Fees and Charges.............................................................14
Mortality and Expense Risk Charge........................................14
Administration Charge....................................................14
Contract Maintenance Fee.................................................14
Surrenders...................................................................14
Surrenders...............................................................14
Surrender Value..........................................................14
Contingent Deferred Sales Charge.........................................14
Free Withdrawal Privilege................................................15
Deferral of Payment......................................................15
Ownership Provisions.........................................................15
Ownership of Separate Account............................................15
Owner....................................................................15
Joint Ownership..........................................................16
Assignment...............................................................16
Transfer of Ownership....................................................16
Successor Owner..........................................................16
Community Property.......................................................16
Annuitant Provisions.........................................................16
Annuitant................................................................16
Death of Annuitant.......................................................17
Change of Annuitant......................................................17
Beneficiary Provisions.......................................................17
Beneficiary..............................................................17
Change of Beneficiary....................................................17
Benefit on Annuity Commencement Date.........................................18
Annuity Commencement Date................................................18
Annuity Benefit Payments.................................................18
Form of Annuity Benefit..................................................18
Benefit on Death of Owner....................................................18
Death Benefit............................................................18
Death Benefit Amount.....................................................19
Transfers After Death....................................................20
Death Benefit Commencement Date..........................................20
Form of Death Benefit....................................................20
Contract Distribution Rules..................................................20
Rules Before Annuity Commencement Date...................................20
Rules On or After Annuity Commencement Date..............................21
Rules On or After Death Benefit Commencement Date........................21
Settlement Options...........................................................21
Conditions...............................................................21
Benefit Payments.........................................................21
Fixed Dollar Benefit.....................................................22
Betterment Of Rates......................................................22
Variable Dollar Benefit..................................................22
Limitation on Election of Settlement Option..............................22
Settlement Option Computations...........................................22
Available Settlement Options.............................................23
Settlement Option Tables.................................................23
<PAGE>
DEFINITIONS
Account(s): The Sub-Account(s) and/or the Fixed Account options.
Account Value: The aggregate value of your interest in the Sub-Account(s) and
the Fixed Account options as of the end of any Valuation Period. The value of
your interest in all Sub-Accounts is the "Variable Account Value," and the value
of your interest in all Fixed Account options is the "Fixed Account Value."
Accumulated Earnings: The Account Value in excess of Purchase Payments received
by us and which have not been returned to you.
Accumulation Period: The period prior to the applicable Commencement Date.
Accumulation Unit: A unit of measure used to calculate the value(s) of the
Sub-Account(s) prior to the applicable Commencement Date.
Administrative Office: The home office of the Company or any other place of
business which we may designate for administration.
Age: Age as of most recent birthday.
Annuitant: A natural person whose life is used to determine the duration of
annuity payments involving life contingencies.
Annuity Benefit: Periodic payments under a settlement option, which commence on
or after the Annuity Commencement Date.
Annuity Commencement Date: The first day of the first Payment Interval for which
an Annuity Benefit payment is to be made under a settlement option.
Beneficiary: A person entitled to the Death Benefit under the Contract upon the
death of an Owner. If there is a surviving joint Owner, that person will be
deemed the Beneficiary.
Benefit Payment: The Annuity Benefit or Death Benefit payable under a settlement
option. Variable Dollar Benefit payments may vary in amount. Fixed Dollar
Benefit payments remain constant except under certain joint and survivor
settlement options.
Benefit Payment Period: The period starting with the Commencement Date during
which Benefit Payments are to be made under this Contract.
Benefit Unit: A unit of measure used to determine the dollar value of any
Variable Dollar Benefit payments after the first Benefit Payment is made by us.
Code: The Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder.
Commencement Date: The Annuity Commencement Date if an Annuity Benefit is
payable under this Contract, or the Death Benefit Commencement Date if a Death
Benefit is payable under this Contract.
Contract Anniversary: An annual anniversary of the Contract Effective Date.
Contract Effective Date: The date shown on the Contract Specifications page.
Contract Year: Any period of twelve (12) months, commencing on the Contract
Effective Date and on each Contract
Anniversary thereafter.
Death Benefit: The benefit described in the Benefit on Death of Owner section of
this Contract.
<PAGE>
Death Benefit Commencement Date: The first day of the first Payment Interval for
which a Death Benefit payment is to be made under a settlement option, or the
date a Death Benefit is to be paid in a lump sum.
Death Benefit Valuation Date: The date that Due Proof of Death has been received
by us and the earlier to occur of:
1) our receipt of a Written Request with instructions as to the form of
Death Benefit; or
2) the Death Benefit Commencement Date.
Due Proof of Death: Any of the following:
1) a certified copy of a death certificate;
2) a certified copy of a decree of a court of competent jurisdiction as to
the finding of death; or
3) any other proof satisfactory to us.
Fund: A management investment company or portfolio thereof, registered under the
Investment Company Act of 1940, in which a Sub-Account of the Separate Account
invests.
Net Asset Value: The amount computed by an investment company, no less
frequently than each Valuation Period, as the price at which its shares or
units, as the case may be, are redeemed in accordance with the rules of the
Securities and Exchange Commission.
Owner: The person(s) identified as such on the Contract Specifications page.
Payment Interval: A monthly, quarterly, annual or other regular interval during
the Benefit Payment Period.
Person Controlling Payments: The "Person Controlling Payments" means the
following, as the case may be:
1) with respect to Annuity Benefit payments,
a) the Owner, if the Owner has the right to change the payee; or
b) in all other cases, the payee; and
2) with respect to Death Benefit payments,
a) the Beneficiary; or
b) if the Beneficiary is deceased, the payee.
Purchase Payment: A contribution amount paid to us in consideration for this
Contract, after the deduction of any and all of the following which may apply:
1) any fee charged by the person remitting payments for you;
2) premium taxes; and/or
3) other taxes.
Separate Account: An account, which may be an investment company, which is
established and maintained by the Company pursuant to the laws of the State of
New York.
Sub-Account: The Separate Account is divided into Sub-Accounts, each of which
invests in the shares of a designated Fund.
Valuation Period: The period commencing at the close of regular trading on the
New York Stock Exchange on any Valuation Date, and ending at the close of
trading on the next succeeding Valuation Date. "Valuation Date" means each day
on which the New York Stock Exchange is open for business.
<PAGE>
Written Request: Information provided, or a request made, that is complete and
satisfactory to us, that is sent to us on our form or in a manner satisfactory
to us, and that is received by us at our Administrative Office. A Written
Request is subject to any payment made or any action we take before we receive
it. The Company will deem a Written Request a standing order which may be
modified or revoked only by a subsequent Written Request, when permitted by the
terms of this Contract. You may be required to return this Contract to us in
connection with a Written Request.
GENERAL PROVISIONS
Entire Contract
We have issued this Contract to the Owner identified on the Contract
Specifications page. This Contract is an individual flexible premium deferred
variable annuity contract. This Contract is restricted as required to obtain
favorable tax treatment under the Code. This Contract, any endorsements to it
and the application for it, if any, form the entire Contract between you and us.
Changes - Waivers
No changes or waivers of the terms of this Contract are valid unless made in
writing by our President, Vice President, or Secretary. No agent or other person
not named above has authority to change or waive any provision of this Contract.
We reserve the right both to administer and to change the provisions of this
Contract to conform to any applicable laws, regulations or rulings issued by a
governmental agency.
In any event, the Company reserves the right to add or delete Fixed Account
options and Sub-Accounts, to substitute shares of a different Fund or different
class or series of a Fund for shares held in a Sub-Account, to merge or combine
Sub-Accounts, to merge or combine the Separate Account with any other separate
account of the Company, to transfer the assets of the Separate Account to
another life insurance company by means of a merger or reinsurance, to convert
the Separate Account into a managed separate account, and to de-register the
Separate Account under the Investment Company Act of 1940. Any such change will
be made in accordance with applicable insurance and securities laws and after
obtaining any necessary approvals, including those of the New York State
Insurance Department and the Securities and Exchange Commission. Any such change
will not reduce benefits due under this Contract.
Nonparticipating
This Contract does not pay dividends or share in the Company's divisible
surplus.
Misstatement
If the age of a person on whose life Benefit Payments are based is misstated,
the payments or other benefits under this Contract shall be adjusted to the
amount which would have been payable based on the correct age. If we made any
underpayments based on any misstatement, the amount of any underpayment with
interest at the rate of six percent (6%) per year shall be immediately paid in
one sum. In addition to any other remedies that may be available at law or at
equity, we may deduct any overpayments made, with interest at the rate of six
percent (6%) per year, from any succeeding payment(s) due under this Contract.
Required Reports
At least once each Contract Year, we will send you one or more statements
reporting the investments held in the Separate Account, the number of
Accumulation Units under your Contract and your Account Value as of the most
recent calendar quarter, and any other information required by law, until the
first to occur of the following:
1) the date this Contract is fully surrendered;
2) the Annuity Commencement Date; or
3) the Death Benefit Commencement Date.
The report will be mailed to your last known address. The reported values will
be based on the information in our possession at the time the report is prepared
by us. We may adjust the reported values at a later date if that information
proves to be incorrect or has changed.
Exclusive Benefit
This Contract is for the exclusive benefit of you and your Beneficiaries. Your
interest under this Contract is nonforfeitable by us.
<PAGE>
State Law
All factors, values, benefits and reserves under this Contract will not be less
than those required by the law of the state in which this Contract is delivered.
Claims of Creditors
To the extent allowed by law, your Contract and all values and benefits under it
are not subject to the claims of creditors or to legal process.
Company Liability
We will not incur any liability or be responsible for any failure, in whole or
in part, by you or by any person having rights or benefits arising out of or
related to this Contract, to comply with any applicable laws, regulations or
rulings issued by a governmental agency.
Voting Rights
To the extent required by law, we will vote all shares of the Funds held in the
Separate Account, at regular and special shareholder meetings of the Funds. The
shares will be voted in accordance with instructions received from you, or if
applicable, from the Person Controlling Payments. If there is a change in the
law which permits us to vote the shares of the Funds without such instructions,
then we reserve the right to do so.
Incontestability
This Contract shall not be contestable by us.
Discharge of Liability
Upon payment of any partial or full surrender, or any Benefit Payment, we shall
be discharged from all liability to the extent of each such payment.
PURCHASE PAYMENTS
Purchase Payments
One or more Purchase Payments may be paid to us at any time before the Annuity
Commencement Date, so long as:
1) you are still living; and
2) this Contract has not been fully surrendered.
The initial Purchase Payment must be paid to us on or before the Contract
Effective Date. Each Purchase Payment must be paid to us at our Administrative
Office, and is subject to any minimums or maximums shown on the Contract
Specifications page. Upon request, we will provide you with a receipt as proof
of payment.
Allocation of Purchase Payments
We will allocate Purchase Payments to the Fixed Account options and/or to the
Sub-Accounts according to the instructions we receive by Written Request.
Allocations must be made in whole percentages. The minimum Purchase Payment
amount that can be allocated to a Fixed Account option other than the Fixed
Accumulation Account is $2,000.
No Termination
Except as stated elsewhere in this Contract, this Contract will not be
terminated by us due to failure to make additional Purchase Payments.
<PAGE>
FIXED ACCOUNT
Fixed Account
The Fixed Account is part of the Company's general account. The values of the
Fixed Account are not dependent upon the investment performance of the
Sub-Accounts.
Fixed Account Options. The Fixed Account options available as of the Contract
Effective Date are listed on the Contract Specifications page. Different Fixed
Account options may be offered by us at any time.
Interest Credited. The guaranteed rate of interest for the Fixed Account options
is three percent (3%) per year, compounded annually. We may, at any time, pay a
current interest rate as declared by our Board of Directors for any of the Fixed
Account options that is higher than the guaranteed rate.
The interest rate initially credited to each Purchase Payment(s) allocated to
the Fixed Accumulation Account Option will not be changed any sooner than twelve
(12) months following the date on which that Purchase Payment was received;
thereafter, the interest rate credited will not be changed more frequently than
once per calendar quarter. In the case of transfers from other Fixed Account
options or the Sub-Accounts to the Fixed Accumulation Account Option, the
interest rate will not be changed more frequently than once per calendar
quarter.
The interest rate credited to amounts allocated to the Fixed Account options
other than the Fixed Accumulation Account Option will not be changed during the
duration of the applicable guarantee period.
Renewal. The following provisions apply to all Fixed Account options except the
Fixed Accumulation Account Option.
At the end of a guarantee period, and for the thirty (30) days immediately
preceding the end of such guarantee period, you may elect a new option to
replace the Fixed Account option that is then expiring. The entire amount
maturing may be re-allocated to any of the then-current options under this
Contract (including the various Sub-Accounts within the Separate Account),
except that a Fixed Account option with a guarantee period that would extend
past the Annuity Commencement Date may not be selected. In particular, in the
case of renewals occurring within one (1) year of such Commencement Date, the
only Fixed Account option available is the Fixed Accumulation Account Option.
If you do not specify a new Fixed Account option in accordance with the
preceding paragraph, you will be deemed to have selected the same Fixed Account
option as is expiring, so long as the guarantee period of such option does not
extend beyond the Annuity Commencement Date. In the event that such a period
would extend beyond the Annuity Commencement Date, you will be deemed to have
selected the Fixed Account option with the longest available guarantee period
that expires prior to the Annuity Commencement Date, or, failing that, the Fixed
Accumulation Account Option.
Any renewal of a Fixed Account option under this Renewal provision will be
effective on the day after the expiration of the guarantee period that is then
expiring.
Fixed Account Value
The Fixed Account Value for this Contract at any time is equal to:
1) the Purchase Payment(s) allocated to the Fixed Account; plus
2) amounts transferred to the Fixed Account; plus
3) interest credited to the Fixed Account; less
4) any charges, surrenders, deductions, amounts transferred from the Fixed
Account or other adjustments made as described elsewhere in this
Contract.
<PAGE>
SEPARATE ACCOUNT
General Description
The variable benefits under this Contract are provided through the Separate
Account. The Separate Account is registered with the Securities and Exchange
Commission as a unit investment trust under the Investment Company Act of 1940.
The income, if any, and any gains or losses, realized or unrealized, on the
Separate Account will be credited to or charged against the amounts allocated to
such account without regard to other income, gains, or losses of the Company.
The amounts allocated to the Separate Account and the accumulations thereon
remain the property of the Company, but that portion of the assets of the
Separate Account that is equal to the reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account is not chargeable with liabilities arising out of any other business of
the Company. The Company is not, and does not hold itself out to be, a trustee
in respect of such amounts.
We have the right to transfer to our general account, in our sole discretion and
at any time without prior written notice, any assets of the Separate Account
which are in excess of the required reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account.
Sub-Accounts of the Separate Account
The assets of the Separate Account are divided into Sub-Accounts. The
Sub-Accounts available as of the Contract Effective Date are listed on the
Contract Specifications page. Each Sub-Account invests exclusively in shares of
an underlying Fund as shown on the Contract Specifications page. Any amounts of
income and any gains on the shares of a Fund will be reinvested in additional
shares of that Fund at its Net Asset Value.
Valuation of Assets
Shares of Funds held by each Sub-Account will be valued at their Net Asset Value
at the end of each Valuation Period, as reported by each such Fund.
Variable Account Value
Purchase Payment(s) may be allocated among and, as described elsewhere in this
Contract, Account values may be transferred to the various Sub-Accounts within
the Separate Account. For each Sub-Account, the Purchase Payment(s) or amounts
transferred are converted into Accumulation Units. The number of Accumulation
Units credited is determined by dividing the dollar amount directed to each
Sub-Account by the value of the Accumulation Unit for that Sub-Account at the
end of the Valuation Period during which the Purchase Payment(s) or transferred
amount is received.
The following events will result in the cancellation of an appropriate number of
Accumulation Units of a Sub-Account:
1) transfer from a Sub-Account;
2) full or partial surrender of the Variable Account Value;
3) payment of a Death Benefit;
4) application of the Variable Account Value to a settlement option;
5) deduction of the Contract Maintenance Fee; or
6) deduction of any Transfer Fee.
Accumulation Units will be canceled as of the end of the Valuation Period during
which the Company receives a Written Request regarding the event giving rise to
such cancellation, or an applicable Commencement Date, or the end of the
Valuation Period on which the Contract Maintenance Fee or Transfer Fee is due,
as the case may be.
The Variable Account Value for this Contract at any time is equal to the sum of
the number of Accumulation Units for each Sub-Account attributable to this
Contract multiplied by the Accumulation Unit Value for each Sub-Account at the
end of the preceding Valuation Period.
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Accumulation Unit Value
The initial Accumulation Unit Value for each Sub-Account, with the exception of
the Money Market Sub-Account, was set at $10.00. The initial Accumulation Unit
Value for the Money Market Sub-Account was set at $1.00. Thereafter, the
Accumulation Unit Value at the end of each Valuation Period is the Accumulation
Unit Value at the end of the previous Valuation Period multiplied by the Net
Investment Factor, as described below.
The Net Investment Factor is a factor applied to measure the investment
performance of a Sub-Account from one Valuation Period to the next. Each
Sub-Account has a Net Investment Factor for each Valuation Period which may be
greater or less than one. Therefore, the Accumulation Unit Value for each
Sub-Account may increase or decrease. The Net Investment Factor for any
Sub-Account for any Valuation Period is determined by dividing (1) by (2) and
subtracting (3) from the result, where:
1) is equal to:
a) the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the
applicable Valuation Period; plus
b) the per share amount of any dividend or net capital gain
distributions made by the Fund held in the Sub-Account, if the
"ex-dividend" date occurs during the applicable Valuation Period;
plus or minus
c) a per share charge or credit for any taxes reserved for, which is
determined by the Company to have resulted from the investment
operations of the Sub-Account;
2) is the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the immediately preceding Valuation Period; and
3) is the factor representing the Mortality and Expense Risk Charge and the
Administration Charge deducted from the Sub-Account for the number of days
in the applicable Valuation Period.
TRANSFERS
Prior to the applicable Commencement Date, you may transfer amounts in a
Sub-Account to a different Sub-Account and/or one or more of the Fixed Account
options.
After the first Contract Anniversary, and prior to the applicable Commencement
Date, you may transfer amounts from any Fixed Account option to any other Fixed
Account option and/or one or more of the Sub-Accounts. If a transfer is being
made from a Fixed Account option pursuant to the Renewal provision of this
Contract, then the entire amount of that Fixed Account option subject to renewal
at that time may be transferred. In any other case, transfers from a Fixed
Account option are subject to a cumulative limit during each Contract Year of
twenty percent (20%) of the Fixed Account option's value as of the most recent
Contract Anniversary.
Amounts previously transferred from Fixed Account options to the Sub-Accounts
may not be transferred back to the Fixed Account options for a period of ninety
(90) days from the date of transfer.
The minimum transfer amount for any transfer is $500. The number of transfers
per year over which we will charge a Transfer Fee on each additional transfer,
and the amount of the Transfer Fee, are shown on the Contract Specifications
page.
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FEES AND CHARGES
Mortality and Expense Risk Charge
The Mortality and Expense Risk Charge is shown on the Contract Specifications
page and is deducted daily from each Sub-Account. This deduction is made to
compensate the Company for assuming the mortality and expense risks under this
Contract.
Administration Charge
The Administration Charge is shown on the Contract Specifications page and is
deducted daily from each Sub-Account. This deduction is made to reimburse the
Company for expenses incurred in the administration of this Contract and the
Separate Account.
Contract Maintenance Fee
The Contract Maintenance Fee ("Fee") is shown on the Contract Specifications
page and is deducted as of the Valuation Period next following each Contract
Anniversary prior to the applicable Commencement Date. In addition, the full
annual Fee will be deducted at the time of a full surrender. The Fee will be
allocated to each Sub-Account in the same proportion as each Sub-Account's value
is to the total Variable Account Value as of the end of such Valuation Period.
The Fee does not apply to the Fixed Account.
After the applicable Commencement Date, if a Variable Dollar Benefit is elected,
the Fee will be deducted pro-rata from each Benefit Payment and will result in a
reduction in the amount of such payment.
The Fee may be waived in whole or in part in our sole discretion if:
1) during the Accumulation Period, the Account Value is at least $40,000
on the date the charge is made; or
2) during the Benefit Payment Period, the amount applied to a Variable
Dollar Benefit is at least $40,000.
SURRENDERS
Surrenders
You may surrender this Contract in full for the Surrender Value, or, partial
surrenders may be made for a lesser amount, by Written Request at any time prior
to the Annuity Commencement Date. The amount of any partial surrender must be at
least $500. If a partial surrender would reduce your Account Value to less than
$500, we will treat the surrender request as a request for full surrender.
Surrenders will be deemed to be withdrawn first from the portion of the Account
Value that represents your Accumulated Earnings and then from Purchase Payments.
For purposes of this Contract, Purchase Payments are deemed to be withdrawn on a
"first-in, first out" (FIFO) basis.
The amount available for surrender will be the Surrender Value at the end of the
Valuation Period in which the Written Request is received.
Surrender Value
The Surrender Value at any time is an amount equal to:
1) the Account Value as of the end of the applicable Valuation Period;
less
2) any applicable Contingent Deferred Sales Charge; less
3) any outstanding loans; and less
4) any applicable premium tax or other taxes not previously deducted.
On full surrender, a full Contract Maintenance Fee will also be deducted as part
of the calculation of the Surrender Value.
Contingent Deferred Sales Charge
A full or partial surrender may be subject to a Contingent Deferred Sales Charge
as set forth on the Contract Specifications page. The Contingent Deferred Sales
Charge applies to and is calculated separately for each Purchase Payment.
The Contingent Deferred Sales Charge may be waived in whole or in part in our
sole discretion, if:
1) the Contract is issued with a tax sheltered annuity endorsement (and
without an employer plan endorsement): (i) upon separation from service
if the Owner has attained age 55 and the Contract has been in force for
at least seven (7) years; or (ii) after the Contract has been in force
fifteen (15) years or more; or
2) the Social Security Administration determines after the Contract is
issued that the owner is "disabled" as defined in the Social Security
Act of 1935, as amended; or
3) the Contract is issued with a Successor Owner endorsement.
Surrenders will result in the cancellation of Accumulation Units from each
applicable Sub-Account(s) and/or a reduction of your Fixed Account Value and a
reduction in your Death Benefit amount. In the case of a full surrender, this
Contract will be terminated.
Free Withdrawal Privilege
Subject to the provisions of this Contract, we will waive the Contingent
Deferred Sales Charge, to the extent applicable, on full or partial surrenders
as follows:
1) during the first Contract Year, on an amount equal to not more than the
applicable percentage (shown on the Contract Specifications page) of
all Purchase Payments received; and
2) during the second and succeeding Contract Years, on an amount equal to
the greater of:
a) Accumulated Earnings, or
b) not more than the applicable percentage (shown on the Contract
Specifications page) of the Account Value as of the last Contract
Anniversary.
The Free Withdrawal Privilege will be applied in each case to monies in the
order in which they are deemed withdrawn, as described in the Surrenders
provision of this Contract.
Deferral of Payment
The Company has the right to suspend or delay the date of payment of a partial
or full surrender of the Variable Account Value for any period:
1) when the New York Stock Exchange is closed, or when trading on the New
York Stock Exchange is restricted; or
2) when an emergency exists (as determined by the Securities and Exchange
Commission) as a result of which: a) the disposal of securities in the
Separate Account is not reasonably practicable; or b) it is not
reasonably practicable to determine fairly the value of the net assets
in the Separate Account; or
3) when the Securities and Exchange Commission so permits for the
protection of security holders.
The Company further reserves the right to delay payment of a partial or full
surrender of the Fixed Account Value for up to six (6) months after we receive
your Written Request.
OWNERSHIP PROVISIONS
Ownership of Separate Account
The Company has absolute ownership of the assets in the Separate Account. The
Company is not, and does not hold itself out to be, a trustee in respect of any
amounts under the Separate Account.
Owner
The Owner of this Contract is the person or persons shown as Owner on the
Contract Specifications page, or the person or persons you designate under the
Transfer of Ownership provision of this Contract.
Unless otherwise stated, the Owner may exercise all ownership rights under this
Contract.
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If you or the joint owner is a non-natural person, then the age of the eldest
Annuitant will be treated as the age of such Owner for all purposes under this
Contract.
Joint Ownership
Two owners may jointly own this Contract. Joint owners may independently
exercise transfers among the Sub-Accounts and the Fixed Account options. In
addition, joint owners may independently designate Purchase Payment allocations.
All other rights of ownership must be exercised by joint action.
Assignment
You may assign all or any part of your rights under this Contract except your
rights to:
1) designate or change a Beneficiary;
2) designate or change an Annuitant;
3) transfer ownership; and
4) elect a settlement option.
The person to whom you make an assignment is called an assignee.
We are not responsible for the validity of any assignment. An assignment must be
in writing and must be received at our Administrative Office. We will not be
bound by an assignment until we receive it. An assignment is subject to any
payment made or any action we take before we receive it. An assignment may be
ended only by the assignee or as provided by law.
The rights of an assignee, including the right to any distribution under this
Contract, come before the rights of any Owner, Annuitant, Beneficiary or other
payee.
Transfer of Ownership
You may transfer ownership at any time during your lifetime. Any such transfer
is subject to the following:
1) it must be made by Written Request. The Written Request will be
effective as of the date it is signed, subject to our receipt of the
Written Request; and
2) unless otherwise elected or required by law, it will not cancel a
designation of an Annuitant or Beneficiary or any settlement option
election previously made.
Successor Owner
By Written Request, your spouse may, in some cases, succeed to the ownership of
this Contract after your death. Specifically, if you die and your spouse is the
surviving joint owner or sole surviving Beneficiary under this Contract, he or
she will become the Successor Owner of this Contract if:
1) you make that Written Request before your death; or
2) after your death, your spouse makes that Written Request within one (1)
year of your death and before the Death Benefit Commencement Date.
As Successor Owner, your spouse will then succeed to all rights of ownership
under this Contract except the right to name another Successor Owner.
Community Property
If you live in a community property state and have a spouse at any time while
you own this Contract, the laws of that state may vary your ownership rights.
ANNUITANT PROVISIONS
Annuitant
The Annuitant is the person or persons designated on the Contract Specifications
page, or under the Change of Annuitant provision of this Contract. Two or more
Annuitants may jointly be the persons on whose lives Annuity Benefit payments
are based.
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An Annuitant designation may be joint or contingent or both. A contingent
Annuitant will be the person on whose life Annuity Benefit payments are based
only if there is no surviving primary Annuitant.
Death of Annuitant (Other than Owner)
If an Annuitant who is not an Owner dies before the Annuity Commencement Date,
then:
1) if there is one or more surviving joint Annuitant(s), such survivor or
survivors will continue as the sole or joint Annuitant(s) under the
Contract, as the case may be; or
2) if there is no surviving joint Annuitant(s), any surviving contingent
Annuitant(s) will become the sole or joint Annuitant(s) under the
Contract, as the case may be; or
3) if there is no surviving joint or contingent Annuitant(s), the Owner or
joint owners will become the sole or joint Annuitant(s), as the case
may be.
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If you or the joint owner, if any, is a non-natural person, then the death of an
Annuitant before the Annuity Commencement Date will be treated as the death of
the Owner for all purposes under this Contract.
Change of Annuitant
You may change the Annuitant at any time before the Annuity Commencement Date,
except that no change of Annuitant may be made if you or the joint owner, if
any, is a non-natural person.
Any such change is subject to the following:
1) it must be made by Written Request. The Written Request will be
effective as of the date it is signed, subject to our receipt of the
Written Request; and
2) unless otherwise elected or required by law, it will not cancel a
designation of a Beneficiary or any settlement option election
previously made.
BENEFICIARY PROVISIONS
Beneficiary
If there is a joint owner and that joint owner survives you, that joint owner is
the Beneficiary, regardless of any designation made by you. If there is no
surviving joint owner, the Beneficiary is the person or persons so designated in
the application, if any, or under the Change of Beneficiary provision of this
Contract. If you have not designated a Beneficiary, or if no Beneficiary
designated by you survives you, then the Beneficiary will be your estate.
Unless you provide otherwise by Written Request, a Beneficiary will be deemed
not to have survived you if he or she dies within thirty (30) days after your
death.
A beneficiary designation may be joint or contingent or both. Unless otherwise
stated, joint Beneficiaries will be entitled to equal shares. A contingent
Beneficiary will be entitled to a benefit only if there is no surviving primary
Beneficiary.
Change of Beneficiary
An irrevocable Beneficiary may not be changed without his or her consent. Unless
you have designated an irrevocable Beneficiary, you may change your designation
of a Beneficiary at any time before the Annuity Commencement Date, effective as
of the date the Written Request is signed, subject to our receiving the Written
Request.
Any such change is subject to the following:
1) it must be made by Written Request; and
2) unless otherwise elected or required by law, it will not cancel a
designation of an Annuitant or any settlement option election
previously made.
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BENEFIT ON ANNUITY COMMENCEMENT DATE
Annuity Commencement Date
The Annuity Commencement Date is shown on the Contract Specifications page. You
may change the Annuity Commencement Date by Written Request made at least thirty
(30) days prior to the date that Annuity Benefit payments are scheduled to
begin. The Annuity Commencement Date cannot be later than the Contract
Anniversary following your 85th birthday or five (5) years after the Contract
Effective Date, whichever is later, but in no event will it be later than your
90th birthday..
Annuity Benefit Payments
An amount equal to the Account Value (after deduction of any fees and charges,
loans, or applicable premium tax or other taxes not previously deducted) will be
used to provide Annuity Benefit payments under this Contract commencing on or
after the Annuity Commencement Date.
Annuity Benefit payments will be made to the Annuitant as payee. In lieu of
that, you may elect by Written Request to have Annuity Benefit payments made to
you or any natural person as payee. Any Annuity Benefit amounts remaining
payable on the death of the payee will be paid to the contingent payee
designated by you by Written Request. You may designate or change the payee or
contingent payee after the Annuity Commencement Date only if:
1) you are the payee, or
2) you reserve that right, by Written Request, on or before the Annuity
Commencement Date; or 3) you reserve that right, by Written Request, when
designating another person as payee or contingent
payee.
In any event, the Annuitant will be the person on whose life any Annuity Benefit
payments are based, and no change of payee or contingent payee at any time will
change this.
If no payee or contingent payee designated by you is surviving at the time
payment is to be made, then any Annuity Benefit amounts remaining payable will
be paid to the person or persons designated as contingent payee by Written
Request by the last payee who received payments. Failing that, any such amounts
will be paid to the estate of the last payee who received payments.
Form of Annuity Benefit
Annuity Benefit payments will be Fixed Dollar Benefit payments, made monthly in
accordance with the terms of Option B with a fixed period of one hundred twenty
(120) months under the SETTLEMENT OPTIONS section of this Contract.
In lieu of that, you may elect to have Annuity Benefit payments made pursuant to
any other available settlement option under the SETTLEMENT OPTIONS section of
this Contract. Any such election must be made by Written Request before the
Annuity Commencement Date, and is subject to the CONTRACT DISTRIBUTION RULES
section of this Contract. You may change your election of a settlement option by
Written Request made at least thirty (30) days prior to the date that Annuity
Benefit payments are scheduled to begin.
BENEFIT ON DEATH OF OWNER
Death Benefit
A Death Benefit will be paid under this Contract if:
1) you or the joint owner, if any, dies before the Annuity Commencement
Date and before this Contract is fully surrendered;
2) the Death Benefit Valuation Date has occurred; and 3) a spouse does not
become the Successor Owner.
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If a Death Benefit becomes payable:
1) it will be in lieu of all other benefits under this Contract; and
2) all other rights under this Contract will be terminated except for
rights related to the Death Benefit.
Death Benefit payments shall be made to the Beneficiary as payee. In lieu of
that, after the death of the Owner, a Beneficiary which is a non-natural person
may elect to have Death Benefit payments made to a payee to whom the Beneficiary
is obligated to make corresponding payments of a death benefit. Any such
election by a non-natural person as Beneficiary shall be by Written Request, and
may be made or changed at any time.
The Beneficiary will be the person on whose life any Death Benefit payments
under a settlement option are based. However, if the Beneficiary is a
non-natural person, then any payments under a life option will be based on the
life of a person to whom the Beneficiary is obligated, who must be designated by
the Beneficiary by Written Request before the Death Benefit Commencement Date.
Any Death Benefit amounts remaining payable on the death of the Beneficiary will
be paid:
1) to any contingent payee designated by you as part of any Death Benefit
settlement option election made by you, or if none is surviving at the
time payment is to be made; then
2) to any contingent payee designated by the Beneficiary by Written
Request, or if none is surviving at the time payment is to be made;
then
3) to the estate of the last payee who received payments.
In any event, if the Beneficiary is a non-natural person, any Death Benefit
amounts remaining payable on the death of the payee will be paid to any
contingent payee designated by the Beneficiary by Written Request, or if none is
surviving at the time payment is to be made, then to the Beneficiary.
Only one Death Benefit will be paid under this Contract.
Death Benefit Amount
If you die before attaining Age eighty (80) and before the Annuity Commencement
Date, the Death Benefit is an amount equal to the greatest of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), with interest at three percent (3%) per
year, compounded annually through the earlier of the Death Benefit
Valuation Date or the Contract Anniversary prior to the date you would
have attained Age eights (80), less any partial surrenders and any
Contingent Deferred Sales Charges that applied to those amounts; or
3) the largest Account Value on any Contract Anniversary after the fourth
Contract Anniversary and prior to the earlier of the Death Benefit
Valuation Date or the date you would have attained Age eighty (80),
less any partial surrenders after such Account Value was determined and
any Contingent Deferred Sales Charge that applied to those amounts.
If you die after attaining Age eighty (80) and before the Annuity Commencement
Date, the Death Benefit is an amount equal to the greatest of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), with interest at three percent (3%) per
year, compounded annually through the Contract Anniversary prior to
your 80th birthday, less any partial surrenders and any Contingent
Deferred Sales Charges that applied to those amounts; or
3) the largest Account Value on any Contract Anniversary after the fourth
Contract Anniversary and prior to the date on which you attained Age
eighty (80), less any partial surrenders after such Account Value was
determined and any Contingent Deferred Sales Charges that applied to
those amounts.
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In any event, if this Contract was issued to you after Age eighty (80), and you
die before the Annuity Commencement Date, the amount of the Death Benefit will
be the greater of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), less any partial surrenders and any
Contingent Deferred Sales Charges that applied to those amounts.
As of the Death Benefit Valuation Date, the amount of the Death Benefit will be
allocated among the Sub-Accounts and Fixed Account options in the same
proportion as each Account's value is to the total Account Value as of the end
of the Valuation Period immediately preceding the Death Benefit Valuation Date.
Any applicable premium tax or other taxes not previously deducted, and any
outstanding loans, will be deducted from the Death Benefit amount described
above.
Transfers After Death
Between the Death Benefit Valuation Date and the Death Benefit Commencement
Date, the Beneficiary may transfer funds among Sub-Accounts and Fixed Account
options as described under the TRANSFERS section of this Contract.
Death Benefit Commencement Date
The Beneficiary may designate the Death Benefit Commencement Date by Written
Request within one (1) year of your death. If no designation is made, then the
Death Benefit Commencement Date will be one (1) year after your death.
Form of Death Benefit
Payments under the Death Benefit provision of this Contract will be Fixed Dollar
Benefit payments made monthly in accordance with the terms of Option A with a
period certain of forty-eight (48) months under the SETTLEMENT OPTIONS section
of this Contract.
In lieu of that, you may elect at any time before your death to have payments
under the Death Benefit provision of this Contract made in one lump sum or
pursuant to any available settlement option under the SETTLEMENT OPTIONS section
of this Contract. If you do not make any such election, the Beneficiary may make
that election at any time after your death and before the Death Benefit
Commencement Date.
You may change your election of a settlement option at any time before your
death.
If a Beneficiary elects a settlement option as noted above, he or she may change
his or her own election of a settlement option by Written Request made at least
thirty (30) days prior to the date that Death Benefit payments are scheduled to
begin.
Any election or change of election must be made by Written Request, and is
subject to the CONTRACT DISTRIBUTION RULES section of this Contract.
CONTRACT DISTRIBUTION RULES
Rules Before Annuity Commencement Date
If you or the joint owner, if any, dies before the Annuity Commencement Date,
the Death Benefit under the BENEFIT ON DEATH OF OWNER section of this Contract
must be paid either:
1) in full within five (5) years of such death; or
2) over the life of the Beneficiary or over a period certain not exc ally
starting within one (1) year of such death.
However, if your spouse becomes the Successor Owner of this Contract after your
death, then:
1) this rule will not apply at the time of your death; and
2) if your spouse later dies before the Annuity Commencement Date, this
rule will apply upon the death of your spouse, with your spouse being
treated as the Owner for purposes of this rule.
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Rules On or After Annuity Commencement Date
If the Person Controlling Payments under this Contract on or after the Annuity
Commencement Date dies on or after that date, any amount remaining payable under
this Contract at the time of his or her death must be paid at least as rapidly
as payments were being made at the time of such death.
Rules On or After Death Benefit Commencement Date
If the Beneficiary dies on or after the Death Benefit Commencement Date, any
amount remaining payable under this Contract at the time of his or her death
must be paid at least as rapidly as payments were being made at the time of such
death.
SETTLEMENT OPTIONS
Conditions
The amount applied to a settlement option must be at least $2,000. We will pay
you the Account Value in one lump sum on the Annuity Commencement Date if it is
less than $2,000. The amount of any Fixed Dollar Benefit payment, or the amount
of the first Variable Dollar Benefit payment, under a settlement option must be
at least $20. More than one settlement option may be elected if the requirements
for each settlement option elected are satisfied. Once payment begins under a
settlement option, the settlement option may not be changed.
All elected settlement options must comply with current applicable laws,
regulations and rulings issued by any governmental agency.
If more than one person is the payee under a settlement option, payments will be
made to the payees in equal shares, unless otherwise provided by Written
Request. No more than two persons may be initial payees under any joint and
survivor settlement option.
If payment under a settlement option depends on whether a specified person is
still alive, we may at any time require proof that such person is still living.
We will require proof of the age of any person on whose life Benefit Payments
are based.
Benefit Payments
Benefit Payments may be calculated and paid:
1) as a Fixed Dollar Benefit;
2) as a Variable Dollar Benefit; or
3) as a combination of both.
If only a Fixed Dollar Benefit is to be paid, we will transfer all of the
Account Value to the Company's general account on the applicable Commencement
Date, or on the Death Benefit Valuation Date (if applicable). Similarly, if only
a Variable Dollar Benefit is elected, we will transfer all of the Account Value
to the Sub-Accounts as of the end of the Valuation Period immediately prior to
the applicable Commencement Date; we will allocate the amount transferred among
the Sub-Accounts in accordance with a Written Request. No transfers between the
Fixed Dollar Benefit and the Variable Dollar Benefit will be allowed after the
Commencement Date. However, after the Variable Dollar Benefit has been paid for
at least twelve (12) months, the Person Controlling Payments may, no more than
once each twelve (12) months thereafter, transfer all or part of the Benefit
Units upon which the Variable Dollar Benefit is based from the Sub-Account(s)
then held, to Benefit Units in different Sub-Account(s).
If a Variable Dollar Benefit is elected, the amount to be applied under that
benefit is the Variable Account Value as of the end of the Valuation Period
immediately preceding the applicable Commencement Date. If a Fixed Dollar
Benefit is to be paid, the amount to be applied under that benefit is the Fixed
Account Value as of the applicable Commencement Date, or as of the Death Benefit
Valuation Date (if applicable).
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Fixed Dollar Benefit
Fixed Dollar Benefit payments are determined by multiplying the Fixed Account
Value (expressed in thousands of dollars and after deduction of any fees and
charges, loans, or applicable premium tax or other taxes not previously
deducted) by the amount of the monthly payment per $1,000 of value obtained from
the Settlement Option Table for the settlement option elected. Fixed Dollar
Benefit payments will remain level for the duration of the Benefit Payment
Period.
If at the time a Fixed Dollar Benefit is elected, we have available options or
rates on a more favorable basis than those guaranteed, the higher benefits shall
be applied and shall not change for as long as that election remains in force.
Betterment Of Rates
The Fixed Dollar Benefit available under this Contract as of the Annuity
Commencement Date or the Death Benefit Commencement Date will not be less than
the benefit that would be provided by the application of the Account Value to
purchase any single consideration immediate annuity contract offered by us at
the time to the same class of annuitants.
Variable Dollar Benefit
The first monthly Variable Dollar Benefit payment is equal to your Variable
Account Value (expressed in thousands of dollars and after deduction of any fees
and charges, loans, or applicable premium tax or other taxes not previously
deducted) as of the end of the Valuation Period immediately preceding the
applicable Commencement Date multiplied by the amount of the monthly payment per
$1,000 of value obtained from the Settlement Option Table for the Benefit
Payment option elected less the pro-rata portion of the Contract Maintenance
Fee.
The number of Benefit Units in each Sub-Account held by you is determined by
dividing the dollar amount of the first monthly Variable Dollar Benefit payment
from each Sub-Account by the Benefit Unit Value for that Sub-Account as of the
applicable Commencement Date. The number of Benefit Units remains fixed during
the Benefit Payment Period, except as a result of any transfers among
Sub-Accounts after the applicable Commencement Date.
The dollar amount of the second and any subsequent Variable Dollar Benefit
payment will reflect the investment performance of the Sub-Account(s) selected
and may vary from month to month. The total amount of the second and any
subsequent Variable Dollar Benefit payment will be equal to the sum of the
payments from each Sub-Account less a pro-rata portion of the Contract
Maintenance Fee.
The payment from each Sub-Account is found by multiplying the number of Benefit
Units held in each Sub-Account by the Benefit Unit Value for that Sub-Account as
of the end of the fifth Valuation Period preceding the due date of the payment.
The Benefit Unit Value for each Sub-Account is originally established in the
same manner as Accumulation Unit Values. Thereafter, the value of a Benefit Unit
for a Sub-Account is determined by multiplying the Benefit Unit Value as of the
end of the preceding Valuation Period by the Net Investment Factor, determined
as set forth above under the Accumulation Unit Value provision of this Contract,
for the Valuation Period just ended. The product is then multiplied by the
assumed daily investment factor (0.99991781), for the number of days in the
Valuation Period. The factor is based on the assumed net investment rate of
three percent (3%) per year, compounded annually, that is reflected in the
Settlement Option Tables.
Variable Dollar Benefit payments will not be adversely affected by actual
mortality and expense experience of the Sub-Accounts.
Limitation on Election of Settlement Option
Fixed periods shorter than five (5) years are not available, except as a Death
Benefit settlement option.
Settlement Option Computations
The 1983 Individual Annuity Mortality Table with interest at three percent (3%)
per year, compounded annually, is used to compute all guaranteed settlement
option factors, values, and benefits under this Contract.
<PAGE>
Available Settlement Options
The available settlement options are set out below.
Option A Income for a Fixed Period
We will make periodic payments for a fixed period. The first payment
will be paid as of the last day of the initial Payment Interval. The
maximum time over which payments will be made by us or money will be
held by us is thirty (30) years. The Option A Table applies to this
Option.
Option B Life Annuity with Payments for at Least a Fixed Period
We will make periodic payments for at least a fixed period. If the
person on whose life Benefit Payments are based lives longer than the
fixed period, then we will make payments until his or her death. The
first payment will be paid as of the first day of the initial Payment
Interval. The Option B Tables apply to this Option.
<PAGE>
Option C Joint and One-half Survivor Annuity
We will make periodic payments until the death of the primary person on
whose life Benefit Payments are based; thereafter, we will make
one-half (1/2) of the periodic payment until the death of the secondary
person on whose life Benefit Payments are based. The first payment will
be paid as of the first day of the initial Payment Interval. The Option
C Tables apply to this Option.
Option D Life Annuity
We will make periodic payments until the death of the person on whose
life Benefit Payments are based. The first payment will be paid as of
the first day of the initial Payment Interval. The Option D Tables
apply to this Option.
Option E Any Other Form
We will make periodic payments in any other form of settlement option
which is acceptable to us at the time of an election.
Settlement Option Tables
The Option Tables show the payments we will make at sample Payment Intervals for
each $1,000 applied at the guaranteed interest rate. Amounts may vary with the
Payment Interval and the sex and age of the person on whose life Benefit
Payments are based.
<PAGE>
<TABLE>
<CAPTION>
OPTION A TABLE - INCOME FOR A FIXED PERIOD
Payments for fixed number of years for each $1,000
applied.
- ------------------------------------------------------------------------------------------------------------------------------------
Terms of Semi-Annual Terms of Semi-Annual Terms of Semi-Annual
Payments Annual Quarterly Monthly Payments Annual Quarterly Monthly Payments Annual QuarterlyMonthly
- ------------------------------------------------------------------------------------------------------------------------------------
Years Years Years
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
6 184.60 91.62 45.64 15.18 11 108.08 53.64 26.72 8.88 16 79.61 39.51 19.68 6.54
7 160.51 79.66 39.68 13.20 12 100.46 49.86 24.84 8.26 17 75.95 37.70 18.78 6.24
8 142.46 70.70 35.22 11.71 13 94.03 46.67 23.25 7.73 18 72.71 36.09 17.98 5.98
9 128.43 63.74 31.75 10.56 14 88.53 43.94 21.89 7.28 19 69.81 34.65 17.26 5.74
10 117.23 58.18 28.98 9.64 15 83.77 41.57 20.71 6.89 20 67.22 33.36 16.62 5.53
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
OPTION B TABLE LIFE ANNUITY
With Payments For At Least A Fixed Period
--------- ---------------- --------------- ---------------- ----------------
60 Months 120 Months 180 Months 240 Months
--------- ---------------- --------------- ---------------- ----------------
Age
--------- ---------------- --------------- ---------------- ----------------
55 $4.42 $4.39 $4.32 $4.22
56 4.51 4.47 4.40 4.29
57 4.61 4.56 4.48 4.35
58 4.71 4.65 4.56 4.42
59 4.81 4.75 4.64 4.49
60 4.92 4.86 4.73 4.55
61 5.04 4.97 4.83 4.62
62 5.17 5.08 4.92 4.69
63 5.31 5.20 5.02 4.76
64 5.45 5.33 5.12 4.83
65 5.61 5.46 5.22 4.89
66 5.77 5.60 5.33 4.96
67 5.94 5.75 5.43 5.02
68 6.13 5.91 5.54 5.08
69 6.33 6.07 5.65 5.14
70 6.54 6.23 5.76 5.19
71 6.76 6.41 5.86 5.24
72 7.00 6.58 5.96 5.28
73 7.26 6.77 6.06 5.32
74 7.53 6.95 6.16 5.35
--------- ---------------- --------------- ---------------- ----------------
<TABLE>
<CAPTION>
OPTION C TABLE - JOINT AND ONE-HALF SURVIVOR
ANNUITY Monthly payments for each $1,000 of proceeds by
ages of persons named.*
- -------------- -------------------------------------------------------------------------------------------------------
Secondary Age
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
Primary Age
60 61 62 63 64 65 66 67 68 69 70
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 $4.56 $4.58 $4.61 $4.63 $4.65 $4.67 $4.69 $4.71 $4.73 $4.75 $4.76
61 4.63 4.66 4.69 4.71 4.73 4.76 4.78 4.80 4.82 4.84 4.86
62 4.71 4.74 4.77 4.80 4.82 4.85 4.87 4.90 4.92 4.94 4.96
63 4.79 4.82 4.85 4.88 4.91 4.94 4.97 5.00 5.02 5.05 5.07
64 4.88 4.91 4.94 4.98 5.01 5.04 5.07 5.10 5.13 5.15 5.18
65 4.96 5.00 5.03 5.07 5.11 5.14 5.17 5.20 5.24 5.27 5.30
66 5.05 5.09 5.13 5.17 5.21 5.24 5.28 5.32 5.35 5.38 5.42
67 5.14 5.18 5.23 5.27 5.31 5.35 5.39 5.43 5.47 5.51 5.54
68 5.23 5.28 5.33 5.37 5.42 5.46 5.50 5.55 5.59 5.63 5.67
69 5.33 5.38 5.43 5.48 5.53 5.57 5.62 5.67 5.72 5.76 5.81
70 5.43 5.48 5.53 5.59 5.64 5.69 5.74 5.80 5.85 5.90 5.95
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
</TABLE>
*Payments after the death of the Primary Payee will be one-half (1/2) of the
amount shown.
<PAGE>
NY3382NQ99
OPTION D TABLE - LIFE ANNUITY Monthly
payments for each $1,000 applied.
-------------- -------------------
Age
-------------- -------------------
55 4.43
56 4.52
57 4.62
58 4.72
59 4.83
60 4.94
61 5.07
62 5.20
63 5.34
64 5.49
65 5.65
66 5.82
67 6.00
68 6.20
69 6.41
70 6.64
71 6.89
72 7.15
73 7.43
74 7.74
-------------- -------------------
<PAGE>
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Individual Flexible Premium Deferred Variable Annuity Contract
Nonparticipating - No Dividends
Non-Tax-Qualified
<PAGE>
NY3603E99
[GRAPHIC OMITTED]
LOAN ENDORSEMENT
The policy contract is changed as set out below to permit loans:
LOAN AMOUNT AND CONDITIONS. So long as you have not commenced distributions
under a payment option (or any other systematic payment program), you may borrow
an amount (the "new policy contract loan") if all of the following requirements
are met:
1) the sum of the new policy contract loan plus the highest balance of each
other policy contract loan, if any, at any time during the one-year period
ending on the date of the new policy contract loan, cannot exceed $50,000; and
2) the sum of the new policy contract loan plus the current balance of each
other policy contract loan, if any, cannot exceed the greater of (i)
$10,000, or (ii) one-half of the net amount payable to you upon a full
surrender of this policy contract; and
3) the net amount payable to you upon a full surrender of this policy
contract, less the sum of the new policy contract loan and the current
balance of each other policy contract loan, if any, cannot be less than the
minimum amount required to avoid an involuntary surrender under the other
provisions of this policy contract.
An application for a loan must be made on our form. We may delay granting the
loan for up to six months after we receive your request for it. We may also
limit the frequency at which loans may be made, the minimum amount of a loan,
and the minimum amount of loan payments to be made to us.
TERM; REPAYMENT. The principal and interest of each loan must be repaid to us
within five years of the date such loan is made. This five year limit will not
apply to any loan used to acquire a dwelling unit that is to be used as a
principal residence by you. Regular substantially equal periodic payments must
be made at least quarterly over the term of a loan until fully paid.
LIEN -- DEEMED SURRENDER AND DISTRIBUTION. A policy contract loan is a first
lien on this policy contract. Your interest in this policy contract will be the
sole security for a loan. We may pay off the loan (by treating an amount equal
to the balance of a loan as surrendered, and applying it to pay off the loan)
if:
1) this policy contract is fully surrendered; or
2) distributions begin under a payment option (or any other systematic payment
program); or
3) you die and your spouse is not the sole person entitled to your interest in
this policy contract.
If there is a default on repayment, then we may also pay off the loan (as
described above), unless a distribution to you is prohibited by the other
provisions of this policy contract.
<PAGE>
INTEREST. The interest rate on a policy contract loan will not be more than 8%
per year, unless otherwise provided under any other provision of this policy
contract covering employee benefit plan loans . Any unpaid interest will be
added to a loan; in effect, then, it will be compounded and will be part of the
loan.
That portion of the policy contract securing the outstanding loan balance shall
be credited with interest at an annual rate that is not more than 3 percentage
points below the interest rate charged on such loan. The interest credited on
such portion of the policy contract will not be less than that required under
the applicable guaranteed minimum rate or value provisions of the policy
contract.
This is part of your policy contract. It is not a separate contract. It changes
the policy contract only as and to the extent stated. In all cases of conflict
with the other terms of the policy contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3604E99
[GRAPHIC OMITTED]
NONQUALIFIED LOAN ENDORSEMENT
This policy is changed as set out below to permit loans:
LOAN AMOUNT AND CONDITIONS. So long as you have not commenced distributions
under a payment option (or any other systematic payment program), you may borrow
an amount (the "new policy loan") if all of the following requirements are met:
1) the policy has been in effect for at least one full year; and
2) the sum of the new policy loan plus the current balance of each other
policy loan, if any, cannot exceed one-half of the net amount payable to
you upon a full surrender of this policy; and
3) the net amount payable to you upon a full surrender of this policy, less
the sum of the new policy loan and the current balance of each other policy
loan, if any, cannot be less than the minimum amount required to avoid an
involuntary surrender under the other provisions of this policy.
An application for a loan must be made on our form. We may delay granting the
loan for up to six months after we receive your request for it. We may also
limit the frequency at which loans may be made and the minimum amount of a loan.
TERM; REPAYMENT. The principal and interest of each loan must be repaid to us on
or before the policy is fully surrendered or distributions commence under a
payment option (or any other systematic payment program). Regular payments of
interest must be made in advance at least annually over the term of a loan until
fully paid.
LIEN - DEEMED SURRENDER AND DISTRIBUTION. A policy loan is a first lien on this
policy. Your interest in this policy will be the sole security for a loan. We
may pay off the loan (by treating an amount equal to the balance of a loan as
surrendered, and applying it to pay off the loan) if:
1) this policy is fully surrendered; or
2) distributions begin under a payment option (or any other systematic payment
program); or 3) the annuitant or owner dies, or 4) the net amount payable
to you upon a full surrender of this policy, less the sum of the current
balance of each policy loan, is less then the minimum amount required to
avoid an involuntary surrender under the other provisions of this policy.
INTEREST. The interest rate on a policy loan will not be more than 8% per year.
Any unpaid interest will be added to a loan; in effect, then, it will be
compounded and will be part of the loan.
That portion of the policy contract securing the outstanding loan balance shall
be credited with interest at an annual rate that is not more than 3 percentage
points below the interest rate charged on such loan. The interest credited on
such portion of the policy contract will not be less than that required under
the applicable guaranteed minimum rate or value provisions of the policy
contract.
<PAGE>
This is part of your policy. It is not a separate contract. It changes the
policy only as and to the extent stated. In all cases of conflict with the other
terms of the policy, the provisions of this Endorsement shall control.
Signed for us at out office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3593E99
[GRAPHIC OMITTED]
TAX SHELTERED ANNUITY ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a Tax
Sheltered Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to receive
contributions that qualify for deferred tax treatment under Internal Revenue
Code ("IRC") Section 403(b). It is restricted as required by federal tax law. We
may change the terms of this annuity contract or administer this annuity
contract at any time as needed to comply with that law. Any such change may be
applied retroactively.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your interest in
this annuity contract. You cannot pledge it to secure a loan or the performance
of an obligation, or for any other purpose. The only exceptions to these rules
are:
1) you may use this annuity contract to secure a loan made under any loan
provisions of this annuity contract;
2) an interest in this annuity contract may be transferred under a Qualified
Domestic Relations Order as defined in IRC Section 414(p); and
3) you may designate another person to receive payments with you based on
joint lives or joint life expectancies, but any such designation shall not
give that other person any present rights under the annuity contract during
your lifetime.
LIMITS ON CONTRIBUTIONS. We may refuse to accept any contribution to this
annuity contract that does not qualify for deferred tax treatment under IRC
Section 403(b) and Section 415. Contributions made for you to this annuity
contract and any other plan, contract, or arrangement under salary reduction
agreement(s) with your employer(s) cannot exceed the limits of IRC Section
402(g).
DISTRIBUTION RESTRICTIONS ON SALARY REDUCTION CONTRIBUTIONS AND CUSTODIAL
ACCOUNTS TRANSFERS. To comply with federal tax law, distribution restrictions
apply to amounts under this annuity contract that represent:
1) contributions made after December 31, 1988 under any salary reduction
agreement with an employer;
2) income earned after December 31, 1988 on salary reduction contributions
whenever made; or
3) transfers from a custodial account described in IRC Section 403(b)(7) and
all income attributable to the amount transferred.
Any such amount cannot be distributed from this annuity contract unless you
have:
1) reached age 59-1/2; or
2) separated from service with your employer; or
3) become disabled (as defined in IRC Section 72(m)(7)); or
4) in the case of salary reduction contributions (including salary reduction
contributions to a custodial account), incurred a hardship as defined under
the IRC. A withdrawal made by reason of a hardship cannot include any
income earned after December 31, 1988 attributable to salary reduction
contributions.
<PAGE>
IRC Section 72(m)(7) states that: "An individual shall be considered to be
disabled if he is unable to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be
expected to result in death or to be of long-continued and indefinite duration.
An individual shall not be considered to be disabled unless he furnishes proof
of the existence thereof in such form and manner as the Secretary [of the
Treasury] may require."
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), you or
your surviving spouse may elect to have any portion of an eligible rollover
distribution (as defined in IRC Section 403(b)(8)) paid directly to an
Individual Retirement Annuity or Individual Retirement Account (as defined in
IRC Section 408) or, if allowed, to another Tax Sheltered Annuity (as defined in
IRC Section 403(b)), specified by you or your surviving spouse and which accepts
such distribution. Any direct rollover election must be made on our form, and
must be received at our office before the date of payment.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions under this annuity contract is April 1 following the later of the
calendar year in which you reach age 70-1/2 or the calendar year in which you
retire. No later than the Required Beginning Date:
1) your interest in this annuity contract must be paid in full; or
2) distributions from this annuity contract must begin in the form of periodic
payments made at least annually (i) for your life or as joint and survivor
payments to you and one other individual, or (ii) over a period certain not
to exceed your life expectancy or the joint and last survivor life
expectancy of you and one other individual named to receive any remaining
payments after your death, with payments which do not increase or increase
only as provided in Q&A F-3 of Section 1.401(a)(9)-1 of the Proposed Income
Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death benefit
requirements of IRC Section 401(a)(9)(G), and the regulations thereunder,
including the minimum distribution incidental benefit requirements of Section
1.401(a)(9)-2 of the Proposed Income Tax Regulations.
Life expectancies are computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. The life expectancies of
you and your spouse shall be recalculated annually unless periodic payments for
a fixed period begin irrevocably (subject to acceleration) by the Required
Beginning Date. The life expectancy of any other individual may not be
recalculated. Any life expectancy which is not being recalculated shall be
determined using the attained age of the individual in the calendar year in
which you reach age 70-1/2 or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be based on
such life expectancy reduced by one for each calendar year which has elapsed
since the calendar year such life expectancy was first determined. Therefore, if
a life expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to acceleration),
the remaining portion of your interest in this annuity contract must continue to
be distributed at least as rapidly as under the method of distribution being
used prior to your death.
<PAGE>
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in this annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after your death; or
2) over the life or over a period certain not greater than the life expectancy
of the individual designated under this annuity contract to receive
payments after your death with payments beginning by December 31 of the
first calendar year after your death.
However, if your surviving spouse is the individual designated to receive your
entire interest in this annuity contract, then the starting date for payments
under clause 2) above may be delayed to a date not later than December 31 of the
calendar year in which you would have reached age 70-1/2. If your surviving
spouse dies before payments begin under this provision, then this provision
shall apply upon the death of your spouse as if your spouse were the owner of
this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V and
VI of Section 1.72-9 of the Income Tax Regulations. For distributions beginning
after your death, the life expectancy of your surviving spouse shall be
recalculated annually unless periodic payments for a fixed period begin
irrevocably (subject to acceleration) by the date payments are required to
begin. The life expectancy of any other individual may not be recalculated. Any
life expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin irrevocably,
and any payment calculations for subsequent years shall be based on such life
expectancy reduced by one for each calendar year which has elapsed since the
calendar year life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period which
could end before that person's actual death.
This is part of your annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
*********************3604E99
<PAGE>
NY3643E99
[GRAPHIC OMITTED]
EMPLOYER PLAN
ENDORSEMENT
The annuity contract is changed as set out below to adapt it for use with an
employee benefit plan:
PLAN. "Plan" means the employee benefit plan named on your application or any
successor plan.
EMPLOYER. "Employer" means the employer sponsoring the Plan and named on your
application, or any other
employer which succeeds to its rights under the Plan.
PLAN ADMINISTRATOR. "Plan Administrator" means the person designated as such to
us in writing by the Employer. If no person has been designated, "Plan
Administrator" means the Employer.
PLAN INTERPRETATION. For purposes of this annuity contract, the Plan
Administrator shall interpret the Plan and decide all questions about what is
allowed or required by the Plan. We have no duty to review or interpret the
Plan, or to review or approve any decision of the Plan Administrator. We are
entitled to rely on the written directions of the Plan Administrator on such
matters.
APPLICABLE RESTRICTIONS. This annuity contract may be restricted by federal
and/or state laws related to employee benefit plans. We may change the terms of
this annuity contract or administer this annuity contract at any time as needed
to comply with such laws.
PLAN DISTRIBUTION PROVISIONS. Distributions allowed under this annuity contract
may be made only at a time allowed by the Plan or required by this annuity
contract. The form of any distribution shall be determined under the Plan from
among those forms of distribution available under this annuity contract. No
distribution may be made without the written direction of the Plan Administrator
unless required by this annuity contract. Distributions may be made without your
consent when required by the Plan.
FORFEITURE OF NON-VESTED AMOUNTS. Any amount under this annuity contract
attributable to contributions by the Employer (excluding any contributions made
under a salary reduction agreement with your employer) is subject to the vesting
provisions of the Plan. If at any time the Plan provides for a forfeiture of an
amount that is not vested, then such amount may be withdrawn and paid as
directed by the Plan Administrator.
RETURN OF EXCESS CONTRIBUTIONS. Contributions made to this annuity contract for
you are subject to any limits on contributions and nondiscrimination provisions
of the Plan. If the Plan Administrator determines that excess or discriminatory
contributions were made, then amounts attributable to such contributions may be
withdrawn and paid as directed by the Plan Administrator.
ENTITLEMENT TO DEATH BENEFITS. The person or persons entitled to any amount
remaining payable under this annuity contract after your death shall be
determined under the Plan. No distribution of any such amount shall be made
without the written direction of the Plan Administrator.
<PAGE>
INVESTMENT ALLOCATIONS AND TRANSFERS. If this annuity contract provides that
amounts held under it are allocated among separate investment funds or fixed
accounts, then any such allocations and/or subsequent transfers shall be made
only as required or allowed by the Plan, or as required by this annuity contract
to secure a loan. No such allocation or transfer shall be made without the
written direction of the Plan Administrator unless required by this annuity
contract to secure a loan. Allocations or transfers may be made without your
consent when required by the Plan or the annuity contract.
PLAN LOAN PROVISIONS. If loans are allowed under this annuity contract, no such
loan may be made unless also allowed by the Plan. Any such loan will be subject
to any additional limits and conditions which apply under the Plan. No loan may
be made without the written direction of the Plan Administrator. The rate of
interest to be paid by you on any such loan will be fixed by the Plan
Administrator, but we may require that it be at least three percentage points
higher than the minimum guaranteed rate of interest, if any, that applies to
your interest in this annuity contract used as security for the loan.
QUALIFIED JOINT AND 50% SURVIVOR ANNUITY OPTION. In addition to the other
payment options available under this annuity contract, payments may be made in
the form of a Qualified Joint and 50% Survivor Annuity. Under this payment
option, we will make equal payments to you for life at least once per year. If
the person who is your spouse at the time payments commence survives you, then
after your death we will make payments to such spouse at the same intervals
equal to one-half of the amount of the prior payments, with such payments
continuing to such spouse until his or her death. The first payment under this
payment option will be made on the effective date of the payment option. The
amount of the payments we will make under this payment option is based on the
intervals for payments, which are subject to our approval. Amounts vary with the
ages, as of the first payment date, of you and your spouse. We will require
proof of the ages of you and your spouse. Monthly payments that we will make
under this payment option for each $1,000 of proceeds applied will be furnished
at your request. Once payments begin under this payment option, the value of
future payments may not be withdrawn as a commutation of benefits.
This is a part of your annuity contract. It is not a separate contract. It
changes the annuity contract only as and to the extent stated. In all cases of
conflict with the other terms of the annuity contract, the provisions of this
endorsement shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3583E99
[GRAPHIC OMITTED]
INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract is changed as set out below to make it an Individual
Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions that qualify for deferred tax treatment under
Internal Revenue Code ("IRC") Section 408(b). It is restricted as required
by federal tax law. We may change the terms of this annuity contract or
administer this annuity contract at any time as needed to comply with that
law. Any such change may be applied retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of you and your beneficiaries. Your interest in this annuity
contract is nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share
in our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in this annuity contract. You cannot pledge it to secure a loan
or the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) an interest in this annuity contract may be transferred to a spouse
or former spouse under a divorce or separation instrument described
in IRC Section 71(b)(2)(A); and
2) you may designate another person to receive payments with you based
on joint lives or joint life expectancies, but any such designation
shall not give that other person any present rights under the annuity
contract during your lifetime.
CONTRIBUTIONS. This annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept
any contribution of less than $50. This annuity contract will not lapse if
you do not make contributions. This annuity contract will remain subject
to cancellation under any involuntary surrender or termination provision
of this annuity contract; provided, however, that in no event shall any
such cancellation occur unless, at a minimum, contributions have not been
made for at least two full years and the value of this annuity contract
(increased by any guaranteed interest) would provide a benefit at age
70-1/2 of less than $20 a month under the regular settlement option.
<PAGE>
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US. Total contributions made to this policy with respect to any
one tax year may not exceed $2,000, excluding any payment which is:
1) allowed as a rollover under IRC Section 402(c), 403(a)(4), 403(b)(8),
or 408(d)(3); or
2) made through a Simplified Employee Pension (SEP) program under IRC
Section 408(k).
This annuity contract will not accept contributions made by an employer
through a SIMPLE plan under IRC Section 408(p). This annuity contract will
not accept a transfer or rollover of any funds attributable to
contributions made by an employer through a SIMPLE plan until at least
2-years after the date you first participated in that employer's SIMPLE
plan.
ANNUAL REPORT. Following the end of each calendar year, we will send you a
report concerning the status of your annuity contract. This report will
include (i) the amount of all regular contributions received during or
after the calendar year which relate to such calendar year, (ii) the
amount of all rollover contributions received during such calendar year,
(iii) the contract value(s) determined as of the end of such calendar
year, and (iv) such other information as may be required under federal tax
law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date
for distributions under this annuity contract is April 1 following the
calendar year in which you reach age 70-1/2. No later than the Required
Beginning Date:
1) your entire interest in this annuity contract must be paid in full;
or
2) distributions from this annuity contract must begin in the form of
periodic payments made at least annually (i) for your life or as
joint and survivor payments to you and one other individual, or (ii)
over a period certain not to exceed your life expectancy or the joint
and last survivor expectancy of you and one other individual
designated to receive any remaining payments after your death, with
payments which do not increase or increase only as provided in Q&A
F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of you and your spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the Required Beginning Date. The life expectancy of any
other individual may not be recalculated. Any life expectancy which is not
being recalculated shall be determined using the attained age of the
individual in the calendar year in which you reach age 70-1/2 or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year such life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
<PAGE>
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of your interest in this annuity
contract must continue to be distributed at least as rapidly as under the
method of distribution being used prior to your death.
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in this annuity contract must be paid
either:
1) in full by December 31 of the fifth calendar year after your death;
or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract
to receive payments after your death with payments beginning by
December 31 of the first calendar year after your death.
However, if your surviving spouse is the individual designated to receive
your entire interest in this annuity contract, the starting date for
payments under clause (2) above may be delayed to a date not later than
December 31 of the calendar year in which you would have reached age
70-1/2. Alternatively, this annuity contract will be treated as the IRA of
such spouse if he or she becomes Successor Owner of this contract, makes a
rollover from this contract, or fails to receive distributions from this
contract otherwise required by this provision. No contributions or
rollover to this annuity contract may be made after your death unless your
spouse becomes Successor Owner In any case, if a surviving spouse dies
before payments begin under this provision, then this provision shall
apply upon the death of your spouse as if your spouse was the owner of
this annuity contract.
Life expectancy is computed using the expected return multiples in Tables
V and VI of Section 1.72-9 of the Income Tax Regulations. For
distributions beginning after your death, the life expectancy of your
surviving spouse shall be recalculated annually unless periodic payments
for a fixed period begin irrevocably (subject to acceleration) by the date
payments are required to begin. The life expectancy of any other
individual may not be recalculated. Any life expectancy which is not being
recalculated shall be determined using the attained age of such individual
in the calendar year in which payments are required to begin or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first determined. Therefore, if a life expectancy
is not recalculated, payments will be made over a fixed period which could
end before that person's actual death.
This is part of your annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3653E99
[GRAPHIC OMITTED]
SAVINGS INCENTIVE MATCH PLAN FOR EMPLOYEES
INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract is changed as set out below to make it a SIMPLE Individual
Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to receive
contributions under a Savings Incentive Match Plan for Employees of Small
Employers ("SIMPLE IRA plan") that qualifies under Internal Revenue Code ("IRC")
Section 408(p). It is restricted as required by federal tax law. We may change
the terms of this annuity contract or administer this annuity contract at any
time as needed to comply with that law. Any such change may be applied
retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of you and your beneficiaries. Your interest in this annuity contract is
nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share in our
surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your interest in
this annuity contract. You cannot pledge it to secure a loan or the performance
of an obligation, or for any other purpose. The only exceptions to these rules
are:
1) an interest in this annuity contract may be transferred to a
spouse or former spouse under a divorce or separation instrument
described in IRC Section 71(b)(2)(A); and
2) you may designate another person to receive payments with you
based on joint lives or joint life expectancies, but any such
designation shall not give that other person any present rights
under the annuity contract during your lifetime.
CONTRIBUTIONS. This annuity contract does not require fixed premiums, purchase
payments, or other contributions, but we may decline to accept any contribution
of less than $50. This annuity contract will not lapse if you do not make
contributions. This annuity contract will remain subject to cancellation under
any involuntary surrender or termination provision of this annuity contract;
provided, however, that in no event shall any such cancellation occur unless, at
a minimum, contributions have not been made for at least two full years and the
value of this annuity contract (increased by any guaranteed interest) would
provide a benefit at age 70-1/2 of less than $20 a month under the regular
settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
This annuity contract will only accept contributions made by an employer under a
SIMPLE IRA plan that meets the requirements of IRC Section 408(p), and rollover
contributions or transfers from another SIMPLE IRA owned by you. No other
contributions to this annuity contract will be accepted.
<PAGE>
ANNUAL REPORT. Following the end of each calendar year, we will send you a
report concerning the status of your annuity contract. This report will include
(i) the amount of all regular contributions received during or after the
calendar year which relate to such calendar year, (ii) the amount of all
rollover contributions received during such calendar year, (iii) the contract
value(s) determined as of the end of such calendar year, and (iv) such other
information as may be required under federal tax law.
If contributions to this annuity contract are paid directly by your employer
under a SIMPLE IRA plan, we will provide your employer with the summary
description required by IRC Section 408(l)(2)(B).
DESIGNATED FINANCIAL INSTITUTION. If we are the designated financial institution
for your employer's SIMPLE IRA plan, as defined in IRC Section 408(p)(7), then
you may direct that contributions paid on your behalf be transferred to another
qualified SIMPLE IRA without cost or penalty, provided that you elect such a
transfer either before the beginning of the calendar year to which such
contribution relates or within the 60-day election period which includes the
date you first become eligible to participate in the SIMPLE IRA plan.
LIMITS ON ROLLOVERS AND TRANSFERS; ADDITIONAL TAXES. During the first two years
that you participate in the SIMPLE IRA plan of your employer, any rollover or
transfer otherwise permitted under this annuity contract must be made to another
SIMPLE IRA owned by you. If you are under age 59-1/2, any distribution to you
during this two-year period may be subject to a twenty-five percent additional
penalty tax if you do not roll over the amount distributed into a SIMPLE IRA.
After the end of this two-year period, a rollover or transfer otherwise
permitted under this annuity contract may be made to any IRA owned by you that
is qualified under IRC Section 408(a), (b), or (p).
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions under this annuity contract is April 1 following the calendar year
in which you reach age 70-1/2. No later than the Required Beginning Date:
1) your entire interest in this annuity contract must be paid in full;
or
2) distributions from this annuity contract must begin in the form of
periodic payments made at least annually (i) for your life or as
joint and survivor payments to you and one other individual, or
(ii) over a period certain not to exceed your life expectancy or
the joint and last survivor expectancy of you and one other
individual designated to receive any remaining payments after your
death, with payments which do not increase or increase only as
provided in Q&A F-3 of Section 1.401(a)(9)-1 of the Proposed Income
Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death benefit
requirements of IRC Section 401(a)(9)(G), and the regulations thereunder,
including the minimum distribution incidental benefit requirements of Section
1.401(a)(9)-2 of the Proposed Income Tax Regulations.
Life expectancies are computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. The life expectancies of
you and your spouse shall be recalculated annually unless periodic payments for
a fixed period begin irrevocably (subject to acceleration) by the Required
Beginning Date. The life expectancy of any other individual may not be
recalculated. Any life expectancy which is not being recalculated shall be
determined using the attained age of the individual in the calendar year in
which you reach age 70-1/2 or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be based on
such life expectancy reduced by one for each calendar year which has elapsed
since the calendar year such life expectancy was first determined. Therefore, if
a life expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
<PAGE>
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to acceleration),
the remaining portion of your interest in this annuity contract must continue to
be distributed at least as rapidly as under the method of distribution being
used prior to your death.
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in this annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after your death;
or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract
to receive payments after your death with payments beginning by
December 31 of the first calendar year after your death.
However, if your surviving spouse is the individual designated to receive your
entire interest in this annuity contract, the starting date for payments under
clause (2) above may be delayed to a date not later than December 31 of the
calendar year in which you would have reached age 70-1/2. Alternatively, this
annuity contract will be treated as the IRA of such spouse if he or she becomes
Successor Owner of this contract, makes a rollover from this contract, or fails
to receive distributions from this contract otherwise required by this
provision. No contributions or rollover to this annuity contract may be made
after your death unless your spouse becomes Successor Owner In any case, if a
surviving spouse dies before payments begin under this provision, then this
provision shall apply upon the death of your spouse as if your spouse was the
owner of this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V and
VI of Section 1.72-9 of the Income Tax Regulations. For distributions beginning
after your death, the life expectancy of your surviving spouse shall be
recalculated annually unless periodic payments for a fixed period begin
irrevocably (subject to acceleration) by the date payments are required to
begin. The life expectancy of any other individual may not be recalculated. Any
life expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin irrevocably,
and any payment calculations for subsequent years shall be based on such life
expectancy reduced by one for each calendar year which has elapsed since the
calendar year life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period which
could end before that person's actual death.
This is part of your annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3332G99
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Group Flexible Premium Deferred Variable Annuity Contract
In consideration of the application, the enrollment forms of participants
hereunder ("Participants"), and the payment of Purchase Payments for the benefit
of Participants, we have issued this Group Flexible Premium Deferred Variable
Annuity Contract ("Contract") to the Contract Owner identified on the Contract
Specifications page, effective as of the Contract Effective Date and subject to
all of the terms and conditions set out on the following pages. As you read
through this Contract, please note that the words "we", "us", "our", and
"Company" refer to Great American Life Insurance Company of New York. The words
"you" and "your" refer to the Contract Owner.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
Nonparticipating - No Dividends
ANNUITY BENEFITS AND OTHER VALUES DESCRIBED IN THIS CONTRACT, WHEN BASED ON THE
INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, MAY INCREASE OR DECREASE AND ARE
NOT GUARANTEED AS TO FIXED DOLLAR AMOUNTS. NO MINIMUM CONTRACT VALUE IS
GUARANTEED, EXCEPT FOR AMOUNTS IN THE FIXED ACCOUNT.
After a Variable Dollar Benefit is elected under a Certificate, the annual rate
of return earned on the assets of the Sub-Accounts must be equal to or exceed 3%
for the Variable Dollar Benefit payments not to decrease.
<PAGE>
CONTRACT SPECIFICATIONS
CONTRACT OWNER:
CONTRACT NUMBER:
CONTRACT EFFECTIVE DATE:
SEPARATE ACCOUNT: GALIC of New York Separate Account I
Following is a list of the Funds in which the currently available Sub-Accounts
invest:
[Janus Aspen Series Aggressive Growth Portfolio]
[Janus Aspen Series Worldwide Growth Portfolio]
[Janus Aspen Series Balanced Portfolio]
[Janus Aspen Series Growth Portfolio]
[Janus Aspen Series International Growth Portfolio]
[Dreyfus Variable Investment Fund-Capital Appreciation Portfolio]
[Dreyfus Variable Investment Fund-Money Market Portfolio]
[Dreyfus Variable Investment Fund-Growth and Income Portfolio]
[Dreyfus Variable Investment Fund-Small Cap Portfolio]
[The Dreyfus Socially Responsible Growth Fund, Inc.]
[Dreyfus Stock Index Fund]
[Strong Opportunity Fund II]
[Strong Mid Cap Growth Fund II]
[The Timothy Plan Variable Series]
[INVESCO VIF-Equity Income Fund]
INVESCO VIF-Total Return Fund]
[INVESCO VIF-High Yield Fund]
[Morgan Stanley Dean Witter Universal Funds, Inc.- U.S. Real Estate Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Value Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Emerging Markets Equity
Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc.- Fixed Income Portfolio]
[Morgan Stanley Universal Funds, Inc.- Mid Cap Value Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Growth II Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Large-Cap Growth Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Technology & Communications Portfolio]
<PAGE>
FIXED ACCOUNT:
Following is a list of the currently available Fixed Account options, with
guarantee periods as may be applicable:
Fixed Accumulation Account Option
Fixed Account Option One-Year Guarantee Period
Fixed Account Option Three-Year Guarantee Period
Fixed Account Option Five-Year Guarantee Period
Fixed Account Option Seven-Year Guarantee Period
Minimum guaranteed interest rate credited to the Fixed Account: Three percent
(3%) effective annual rate.
MINIMUM PURCHASE PAYMENT: $50
MAXIMUM PURCHASE PAYMENT: $500,000, without home office approval.
TRANSFER FEE: $25 per transfer in excess of twelve (12) in any Certificate Year.
- ------------
CONTINGENT DEFERRED SALES CHARGE: An amount deducted on each partial or full
surrender of a Purchase Payment, as follows:
Number of full years elapsed between Contingent Deferred Sales Charge as
the date of receipt of a Purchase Payment a percentage of the associated
and date Written Request for Purchase Payment
surrender is received surrendered
- ---------------------------------------- ----------------------------------
0 7%
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7+ 0%
CERTIFICATE MAINTENANCE FEE: $30 Annually
MORTALITY AND EXPENSE RISK CHARGE: A charge equal to an effective annual rate of
1.25% of the daily Net Asset Value of the Sub-Accounts.
ADMINISTRATION CHARGE: A charge equal to an effective annual rate of 0.15% of
the daily Net Asset Value of the --------------------- Sub-Accounts.
TERMINATION: We reserve the right to terminate any Participant's participation
interest at any time prior to his or her Annuity Commencement Date if 1) no
Purchase Payments have been paid for the Participant for three (3) consecutive
years and 2) the Account Value of the Certificate is less than $2,000. We will
then pay the Participant the Account Value of his or her participation interest
as of the end of the Valuation Period in which the Contract is terminated.
We reserve the right to terminate this Contract, if
INQUIRIES: For information, or to make a complaint, call or write:
Variable Annuity Service Center
Great American Life Insurance Company of New York
Post Office Box 5423
Cincinnati, Ohio 45201-5423
1-800-789-6771
<PAGE>
TABLE OF CONTENTS PAGE
Definitions................................................................7
General Provisions........................................................10
Entire Contract......................................................10
Participant Certificate..............................................10
Changes -- Waivers...................................................10
Nonparticipating.....................................................10
Misstatement.........................................................10
Required Reports.....................................................10
Exclusive Benefit....................................................11
State Law............................................................11
Claims of Creditors..................................................11
Company Liability....................................................11
Voting Rights........................................................11
Incontestability.....................................................11
Discharge of Liability...............................................11
Termination..........................................................11
Purchase Payments.........................................................12
Purchase Payments....................................................12
Allocation of Purchase Payment(s)....................................12
No Termination.......................................................12
Fixed Account.............................................................12
Fixed Account........................................................12
Fixed Account Options............................................12
Interest Credited................................................12
Renewal..........................................................13
Fixed Account Value..................................................13
Separate Account..........................................................13
General Description..................................................13
Sub-Accounts of the Separate Account.................................14
Valuation of Assets..................................................14
Variable Account Value...............................................14
Accumulation Unit Value..............................................14
Transfers.................................................................15
Fees and Charges..........................................................15
Mortality and Expense Risk Charge....................................15
Administration Charge................................................16
Certificate Maintenance Fee..........................................16
Surrenders................................................................16
Surrenders...........................................................16
Surrender Value......................................................16
Contingent Deferred Sales Charge.....................................16
Deferral of Payment..................................................17
Ownership Provisions......................................................17
Ownership of Separate Account........................................17
Ownership of Contract and Participant Account........................17
Transfer and Assignment..............................................17
Successor Owner......................................................17
Community Property...................................................18
Beneficiary Provisions....................................................18
Beneficiary..........................................................18
Change of Beneficiary................................................18
Benefit on Annuity Commencement Date......................................18
Annuity Commencement Date............................................18
Annuity Benefit Payments.............................................18
Form of Annuity Benefit..............................................19
Benefit on Death of Participant...........................................19
Death Benefit........................................................19
Death Benefit Amount.................................................20
Transfers After Death................................................20
Form of Death Benefit................................................21
Settlement Options........................................................21
Conditions...........................................................21
Benefit Payments.....................................................21
Fixed Dollar Benefit.................................................22
Betterment Of Rates..................................................22
Variable Dollar Benefit..............................................22
Limitation on Election of Settlement Option..........................23
Settlement Option Computations.......................................23
Available Settlement Options.........................................23
Settlement Option Tables.............................................24
<PAGE>
DEFINITIONS
Account(s): The Sub-Account(s) and/or the Fixed Account options.
Account Value: The aggregate value of a Participant's interest in the
Sub-Account(s) and the Fixed Account options as of the end of any Valuation
Period. The value of a Participant's interest in all Sub-Accounts is his or her
"Variable Account Value," and the value of a Participant's interest in all Fixed
Account options is his or her "Fixed Account Value."
Accumulated Earnings: A Participant's Account Value in excess of Purchase
Payments received by us and which have not been returned to the Participant.
Accumulation Period: The period prior to the applicable Commencement Date under
a Certificate.
Accumulation Unit: A unit of measurement used to calculate the value(s) of the
Sub-Account(s) prior to the applicable Commencement Date.
Administrative Office: The home office of the Company or any other place of
business which we may designate for administration.
Age: Age as of most recent birthday.
Annuitant: For each participation interest under this Contract, the Annuitant is
the Participant, and is the person on whose life Annuity Benefit payments are
based.
Annuity Benefit: Periodic payments made under a settlement option, which
commence on or after the Annuity Commencement Date.
Annuity Commencement Date: For each Participant, the first day of the first
Payment Interval for which an Annuity Benefit payment is to be made under a
settlement option.
Beneficiary: A person entitled to the Death Benefit under a Certificate.
Benefit Payment: The Annuity Benefit or Death Benefit payable under a settlement
option. Variable Dollar Benefit payments may vary in amount. Fixed Dollar
Benefit payments remain constant except under certain joint and survivor
settlement options.
Benefit Payment Period: The pe riod starting with the Commencement Date during
which Benefit Payments are to be
made under a Certificate.
Benefit Unit: A unit of measure used to determine the dollar value of any
Variable Dollar Benefit payments after the first Benefit Payment is made by us.
Certificate Anniversary: An annual anniversary of a Participant's Certificate
Effective Date.
Certificate Effective Date: The date shown on a Participant's Certificate
Specifications page.
Certificate Year: For a Participant's Certificate, any period of twelve (12)
months commencing on the Certificate Effective Date and on each Certificate
Anniversary thereafter.
Code: The Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder.
<PAGE>
Commencement Date: The Annuity Commencement Date if an Annuity Benefit is
payable under a Certificate, or the Death Benefit Commencement Date if a Death
Benefit is payable under a Certificate.
Death Benefit: The benefit described in the Benefit on Death of Participant
section of this Contract.
Death Benefit Commencement Date: For each Participant, the first day of the
first Payment Interval for which a Death Benefit payment is to be made under a
settlement option, or the date a Death Benefit is to be paid in a lump sum.
Death Benefit Valuation Date: The date that Due Proof of Death has been received
by us and the earlier to occur of:
1) our receipt of a Written Request with instructions as to the form of
Death Benefit; or
2) the Death Benefit Commencement Date.
Due Proof of Death: Any of the following:
1) a certified copy of a death certificate;
2) a certified copy of a decree of a court of competent jurisdiction as to
the finding of death; or
3) any other proof of death satisfactory to us.
Fund: A management investment company or portfolio thereof, registered under the
Investment Company Act of 1940, in which a Sub-Account of the Separate Account
invests.
Net Asset Value: The amount computed by an investment company, no less
frequently than each Valuation Period, as the price at which its shares or
units, as the case may be, are redeemed in accordance with the rules of the
Securities and Exchange Commission.
Owner: The person identified as such on the Contract Specifications page.
Participant: A person who participates in the benefits of this Contract pursuant
to the enrollment form for such person, as evidenced by a Certificate.
Payment Interval: A monthly, quarterly, annual or other regular interval during
a Benefit Payment Period.
Person Controlling Payments: The "Person Controlling Payments" means the
following, as the case may be:
1) with respect to Annuity Benefit payments, the Participant; and
2) with respect to Death Benefit payments,
a) the Beneficiary; or
b) if the Beneficiary is deceased, the payee.
Purchase Payment: A contribution amount paid to us in consideration for a
Participant's participation under this Contract, after the deduction of any and
all of the following which may apply:
1) any fee charged by the person remitting payments for you;
2) premium taxes; and/or
3) other taxes.
Separate Account: An account, which may be an investment company, which is
established and maintained by the Company pursuant to the laws of the State of
New York.
<PAGE>
Sub-Account: The Separate Account is divided into Sub-Accounts, each of which
invests in the shares of a designated Fund.
Valuation Period: The period commencing at the close of regular trading on the
New York Stock Exchange on any Valuation Date, and ending at the close of
trading on the next succeeding Valuation Date. "Valuation Date" means each day
on which the New York Stock Exchange is open for business.
Written Request: Information provided, or a request made, that is complete and
satisfactory to us that is sent to us on our form or in a manner satisfactory to
us and that is received by us at our Administrative Office. A Written Request is
subject to any payment made or any action we take before we receive it. The
Company will deem a Written Request a standing order which may be modified or
revoked only by a subsequent Written Request, when permitted by the terms of
this Contract. A Participant may be required to return his or her Certificate to
us in connection with a Written Request.
<PAGE>
GENERAL PROVISIONS
Entire Contract
We have issued this Contract to the Contract Owner identified on the Contract
Specifications page. This Contract is a group flexible premium deferred variable
annuity contract. This Contract is restricted by endorsement as required to
obtain favorable tax treatment under the Code, and is not valid without the
requisite endorsement(s) being attached. This Contract, its endorsements, the
application, if any, and the enrollment forms of all Participants under it, form
the entire Contract between you and us. Certificates are not contracts and are
not a part of this Contract.
Participant Certificate
A Certificate is evidence of a Participant's participation interest under this
Contract.
Changes -- Waivers
No changes or waivers of the terms of this Contract are valid unless made in
writing by our President, Vice President, or Secretary. No agent or other person
not named above has authority to change or waive any provision of this Contract.
We reserve the right both to administer and to change the provisions of this
Contract to conform to any applicable laws, regulations or rulings issued by a
governmental agency.
In any event, the Company reserves the right to add or delete Fixed Account
options and Sub-Accounts, to substitute shares of a different Fund or different
class or series of a Fund for shares held in a Sub-Account, to merge or combine
Sub-Accounts, to merge or combine the Separate Account with any other separate
account of the Company, to transfer the assets of the Separate Account to
another life insurance company by means of a merger or reinsurance, to convert
the Separate Account into a managed separate account, and to de-register the
Separate Account under the Investment Company Act of 1940. Any such change will
be made in accordance with applicable insurance and securities laws and after
obtaining any necessary approvals, including those of the New York State
Insurance Department and the Securities and Exchange Commission, Any such change
will not reduce benefits due under this Contract.
Nonparticipating
This Contract does not pay dividends or share in the Company's divisible
surplus.
Misstatement
If the age o a person on whose life Benefit Payments are based is misstated, the
payments or other benefits under this Contract shall be adjusted to the amount
which would have been payable based on the correct age. If we made any
underpayments based on any misstatement, the amount of any underpayment with
interest at the rate of six percent (6%) per year shall be immediately paid in
one sum. In addition to any other remedies that may be available at law or at
equity, we may deduct any overpayments made, with interest at the rate of six
percent (6%) per year, from any succeeding payments due.
Required Reports
At least once each Certificate Year, we will send one or more statements
reporting the investments held in the Separate Account, the number of
Accumulation Units under the Participant's Certificate and the Participant's
Account Value as of the most recent calendar quarter and any other information
required by law, until the first to occur of the following:
1) the date the Participant's participation interest under this Contract
is fully surrendered;
2) the Participant's Annuity Commencement Date; or
3) the Participant's Death Benefit Commencement Date.
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The report will be mailed to the last known address of the Participant. The
reported values will be based on the information in our possession at the time
the report is prepared by us. We may adjust the reported values at a later date
if that information proves to be incorrect or has changed.
Exclusive Benefit
This Contract is for the exclusive benefit of Participants and their
Beneficiaries. Their interests under this Contract are nonforfeitable by us.
State Law
All factors, values, benefits and reserves under this Contract will not be less
than those required by the law of the state in which this Contract is delivered.
Claims of Creditors
To the extent allowed by law, this Contract and all values and benefits under it
are not subject to the claims of creditors or to legal process.
Company Liability
We will not incur any liability or be responsible for any failure, in whole or
in part, by you or by any person having rights or benefits arising out of or
related to this Contract, to comply with any applicable laws, regulations or
rulings issued by a governmental agency.
Voting Rights
To the extent required by law, we will vote all shares of the Funds held in the
Separate Account, at regular and special shareholder meetings of the Funds, in
accordance with instructions received from the Participant, or, if applicable,
from the Person Controlling Payments. If there is a change in the law which
permits us to vote the shares of the Funds without such instructions, then we
reserve the right to do so.
Incontestability
This Contract, and the participation interests of Participants under it, shall
not be contestable by us.
Discharge of Liability
Upon payment of any partial or full surrender, or any Benefit Payment, we shall
be discharged from all liability to the extent of each such payment.
Termination
Either we or you may terminate this Contract by giving sixty (60) days advance
notice in writing. Refer to the Contract Specifications page for information
regarding the benefits and charges, if any, in the event of termination of this
Contract. If this Contract is terminated, a Participant may continue his or her
participation under it on a deferred paid-up basis, subject to all of the terms
and conditions of this Contract, unless he or she surrenders his or her
participation as a whole. Termination of this Contract will not affect Benefit
Payments being made by us.
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PURCHASE PAYMENTS
Purchase Payments
One or more Purchase Payments may be paid to us for a Participant at any time
before the Participant's Annuity Commencement Date, so long as:
1) the Participant is still living; and
2) the Participant's participation interest has not been fully
surrendered.
The initial Purchase Payment for a Participant must be paid to us on or before
the Participant's Certificate Effective Date. Each Purchase Payment must be paid
to us at our Administrative Office, and is subject to any minimums or maximums
shown on the Contract Specifications page . Upon request, we will provide you
with a receipt as proof of payment.
Allocation of Purchase Payment(s)
We will allocate Purchase Payments to the Fixed Account options and/or to the
Sub-Accounts according to the instructions we receive in the Participant's
enrollment form or subsequent Written Request. Allocations must be made in whole
percentages. The minimum Purchase Payment amount that can be allocated to a
Fixed Account option other than the Fixed Accumulation Account is $2,000.
You shall be responsible to collect Purchase Payment(s) by payroll deduction or
otherwise and to remit Purchase Payment(s) to us in the proper amount, together
with all information necessary to apply such amounts properly under the terms of
this Contract and with respect to the participation interests of Participants
hereunder.
No Termination
Except as stated elsewhere in this Contract, neither this Contract nor the
participation of a Participant under it will be terminated by us due to failure
to make additional Purchase Payments.
FIXED ACCOUNT
Fixed Account
The Fixed Account is part of the Company's general account. The values of the
Fixed Account are not dependent upon the investment performance of the
Sub-Accounts.
Fixed Account Options. The Fixed Account options available as of the Contract
Effective Date are listed on the Contract Specifications page. Different Fixed
Account options may be offered by us at any time.
Interest Credited. The guaranteed rate of interest for the Fixed Account options
is three percent (3%) per year, compounded annually. We may, at any time, pay a
current interest rate as declared by our Board of Directors for any of the Fixed
Account options that is higher than the guaranteed rate.
The interest rate initially credited to each Purchase Payment allocated to the
Fixed Accumulation Account Option will not be changed any sooner than twelve
(12) months following the date on which that Purchase Payment was received;
thereafter, the interest rate credited will not be changed more frequently than
once per calendar quarter. In the case of transfers from other Fixed Account
options or the Sub-Accounts to the Fixed Accumulation Account Option, the
interest rate will not be changed more frequently than once per calendar
quarter.
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The interest rate credited to amounts allocated to the Fixed Account options
other than the Fixed Accumulation Account Option will not be changed during the
duration of the applicable guarantee period.
Renewal. The following provisions apply to all Fixed Account options except the
Fixed Accumulation Account Option.
At the end of a guarantee period, and for the thirty (30) days immediately
preceding the end of such guarantee period, a Participant may elect a new option
to replace the Fixed Account option that is then expiring. The entire amount
maturing may be re-allocated to any of the then-current options under the
Contract (including the various Sub-Accounts within the Separate Account),
except that a Fixed Account option with a guarantee period that would extend
past the Participant's Annuity Commencement Date may not be selected. In
particular, in the case of renewals occurring within one (1) year of such
Commencement Date, the only Fixed Account option available to the Participant is
the Fixed Accumulation Account Option.
If a new Fixed Account option is not specified in accordance with the preceding
paragraph, the Participant will be deemed to have selected the same Fixed
Account option as is expiring, so long as the guarantee period of such option
does not extend beyond the Participant's Annuity Commencement Date. In the event
that such a period would extend beyond that date, the Participant will be deemed
to have selected the Fixed Account option with the longest available guarantee
period that expires prior to that date, or, failing that, the Fixed Accumulation
Account Option.
Any renewal of a Fixed Account option under this Renewal provision will be
effective on the day after the expiration of the guarantee period that is then
expiring.
Fixed Account Value
A Participant's Fixed Account Value at any time is equal to:
1) Purchase Payment(s) received by us for him or her which are allocated
to the Fixed Account; plus
2) amounts transferred to the Fixed Account for him or her; plus
3) interest credited to the Participant's interest in the Fixed Account;
less
4) any charges, surrenders, deductions, amounts transferred from the Fixed
Account or other adjustments made as described elsewhere in this
Contract, which relate to his or her participation.
SEPARATE ACCOUNT
General Description
The variable benefits under this Contract are provided through the Separate
Account. The Separate Account is registered with the Securities and Exchange
Commission as a unit investment trust under the Investment Company Act of 1940.
The income, if any, and any gains or losses, realized or unrealized, on the
Separate Account will be credited to or charged against the amounts allocated to
such account without regard to other income, gains, or losses of the Company.
The amounts allocated to the Separate Account and the accumulations thereon
remain the property of the Company, but that portion of the assets of the
Separate Account that is equal to the reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account, is not chargeable with liabilities arising out of any other business of
the Company. The Company is not, and does not hold itself out to be, a trustee
in respect of such amounts.
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We have the right to transfer to our general account, in our sole discretion and
at any time without prior written notice, any assets of the Separate Account
which are in excess of the required reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account.
Sub-Accounts of the Separate Account
The assets of the Separate Account are divided into Sub-Accounts. The
Sub-Accounts available as of the Contract Effective Date are listed on the
Contract Specifications page. Each Sub-Account invests exclusively in shares of
an underlying Fund as shown on the Contract Specifications page. Any amounts of
income and any gains on the shares of a Fund will be reinvested in additional
shares of that Fund at its Net Asset Value.
Valuation of Assets
Shares of Funds held by each Sub-Account will be valued at their Net Asset Value
at the end of each Valuation Period, as reported by each such Fund.
Variable Account Value
Purchase Payment(s) may be allocated among and, as described elsewhere in this
Contract, Account Values may be transferred to the various Sub-Accounts within
the Separate Account. For each Sub-Account, the Purchase Payment(s) or amounts
transferred are converted into Accumulation Units. The number of Accumulation
Units credited is determined by dividing the dollar amount directed to each
Sub-Account by the value of the Accumulation Unit for that Sub-Account at the
end of the Valuation Period on which the Purchase Payment(s) or transferred
amount is received.
The following events will result in the cancellation of an appropriate number of
Accumulation Units of a Sub-Account:
1) transfer from a Sub-Account;
2) full or partial surrender of a Participant's Variable Account Value;
3) payment of a Death Benefit;
4) application of a Participant's Variable Account Value to a settlement
option;
5) deduction of a Certificate Maintenance Fee; or
6) deduction of any Transfer Fee.
Accumulation Units will be canceled as of the end of the Valuation Period during
which the Company receives a Written Request regarding the event giving rise to
such cancellation, or an applicable Commencement Date, or the end of the
Valuation Period on which a Certificate Maintenance Fee or Transfer Fee is due,
as the case may be.
A Participant's Variable Account Value at any time is equal to the sum of the
number of Accumulation Units for each Sub-Account attributable to his or her
participation multiplied by the Accumulation Unit Value for each Sub-Account at
the end of the preceding Valuation Period.
Accumulation Unit Value
The initial Accumulation Unit Value for each Sub-Account, with the exception of
the Money Market Sub-Account, was set at $10.00. The initial Accumulation Unit
Value for the Money Market Sub-Account was set at $1.00. Thereafter, the
Accumulation Unit Value at the end of each Valuation Period is the Accumulation
Unit Value at the end of the previous Valuation Period multiplied by the Net
Investment Factor, as described below.
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The Net Investment Factor is a factor applied to measure the investment
performance of a Sub-Account from one Valuation Period to the next. Each
Sub-Account has a Net Investment Factor for each Valuation Period which may be
greater or less than one. Therefore, the Accumulation Unit Value for each
Sub-Account may increase or decrease. The Net Investment Factor for any
Sub-Account for any Valuation Period is determined by dividing (1) by (2) and
subtracting (3) from the result, where:
1) is equal to:
a) the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the applicable Valuation Period; plus
b) the per share amount of any dividend or net capital gain
distributions made by the Fund held in the Sub-Account, if the
"ex-dividend" date occurs during the applicable Valuation Period;
plus or minus
c) a per share charge or credit for any taxes reserved for, which is
determined by the Company to have resulted from the investment
operations of the Sub-Account;
2) is the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the immediately preceding Valuation Period;
and
3) is the factor representing the Mortality and Expense Risk Charge and
the Administration Charge deducted from the Sub-Account for the number
of days in the applicable Valuation Period.
TRANSFERS
Prior to his or her applicable Commencement Date, a Participant may transfer
amounts in a Sub-Account to a different Sub-Account and/or one or more of the
Fixed Account options.
After the first Certificate Anniversary, and prior to the applicable
Commencement Date, a Participant may transfer amounts from any Fixed Account
option to any other Fixed Account option and/or one or more of the Sub-Accounts.
If a transfer is being made from a Fixed Account option pursuant to the Renewal
provision of this Contract, then the entire amount of that Fixed Account option
subject to renewal at that time may be transferred. In any other case, transfers
from any Fixed Account option are subject to a cumulative limit for each
Participant during each Certificate Year of twenty percent (20%) of the Fixed
Account option's value for that Participant as of the most recent Certificate
Anniversary.
Amounts previously transferred from Fixed Account options to the Sub-Accounts
may not be transferred back to the Fixed Account options for a period of ninety
(90) days from the date of transfer.
The minimum transfer amount for any transfer is $500. The number of transfers
per year for each Participant, over which we will charge a Transfer Fee on each
additional transfer, and the amount of the Transfer Fee, are shown on the
Contract Specifications page.
FEES AND CHARGES
Mortality and Expense Risk Charge
The Mortality and Expense Risk Charge is shown on the Contract Specifications
page and is deducted daily from each Sub-Account. This deduction is made to
compensate the Company for assuming the mortality and expense risks under this
Contract.
<PAGE>
Administration Charge
The Administration Charge is shown on the Contract Specifications page and is
deducted daily from each Sub-Account. This deduction is made to reimburse the
Company for expenses incurred in the administration of this Contract, the
Certificates thereunder, and the Separate Account.
Certificate Maintenance Fee
The Certificate Maintenance Fee ("Fee") is shown on the Contract Specifications
page and is deducted for each Participant as of the Valuation Period next
following each Certificate Anniversary prior to the applicable Commencement
Date. In addition, the full annual Fee will be charged at the time of a full
surrender of a Participant's participation interest. The Fee will be allocated
to each Sub-Account in the same proportion as each Sub-Account's value is to the
Participant's total Variable Account Value as of the end of such Valuation
Period. The Fee does not apply to the Fixed Account.
After his or her applicable Commencement Date, if a Variable Dollar Benefit is
elected by a Participant, the Fee will be deducted pro-rata from each Benefit
Payment and will result in a reduction in the amount of such payment.
The Fee may be waived in whole or in part in our sole discretion.
SURRENDERS
Surrenders
A surrender in full may be made for a Participant's Surrender Value, or partial
surrenders may be made for a lesser amount, by Written Request at any time prior
to the Participant's Annuity Commencement Date. The amount of any partial
surrender must be at least $500. If a partial surrender would reduce a
Participant's Account Value to less than $500, we will treat the surrender
request as a request for full surrender. Surrenders will be deemed to be
withdrawn first from the portion of the Account Value that represents a
Participant's Accumulated Earnings and then from Purchase Payments. For purposes
of this Contract, Purchase Payments are deemed to be withdrawn on a "first-in,
first-out" (FIFO) basis.
The amount available for surrender will be the Surrender Value at the end of the
Valuation Period in which the Written Request is received by us.
Surrender Value
A Participant's Surrender Value at any time is an amount equal to:
1) his or her Account Value as of the end of the applicable Valuation
Period; less
2) any applicable Contingent Deferred Sales Charge; less
3) any outstanding loans; and less
4) any applicable premium tax or other taxes not previously deducted.
On full surrender, a full Certificate Maintenance Fee will also be deducted as
part of the calculation of the Surrender Value.
Contingent Deferred Sales Charge
A full or partial surrender of a Participant's participation interest may be
subject to a Contingent Deferred Sales Charge as set forth on the Contract
Specifications page. The Contingent Deferred Sales Charge applies to and is
calculated separately for each Purchase Payment.
<PAGE>
Surrenders will result in the cancellation of Accumulation Units from each
applicable Sub-Account(s) and/or a reduction of the Participant's Fixed Account
Value and a reduction in the Participant's Death Benefit Amount. In the case of
a full surrender, a Participant's participation interest under this Contract
will be terminated. The Contingent Deferred Sales Charge may be waived in whole
or in part in our sole discretion.
Deferral of Payment
The Company has the right to suspend or delay the date of payment of a partial
or full surrender of the Variable Account Value for any period:
1) when the New York Stock Exchange is closed, or when trading on the New
York Stock Exchange is restricted; or
2) when an emergency exists (as determined by the Securities and Exchange
Commission) as a result of which: a) the disposal of securities in the
Separate Account is not reasonably practicable; or b) it is not
reasonably practicable to determine fairly the value of the net assets
in the Separate Account; or
3) when the Securities and Exchange Commission so permits for the
protection of security holders.
The Company further reserves the right to delay payment of a partial or full
surrender of the Fixed Account Value for up to six (6) months after we receive a
Written Request.
OWNERSHIP PROVISIONS
Ownership of Separate Account
The Company has absolute ownership of the assets in the Separate Account.
However, the Company is not, and does not hold itself out to be, a trustee in
respect of any amounts under the Separate Account.
Ownership of Contract and Participant Account
The Contract Owner must be an employer or the trustee for an employer's
retirement plan. The Contract Owner is shown on the Contract Specifications
page. This Contract is held by the Contract Owner for the benefit of the
Participants and Beneficiaries.
Each participant for whom Purchase Payment(s) are made will participate in this
Contract as a Participant. A participant account will be established for each
Participant.
Transfer and Assignment
Neither you nor a Participant may transfer, sell, assign, pledge, charge,
encumber or in any way alienate an interest under this Contract.
Successor Owner
By Written Request, a Participant's spouse may, in some cases, succeed to the
ownership of a Participant's participation interest under this Contract after
the Participant's death. Specifically, if a Participant dies and his or her
spouse is the sole surviving Beneficiary of the Participant's participation
interest, he or she will become the Successor Owner of the Participant's
participation interest if:
1) the Participant makes that Written Request before his or her death; or
2) after the Participant's death, his or her spouse makes that Written
Request within one (1) year of the Participant's death and before the
Death Benefit Commencement Date.
<PAGE>
As Successor Owner, the Participant's spouse will then succeed to all the
Participant's rights of ownership under this Contract except the right to name
another Successor Owner.
Community Property
If a Participant lives in a community property state and has a spouse at any
time while he or she participates under this Contract, the laws of that state
may vary his or her ownership rights.
BENEFICIARY PROVISIONS
Beneficiary
A Participant's Beneficiary is the person or persons so designated on his or her
enrollment form, if any, or under the Change of Beneficiary provision of this
Contract. If a Participant has not designated a Beneficiary, or if no
Beneficiary designated survives the Participant, then the Beneficiary will be
the Participant's estate.
Unless the Participant provides otherwise by Written Request, a Beneficiary will
be deemed not to have survived a Participant if he or she dies within thirty
(30) days after the Participant's death.
A Beneficiary designation may be joint or contingent or both. Unless otherwise
stated, joint Beneficiaries will be entitled to equal shares. A contingent
Beneficiary will be entitled to a benefit only if there is no surviving primary
Beneficiary.
Change of Beneficiary
An irrevocable Beneficiary may not be changed without his or her consent. Unless
a Participant has designated an irrevocable Beneficiary, he or she may change
his or her designation of a Beneficiary at any time before the Annuity
Commencement Date, effective as of the date the Written Request is signed,
subject to our receiving the Written Request.
Any such change is subject to the following:
1) it must be made by Written Request; and
2) unless otherwise elected or required by law, it will not cancel any
settlement option election previously made.
BENEFIT ON ANNUITY COMMENCEMENT DATE
Annuity Commencement Date
The Annuity Commencement Date for a Participant is shown on the Participant's
Certificate Specifications page. A Participant may change his or her Annuity
Commencement Date by Written Request made at least thirty (30) days prior to the
date that Annuity Benefit payments are scheduled to begin. A Participant's
Annuity Commencement Date cannot be later than the Certificate Anniversary
following his or her 85th birthday, or five (5) years after his or her
Certificate Effective Date, whichever is later, but in no event will it be later
than the Participant's 90th birthday.
Annuity Benefit Payments
An amount equal to the Participant's Account Value (after deduction of any fees
and charges, loans, or applicable premium tax or other taxes not previously
deducted) will be used to provide Annuity Benefit payments to Participants under
this Contract commencing on or after a Participant's Annuity Commencement Date.
<PAGE>
Annuity Benefit payments will be made to the Participant as payee. Any Annuity
Benefit amounts remaining payable on his or her death will be paid to the
contingent payee designated by the Participant by Written Request. The
Participant will be the person on whose life any Annuity Benefit payments are
based.
If no contingent payee designated by the Participant is surviving at the time
payment is to be made, then after the Participant's death any Annuity Benefit
amounts remaining payable will be paid to the person or persons designated as
contingent payee by Written Request by the last payee who received payments.
Failing that, any such amounts will be paid to the estate of the last payee who
received payments.
Form of Annuity Benefit
Annuity Benefit payments will be Fixed Dollar Benefit payments, made monthly in
accordance with the terms of Option B with a fixed period of one hundred twenty
(120) months under the SETTLEMENT OPTIONS section of this Contract.
In lieu of that, a Participant may elect to have Annuity Benefit payments made
pursuant to any other available settlement option under the SETTLEMENT OPTIONS
section of this Contract. Any such election must be made by Written Request
before the Annuity Commencement Date. A Participant may change his or her
election of a settlement option by Written Request made at least thirty (30)
days prior to the date that Annuity Benefit payments are scheduled to begin.
BENEFIT ON DEATH OF PARTICIPANT
Death Benefit
A Death Benefit will be paid under this Contract if:
1) a Participant dies before his or her Annuity Commencement Date and
before his or her participation interest is fully surrendered;
2) the Participant's Death Benefit Valuation Date has occurred; and
3) the Participant's spouse does not become the Successor Owner of the
Participant's participation interest.
If a Death Benefit becomes payable with respect to a Participant:
1) it will be in lieu of all other benefits with respect to that
Participant under this Contract; and
2) all other rights with respect to that Participant under this Contract
will be terminated except for rights related to the Death Benefit.
Death Benefit payments shall be made to the Participant's Beneficiary as payee.
The Participant's Beneficiary will be the person on whose life any Death Benefit
payments under a settlement option are based.
Any Death Benefit amounts remaining payable on the death of a Beneficiary will
be paid:
1) to any contingent payee designated by the Participant as part of any
Death Benefit settlement option election made by the Participant, or if
none is surviving at the time payment is to be made; then
2) to any contingent payee designated by the Beneficiary by Written
Request, or if none is surviving at the time payment is to be made;
then
3) to the estate of the last payee who received payments.
Only one Death Benefit will be paid with respect to a Participant's
participation interest under this Contract.
Death Benefit Amount
If the Participant dies before attaining Age eighty (80) and before his or her
Annuity Commencement Date, the Death Benefit is an amount equal to the greatest
of:
1) the Participant's Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s) received by us for him or her, with
interest at three percent (3%) per year, compounded annually through
the earlier of the Death Benefit Valuation Date or the Certificate
Anniversary prior to the date the Participant would have attained Age
eighty (80), less any partial surrenders and any Contingent Deferred
Sales Charges that applied to those amounts; or
3) the largest Account Value for the Participant on any Certificate
Anniversary after the fourth Certificate Anniversary and prior to the
earlier of the Death Benefit Valuation Date or the date the Participant
would have attained Age eighty (80), less any partial surrenders after
such Account Value was determined and any Contingent Deferred Sales
Charges that applied to those amounts.
If the Participant dies after attaining Age eighty (80) and before his or her
Annuity Commencement Date, the Death Benefit is an amount equal to the greatest
of:
1) the Participant's Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s) received by us for him or her, with
interest at three percent (3%) per year, compounded annually through
the Certificate Anniversary prior to the Participant's 80th birthday,
less any partial surrenders and any Contingent Deferred Sales Charges
that applied to those amounts; or
3) the largest Account Value for the Participant on any Certificate
Anniversary after the fourth Certificate Anniversary and prior to the
date on which the Participant attained Age eighty (80), less any
partial surrenders after such Account Value was determined and any
Contingent Deferred Sales Charges that applied to those amounts.
In any event, if a Certificate was issued to a Participant after Age eighty
(80), and the Participant dies before his or her Annuity Commencement Date, the
amount of the Death Benefit will be the greater of:
1) the Participant's Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s) received by us for him or her, less any
partial surrenders and any Contingent Deferred Sales Charges that
applied to those amounts.
As of the Death Benefit Valuation Date for a Participant, the amount of the
Death Benefit will be allocated among the Sub-Accounts and Fixed Account options
in the same proportion as each Account's value is to the total Account Value for
that Participant as of the end of the Valuation Period immediately preceding the
Death Benefit Valuation Date.
Any applicable premium tax or other taxes not previously deducted, and any
outstanding loans, will be deducted from the Death Benefit amount described
above.
Transfers After Death
Between the Death Benefit Valuation Date and the Death Benefit Commencement
Date, a Beneficiary may transfer funds among Sub-Accounts and Fixed Account
options as described under the TRANSFERS section of this Contract.
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Form of Death Benefit
Payments under the Death Benefit provision of this Contract will be Fixed Dollar
Benefit payments made monthly in accordance with the terms of Option A with a
period certain of forty-eight (48) months under the SETTLEMENT OPTIONS section
of this Contract.
In lieu of that, a Participant may elect at any time before his or her death to
have payments under the Death Benefit provision of this Contract made in one
lump sum or pursuant to any available settlement option under the SETTLEMENT
OPTIONS section of this Contract. If a Participant does not make any such
election, the Beneficiary may make that election at any time after the
Participant's death and before the Death Benefit Commencement Date.
A Participant may change his or her election of a settlement option at any time
before his or her death.
If a Beneficiary elects a settlement option as noted above, he or she may change
his or her own election of a settlement option by Written Request made at least
thirty (30) days prior to the date that Death Benefit payments are scheduled to
begin.
Any election or change of election must be made by Written Request.
SETTLEMENT OPTIONS
Conditions
The amount applied to a settlement option must be at least $2,000. We will pay
you the Account Value in in one lump sum on the Annuity Commencement Date if it
is less than $2,000. The amount of any Fixed Dollar Benefit payment, or the
amount of the first Variable Dollar Benefit payment, under a settlement option
must be at least $20. More than one settlement option may be elected if the
requirements for each settlement option elected are satisfied. Once payment
begins under a settlement option, the settlement option may not be changed.
All elected settlement options must comply with current applicable laws,
regulations and rulings issued by any governmental agency.
If more than one person is the payee under a settlement option, payments will be
made to the payees in equal shares, unless otherwise provided by Written Request
. No more than two persons may be initial payees under any joint and survivor
settlement options.
If payment under a settlement option depends on whether a specified person is
still alive, we may at any time require proof that such person is still living.
We will require proof of the age of any person on whose life Benefit Payments
are based.
Benefit Payments
Benefit Payments may be calculated and paid:
1) as a Fixed Dollar Benefit;
2) as a Variable Dollar Benefit; or
3) as a combination of both.
If only a Fixed Dollar Benefit is to be paid, we will transfer all of the
Participant's Account Value to the Company's general account on the applicable
Commencement Date, or on the Death Benefit Valuation Date (if applicable).
Similarly, if only a Variable Dollar Benefit is elected, we will transfer all of
the Participant's Account Value to the Sub-Accounts as of the end of the
Valuation Period immediately prior to the applicable Commencement Date; we will
allocate the amount transferred among the Sub-Accounts in accordance with a
Written Request. No transfers between the Fixed Dollar Benefit and the Variable
Dollar Benefit will be allowed after the Commencement Date. However, after the
Variable Dollar Benefit has been paid for at least twelve (12) months, the
Person Controlling Payments may, no more than once each twelve (12) months
thereafter, transfer all or part of the Benefit Units upon which the Variable
Dollar Benefit is based from the Sub-Account(s) then held, to the Benefit Units
in different Sub-Account(s).
If a Variable Dollar Benefit is elected, the amount to be applied under that
benefit is the Variable Account Value as of the end of the Valuation Period
immediately preceding the applicable Commencement Date. If a Fixed Dollar
Benefit is to be paid, the amount to be applied under that benefit is the Fixed
Account Value as of the applicable Commencement Date, or as of the Death Benefit
Valuation Date (if applicable).
Fixed Dollar Benefit
Fixed Dollar Benefit payments are determined by multiplying the Participant's
Fixed Account Value (expressed in thousands of dollars and after deduction of
any fees and charges, loans, or applicable premium tax or other taxes not
previously deducted) by the amount of the monthly payment per $1,000 of value
obtained from the Settlement Option Table for the settlement option elected.
Fixed Dollar Benefit payments will remain level for the duration of the Benefit
Payment Period.
If at the time a Fixed Dollar Benefit is elected, we have available options or
rates on a more favorable basis than those guaranteed, the higher benefits shall
be applied and shall not change for as long as that election remains in force.
Betterment Of Rates
The Fixed Dollar Benefit available under this Contract as of the Annuity
Commencement Date or the Death Benefit Commencement Date will not be less than
the benefit that would be provided by the application of the Participant's
Account Value to purchase any single consideration immediate annuity contract
offered by us at the time to the same class of annuitants.
Variable Dollar Benefit
The first monthly Variable Dollar Benefit payment is equal to the Participant's
Variable Account Value (expressed in thousands of dollars and after deduction of
any fees and charges, loans, or applicable premium tax or other taxes not
previously deducted) as of the end of the Valuation Period immediately preceding
the applicable Commencement Date multiplied by the amount of the monthly payment
per $1,000 of value obtained from the Settlement Option Table for the Benefit
Payment elected less the pro-rata portion of the Certificate Maintenance Fee.
The number of Benefit Units in each Sub-Account held by a Participant is
determined by dividing the dollar amount of the first monthly Variable Dollar
Benefit payment from each Sub-Account by the Benefit Unit Value for that
Sub-Account as of the applicable Commencement Date. The number of Benefit Units
remains fixed during the Benefit Payment Period, except as a result of any
transfers among Sub-Accounts after the applicable Commencement Date.
The dollar amount of the second and subsequent Variable Dollar Benefit payment
will reflect the investment performance of the Sub-Account(s) selected and may
vary from month to month. The total amount of the second and any subsequent
Variable Dollar Benefit payment will be equal to the sum of the payments from
each Sub-Account less a pro-rata portion of the Certificate Maintenance Fee.
The payment from each Sub-Account is found by multiplying the number of Benefit
Units held in each Sub-Account by a Participant by the Benefit Unit Value for
that Sub-Account as of the end of the fifth Valuation Period preceding the due
date of the payment.
<PAGE>
The Benefit Unit Value for each Sub-Account is originally established in the
same manner as Accumulation Unit Values. Thereafter, the value of a Benefit Unit
for a Sub-Account is determined by multiplying the Benefit Unit Value as of the
end of the preceding Valuation Period by the Net Investment Factor, determined
as set forth under the Accumulation Unit Value provision of this Contract, for
the Valuation Period just ended. The product is then multiplied by the assumed
daily investment factor (0.99991781), for the number of days in the Valuation
Period. The factor is based on the assumed net investment rate of three percent
(3%) per year, compounded annually, that is reflected in the Settlement Option
Tables.
Variable Dollar Benefit payments will not be adversely affected by actual
mortality and expense experience of the Sub-Accounts.
Limitation on Election of Settlement Option
Fixed periods shorter than five (5) years are not available, except as a Death
Benefit settlement option.
Settlement Option Computations
The 1983 Group Annuity Mortality Table with interest at three percent (3%) per
year, compounded annually, is used to compute all guaranteed settlement option
factors, values, and benefits under this Contract.
Available Settlement Options
The available settlement options are set out below.
Option A Income for a Fixed Period
We will make periodic payments for a fixed period. The first payment
will be paid as of the last day of the initial Payment Interval. The
maximum time over which payments will be made by us or money will be
held by us is thirty (30) years. The Option A Table applies to this
Option.
Option B Life Annuity with Payments for at Least a Fixed Period
We will make monthly payments for at least a fixed period. If the
person on whose life Benefit Payments are based lives longer than the
fixed period, then we will make payments until his or her death. The
first payment will be paid as of the first day of the initial Payment
Interval. The Option B Table applies to this Option.
Option C Joint and One-half Survivor Annuity
We will make a periodic payments until the death of the person on whose
life Benefit Payments are based; thereafter, we will make one-half
(1/2) of the periodic payment until the death of the secondary person
on whose life Benefit Payments are based. The first payment will be
paid as of the first day of the initial Payment Interval. The Option C
Table applies to this Option.
Option D Life Annuity
We will make periodic payments until the death of the person on whose
life Benefit Payments are based. The first payment will be paid as of
the first day of the initial Payment Interval. The Option D Table
applies to this Option.
Option E Any Other Form
We will make periodic payments in any other form of settlement option
which is acceptable to us at the time of election.
<PAGE>
Settlement Option Tables
The Option Tables show the payments we will make at sample Payment Intervals for
each $1,000 applied at the guaranteed interest rate. Amounts may vary with the
Payment Interval and the age of the person on whose life Benefit Payments are
based.
<TABLE>
<CAPTION>
OPTION A TABLE - INCOME FOR A FIXED PERIOD
Payments for fixed number of years for each $1,000
applied.
- -----------------------------------------------------------------------------------------------------------------------
Terms of Semi-Annual Terms Semi-Annual Terms of Semi-Annual
Payments Annual Quarterly Monthly of Annual Quarterly Monthly Payments Annual Quarterly Monthly
Payments
- -----------------------------------------------------------------------------------------------------------------------
Years Years Years
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
6 184.60 91.62 45.64 15.18 11 108.08 53.64 26.72 8.88 16 79.61 39.51 19.68 6.54
7 160.51 79.66 39.68 13.20 12 100.46 49.86 24.84 8.26 17 75.95 37.70 18.78 6.24
8 142.46 70.70 35.22 11.71 13 94.03 46.67 23.25 7.73 18 72.71 36.09 17.98 5.98
9 128.43 63.74 31.75 10.56 14 88.53 43.94 21.89 7.28 19 69.81 34.65 17.26 5.74
10 117.23 58.18 28.98 9.64 15 83.77 41.57 20.71 6.89 20 67.22 33.36 16.62 5.53
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
OPTION B TABLE - LIFE ANNUITY
With Payments For At Least A Fixed Period
- --------- ---------------- --------------- ---------------- ----------------
60 Months 120 Months 180 Months 240 Months
- --------- ---------------- --------------- ---------------- ----------------
Age
- --------- ---------------- --------------- ---------------- ----------------
55 $4.55 $4.51 $4.44 $4.33
56 4.65 4.61 4.52 4.39
57 4.76 4.71 4.61 4.46
58 4.87 4.81 4.70 4.53
59 4.99 4.92 4.79 4.60
60 5.12 5.04 4.89 4.67
61 5.25 5.16 4.99 4.74
62 5.40 5.29 5.09 4.81
63 5.55 5.42 5.19 4.87
64 5.72 5.56 5.30 4.94
65 5.89 5.71 5.40 5.00
66 6.08 5.86 5.51 5.06
67 6.27 6.02 5.62 5.11
68 6.48 6.19 5.72 5.17
69 6.71 6.36 5.83 5.22
70 6.95 6.54 5.93 5.26
71 7.20 6.72 6.03 5.30
72 7.46 6.90 6.12 5.34
73 7.75 7.08 6.21 5.37
74 8.04 7.27 6.30 5.40
- --------- ---------------- --------------- ---------------- ----------------
<PAGE>
<TABLE>
<CAPTION>
OPTION C TABLE - JOINT AND ONE-HALF SURVIVOR
ANNUITY Monthly payments for each $1,000 of proceeds by
ages of persons named.*
- -------------- -------------------------------------------------------------------------------------------------------
Secondary Age
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
Primary Age
60 61 62 63 64 65 66 67 68 69 70
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 $4.73 $4.75 $4.78 $4.80 $4.83 $4.85 $4.87 $4.89 $4.92 $4.93 $4.95
61 4.81 4.84 4.87 4.90 4.92 4.95 4.97 5.00 5.02 5.04 5.06
62 4.90 4.93 4.96 4.99 5.02 5.05 5.08 5.11 5.13 5.16 5.18
63 4.99 5.03 5.06 5.09 5.13 5.16 5.19 5.22 5.25 5.28 5.30
64 5.09 5.12 5.16 5.20 5.23 5.27 5.30 5.34 5.37 5.40 5.43
65 5.18 5.22 5.26 5.31 5.35 5.38 5.42 5.46 5.49 5.53 5.56
66 5.28 5.33 5.37 5.42 5.46 5.50 5.54 5.58 5.62 5.66 5.70
67 5.38 5.43 5.48 5.53 5.58 5.62 5.67 5.72 5.76 5.80 5.84
68 5.49 5.54 5.59 5.65 5.70 5.75 5.80 5.85 5.90 5.95 5.99
69 5.60 5.65 5.71 5.77 5.82 5.88 5.93 5.99 6.04 6.10 6.15
70 5.71 5.77 5.83 5.89 5.95 6.01 6.07 6.13 6.19 6.25 6.31
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
</TABLE>
*Payments after the death of the Primary Payee will be one-half (1/2) of the
amount shown.
<TABLE>
<CAPTION>
OPTION D TABLE - LIFE ANNUITY
Monthly payments for each $1,000 applied.
- ------------ ------------------ --------- ------------------ ---------- ----------------- --------- ------------------
Age Age Age Age
- ------------ ------------------ --------- ------------------ ---------- ----------------- --------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
55 $4.56 60 $5.14 65 $5.95 70 $7.08
56 4.67 61 5.28 66 6.14 71 7.36
57 4.77 62 5.43 67 6.35 72 7.66
58 4.89 63 5.59 68 6.58 73 7.98
59 5.01 64 5.76 69 6.82 74 8.33
- ------------ ------------------ --------- ------------------ ---------- ----------------- --------- ------------------
</TABLE>
<PAGE>
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Group Flexible Premium Deferred Variable Annuity Contract
Nonparticipating - No Dividends
<PAGE>
NY3333C99
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Certificate of Participation
Under a Group Flexible Premium Deferred Variable Annuity Contract
This is your Certificate of Participation ("Certificate"). It is evidence of
your participation interest in the Group Flexible Premium Deferred Variable
Annuity Contract ("the Contract"), as identified on the Certificate
Specifications page, which has been issued by Great American Life Insurance
Company of New York to the Contract Owner. As you read through this Certificate,
please note that the words "we", "us", "our", and "Company" refer to Great
American Life Insurance Company of New York. The words "you" and "your" refer to
the Participant.
RIGHT TO CANCEL
You may cancel this certificate ("Certificate") by returning it and giving us
written notice of cancellation. You have until midnight of the twentieth day
following the date you receive this Certificate. If you cancel this Certificate
within twenty days after you receive it, the Certificate will be void and we
will refund the Purchase Payments in full, plus or minus any investment gains or
losses under the Certificate. If this Certificate was purchased to replace an
existing contract and if you cancel this Certificate after the twentieth day and
on or before midnight of the sixtieth day after you receive it, we will refund
the Purchase Payments in full, plus or minus any investment gains or losses
under the Certificate as of the end of the Valuation Period during which the
returned Certificate is received by the Company, or as otherwise required by
law. Upon such refund, the Certificate shall be void. This Certificate must be
returned to us and the required notice must be given in person, or to the agent
who sold it to you, or by mail. If by mail, the return of the Certificate or the
notice is effective on the date it is postmarked, with the proper address and
with postage paid.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
Nonparticipating - No Dividends
ANNUITY BENEFITS AND OTHER VALUES DESCRIBED IN THIS CERTIFICATE, WHEN BASED ON
THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, MAY INCREASE OR DECREASE AND
ARE NOT GUARANTEED AS TO FIXED DOLLAR AMOUNTS. NO MINIMUM CONTRACT VALUE IS
GUARANTEED, EXCEPT FOR AMOUNTS IN THE FIXED ACCOUNT.
After a Variable Dollar Benefit is elected, the annual rate of return earned on
the assets of the Sub-Accounts must be equal to or exceed 3% for the Variable
Dollar Benefit payments not to decrease.
<PAGE>
CERTIFICATE SPECIFICATIONS
PARTICIPANT: JOHN DOE
AGE OF PARTICIPANT AS OF CERTIFICATE EFFECTIVE DATE: 35
GROUP CONTRACT OWNER: ANYTOWN TRUCKING COMPANY
GROUP CONTRACT NUMBER: 000000000
CERTIFICATE NUMBER: 000000000
CERTIFICATE EFFECTIVE DATE: APRIL 01, 1999
ANNUITY COMMENCEMENT DATE: APRIL 01, 2034
SEPARATE ACCOUNT: GALIC of New York Separate Account I
Following is a list of the Funds in which the currently available Sub-Accounts
invest:
[Janus Aspen Series Aggressive Growth Portfolio]
[Janus Aspen Series Worldwide Growth Portfolio]
[Janus Aspen Series Balanced Portfolio]
[Janus Aspen Series Growth Portfolio]
[Janus Aspen Series International Growth Portfolio]
[Dreyfus Variable Investment Fund-Capital Appreciation Portfolio]
[Dreyfus Variable Investment Fund-Money Market Portfolio]
[Dreyfus Variable Investment Fund-Growth and Income Portfolio]
[Dreyfus Variable Investment Fund-Small Cap Portfolio]
[The Dreyfus Socially Responsible Growth Fund, Inc.]
[Dreyfus Stock Index Fund]
[Strong Opportunity Fund II]
[Strong Mid Cap Growth Fund II]
[The Timothy Plan Variable Series]
[INVESCO VIF-Equity Income Fund]
[INVESCO VIF-Total Return Fund]
[INVESCO VIF- High Yield Fund]
[Morgan Stanley Dean Witter Universal Funds, Inc. U.S. Real Estate Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Value Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Emerging Markets Equity
Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Fixed Income Portfolio]
[Morgan Stanley Dean Witter Universal Funds, Inc. Mid Cap Value Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Growth II Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Large Cap Growth Portfolio]
[PBHG Insurance Series Fund, Inc.-PBHG Technology & Communications Portfolio]
<PAGE>
FIXED ACCOUNT:
Following is a list of the currently available Fixed Account options, with
guarantee periods as may be applicable:
Fixed Accumulation Account Option
Fixed Account Option One-Year Guarantee Period
Fixed Account Option Three-Year Guarantee Period
Fixed Account Option Five-Year Guarantee Period
Fixed Account Option Seven-Year Guarantee Period
Minimum guaranteed interest rate credited to the Fixed Account: Three percent
(3%) effective annual rate.
MINIMUM PURCHASE PAYMENT: $50
MAXIMUM PURCHASE PAYMENT: $500,000, without home office approval.
TRANSFER FEE: $25 per transfer in excess of twelve (12) in any Certificate Year.
- ------------
CONTINGENT DEFERRED SALES CHARGE: An amount deducted on each partial or full
surrender of a Purchase Payment, as follows:
Number of full years elapsed between Contingent Deferred Sales Charge as
the date of receipt of a Purchase Payment a percentage of the associated
and date Written Request for Purchase Payment
surrender is received surrendered
- ------------------------------------------ --------------------------------
0 7%
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7+ 0%
CERTIFICATE MAINTENANCE FEE: $30 Annually
MORTALITY AND EXPENSE RISK CHARGE: A charge equal to an effective annual rate of
1.25% of the daily Net Asset Value of the
- -------------------------------------
Sub-Accounts.
ADMINISTRATION CHARGE: A charge equal to an effective annual rate of 0.15% of
the daily Net Asset Value of the Sub-Accounts.
- ---------------------
TERMINATION: We reserve the right to terminate your participation interest under
the Contract, and this Certificate, at any time prior to the Annuity
Commencement Date if 1) no Purchase Payments have been paid to us for you for
three (3) consecutive years and 2) the Account Value of this Certificate is less
than $2,000. We will then pay you the Account Value of your participation
interest under the Contract as of the end of the Valuation Period in which the
Contract is terminated.
<PAGE>
INQUIRIES: For information, or to make a complaint, call or write:
Variable Annuity Service Center
Great American Life Insurance Company of New York
Post Office Box 5423
Cincinnati, Ohio 45201-5423
1-800-789-6771
TABLE OF CONTENTS PAGE
- -------------------------------------------------------------------------------
Definitions..................................................................7
General Provisions..........................................................10
Entire Contract........................................................10
Participant Certificate................................................10
Changes--Waivers.......................................................10
Nonparticipating.......................................................10
Misstatement...........................................................10
Required Reports.......................................................11
Exclusive Benefit......................................................11
State Law..............................................................11
Claims of Creditors....................................................11
Company Liability......................................................11
Voting Rights..........................................................11
Incontestability.......................................................11
Discharge of Liability.................................................11
Termination............................................................11
Purchase Payments...........................................................12
Purchase Payments......................................................12
Allocation of Purchase Payments........................................12
No Termination.........................................................12
Fixed Account...............................................................12
Fixed Account..........................................................12
Fixed Account Options..............................................12
Interest Credited..................................................12
Renewal............................................................12
Fixed Account Value....................................................13
Separate Account............................................................13
General Description....................................................13
Sub-Accounts of the Separate Account...................................14
Valuation of Assets....................................................14
Variable Account Value.................................................14
Accumulation Unit Value................................................14
Transfers...................................................................15
Fees and Charges............................................................15
Mortality and Expense Risk Charge......................................15
Administration Charge..................................................15
Certificate Maintenance Fee............................................16
Surrenders..................................................................16
Surrenders.............................................................16
Surrender Value........................................................16
Contingent Deferred Sales Charge.......................................16
Deferral of Payment....................................................17
Ownership Provisions........................................................17
Ownership of Separate Account..........................................17
Ownership of Contract and Participant Account..........................17
Transfer and Assignment................................................17
Successor Owner........................................................17
Community Property.....................................................17
<PAGE>
Beneficiary Provisions......................................................18
Beneficiary............................................................18
Change of Beneficiary..................................................18
Benefit on Annuity Commencement Date........................................18
Annuity Commencement Date..............................................18
Annuity Benefit Payments...............................................18
Form of Annuity Benefit................................................19
Benefit on Death of Participant.............................................19
Death Benefit..........................................................19
Death Benefit Amount...................................................19
Transfers After Death..................................................20
Form of Death Benefit..................................................20
Settlement Options..........................................................21
Conditions.............................................................21
Benefit Payments.......................................................21
Fixed Dollar Benefit...................................................21
Betterment Of Rates....................................................22
Variable Dollar Benefit................................................22
Limitation on Election of Settlement Option............................22
Settlement Option Computations.........................................22
Available Settlement Options...........................................23
Settlement Option Tables...............................................23
<PAGE>
DEFINITIONS
Account(s): The Sub-Account(s) and/or the Fixed Account options.
Account Value: The aggregate value of your interest in the Sub-Account(s) and
the Fixed Account options as of the end of any Valuation Period. The value of
your interest in all Sub-Accounts is the "Variable Account Value," and the value
of your interest in all Fixed Account options is the "Fixed Account Value."
Accumulated Earnings: The Account Value in excess of Purchase Payments received
by us and which have not been returned to you.
Accumulation Period: The period prior to the applicable Commencement Date.
Accumulation Unit: A unit of measurement used to calculate the value(s) of the
Sub-Account(s) prior to the applicable Commencement Date.
Administrative Office: The home office of the Company or any other place of
business which we may designate for administration.
Age: Age as of most recent birthday.
Annuitant: The Annuitant is the Participant and is the person on whose life
Annuity Benefit payments are based.
Annuity Benefit: Periodic payments made under a settlement option, which
commence on or after the Annuity Commencement Date.
Annuity Commencement Date: The first day of the first Payment Interval for which
an Annuity Benefit payment is to be made under a settlement option.
Beneficiary: A person entitled to the Death Benefit.
Benefit Payment: The Annuity Benefit or Death Benefit payable under a settlement
option. Variable Dollar Benefit payments may vary in amount. Fixed Dollar
Benefit payments remain constant except under certain joint and survivor
settlement options.
Benefit Payment Period: The period starting with the Commencement Date during
which Benefit Payments are to be made.
Benefit Unit: A unit of measure used to determine the dollar value of any
Variable Dollar Benefit payments after the first Benefit Payment is made by us.
Certificate Anniversary: An annual anniversary of the Certificate Effective
Date.
Certificate Effective Date: The date shown on the Certificate Specifications
page.
Certificate Year: Any period of twelve (12) months commencing on the Certificate
Effective Date and on each Certificate Anniversary thereafter.
Code: The Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder.
<PAGE>
Commencement Date: The Annuity Commencement Date if an Annuity Benefit is
payable under a Certificate, or the Death Benefit Commencement Date if a Death
Benefit is payable under a Certificate.
Death Benefit: The benefit described in the Benefit on Death of Participant
section of this Contract.
Death Benefit Commencement Date: The first day of the first Payment Interval for
which a Death Benefit payment is to be made under a settlement option, or the
date a Death Benefit is to be paid in a lump sum.
Death Benefit Valuation Date: The date that Due Proof of Death has been received
by us and the earlier to occur of:
1) our receipt of a Written Request with instructions as to the form of
Death Benefit; or
2) the Death Benefit Commencement Date.
Due Proof of Death: Any of the following:
1) a certified copy of a death certificate;
2) a certified copy of a decree of a court of competent jurisdiction as to
the finding of death; or 3) any other proof satisfactory to us.
Fund: A management investment company or portfolio thereof, registered under the
Investment Company Act of 1940, in which a Sub-Account of the Separate Account
invests.
Net Asset Value: The amount computed by an investment company, no less
frequently than each Valuation Period, as the price at which its shares or
units, as the case may be, are redeemed in accordance with the rules of the
Securities and Exchange Commission.
Owner: The person identified as such on the Contract Specifications page.
Participant: The person identified on the Certificate Specifications page who
participates in the benefits of the Contract as evidenced by this Certificate.
Payment Interval: A monthly, quarterly, annual or other regular interval during
the Benefit Payment Period.
Person Controlling Payments: The "Person Controlling Payments" means the
following, as the case may be:
1) with respect to Annuity Benefit payments, you; and
2) with respect to Death Benefit payments,
a) the Beneficiary; or
b) if the Beneficiary is deceased, the payee.
Purchase Payment: A contribution amount paid to us in consideration for your
participation under the Contract, after the deduction of any and all of the
following which may apply:
1) any fee charged by the person remitting payments for you;
2) premium taxes; and/or
3) other taxes.
Separate Account: An account, which may be an investment company, which is
established and maintained by the Company pursuant to the laws of the State of
New York.
<PAGE>
Sub-Account: The Separate Account is divided into Sub-Accounts, each of which
invests in the shares of a designated Fund.
Valuation Period: The period commencing at the close of regular trading on the
New York Stock Exchange on any Valuation Date, and ending at the close of
trading on the next succeeding Valuation Date. "Valuation Date" means each day
on which the New York Stock Exchange is open for business.
Written Request: Information provided, or a request made, that is complete and
satisfactory to us, that is sent to us on our form or in a manner satisfactory
to and that is received by us at our Administrative Office. A Written Request is
subject to any payment made or any action we take before we receive it. The
Company will deem a Written Request a standing order which may be modified or
revoked only by a subsequent Written Request, when permitted by the terms of the
Contract. You may be required to return this Certificate to us in connection
with a Written Request.
GENERAL PROVISIONS
Entire Contract
We have issued the Contract to the Contract Owner identified on the Certificate
Specifications page. The Contract is a group flexible premium deferred variable
annuity contract. The Contract and this Certificate are restricted by
endorsement as required to obtain favorable tax treatment under the Code, and
neither is valid without the requisite endorsement(s) being attached. The
Contract, its endorsement(s), the application, if any, and the enrollment forms
of all participants under it, form the entire contract between the Contract
Owner and us. This Certificate is not a contract and is not a part of the
Contract.
Nothing in the group annuity Contract invalidates or impairs any rights granted
to you by the laws of the State of New York.
Participant Certificate
This Certificate is evidence of your participation interest under the Contract.
Changes -- Waivers
No changes or waivers of the terms of the Contract or this Certificate, are
valid unless made in writing by our President, Vice President, or Secretary. No
agent or other person not named above has authority to change or waive any
provision of the Contract. We reserve the right both to administer and to change
the provisions of the Contract to conform to any applicable laws, regulations or
rulings issued by a governmental agency.
In any event, the Company reserves the right to add or delete Fixed Account
options and Sub-Accounts, to substitute shares of a different Fund or different
class or series of a Fund for shares held in a Sub-Account, to merge or combine
Sub-Accounts, to merge or combine the Separate Account with any other separate
account of the Company, to transfer the assets of the Separate Account to
another life insurance company by means of a merger or reinsurance, to convert
the Separate Account into a managed separate account, and to de-register the
Separate Account under the Investment Company Act of 1940. Any such change will
be made in accordance with applicable insurance and securities laws and after
obtaining any necessary approvals, including those of the New York State
Insurance Department and the Securities and Exchange Commission. Any such change
will not reduce the benefits due under this Certificate.
Nonparticipating
The Contract does not pay dividends or share in the Company's divisible surplus.
Misstatement
If the age of a person on whose life Benefit Payments are based is misstated,
the payments or other benefits under this Certificate shall be adjusted to the
amount which would have been payable based on the correct age. If we made any
underpayments based on any misstatement, the amount of any underpayment with
interest at the rate of six percent (6%) per year shall be immediately paid in
one sum. In addition to any other remedies that may be available at law or at
equity, we may deduct any overpayments made, with interest at the rate of six
percent (6%) per year, from any succeeding payments due under this Certificate.
<PAGE>
Required Reports
At least once each Certificate Year, we will send you one or more statements
reporting the investments held in the Separate Account, the number of
Accumulation Units under your Certificate and your Account Value as of the most
recent calendar quarter, and any other information required by law, until the
first to occur of the following:
1) the date your participation interest under the Contract is fully
surrendered;
2) the Annuity Commencement Date; or
3) the Death Benefit Commencement Date.
The report will be mailed to your last known address. The reported values will
be based on the information in our possession at the time the report is prepared
by us. We may adjust the reported values at a later date if that information
proves to be incorrect or has changed.
Exclusive Benefit
Your participation interest under the Contract is for the exclusive benefit of
you and your Beneficiaries. Your participation interest under the Contract is
nonforfeitable by us.
State Law
All factors, values, benefits and reserves under the Contract will not be less
than those required by the law of the state in which the Contract is delivered.
Claims of Creditors
To the extent allowed by law, the Contract and all values and benefits under it
are not subject to the claims of creditors or to legal process.
Company Liability
We will not incur any liability or be responsible for any failure, in whole or
in part, by you or by any person having rights or benefits arising out of or
related to the Contract, to comply with any applicable laws, regulations or
rulings issued by a governmental agency.
Voting Rights
To the extent required by law, we will vote all shares of the Funds held in the
Separate Account, at regular and special shareholder meetings of the Funds, in
accordance with instructions received from you, or, if applicable, from the
Person Controlling Payments. If there is a change in the law which permits us to
vote the shares of the Funds without such instructions, then we reserve the
right to do so.
Incontestability
This Certificate shall not be contestable by us.
Discharge of Liability
Upon payment of any partial or full surrender, any Benefit Payment, we shall be
discharged from all liability to the extent of each such payment.
Termination
Either we or the Contract Owner may terminate the Contract by giving advance
notice in writing. The Contract describes the benefits and charges, if any, in
the event of termination of the Contract. Refer to the Contract for information
regarding these benefits and charges. If the Contract is terminated, this
Certificate and your participation interest under the Contract may be continued
on a deferred paid-up basis, subject to all of the terms and conditions of the
Contract, unless you surrender your participation as a whole. Termination of the
Contract will not affect Benefit Payments being made by us.
<PAGE>
PURCHASE PAYMENTS
Purchase Payments
One or more Purchase Payments may be paid to us for you at any time before the
Annuity Commencement Date, so long as:
1) you are still living; and
2) your participation interest has not been fully surrendered.
The initial Purchase Payment for you must be paid to us on or before the
Certificate Effective Date. Each Purchase Payment must be paid to us at our
Administrative Office, and is subject to any minimums or maximums shown on the
Certificates Specification page.
Upon request, we will provide the Contract Owner with a receipt as proof of
payment.
Allocation of Purchase Payment(s)
We will allocate Purchase Payments to the Fixed Account options and/or to the
Sub-Accounts according to the instructions we receive in your enrollment form or
subsequent Written Request. Allocations must be made in whole percentages. The
minimum Purchase Payment amount that can be allocated to a Fixed Account option
other than the Fixed Accumulation Account is $2,000.
No Termination
Except as stated elsewhere in this Certificate, your participation will not be
terminated by us due to failure to make additional Purchase Payments.
FIXED ACCOUNT
Fixed Account
The Fixed Account is part of the Company's general account. The values of the
Fixed Account are not dependent upon the investment performance of the
Sub-Accounts.
Fixed Account Options. The Fixed Account options available as of the Certificate
Effective Date are listed on the Certificate Specifications page. Different
Fixed Account options may be offered by us at any time.
Interest Credited. The guaranteed rate of interest for the Fixed Account options
is three percent (3%) per year, compounded annually. We may, at any time, pay a
current interest rate as declared by our Board of Directors for any of the Fixed
Account options that is higher than the guaranteed rate.
The interest rate initially credited to each Purchase Payment allocated to the
Fixed Accumulation Account Option will not be changed any sooner than twelve
(12) months following the date on which that Purchase Payment was received;
thereafter, the interest rate credited will not be changed more frequently than
once per calendar quarter. In the case of transfers from other Fixed Account
options or the Sub-Accounts to the Fixed Accumulation Account Option, the
interest rate will not be changed more frequently than once per calendar
quarter.
The interest rate credited to amounts allocated to the Fixed Account options
other than the Fixed Accumulation Account Option will not be changed during the
duration of the applicable guarantee period.
Renewal. The following provisions apply to all Fixed Account options except the
Fixed Accumulation Account Option.
<PAGE>
At the end of a guarantee period, and for the thirty (30) days immediately
preceding the end of such guarantee period, you may elect a new option to
replace the Fixed Account option that is then expiring. The entire amount
maturing may be re-allocated to any of the then-current options under the
Certificate (including the various Sub-Accounts within the Separate Account),
except that a Fixed Account option with a guarantee period that would extend
past the Annuity Commencement Date may not be selected. In particular, in the
case of renewals occurring within one (1) year of such Commencement Date, the
only Fixed Account option available is the Fixed Accumulation Account Option.
If you do not specify a new Fixed Account option in accordance with the
preceding paragraph, you will be deemed to have selected the same Fixed Account
option as is expiring, so long as the guarantee period of such option does not
extend beyond the Annuity Commencement Date. In the event that such a period
would extend beyond that date, you will be deemed to have selected the Fixed
Account option with the longest available guarantee period that expires prior to
that date, or, failing that, the Fixed Accumulation Account Option.
Any renewal of a Fixed Account option under this Renewal provision will be
effective on the day after the expiration of the guarantee period that is then
expiring.
Fixed Account Value
The Fixed Account Value for this Certificate at any time is equal to:
1) the Purchase Payment(s) allocated to the Fixed Account; plus
2) amounts transferred to the Fixed Account; plus
3) interest credited to the Fixed Account; less
4) any charges, surrenders, deductions, amounts transferred from the Fixed
Account or other adjustments made as described elsewhere in this
Certificate.
SEPARATE ACCOUNT
General Description
The variable benefits under this Certificate are provided through the Separate
Account. The Separate Account is registered with the Securities and Exchange
Commission as a unit investment trust under the Investment Company Act of 1940.
The income, if any, and any gains or losses, realized or unrealized, on the
Separate Account will be credited to or charged against the amounts allocated to
such account without regard to other income, gains, or losses of the Company.
The amounts allocated to the Separate Account and the accumulations thereon
remain the property of the Company, but that portion of the assets of the
Separate Account that is equal to the reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account, is not chargeable with liabilities arising out of any other business of
the Company. The Company is not, and does not hold itself out to be, a trustee
in respect of such amounts.
We have the right to transfer to our general account, in our sole discretion and
at any time without prior written notice, any assets of the Separate Account
which are in excess of the required reserves and other contractual liabilities
under all policies, annuities, and other contracts identified with the Separate
Account.
<PAGE>
Sub-Accounts of the Separate Account
The assets of the Separate Account are divided into Sub-Accounts. The
Sub-Accounts available as of the Certificate Effective Date are listed on the
Certificate Specifications page. Each Sub-Account invests exclusively in shares
of an underlying Fund as shown on the Certificate Specifications page. Any
amounts of income and any gains on the shares of a Fund will be reinvested in
additional shares of that Fund at its Net Asset Value.
Valuation of Assets
Shares of Funds held by each Sub-Account will be valued at their Net Asset Value
at the end of each Valuation Period, as reported by each such Fund.
Variable Account Value
Purchase Payment(s) may be allocated among and, as described elsewhere in this
Certificate, Account Values may be transferred to the various Sub-Accounts
within the Separate Account. For each Sub-Account, the Purchase Payment(s) or
amounts transferred are converted into Accumulation Units. The number of
Accumulation Units credited is determined by dividing the dollar amount directed
to each Sub-Account by the value of the Accumulation Unit for that Sub-Account
at the end of the Valuation Period on which the Purchase Payment(s) or
transferred amount is received.
The following events will result in the cancellation of an appropriate number of
Accumulation Units of a Sub-Account:
1) transfer from a Sub-Account;
2) full or partial surrender of your Variable Account Value;
3) payment of a Death Benefit;
4) application of your Variable Account Value to a settlement option;
5) deduction of the Certificate Maintenance Fee; or
6) deduction of any Transfer Fee.
Accumulation Units will be canceled as of the end of the Valuation Period during
which the Company receives a Written Request regarding the event giving rise to
such cancellation, or an applicable Commencement Date, or the end of the
Valuation Period on which the Certificate Maintenance Fee or Transfer Fee is
due, as the case may be.
The Variable Account Value for this Certificate at any time is equal to the sum
of the number of Accumulation Units for each Sub-Account attributable to this
Certificate multiplied by the Accumulation Unit Value for each Sub-Account at
the end of the preceding Valuation Period.
Accumulation Unit Value
The initial Accumulation Unit Value for each Sub-Account, with the exception of
the Money Market Sub-Account, was set at $10.00. The initial Accumulation Unit
Value for the Money Market Sub-Account was set at $1.00. Thereafter, the
Accumulation Unit Value at the end of each Valuation Period is the Accumulation
Unit Value at the end of the previous Valuation Period multiplied by the Net
Investment Factor, as described below.
The Net Investment Factor is a factor applied to measure the investment
performance of a Sub-Account from one Valuation Period to the next. Each
Sub-Account has a Net Investment Factor for each Valuation Period which may be
greater or less than one. Therefore, the Accumulation Unit Value for each
Sub-Account may increase or decrease. The Net Investment Factor for any
Sub-Account for any Valuation Period is determined by dividing (1) by (2) and
subtracting (3) from the result, where:
1) is equal to:
a) the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the applicable Valuation Period; plus
b) the per share amount of any dividend or net capital gain
distributions made by the Fund held in the Sub-Account, if the
"ex-dividend" date occurs during the applicable Valuation Period;
plus or minus
c) a per share charge or credit for any taxes reserved for, which is
determined by the Company to have resulted from the investment
operations of the Sub-Account;
2) is the Net Asset Value per share of the Fund held in the Sub-Account,
determined at the end of the immediately preceding Valuation Period;
and
3) is the factor representing the Mortality and Expense Risk Charge and
the Administration Charge deducted from the Sub-Account for the number
of days in the applicable Valuation Period.
TRANSFERS
Prior to the applicable Commencement Date, you may transfer amounts in a
Sub-Account to a different Sub-Account and/or one or more of the Fixed Account
options.
After the first Certificate Anniversary, and prior to the applicable
Commencement Date, you may transfer amounts from any Fixed Account option to any
other Fixed Account option and/or one or more of the Sub-Accounts. If a transfer
is being made from a Fixed Account option pursuant to the Renewal provision of
this Certificate, then the entire amount of that Fixed Account option subject to
renewal at that time may be transferred. In any other case, transfers from any
Fixed Account option are subject to a cumulative limit during each Certificate
Year of twenty percent (20%) of the Fixed Account option's value as of the most
recent Certificate Anniversary.
Amounts previously transferred from Fixed Account options to the Sub-Accounts
may not be transferred back to the Fixed Account options for a period of ninety
(90) days from the date of transfer.
The minimum transfer amount for any transfer is $500. The number of transfers
per year over which we will charge a Transfer Fee on each additional transfer,
and the amount of the Transfer Fee, are shown on the Certificate Specifications
page.
We reserve the right, in our sole discretion and at any time without prior
notice, to terminate, suspend or modify the transfer privileges described above.
FEES AND CHARGES
Mortality and Expense Risk Charge
The Mortality and Expense Risk Charge is shown on the Certificate Specifications
page and is deducted daily from each Sub-Account. This deduction is made to
compensate the Company for assuming the mortality and expense risks under the
Contract.
Administration Charge
The Administration Charge is shown on the Certificate Specifications page and is
deducted daily from each Sub-Account. This deduction is made to reimburse the
Company for expenses incurred in the administration of the Contract, the
Certificates thereunder, and the Separate Account.
<PAGE>
Certificate Maintenance Fee
The Certificate Maintenance Fee ("Fee") is shown on the Certificate
Specifications page and is deducted as of the Valuation Date next following each
Certificate Anniversary prior to the applicable Commencement Date. In addition,
the full annual Fee will be charged at the time of a full surrender. The Fee
will be allocated to each Sub-Account in the same proportion as each
Sub-Account's value is to the total Variable Account Value for this Certificate
on the end of such Valuation Period. The Fee does not apply to the Fixed
Account.
After the applicable Commencement Date, if a Variable Dollar Benefit is elected,
the Fee will be deducted pro-rata from each Benefit Payment and will result in a
reduction in the amount of such payment.
The Fee may be waived in whole or in part in our sole discretion.
SURRENDERS
Surrenders
A surrender in full may be made for the Surrender Value, or partial surrenders
may be made for a lesser amount, by Written Request at any time prior to the
Annuity Commencement Date. The amount of any partial surrender must be at least
$500. If a partial surrender would reduce your Account Value to less than $500,
we will treat the surrender request as a request for full surrender. Surrenders
will be deemed to be withdrawn first from the portion of the Account Value that
represents the Accumulated Earnings for this Certificate and then from Purchase
Payments. For purposes of this Certificate, Purchase Payments are deemed to be
withdrawn on a "first-in, first-out" (FIFO) basis.
The amount available for surrender will be the Surrender Value at the end of the
Valuation Period in which the Written Request is received by us.
Surrender Value
The Surrender Value for this Certificate at any time is an amount equal to:
1) the Account Value as of the end of the applicable Valuation Period;
less
2) any applicable Contingent Deferred Sales Charge; less
3) any outstanding loans; and less
4) any applicable premium tax or other taxes not previously deducted.
On full surrender, a full Certificate Maintenance Fee will also be deducted as
part of the calculation of the Surrender Value.
Contingent Deferred Sales Charge
A full or partial surrender may be subject to a Contingent Deferred Sales Charge
as set forth on the Certificate Specifications page. The Contingent Deferred
Sales Charge applies to and is calculated separately for each Purchase Payment.
Surrenders will result in the cancellation of Accumulation Units from each
applicable Sub-Account(s) and/or a reduction of your Fixed Account Value and a
reduction in your Death Benefit amount. In the case of a full surrender, your
participation interest under the Contract and this Certificate will be
terminated. The Contingent Deferred Sales Charge may be waived in whole or in
part in our sole discretion.
<PAGE>
Deferral of Payment
The Company has the right to suspend or delay the date of payment of a partial
or full surrender of the Variable Account Value for any period:
1) when the New York Stock Exchange is closed, or when trading on the New
York Stock Exchange is restricted; or
2) when an emergency exists (as determined by the Securities and Exchange
Commission) as a result of which:
a) the disposal of securities in the Separate Account is not
reasonably practicable; or
b) it is not reasonably practicable to determine fairly the value of
the net assets in the Separate Account; or
3) when the Securities and Exchange Commission so permits for the
protection of security holders.
The Company further reserves the right to delay payment of a partial or full
surrender of the Fixed Account Value for up to six (6) months after we receive
your Written Request.
OWNERSHIP PROVISIONS
Ownership of Separate Account
The Company has absolute ownership of the assets in the Separate Account.
However, the Company is not, and does not hold itself out to be, a trustee in
respect of any amounts under the Separate Account.
Ownership of Contract and Participant Account
The owner of the Contract (the "Contract Owner") is your employer or the trustee
for your employer's retirement plan, as shown on your enrollment form and on the
Certificate Specifications page. The Contract is held by the Contract Owner for
the benefit of the participants and Beneficiaries.
Each participant for whom Purchase Payment(s) are made will participate in the
Contract as a Participant. A participant account will be established for each
Participant.
Transfer and Assignment
Neither you nor the Contract Owner may transfer, sell, assign, pledge, charge,
encumber or in any way alienate an interest under this Certificate or the
Contract.
Successor Owner
By Written Request, your spouse may, in some cases, succeed to the ownership of
your participation interest under the Contract after your death. Specifically,
if you die and your spouse is the sole surviving Beneficiary of your
participation interest, he or she will become the Successor Owner of your
participation interest if:
1) you make that Written Request before your death; or
2) after your death, your spouse makes that Written Request within one (1)
year of your death and before the Death Benefit Commencement Date.
As Successor Owner, your spouse will then succeed to all rights of ownership
under this Certificate except the right to name another Successor Owner.
Community Property
If you live in a community property state and have a spouse at any time while
you participate under the Contract, the laws of that state may vary your
ownership rights.
<PAGE>
BENEFICIARY PROVISIONS
Beneficiary
The Beneficiary is the person or persons so designated on your enrollment form,
if any, or under the Change of Beneficiary provision of this Contract. If you
have not designated a Beneficiary, or if no Beneficiary designated survives you,
then the Beneficiary will be your estate.
Unless you provide otherwise by Written Request, a Beneficiary will be deemed
not to have survived you if he or she dies within thirty (30) days after your
death.
A Beneficiary designation may be joint or contingent or both. Unless otherwise
stated, joint Beneficiaries will be entitled to equal shares. A contingent
Beneficiary will be entitled to a benefit only if there is no surviving primary
Beneficiary.
Change of Beneficiary
An irrevocable Beneficiary may not be changed without his or her consent. Unless
you have designated an irrevocable Beneficiary, you may change your designation
of a Beneficiary at any time before the Annuity Commencement Date, effective as
of the date the Written Request is signed, subject to our receiving the Written
Request.
Any such change is subject to the following:
1) it must be made by Written Request; and
2) unless otherwise elected or required by law, it will not cancel any
settlement option election previously made.
BENEFIT ON ANNUITY COMMENCEMENT DATE
Annuity Commencement Date
The Annuity Commencement Date is shown on the Certificate Specifications page.
You may change the Annuity Commencement Date by Written Request made at least
thirty (30) days prior to the date that Annuity Benefit payments are scheduled
to begin. The Annuity Commencement Date cannot be later than the Certificate
Anniversary following your 85th birthday, or five (5) years after the
Certificate Effective Date, whichever is later, but in no event will it be later
than your 90th birthday..
Annuity Benefit Payments
An amount equal to the Account Value (after deduction of any fees and charges,
loans, or applicable premium tax or other taxes not previously deducted) will be
used to provide Annuity Benefit payments commencing on or after the Annuity
Commencement Date.
Annuity Benefit payments will be made to you as payee. Any Annuity Benefit
amounts remaining payable on your death will be paid to the contingent payee
designated by you by Written Request. You will be the person on whose life any
Annuity Benefit payments are based.
If no contingent payee designated by you is surviving at the time payment is to
be made, then after your death any Annuity Benefit amounts remaining payable
will be paid to the person or persons designated as contingent payee by Written
Request by the last payee who received payments. Failing that, any such amounts
will be paid to the estate of the last payee who received payments.
<PAGE>
Form of Annuity Benefit
Annuity Benefit payments will be Fixed Dollar Benefit payments, made monthly in
accordance with the terms of Option B with a fixed period of one hundred twenty
(120) months under the SETTLEMENT OPTIONS section of this Contract.
In lieu of that, you may elect to have Annuity Benefit payments made pursuant to
any other available settlement option under the SETTLEMENT OPTIONS section of
this Certificate. Any such election must be made by Written Request before the
Annuity Commencement Date. You may change your election of a settlement option
by Written Request made at least thirty (30) days prior to the date that Annuity
Benefit payments are scheduled to begin.
BENEFIT ON DEATH OF PARTICIPANT
Death Benefit
A Death Benefit will be paid under this Certificate if:
1) you die before the Annuity Commencement Date and before your
participation interest is fully surrendered;
2) the Death Benefit Valuation Date has occurred; and
3) your spouse does not become the Successor Owner of your participation
interest.
If a Death Benefit becomes payable:
1) it will be in lieu of all other benefits evidenced by this Certificate;
and
2) all other rights evidenced by this Certificate will be terminated
except for rights related to the Death Benefit.
Death Benefit payments shall be made to the Beneficiary as payee.
The Beneficiary shall be the person on whose life any Death Benefit payments
under a settlement option election are based.
Any Death Benefit amounts remaining payable on the death of the Beneficiary will
be paid:
1) to any contingent payee designated as part of any Death Benefit
settlement option election made by you, or if none is surviving at the
time payment is to be made; then
2) to any contingent payee designated by the Beneficiary by Written
Request, or if none is surviving at the time payment is to be made;
then
3) to the estate of the last payee who received payments.
Only one Death Benefit will be paid with respect to your participation interest
under the Contract.
Death Benefit Amount
If you die before attaining Age eighty (80) and before the Annuity Commencement
Date, the Death Benefit is an amount equal to the greatest of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), with interest at three percent (3%) per
year, compounded annually through the earlier of the Death Benefit
Valuation Date or the Certificate Anniversary prior to the date you
would have attained Age eighty (80, less any partial surrenders and any
Contingent Deferred Sales Charges that applied to those amounts; or
3) the largest Account Value on any Certificate Anniversary after the
fourth Certificate Anniversary and prior to the earlier of the Death
Benefit Valuation Date or the date you would have attained Age eighty
(80), less any partial surrenders after such Account Value was
determined and any Contingent Deferred Sales Charges that applied to
those amounts.
If you die after attaining Age eighty (80) and before the Annuity Commencement
Date, the Death Benefit is an amount equal to the greatest of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), with interest at three percent (3%) per
year, compounded annually through the Certificate Anniversary prior to
your 80th birthday, less any partial surrenders and any Contingent
Deferred Sales Charges that applied to those amounts; or
3) the largest Account Value on any Certificate Anniversary after the
fourth Certificate Anniversary and prior to the date on which you
attained Age eighty (80), less any partial surrenders after such
Account Value was determined and any Contingent Deferred Sales Charges
that applied to those amounts.
In any event, if this Certificate was issued to you after Age eighty (80), and
you die before the Annuity Commencement Date, the amount of the Death Benefit
will be the greater of:
1) the Account Value on the Death Benefit Valuation Date; or
2) the total Purchase Payment(s), less any partial surrenders and any
Contingent Deferred Sales Charges that applied to those amounts.
As of the Death Benefit Valuation Date, the amount of the Death Benefit will be
allocated among the Sub-Accounts and Fixed Account options in the same
proportion as each Account's value is to the total Account Value as of the end
of the Valuation Period immediately preceding the Death Benefit Valuation Date.
Any applicable premium tax or other taxes not previously deducted, and any
outstanding loans, will be deducted from the Death Benefit amount described
above.
Transfers After Death
Between the Death Benefit Valuation Date and the Death Benefit Commencement
Date, a Beneficiary may transfer funds among Sub-Accounts and Fixed Account
options as described under the TRANSFERS section of this Contract.
Form of Death Benefit
Payments under the Death Benefit provision of this Contract will be Fixed Dollar
Benefit payments made monthly in accordance with the terms of Option A with a
period certain of forty-eight (48) months under the SETTLEMENT OPTIONS section
of this Contract.
In lieu of that, you may elect at any time before your death to have payments
under the Death Benefit provision of this Contract made in one lump sum or
pursuant to any available settlement option under the SETTLEMENT OPTIONS section
of this Contract. If you do not make any such election, the Beneficiary may make
that election at any time after your death and before the Death Benefit
Commencement Date.
You may change your election of a settlement option at any time before your
death.
If a Beneficiary elects a settlement option as noted above, he or she may change
his or her own election of a settlement option by Written Request made at least
thirty (30) days prior to the date that Death Benefit payments are scheduled to
begin.
Any election or change of election must be made by Written Request.
<PAGE>
SETTLEMENT OPTIONS
Conditions
The amount applied to a settlement option must be at least $2,000. We will pay
you the Account Value in one lump sum on the Annuity Commencement Date if it is
less than $2,000. The amount of any Fixed Dollar Benefit payment, or the amount
of the first Variable Dollar Benefit payment, under a settlement option must be
at least $20. More than one settlement option may be elected if the requirements
for each settlement option elected are satisfied. Once payment begins under a
settlement option, the settlement option may not be changed.
All elected settlement options must comply with current applicable laws,
regulations and rulings issued by any governmental agency.
If more than one person is the payee under a settlement option, payments will be
made to the payees in equal shares, unless otherwise provided by Written
Request. No more than two persons may be initial payees under any joint and
survivor settlement options.
If payment under a settlement option depends on whether a specified person is
still alive, we may at any time require proof that such person is still living.
We will require proof of the age of any person on whose life Benefit Payments
are based.
Benefit Payments
Benefit Payments may be calculated and paid:
1) as a Fixed Dollar Benefit:
2) as a Variable Dollar Benefit; or
3) as a combination of both.
If only a Fixed Dollar Benefit is to be paid, we will transfer all of the
Account Value to the Company's general account on the applicable Commencement
Date, or on the Death Benefit Valuation Date (if applicable). Similarly, if only
a Variable dollar Benefit is elected, we will transfer all of the Account Value
to the Sub-Accounts as of the end of the Valuation Period immediately prior to
the applicable Commencement Date; we will allocate the amount transferred among
the Sub-Accounts in accordance with a Written Request. No transfers between the
Fixed Dollar Benefit and the Variable Dollar Benefit will be allowed after the
Commencement Date. However, after the Variable Dollar Benefit has been paid for
at least twelve (12) months, the Person Controlling Payments may, no more than
once each twelve (12) months thereafter, transfer all or part of the Benefit
Units upon which the Variable Dollar Benefit is based form the Sub-Account(s)
then held, to the Benefit Units in different Sub-Account(s).
If a Variable Dollar Benefit is elected, the amount to be applied under that
benefit is the Variable Account Value as of the end of the Valuation Period
immediately preceding the applicable Commencement Date. If a Fixed Dollar
Benefit is to be paid, the amount to be applied under that benefit is the Fixed
Account Value as of the applicable Commencement Date, or as of the Death Benefit
Valuation Date (if applicable).
Fixed Dollar Benefit
Fixed Dollar Benefits payments are determined by multiplying the Fixed Account
Value (expressed in thousands of dollars and after deduction of any fees and
charges, loans, or applicable premium tax or other taxes not previously
deducted) by the amount of the monthly payment per $1,000 of value obtained from
the Settlement Option Table for the settlement option elected. Fixed Dollar
Benefit payments will remain level for the duration of the Benefit Payment
Period.
<PAGE>
If at the time a Fixed Dollar Benefit is elected, we have available options or
rates on a more favorable basis than those guaranteed, the higher benefits shall
be applied and shall not change for as long as that election remains in force.
Betterment Of Rates
The Fixed Dollar Benefit available under this Certificate as of the Annuity
Commencement Date or the Death Benefit Commencement Date will not be less than
the benefit that would be provided by the application of the Account Value to
purchase any single consideration immediate annuity contract offered by us at
the time to the same class of annuitants.
Variable Dollar Benefit
The first monthly Variable Dollar Benefit payment is equal to your Variable
Account Value (expressed in thousands of dollars and after deduction of any fees
and charges, loans, or applicable premium tax or other taxes not previously
deducted) as of the end of the Valuation Period immediately preceding the
applicable Commencement Date multiplied by the amount of the monthly payment per
$1,000 of value obtained from the Settlement Option Table for the Benefit
Payment elected less the pro-rata portion of the Certificate Maintenance Fee.
The number of Benefit Units in each Sub-Account held by you is determined by
dividing the dollar amount of the first monthly Variable Dollar Benefit payment
for each Sub-Account by the Benefit Unit Value for that Sub-Account as of the
applicable Commencement Date. The number of Benefit Units remains fixed during
the Benefit Payment Period, except as a result of any transfers among
Sub-Accounts after the applicable Commencement Date.
The dollar amount of the second and subsequent Variable Dollar Benefit payment
will reflect the investment performance of the Sub-Account(s) selected and may
vary from month to month. The total amount of the second and any subsequent
Variable Dollar Benefit payment will be equal to the sum of the payments from
each Sub-Account less a pro-rata portion of the Certificate Maintenance Fee.
The payment from each Sub-Account is found by multiplying the number of Benefit
Units held in each Sub-Account by you by the Benefit Unit Value for that
Sub-Account as of the end of the fifth Valuation Period preceding the due date
of the payment.
The Benefit Unit Value for each Sub-Account is originally established in the
same manner as Accumulation Unit Values. Thereafter, the value of a Benefit Unit
for a Sub-Account is determined by multiplying the Benefit Unit Value as of the
end of the preceding Valuation Period by the Net Investment Factor, determined
as set forth under the Accumulation Unit Value provision of this Certificate,
for the Valuation Period just ended. The product is then multiplied by the
assumed daily investment factor (0.99991781), for the number of days in the
Valuation Period. The factor is based on the assumed net investment rate of
three percent (3%) per year, compounded annually, that is reflected in the
Settlement Option Tables.
Variable Dollar Benefit payments will not be adversely affected by actual
mortality and expense experience of the Sub-Accounts.
Limitation on Election of Settlement Option
Fixed periods shorter than five (5) years are not available, except as a Death
Benefit settlement option.
Settlement Option Computations
The 1983 Group Annuity Mortality Table with interest at three percent (3%) per
year, compounded annually, is used to compute all guaranteed settlement option
factors, values, and benefits under this Contract.
<PAGE>
Available Settlement Options
The available settlement options are set out below.
Option A Income for a Fixed Period
We will make periodic payments for a fixed period. The first payment
will be paid as of the last day of the initial Payment Interval. The
maximum time over which payments will be made by us or money will be
held by us is thirty (30) years. The Option A Table applies to this
Option.
Option B Life Annuity with Payments for at Least a Fixed Period
We will make monthly payments for at least a fixed period. If the
person on whose life Benefit Payments are based lives longer than the
fixed period, then we will make payments until his or her death. The
first payment will be paid as of the first day of the initial Payment
Interval. The Option B Table applies to this Option.
Option C Joint and One-half Survivor Annuity
We will make periodic payments until the death of the person on whose
life Benefit Payments are based; thereafter, we will make one-half
(1/2) of the periodic payment until the death of the secondary person
on whose life Benefit Payments are based. The first payment will be
paid as of the first day of the initial Payment Interval. The Option C
Table applies to this Option.
Option D Life Annuity
We will make periodic payments until the death of the person on whose
life Benefit Payments are based. The first payment will be paid as of
the first day of the initial Payment Interval. The Option D Table
applies to this Option.
Option E Any Other Form
We will make periodic payments in any other form of settlement option
which is acceptable to us at the time of election.
Settlement Option Tables
The Option Tables show the payments we will make at sample Payment Intervals for
each $1,000 applied at the guaranteed interest rate. Amounts may vary with the
Payment Interval and the age of the person on whose life Benefit Payments are
based.
<TABLE>
<CAPTION>
OPTION A TABLE - INCOME FOR A FIXED PERIOD
Payments for fixed number of years for
each $1,000 applied.
- -----------------------------------------------------------------------------------------------------------------------
Terms of Semi-Annual Terms Semi-Annual Terms of Semi-Annual
Payments Annual Quarterly Monthly of Annual Quarterly Monthly Payments Annual Quarterly Monthly
Payments
- -----------------------------------------------------------------------------------------------------------------------
Years Years Years
<S><C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
6 184.60 91.62 45.64 15.18 11 108.08 53.64 26.72 8.88 16 79.61 39.51 19.68 6.54
7 160.51 79.66 39.68 13.20 12 100.46 49.86 24.84 8.26 17 75.95 37.70 18.78 6.24
8 142.46 70.70 35.22 11.71 13 94.03 46.67 23.25 7.73 18 72.71 36.09 17.98 5.98
9 128.43 63.74 31.75 10.56 14 88.53 43.94 21.89 7.28 19 69.81 34.65 17.26 5.74
10 117.23 58.18 28.98 9.64 15 83.77 41.57 20.71 6.89 20 67.22 33.36 16.62 5.53
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
OPTION B TABLE - LIFE ANNUITY
With Payments For At Least A Fixed Period
- --------- ---------------- --------------- ---------------- ----------------
60 Months 120 Months 180 Months 240 Months
- --------- ---------------- --------------- ---------------- ----------------
Age
- --------- ---------------- --------------- ---------------- ----------------
55 $4.55 $4.51 $4.44 $4.33
56 4.65 4.61 4.52 4.39
57 4.76 4.71 4.61 4.46
58 4.87 4.81 4.70 4.53
59 4.99 4.92 4.79 4.60
60 5.12 5.04 4.89 4.67
61 5.25 5.16 4.99 4.74
62 5.40 5.29 5.09 4.81
63 5.55 5.42 5.19 4.87
64 5.72 5.56 5.30 4.94
65 5.89 5.71 5.40 5.00
66 6.08 5.86 5.51 5.06
67 6.27 6.02 5.62 5.11
68 6.48 6.19 5.72 5.17
69 6.71 6.36 5.83 5.22
70 6.95 6.54 5.93 5.26
71 7.20 6.72 6.03 5.30
72 7.46 6.90 6.12 5.34
73 7.75 7.08 6.21 5.37
74 8.04 7.27 6.30 5.40
- --------- ---------------- --------------- ---------------- ----------------
<TABLE>
<CAPTION>
OPTION C TABLE - JOINT AND ONE-HALF
SURVIVOR ANNUITY Monthly payments for each
$1,000 of proceeds by ages of persons named.*
- -------------- -------------------------------------------------------------------------------------------------------
Secondary Age
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
Primary Age
60 61 62 63 64 65 66 67 68 69 70
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 $4.73 $4.75 $4.78 $4.80 $4.83 $4.85 $4.87 $4.89 $4.92 $4.93 $4.95
61 4.81 4.84 4.87 4.90 4.92 4.95 4.97 5.00 5.02 5.04 5.06
62 4.90 4.93 4.96 4.99 5.02 5.05 5.08 5.11 5.13 5.16 5.18
63 4.99 5.03 5.06 5.09 5.13 5.16 5.19 5.22 5.25 5.28 5.30
64 5.09 5.12 5.16 5.20 5.23 5.27 5.30 5.34 5.37 5.40 5.43
65 5.18 5.22 5.26 5.31 5.35 5.38 5.42 5.46 5.49 5.53 5.56
66 5.28 5.33 5.37 5.42 5.46 5.50 5.54 5.58 5.62 5.66 5.70
67 5.38 5.43 5.48 5.53 5.58 5.62 5.67 5.72 5.76 5.80 5.84
68 5.49 5.54 5.59 5.65 5.70 5.75 5.80 5.85 5.90 5.95 5.99
69 5.60 5.65 5.71 5.77 5.82 5.88 5.93 5.99 6.04 6.10 6.15
70 5.71 5.77 5.83 5.89 5.95 6.01 6.07 6.13 6.19 6.25 6.31
- -------------- -------- --------- -------- --------- -------- --------- -------- --------- -------- --------- --------
</TABLE>
*Payments after the death of the Primary Payee will be one-half (1/2) of the
amount shown.
<PAGE>
<TABLE>
<CAPTION>
OPTION D TABLE - LIFE ANNUITY
Monthly payments for each $1,000
applied.
- ------------ ------------------ --------- ------------------ ---------- ----------------- --------- ------------------
Age Age Age Age
- ------------ ------------------ --------- ------------------ ---------- ----------------- --------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
55 $4.56 60 $5.14 65 $5.95 70 $7.08
56 4.67 61 5.28 66 6.14 71 7.36
57 4.77 62 5.43 67 6.35 72 7.66
58 4.89 63 5.59 68 6.58 73 7.98
59 5.01 64 5.76 69 6.82 74 8.33
- ------------ ------------------ --------- ------------------ ---------- ----------------- --------- ------------------
</TABLE>
<PAGE>
NY3333C99
[GRAPHIC OMITTED]
A Stock Insurance Company
Home Office Address: 90 William Street, New York, NY 10038
Administrative Office:
[P.O. Box 5423] Cincinnati, Ohio [45201-5423]
Certificate of Participation
Under a Group Flexible Premium Deferred Variable Annuity Contract
Nonparticipating - No Dividends
<PAGE>
NY3463GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
LOAN ENDORSEMENT
The policy is changed as set out below to permit loans:
LOAN AMOUNT AND CONDITIONS. So long as a participant has not commenced
distributions of his or her interest under a payment option (or any other
systematic payment program), the participant may borrow an amount (the "new
policy loan") if all of the following requirements are met:
1. the sum of the participant's new policy loan plus the highest
balance of each other policy loan, if any, of the participant at
any time during the one-year period ending on the date of the new
policy loan, cannot exceed $50,000; and
2. the sum of the participant's new policy loan plus the current
balance of each other policy loan, if any, of the participant,
cannot exceed the greater of (i) $10,000, or (ii) one-half of the
net amount payable to the participant upon a full surrender of his
or her interest in the policy; and
3. the net amount payable the participant upon a full surrender of
his or her interest in the policy, less the sum of the
participant's new policy loan and the current balance of each
other policy loan, if any, of the participant, cannot be less than
the minimum amount required to avoid an involuntary surrender
under the other provisions of the policy.
An application for a loan must be made on our form. We may delay granting the
loan for up to six months after we receive a participant's request for it. We
may also limit the frequency at which loans may be made, the minimum amount of a
loan, and the minimum amount of loan payments to be made to us.
TERM; REPAYMENT. The principal and interest of each loan must be repaid to us
within five years of the date such loan is made. This five year limit will not
apply to any loan used to acquire a dwelling unit that is to be used as a
principal residence by the participant. Regular substantially equal periodic
payments must be made at least quarterly over the term of a loan until fully
paid.
LIEN -- DEEMED SURRENDER AND DISTRIBUTION. A policy loan is a first lien on the
participant's interest in the policy. The participant's interest in the policy
will be the sole security for a loan. We may pay off the loan (by treating a
portion of the interest equal to the balance of a loan as surrendered, and
applying it to pay off the loan) if:
1. the participant's interest in the policy is fully surrendered; or
2. distributions of the participant's interest begin under a payment
option (or any other systematic payment program); or
3. the participant dies and his or her spouse is not the sole person
entitled to the participant's interest in the policy.
If there is a default on repayment, then we may also pay off the loan (as
described above), unless a distribution to the participant is prohibited by the
other provisions of the policy.
<PAGE>
NY3463GE99
INTEREST. The interest rate on a policy loan will not be more than 8% per year,
unless otherwise provided under any other provision of the policy covering
employee benefit plan loans. Any unpaid interest will be added to a loan; in
effect, then, it will be compounded and will be part of the loan.
That portion of the participant's interest in the policy securing the
outstanding loan balance shall be credited with interest at an annual rate that
is not more than 3 percentage points below the interest rate charged on such
loan. The interest credited on such portion of the participant's interest in the
policy will not be less than that required under the applicable guaranteed
minimum rate or value provisions of the policy.
This is part of the policy. It is not a separate contract. It changes the policy
only as and to the extent stated. In all cases of conflict with the other terms
of the policy, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
- --------------------------------------------
<PAGE>
NY3464CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
LOAN ENDORSEMENT
Your Certificate of Participation under the policy (your "Certificate") is
changed as set out below to add provisions for policy loans:
LOAN AMOUNT AND CONDITIONS. So long as you have not commenced distributions of
your interest under a payment option (or any other systematic payment program),
you may borrow an amount (the "new policy loan") if all of the following
requirements are met:
1. the sum of your new policy loan plus the highest balance of each
other policy loan of yours, if any, at any time during the
one-year period ending on the date of the new policy loan, cannot
exceed $50,000; and
2. the sum of your new policy loan plus the current balance of each
other policy loan of yours, if any, cannot exceed the greater of
(i) $10,000, or (ii) one-half of the net amount payable to you
upon a full surrender of your interest in the policy; and
3. the net amount payable to you upon a full surrender of your
interest in the policy, less the sum of your new policy loan and
the current balance of each other policy loan of yours, if any,
cannot be less than the minimum amount required to avoid an
involuntary surrender under the other provisions of the policy.
An application for a loan must be made on our form. We may delay granting the
loan for up to six months after we receive your request for it. We may also
limit the frequency at which loans may be made, the minimum amount of a loan,
and the minimum amount of loan payments to be made to us.
TERM; REPAYMENT. The principal and interest of each loan must be repaid to us
within five years of the date such loan is made. This five year limit will not
apply to any loan used to acquire a dwelling unit that is to be used as a
principal residence by you. Regular substantially equal periodic payments must
be made at least quarterly over the term of a loan until fully paid.
LIEN -- DEEMED SURRENDER AND DISTRIBUTION. A policy loan is a first lien on your
interest in the policy. Your interest in the policy will be the sole security
for a loan. We may pay off the loan (by treating a portion of your interest
equal to the balance of a loan as surrendered, and applying it to pay off the
loan) if:
1. your interest in the policy is fully surrendered; or
2. distributions of your interest begin under a payment option (or any other
systematic payment program); or
3. you die and your spouse is not the sole person entitled to your interest in
the policy.
If there is a default on repayment, then we may also pay off the loan (as
described above), unless a distribution to you is prohibited by the other
provisions of the policy.
INTEREST. The interest rate on a policy loan will not be more than 8% per year,
unless otherwise provided under any other provision of the policy covering
employee benefit plan loans. Any unpaid interest will be added to a loan; in
effect, then, it will be compounded and will be part of the loan.
That portion of your interest in the policy securing the outstanding loan
balance shall be credited with interest at an annual rate that is not more than
3 percentage points below the interest rate charged on such loan. The interest
credited on such portion of your interest in the policy will not be less than
that required under the applicable guaranteed minimum rate or value provisions
of the policy.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
- -------------------------------------------
<PAGE>
NY3453GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
TAX SHELTERED ANNUITY ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a Tax
Sheltered Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions that qualify for deferred tax treatment under
Internal Revenue Code ("IRC") Section 403(b). It is restricted as required
by federal tax law. We may change the terms of this annuity contract or
administer this annuity contract at any time as needed to comply with that
law. Any such change may be applied retroactively.
NO ASSIGNMENT OR TRANSFER. A participant cannot assign, sell, or transfer
his or her interest in this annuity contract. A participant cannot pledge
it to secure a loan or the performance of an obligation, or for any other
purpose. The only exceptions to these rules are:
1) an interest in this annuity contract may secure a loan made under any loan
provisions of this annuity contract; 2) an interest in this annuity contract may
be transferred under a Qualified Domestic Relations Order as defined in IRC
Section
414(p); and
3) a participant may designate another person to receive payments
with the participant based on joint lives or joint life
expectancies, but any such designation shall not give that other
person any present rights under the annuity contract during the
participant's lifetime.
LIMITS ON CONTRIBUTIONS. We may refuse to accept any contribution to this
annuity contract that does not qualify for deferred tax treatment under IRC
Section 403(b) and Section 415. Contributions made for a participant to
this annuity contract and any other plan, contract, or arrangement under
salary reduction agreement(s) with his or her employer(s) cannot exceed the
limits of IRC Section 402(g).
DISTRIBUTION RESTRICTIONS ON SALARY REDUCTION CONTRIBUTIONS AND CUSTODIAL
ACCOUNTS TRANSFERS. To comply with federal tax law, distribution
restrictions apply to amounts under this annuity contract that represent:
1) contributions made after December 31, 1988 under any salary
reduction agreement with an employer;
2) income earned after December 31, 1988 on salary reduction
contributions whenever made; or
3) transfers from a custodial account described in IRC Section
403(b)(7) and all income attributable to the amount transferred.
Any such amount cannot be distributed from this annuity contract unless the
participant has:
1) reached age 59-1/2; or
2) separated from service with his or her employer; or
3) become disabled (as defined in IRC Section 72(m)(7)); or
4) in the case of salary reduction contributions (including salary
reduction contributions to a custodial account), incurred a
hardship as defined under the IRC.
A withdrawal made by reason of a hardship cannot include any income earned
after December 31, 1988 attributable to salary reduction contributions.
IRC Section 72(m)(7) states that: "An individual shall be considered to be
disabled if he is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which
can be expected to result in death or to be of long-continued and
indefinite duration. An individual shall not be considered to be disabled
unless he furnishes proof of the existence thereof in such form and manner
as the Secretary [of the Treasury] may require."
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), a
participant or his or her surviving spouse may elect to have any portion of
an eligible rollover distribution (as defined in IRC Section 403(b)(8))
paid directly to an Individual Retirement Annuity or Individual Retirement
Account (as defined in IRC Section 408) or, if allowed, to another Tax
Sheltered Annuity (as defined in IRC Section 403(b)), specified by the
participant or surviving spouse and which accepts such distribution. Any
direct rollover election must be made on our form, and must be received at
our office before the date of payment.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions of a participant's interest in this annuity contract is April
1 following the later of the calendar year in which the participant reaches
age 70-1/2 or the calendar year in which the participant retires. No later
than the Required Beginning Date:
<PAGE>
1) the participant's interest in this annuity contract must be paid in
full; or
2) distributions of the participant's interest in this annuity contract
must begin in the form of periodic payments made at least annually (i)
for the participant's life or as joint and survivor payments to the
participant and one other individual, or (ii) over a period certain not
to exceed the participant's life expectancy or the joint and last
survivor life expectancy of the participant and one other individual
named to receive any remaining payments after the participant's death,
with payments which do not increase or increase only as provided in Q&A
F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of a participant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year in which the
participant reaches age 70-1/2 or in any earlier year in which payments
begin irrevocably, and any payment calculations for subsequent years shall
be based on such life expectancy reduced by one for each calendar year
which has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the participant dies after
the Required Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of the participant's interest in this
annuity contract must continue to be distributed at least as rapidly as
under the method of distribution being used prior to the participant's
death.
If the participant dies before the Required Beginning Date and before
payments begin irrevocably, the participant's entire interest in this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the
participant's death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract to
receive payments after the participant's death with payments beginning
by December 31 of the first calendar year after the participant's
death.
However, if the participant's surviving spouse is the individual designated
to receive his or her entire interest in this annuity contract, then the
starting date for payments under clause 2) above may be delayed to a date
not later than December 31 of the calendar year in which the participant
would have reached age 70-1/2. If the participant's surviving spouse dies
before payments begin under this provision, then this provision shall apply
upon the death of the participant's spouse as if the participant's spouse
were the owner of this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after the participant's death, the life expectancy of the
participant's surviving spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the date payments are required to begin. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3454CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
TAX SHELTERED ANNUITY ENDORSEMENT
The Certificate of Participation under the annuity contract (your "Certificate")
is changed as set out below to add provisions for a Tax Sheltered Annuity.
APPLICABLE TAX LAW RESTRICTIONS. The annuity contract is intended to
receive contributions that qualify for deferred tax treatment under
Internal Revenue Code ("IRC") Section 403(b). It is restricted as required
by federal tax law. We may change the terms of the annuity contract and
your Certificate, or administer the annuity contract and your interest in
it, at any time as needed to comply with that law. Any such change may be
applied retroactively.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in the annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) you may use your interest in the annuity contract to secure a loan made
under any loan provisions of the annuity contract;
2) all or part of your interest in the annuity contract may be transferred
under a Qualified Domestic Relations Order as defined in IRC Section
414(p); and
3) you may designate another person to receive payments with you based on
joint lives or joint life expectancies, but any such designation shall
not give that other person any present rights under the annuity
contract during your lifetime.
LIMITS ON CONTRIBUTIONS. We may refuse to accept any contribution to the
annuity contract that does not qualify for deferred tax treatment under IRC
Section 403(b) and Section 415. Contributions made for you to the annuity
contract and any other plan, contract, or arrangement under salary
reduction agreement(s) with your employer(s) cannot exceed the limits of
IRC Section 402(g).
DISTRIBUTION RESTRICTIONS ON SALARY REDUCTION CONTRIBUTIONS AND CUSTODIAL
ACCOUNTS TRANSFERS. To comply with federal tax law, distribution
restrictions apply to amounts under the annuity contract that represent:
1) contributions made after December 31, 1988 under any salary reduction
agreement with an employer;
2) income earned after December 31, 1988 on salary reduction contributions
whenever made; or
3) transfers from a custodial account described in IRC Section 403(b)(7)
and all income attributable to the amount transferred.
Any such amount cannot be distributed with respect to your interest in the
annuity contract unless you have:
1) reached age 59-1/2; or
2) separated from service with your employer; or
3) become disabled (as defined in IRC Section 72(m)(7)); or
4) in the case of salary reduction contributions (including salary
reduction contributions to a custodial account), incurred a hardship as
defined under the IRC.A withdrawal made by reason of a hardship cannot
include any income earned after December 31, 1988 attributable to
salary reduction contributions.
IRC Section 72(m)(7) states that: "An individual shall be considered to be
disabled if he is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which
can be expected to result in death or to be of long-continued and
indefinite duration. An individual shall not be considered to be disabled
unless he furnishes proof of the existence thereof in such form and manner
as the Secretary [of the Treasury] may require."
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), you
or your surviving spouse may elect to have any portion of an eligible
rollover distribution (as defined in IRC Section 403(b)(8)) paid directly
to an Individual Retirement Annuity or Individual Retirement Account (as
defined in IRC Section 408) or, if allowed, to another Tax Sheltered
Annuity (as defined in IRC Section 403(b)), specified by your or your
surviving spouse and which accepts such distribution. Any direct rollover
election must be made on our form, and must be received at our office
before the date of payment.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions with respect to your interest in the annuity contract is
April 1 following the later of the calendar year in which you reach age
70-1/2 or the calendar year in which you retire. No later than the Required
Beginning Date:
1) your interest in the annuity contract must be paid in full; or
2) distributions of your interest in the annuity contract must begin in
the form of periodic payments made at least annually (i) for your life
or as joint and survivor payments to you and one other individual, or
(ii) over a period certain not to exceed the your life expectancy or
the joint and last survivor life expectancy of you and one other
individual named to receive any remaining payments after your death,
with payments which do not increase or increase only as provided in Q&A
F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of you and your spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the Required Beginning Date. The life expectancy of any
other individual may not be recalculated. Any life expectancy which is not
being recalculated shall be determined using the attained age of the
individual in the calendar year in which you reach age 70-1/2 or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year such life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of your interest in the annuity
contract must continue to be distributed at least as rapidly as under the
method of distribution being used prior to your death.
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in the annuity contract must be paid
either:
1) in full by December 31 of the fifth calendar year after your death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under the annuity contract to
receive payments after your death with payments beginning by December
31 of the first calendar year after your death.
However, if your surviving spouse is the individual designated to receive
your entire interest in the annuity contract, then the starting date for
payments under clause 2) above may be delayed to a date not later than
December 31 of the calendar year in which you would have reached age
70-1/2. If your surviving spouse dies before payments begin under this
provision, then this provision shall apply upon the death of your spouse as
if your spouse were the owner of your interest in the annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after your death, the life expectancy of your surviving spouse
shall be recalculated annually unless periodic payments for a fixed period
begin irrevocably (subject to acceleration) by the date payments are
required to begin. The life expectancy of any other individual may not be
recalculated. Any life expectancy which is not being recalculated shall be
determined using the attained age of such individual in the calendar year
in which payments are required to begin or in any earlier year in which
payments begin irrevocably, and any payment calculations for subsequent
years shall be based on such life expectancy reduced by one for each
calendar year which has elapsed since the calendar year life expectancy was
first determined. Therefore, if a life expectancy is not recalculated,
payments will be made over a fixed period which could end before that
person's actual death.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3493GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
QUALIFIED PENSION, PROFIT SHARING, AND ANNUITY PLAN
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a
qualified pension, profit sharing, or annuity plan. This endorsement and the
annuity contract to which it is attached are not valid without additional
endorsement(s) defining the Plan and Plan Administrator.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions pursuant to a pension, profit sharing, or annuity
plan qualified under Internal Revenue Code ("IRC") Section 401(a) or
403(a). It is restricted as required by federal tax law. We may change the
terms of this annuity contract or administer this annuity contract at any
time as needed to comply with that law. Any such change may be applied
retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of the participants and their beneficiaries. No amounts held under
this annuity contract may be used for or diverted to any purpose other than
the provision of Plan benefits except as permitted by the Plan after the
complete satisfaction of all liabilities to persons covered by the Plan and
their beneficiaries. Until distributed, the Plan retains all legal
ownership rights and control over a participant's interest in the annuity
contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. A participant cannot assign, sell, or transfer
his or her interest in this annuity contract. A participant cannot pledge
it to secure a loan or the performance of an obligation, or for any other
purpose. The only exceptions to these rules are:
1) a participant's interest in this annuity contract may secure a loan
made to the participant under any loan provisions of this annuity
contract;
2) all or part of a participant's interest in this annuity contract may be
transferred under a Qualified Domestic Relations Order as defined in
IRC Section 414(p); and
3) payments from a participant's interest in this annuity contract may be
made based on joint lives or joint life expectancies of the participant
and another person, but such other person shall have no present rights
under this annuity contract during the participant's lifetime.
Except as elected under the DIRECT ROLLOVER provision, any distributions
from a participant's interest in this annuity contract shall be paid to the
annuity contract owner or to the participant or another person entitled to
Plan benefits through the participant, as may be directed by the annuity
contract owner.
LIMITS ON CONTRIBUTIONS. Contributions to a participant's interest in this
annuity contract which represent contributions to the Plan for the
participant's benefit must not exceed the limits set forth in IRC Section
415. Contributions to a participant's interest in this annuity contract
which represent the participant's elective deferrals cannot exceed the
limits of IRC Section 402(g). Additional limits may apply under the terms
of the Plan. The Plan Administrator shall ensure compliance with these IRC
limits and any Plan limits.
<PAGE>
DISTRIBUTION RESTRICTIONS ON 401(k) EMPLOYEE ELECTIVE CONTRIBUTIONS. Any
amounts under a participant's interest in this annuity contract which
represent employee elective contributions made pursuant to salary reduction
agreement(s) under IRC Section 401(k) and any income earned on such
amounts, cannot be distributed any earlier than allowed under IRC Section
401(k)(2)(B). Additional limits may apply under the terms of the Plan. The
Plan Administrator shall determine when a distribution is allowed under
this IRC section and the Plan.
DISTRIBUTION RESTRICTIONS ON PENSION CONTRIBUTIONS. Any amounts under a
participant's interest in this annuity contract which represent
contributions for the participant to a money purchase pension plan or a
defined benefit pension plan, and any income earned on such amounts, cannot
be distributed any earlier than allowed under Section 1.401-1(b)(1)(i) of
the Income Tax Regulations. Additional limits may apply under the terms of
the Plan. The Plan Administrator shall determine when a distribution is
allowed under this regulation and the Plan.
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), a
participant or his or her surviving spouse may elect to have any portion of
an eligible rollover distribution (as defined in IRC Section 402(c)(4))
paid directly to an Individual Retirement Annuity or Individual Retirement
Account (as defined in IRC Section 408) or, if allowed, to another
qualified pension, profit sharing, or annuity plan (as defined in IRC
Section 401(a) or 403(a)), specified by the participant or surviving spouse
and which accepts such distribution. Any direct rollover election must be
made on our form, and must be received at our office before the date of
payment.
DATE BENEFITS TO BEGIN. Unless a participant elects to delay the payment of
his or her benefits, distributions of the participant's interest in this
annuity contract shall begin no later than 60 days after the end of the
Plan year in which the last of the following occurs:
1) the participant has reached the earlier of age 65 or the normal
retirement age stated in the Plan;
2) the 10th anniversary of the date the participant joined the Plan; or
3) the participant's separation from service with the employer.
The Plan Administrator shall make any determination required under this
provision.
In no event can the payment of benefits be delayed beyond the Required
Beginning Date stated in the REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE
provision, below.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions with respect to a participant's interest in this annuity
contract is April 1 following the later of the calendar year in which the
participant reaches age 70-1/2 or the calendar year in which the
participant separates from service with the Employer. If the participant is
a 5% owner of the Employer, the Required Beginning Date is April 1
following the calendar year in which the participant reaches age 70-1/2. No
later than the Required Beginning Date:
1) the participant's interest in this annuity contract must be paid in
full; or
2) distributions of the participant's interest in this annuity contract
must begin in the form of periodic payments made at least annually (i)
for the participant's life or as joint and survivor payments for the
lives of the participant and one other individual, or (ii) over a
period certain not to exceed the participant's life expectancy or the
joint and last survivor life expectancy of the participant and one
other individual entitled to receive any remaining payments after the
participant's death, with payments which do not increase or increase
only as provided in Q&A F-3 of Section 1.401(a)(9)-1 of the Proposed
Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirement of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
<PAGE>
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of the participant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year immediately preceding
the Required Beginning Date or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If a participant dies after the
Required Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of the participant's interest in this
annuity contract must continue to be distributed at least as rapidly as
under the method of distribution being used prior to the participant's
death.
If a participant dies before the Required Beginning Date and before
payments begin irrevocably, the participant's entire interest in this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the
participant's death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated to receive payments after the
participant's death with payments beginning by December 31 of the first
calendar year after the participant's death.
However, if the participant's surviving spouse is the individual designated
to receive the participant's entire interest in this annuity contract, then
the starting date for payments under clause 2) above may be delayed to a
date not later than December 31 of the calendar year in which the
participant would have reached age 70-1/2. If the participant's surviving
spouse dies before payments begin under this provision, then this provision
shall apply upon the death of the participant's spouse as if the spouse
were the owner of the participant's interest in this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after a participant's death, the life expectancy of the
participant's surviving spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the date payments are required to begin. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3494CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
QUALIFIED PENSION, PROFIT SHARING, AND ANNUITY PLAN
ENDORSEMENT
Your Certificate of Participation under the annuity contract (your
"Certificate") is changed as set out below to add provisions for a qualified
pension, profit sharing, or annuity plan. This endorsement and the Certificate
to which it is attached are not valid without additional endorsement(s) defining
the Plan and Plan Administrator.
APPLICABLE TAX LAW RESTRICTIONS. The annuity contract is intended to
receive contributions pursuant to a pension, profit sharing, or annuity
plan qualified under Internal Revenue Code ("IRC") Section 401(a) or
403(a). It is restricted as required by federal tax law. We may change the
terms of the annuity contract and your Certificate, or administer the
annuity contract and your interest in it, at any time as needed to comply
with that law. Any such change may be applied retroactively.
EXCLUSIVE BENEFIT. Your interest in the annuity contract is established for
the exclusive benefit of you and your beneficiaries. No amounts held under
your interest in the annuity contract may be used for or diverted to any
purpose other than the provision of Plan benefits except as permitted by
the Plan after the complete satisfaction of all liabilities to persons
covered by the Plan and their beneficiaries. Until distributed, the Plan
retains all legal ownership rights and control over your interest in the
annuity contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in the annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) your interest in the annuity contract may secure a loan made to you
under any loan provisions of the annuity contract;
2) all or part of your interest in the annuity contract may be transferred
under a Qualified Domestic Relations Order as defined in IRC Section
414(p); and
3) payments from your interest in the annuity contract may be made based
on joint lives or joint life expectancies of you and another person,
but such other person shall have no present rights under the annuity
contract during your lifetime.
Except as elected under the DIRECT ROLLOVER provision, any distributions
from your interest in the annuity contract shall be paid to the annuity
contract owner or to you or another person entitled to Plan benefits
through you, as may be directed by the annuity contract owner.
LIMITS ON CONTRIBUTIONS. Contributions to your interest in the annuity
contract which represent contributions to the Plan for your benefit must
not exceed the limits set forth in IRC Section 415. Contributions to your
interest in the annuity contract which represent your elective deferrals
cannot exceed the limits of IRC Section 402(g). Additional limits may apply
under the terms of the Plan. The Plan Administrator shall ensure compliance
with these IRC limits and any Plan limits.
<PAGE>
DISTRIBUTION RESTRICTIONS ON 401(k) EMPLOYEE ELECTIVE CONTRIBUTIONS. Any
amounts under your interest in the annuity contract which represent
employee elective contributions made pursuant to salary reduction
agreement(s) under IRC Section 401(k) and any income earned on such
amounts, cannot be distributed any earlier than allowed under IRC Section
401(k)(2)(B). Additional limits may apply under the terms of the Plan. The
Plan Administrator shall determine when a distribution is allowed under
this IRC section and the Plan.
DISTRIBUTION RESTRICTIONS ON PENSION CONTRIBUTIONS. Any amounts under your
interest in the annuity contract which represent contributions for you to a
money purchase pension plan or a defined benefit pension plan, and any
income earned on such amounts, cannot be distributed any earlier than
allowed under Section 1.401-1(b)(1)(i) of the Income Tax Regulations.
Additional limits may apply under the terms of the Plan. The Plan
Administrator shall determine when a distribution is allowed under this
regulation and the Plan.
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), you
or your surviving spouse may elect to have any portion of an eligible
rollover distribution (as defined in IRC Section 402(c)(4)) paid directly
to an Individual Retirement Annuity or Individual Retirement Account (as
defined in IRC Section 408) or, if allowed, to another qualified pension,
profit sharing, or annuity plan (as defined in IRC Section 401(a) or
403(a)), specified by you or your surviving spouse and which accepts such
distribution. Any direct rollover election must be made on our form, and
must be received at our office before the date of payment.
DATE BENEFITS TO BEGIN. Unless you elect to delay the payment of your
benefits, distributions of your interest in the annuity contract shall
begin no later than 60 days after the end of the Plan year in which the
last of the following occurs:
1) you have reached the earlier of age 65 or the normal retirement age
stated in the Plan;
2) the 10th anniversary of the date you joined the Plan; or
3) your separation from service with the employer.
The Plan Administrator shall make any determination required under this
provision.
In no event can the payment of benefits be delayed beyond the Required
Beginning Date stated in the REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE
provision, below.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions with respect to your interest in the annuity contract is
April 1 following the later of the calendar year in which you reach age
70-1/2 or the calendar year in which you separate from service with the
Employer. If you are a 5% owner of the Employer, the Required Beginning
Date is April 1 following the calendar year in which you reach age 70-1/2.
No later than the Required Beginning Date:
1) your interest in the annuity contract must be paid in full; or
2) distributions of your interest in the annuity contract must begin in
the form of periodic payments made at least annually (i) for your life
or as joint and survivor payments for the lives of you and one other
individual, or (ii) over a period certain not to exceed your life
expectancy or the joint and last survivor life expectancy of you and
one other individual entitled to receive any remaining payments after
your death, with payments which do not increase or increase only as
provided in Q&A F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax
Regulations.
<PAGE>
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirement of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of you and your spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the Required Beginning Date. The life expectancy of any
other individual may not be recalculated. Any life expectancy which is not
being recalculated shall be determined using the attained age of the
individual in the calendar year immediately preceding the Required
Beginning Date or in any earlier year in which payments begin irrevocably,
and any payment calculations for subsequent years shall be based on such
life expectancy reduced by one for each calendar year which has elapsed
since the calendar year such life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of your interest in the annuity
contract must continue to be distributed at least as rapidly as under the
method of distribution being used prior to your death.
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in the annuity contract must be paid
either:
1) in full by December 31 of the fifth calendar year after your death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated to receive payments after your
death with payments beginning by December 31 of the first calendar year
after your death.
However, if your surviving spouse is the individual designated to receive
your entire interest in the annuity contract, then the starting date for
payments under clause 2) above may be delayed to a date not later than
December 31 of the calendar year in which you would have reached age
70-1/2. If your surviving spouse dies before payments begin under this
provision, then this provision shall apply upon the death of your spouse as
if your spouse were the owner of your interest in the annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after your death, the life expectancy of your surviving spouse
shall be recalculated annually unless periodic payments for a fixed period
begin irrevocably (subject to acceleration) by the date payments are
required to begin. The life expectancy of any other individual may not be
recalculated. Any life expectancy which is not being recalculated shall be
determined using the attained age of such individual in the calendar year
in which payments are required to begin or in any earlier year in which
payments begin irrevocably, and any payment calculations for subsequent
years shall be based on such life expectancy reduced by one for each
calendar year which has elapsed since the calendar year life expectancy was
first determined. Therefore, if a life expectancy is not recalculated,
payments will be made over a fixed period which could end before that
person's actual death.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3633E99
[GRAPHIC OMITTED]
QUALIFIED PENSION, PROFIT SHARING, AND ANNUITY PLAN
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a
qualified pension, profit sharing, or annuity plan. This endorsement and the
annuity contract to which it is attached are not valid without additional
endorsement(s) defining the Plan and Plan Administrator.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions pursuant to a pension, profit sharing, or annuity
plan qualified under Internal Revenue Code ("IRC") Section 401(a) or
403(a). It is restricted as required by federal tax law. We may change the
terms of this annuity contract or administer this annuity contract at any
time as needed to comply with that law. Any such change may be applied
retroactively.
ANNUITANT. "Annuitant" means the designated person covered under the Plan
for whose benefit this annuity contract was purchased. If the owner of this
annuity contract is the Employer or Plan trustee, then any reference in
this annuity contract to the owner's life, age, death, or spouse shall be
treated as a reference to the Annuitant's life, age, death, or spouse.
EXCLUSIVE BENEFIT. This annuity contract is for the exclusive benefit of
the Annuitant and his or her beneficiaries. No amounts held under this
annuity contract may be used for or diverted to any purpose other than the
provision of Plan benefits except as permitted by the Plan after the
complete satisfaction of all liabilities to persons covered by the Plan and
their beneficiaries. Until distributed, the Plan retains all legal
ownership rights and control over the Annuitant's interest in the annuity
contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. No interest in this annuity contract may be
assigned, sold, or transferred. No interest in this annuity contract may be
pledged to secure a loan or the performance of an obligation, or for any
other purpose. The only exceptions to these rules are:
1) if this annuity contract is owned by the Employer or Plan trustee, it
may be transferred to a successor Employer or Plan trustee or to the
Annuitant or another person entitled to Plan benefits through the
Annuitant;
2) this annuity contract may secure a loan to the Annuitant made under any
loan provisions of this annuity contract;
3) the Annuitant's interest in this annuity contract may be transferred
under a Qualified Domestic Relations Order as defined in IRC Section
414(p); and
4) payments may be made based on joint lives or joint life expectancies of
the Annuitant and another person, but such other person shall have no
present rights under this annuity contract during the lifetime of the
Annuitant.
Except as elected under the DIRECT ROLLOVER provision, any distributions
under this annuity contract shall be paid to the owner or to the Annuitant
or other person entitled to Plan benefits through the Annuitant, as may be
directed by the owner of the annuity contract.
<PAGE>
LIMITS ON CONTRIBUTIONS. Contributions to this annuity contract which
represent contributions to the Plan must not exceed the limits set forth in
IRC Section 415. Contributions to this annuity contract which represent
elective deferrals cannot exceed the limits of IRC Section 402(g).
Additional limits may apply under the terms of the Plan. The Plan
Administrator shall ensure compliance with these IRC limits and any Plan
limits.
DISTRIBUTION RESTRICTIONS ON 401(k) EMPLOYEE ELECTIVE CONTRIBUTIONS. Any
amounts under this annuity contract which represent employee elective
contributions made pursuant to salary reduction agreement(s) under IRC
Section 401(k) and any income earned on such amounts, cannot be distributed
any earlier than allowed under IRC Section 401(k)(2)(B). Additional limits
may apply under the terms of the Plan. The Plan Administrator shall
determine when a distribution is allowed under this IRC section and the
Plan.
DISTRIBUTION RESTRICTIONS ON PENSION CONTRIBUTIONS. Any amounts under this
annuity contract which represent contributions to a money purchase pension
plan or a defined benefit pension plan, and any income earned on such
amounts, cannot be distributed any earlier than allowed under Section
1.401-1(b)(1)(i) of the Income Tax Regulations. Additional limits may apply
under the terms of the Plan. The Plan Administrator shall determine when a
distribution is allowed under this regulation and the Plan.
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), the
Annuitant or his or her surviving spouse may elect to have any portion of
an eligible rollover distribution (as defined in IRC Section 402(c)(4))
paid directly to an Individual Retirement Annuity or Individual Retirement
Account (as defined in IRC Section 408) or, if allowed, to another
qualified pension, profit sharing, or annuity plan (as defined in IRC
Section 401(a) or 403(a)), specified by the Annuitant or surviving spouse
and which accepts such distribution. Any direct rollover election must be
made on our form, and must be received at our office before the date of
payment.
DATE BENEFITS TO BEGIN. Unless the Annuitant elects to delay the payment of
his or her benefits, a distribution of the Annuitant's interest in this
annuity contract shall begin no later than 60 days after the end of the
Plan year in which the last of the following occurs:
1) the Annuitant has reached the earlier of age 65 or the normal
retirement age stated in the Plan;
2) the 10th anniversary of the date the Annuitant joined the Plan; or
3) the Annuitant's separation from service with the employer.
The Plan Administrator shall make any determination required under this
provision.
In no event can the payment of benefits be delayed beyond the Required
Beginning Date stated in the REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE
provision, below.
<PAGE>
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions under this annuity contract is April 1 following the later of
the calendar year in which the Annuitant reaches age 70-1/2 or the calendar
year in which the Annuitant separates from service with the Employer. For
any 5% owner of the Employer, the Required Beginning Date is April 1
following the calendar year in which the Annuitant reaches age 70-1/2. No
later than the Required Beginning Date:
1) the entire amount payable under this annuity contract must be paid in
full; or
2) distributions from this annuity contract must begin in the form of
periodic payments made at least annually (i) for the Annuitant's life
or as joint and survivor payments for the lives of the Annuitant and
one other individual, or (ii) over a period certain not to exceed the
Annuitant's life expectancy or the joint and last survivor life
expectancy of the Annuitant and one other individual entitled to
receive any amount payable after the Annuitant's death, with payments
which do not increase or increase only as provided in Q&A F-3 of
Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirement of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of the Annuitant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year in which the Annuitant
reaches age 70-1/2 or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the Annuitant dies after the
Required Beginning Date or after payments begin irrevocably (subject to
acceleration), any amount remaining payable under this annuity contract
must continue to be distributed at least as rapidly as under the method of
distribution being used prior to the Annuitant's death.
If the Annuitant dies before the Required Beginning Date and before
payments begin irrevocably, then any amount remaining payable under this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the Annuitant's
death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual entitled to payments after the Annuitant's
death with payments beginning by December 31 of the first calendar year
after the Annuitant's death.
However, if the Annuitant's spouse is the individual entitled to receive
the entire amount remaining payable under this annuity contract, then the
starting date for payments under clause 2) above may be delayed to a date
not later than December 31 of the calendar year in which the Annuitant
would have reached age 70-1/2. If the Annuitant's surviving spouse dies
before payments begin under this provision, then this provision shall apply
upon the death of the Annuitant's spouse as if the spouse were the
Annuitant under this annuity contract.
<PAGE>
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after the Annuitant's death, the life expectancy of his or her
surviving spouse shall be recalculated annually unless periodic payments
for a fixed period begin irrevocably (subject to acceleration) by the date
payments are required to begin. The life expectancy of any other individual
may not be recalculated. Any life expectancy which is not being
recalculated shall be determined using the attained age of such individual
in the calendar year in which payments are required to begin or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first determined. Therefore, if a life expectancy
is not recalculated, payments will be made over a fixed period which could
end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3503GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
EMPLOYER PLAN
ENDORSEMENT
The annuity contract is changed as set out below to adapt it for use with an
employee benefit plan:
PLAN. "Plan" means the employee benefit plan named on the group annuity contract
application or any successor plan.
EMPLOYER. "Employer" means the employer sponsoring the Plan and named on the
group annuity contract application, or any other employer which succeeds to its
rights under the Plan.
PLAN ADMINISTRATOR. "Plan Administrator" means the person designated as such to
us in writing by the Employer. If no person has been designated, "Plan
Administrator" means the Employer.
PLAN INTERPRETATION. For purposes of this annuity contract, the Plan
Administrator shall interpret the Plan and decide all questions about what is
allowed or required by the Plan. We have no duty to review or interpret the
Plan, or to review or approve any decision of the Plan Administrator. We are
entitled to rely on the written directions of the Plan Administrator on such
matters.
APPLICABLE RESTRICTIONS. This annuity contract may be restricted by federal
and/or state laws related to employee benefit plans. We may change the terms of
this annuity contract or administer this annuity contract at any time as needed
to comply with such laws.
PLAN DISTRIBUTION PROVISIONS. Distributions of a participant's interest allowed
under this annuity contract may be made only at a time allowed by the Plan or
required by this annuity contract. The form of any distribution shall be
determined under the Plan from among those forms of distribution available under
this annuity contract. No distribution may be made without the written direction
of the Plan Administrator unless required by this annuity contract.
Distributions of a participant's interest in the annuity contract may be made
without the participant's consent when required by the Plan.
FORFEITURE OF NON-VESTED AMOUNTS. Any amount under this annuity contract
attributable to contributions by the Employer (excluding any contributions made
under a salary reduction agreement with an employer) is subject to the vesting
provisions of the Plan. If at any time the Plan provides for a forfeiture of an
amount that is not vested, then such amount may be withdrawn and paid as
directed by the Plan Administrator.
RETURN OF EXCESS CONTRIBUTIONS. Contributions made to this annuity contract are
subject to any limits on contributions and nondiscrimination provisions of the
Plan. If the Plan Administrator determines that excess or discriminatory
contributions were made, then amounts attributable to such contributions may be
withdrawn and paid as directed by the Plan Administrator.
<PAGE>
ENTITLEMENT TO DEATH BENEFITS. The person or persons entitled to any portion of
a participant's interest in this annuity contract remaining payable after the
participant's death shall be determined under the Plan. No distribution of any
such amount shall be made without the written direction of the Plan
Administrator.
INVESTMENT ALLOCATIONS AND TRANSFERS. If this annuity contract provides that
amounts held under it are allocated among separate investment funds or fixed
accounts, then any such allocations and/or subsequent transfers shall be made
only as required or allowed by the Plan, or as required by this annuity contract
to secure a loan. No such allocation or transfer shall be made without the
written direction of the Plan Administrator unless required by this annuity
contract to secure a loan. Allocations or transfers with respect to a
participant's interest in the annuity contract may be made without the
participant's consent when required by the Plan or the annuity contract.
PLAN LOAN PROVISIONS. If loans are allowed under this annuity contract, no such
loan may be made unless also allowed by the Plan. Any such loan will be subject
to any additional limits and conditions which apply under the Plan. No loan may
be made without the written direction of the Plan Administrator. The rate of
interest to be paid by a participant on any such loan will be fixed by the Plan
Administrator, but we may require that it be at least three percentage points
higher than the minimum guaranteed rate of interest, if any, that applies to
that portion of a participant's interest in this annuity contract used as
security for the loan.
QUALIFIED JOINT AND 50% SURVIVOR ANNUITY OPTION. In addition to the other
payment options available under the annuity contract, payments of a
participant's interest may be made in the form of a Qualified Joint and 50%
Survivor Annuity. Under this payment option, we will make equal payments to the
participant for life at least once per year. If the person who is the
participant's spouse at the time payments commence survives the participant,
then after the participant's death we will make payments to such spouse at the
same intervals equal to one-half of the amount of the prior payments, with such
payments continuing to such spouse until his or her death. The first payment
under this payment option will be made on the effective date of the payment
option. The amount of the payments we will make under this payment option is
based on the intervals for payments, which are subject to our approval. Amounts
vary with the ages, as of the first payment date, of the participant and his or
her spouse. We will require proof of the ages of the participant and spouse.
Monthly payments that we will make under this payment option for each $1,000 of
proceeds applied will be furnished upon request. Once payments begin under this
payment option, the value of future payments may not be withdrawn as a
commutation of benefits.
This is a part of the annuity contract. It is not a separate contract. It
changes the annuity contract only as and to the extent stated. In all cases of
conflict with the other terms of the annuity contract, the provisions of this
endorsement shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3504CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
EMPLOYER PLAN
ENDORSEMENT
Your Certificate of Participation under the annuity contract (your
"Certificate") is changed as set out below to adapt it for use with an employee
benefit plan:
PLAN. "Plan" means the employee benefit plan named on your application or any
successor plan.
EMPLOYER. "Employer" means the employer sponsoring the Plan and named on your
application, or any other employer which succeeds to its rights under the Plan.
PLAN ADMINISTRATOR. "Plan Administrator" means the person designated as such to
us in writing by the Employer. If no person has been designated, "Plan
Administrator" means the Employer.
PLAN INTERPRETATION. For purposes of the annuity contract, the Plan
Administrator shall interpret the Plan and decide all questions about what is
allowed or required by the Plan. We have no duty to review or interpret the
Plan, or to review or approve any decision of the Plan Administrator. We are
entitled to rely on the written directions of the Plan Administrator on such
matters.
APPLICABLE RESTRICTIONS. The annuity contract may be restricted by federal
and/or state laws related to employee benefit plans. We may change the terms of
the annuity contract and your Certificate, or administer the annuity contract
and your interest in it, at any time as needed to comply with such laws.
PLAN DISTRIBUTION PROVISIONS. Distributions of your interest allowed under the
annuity contract and your Certificate may be made only at a time allowed by the
Plan or required by the annuity contract. The form of any distribution of shall
be determined under the Plan from among those forms of distribution available
under the annuity contract. No distribution of your interest may be made without
the written direction of the Plan Administrator unless required by the annuity
contract. Distributions of your interest may be made without your consent when
required by the Plan.
FORFEITURE OF NON-VESTED AMOUNTS. Any portion of your interest in the annuity
contract attributable to contributions by the Employer (excluding any
contributions made under a salary reduction agreement with your employer) is
subject to the vesting provisions of the Plan. If at any time the Plan provides
for a forfeiture of an amount that is not vested, then such amount may be
withdrawn and paid as directed by the Plan Administrator.
RETURN OF EXCESS CONTRIBUTIONS. Contributions made to the annuity contract for
you are subject to any limits on contributions and nondiscrimination provisions
of the Plan. If the Plan Administrator determines that excess or discriminatory
contributions were made, then amounts attributable to such contributions may be
withdrawn and paid as directed by the Plan Administrator.
ENTITLEMENT TO DEATH BENEFITS. The person or persons entitled to any portion of
your interest in the annuity contract remaining payable after your death shall
be determined under the Plan. No distribution of any such amount shall be made
without the written direction of the Plan Administrator.
INVESTMENT ALLOCATIONS AND TRANSFERS. If the annuity contract provides that
amounts held under it are allocated among separate investment funds or fixed
accounts, then any such allocations and/or subsequent transfers shall be made
only as required or allowed by the Plan, or as required by the annuity contract
to secure a loan. No such allocation or transfer shall be made without the
written direction of the Plan Administrator unless required by the annuity
contract to secure a loan. Allocations or transfers with respect to your
interest in the annuity contract may be made without your consent when required
by the Plan or the annuity contract.
PLAN LOAN PROVISIONS. If loans are allowed under the annuity contract, no such
loan may be made unless also allowed by the Plan. Any such loan will be subject
to any additional limits and conditions which apply under the Plan. No loan may
be made without the written direction of the Plan Administrator. The rate of
interest to be paid by you on any such loan will be fixed by the Plan
Administrator, but we may require that it be at least three percentage points
higher than the minimum guaranteed rate of interest, if any, that applies to
that portion of your interest in the annuity contract used as security for the
loan.
QUALIFIED JOINT AND 50% SURVIVOR ANNUITY OPTION. In addition to the other
payment options available under the annuity contract, payments of your interest
may be made in the form of a Qualified Joint and 50% Survivor Annuity. Under
this payment option, we will make equal payments to you for life at least once
per year. If the person who is your spouse at the time payments commence
survives you, then after your death we will make payments to such spouse at the
same intervals equal to one-half of the amount of the prior payments, with such
payments continuing to such spouse until his or her death. The first payment
under this payment option will be made on the effective date of the payment
option. The amount of the payments we will make under this payment option is
based on the intervals for payments, which are subject to our approval. Amounts
vary with the ages, as of the first payment date, of you and your spouse. We
will require proof of the ages of you and your spouse. Monthly payments that we
will make under this payment option for each $1,000 of proceeds applied will be
furnished at your request. Once payments begin under this payment option, the
value of future payments may not be withdrawn as a commutation of benefits.
This is a part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3533GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
DEFERRED COMPENSATION
ENDORSEMENT
The Contract is changed as set out below for use with a non-qualified deferred
compensation plan or Internal Revenue Code Section 457 plan:
RIGHTS IN CONTRACT AND PARTICIPATION INTEREST.
The Contract Owner as employer shall possess all rights under this
Contract and in any participation interest under this Contract. Any
request, designation, election, power, or right otherwise permitted or
given to a Participant, Annuitant, Beneficiary, or other payee under
this Contract shall be owned, controlled, and exercised only by the
Contract Owner. No Participant, Annuitant, Beneficiary, or payee (other
than the Contract Owner) shall have any legal or equitable rights under
this Contract or in any participation interest under this Contract.
The entire rights of the Contract Owner under this Contract shall at
all times be subject to the claims of the Contract Owner's general
creditors and to legal process.
BENEFICIARY DESIGNATIONS.
The Beneficiary for each participation interest may be designated by
the Contract Owner at any time before a Death Benefit payment is made
by us, and regardless of any designation of Beneficiary previously
received or acknowledged by us.
PAYEE DESIGNATIONS.
Any Annuity Benefit shall be paid to the Contract Owner or to the
applicable Annuitant and/or any joint or survivor or contingent payee.
Any Death Benefit shall be paid to the Contract Owner or to the
applicable Beneficiary and/or any joint or survivor or contingent
payee. Any other payment or proceeds shall be paid to the Contract
Owner or the applicable Annuitant. Subject to these limits, the
Contract Owner shall designate the person to whom payments shall be
made, and may make or change any such designation at any time subject
to any prior action taken by us.
This is a part of the Contract. It is not a separate contract. In all cases of
conflict with the other terms of the Contract, the restrictions of this
endorsement shall control. It changes the Contract only as and to the extent
stated.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3534CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
DEFERRED COMPENSATION
ENDORSEMENT
Your Certificate of Participation under the Group Contract (your "Certificate")
is changed as set out below for use with a non-qualified deferred compensation
plan or Internal Revenue Code Section 457 plan:
RIGHTS IN GROUP CONTRACT AND CERTIFICATE.
The Group Contract Owner as employer shall possess all rights under
this Certificate and the Group Contract. Any request, designation,
election, power, or right otherwise permitted or given to a
Participant, Annuitant, Beneficiary, or other payee under this
Certificate shall be owned, controlled, and exercised only by the Group
Contract Owner. No Participant, Annuitant, Beneficiary, or payee (other
than the Group Contract Owner) shall have any legal or equitable rights
under this Certificate or the Group Contract.
The entire rights of the Group Contract Owner under this Certificate
and the Group Contract shall at all times be subject to the claims of
the Group Contract Owner's general creditors and to legal process.
BENEFICIARY DESIGNATIONS.
The Beneficiary may be designated by the Group Contract Owner at any
time before a Death Benefit payment is made by us, and regardless of
any designation of Beneficiary previously received or acknowledged by
us.
PAYEE DESIGNATIONS.
Any Annuity Benefit shall be paid to the Group Contract Owner or to the
Annuitant and/or any joint or survivor or contingent payee. Any Death
Benefit shall be paid to the Group Contract Owner or to the Beneficiary
and/or any joint or survivor or contingent payee. Any other payment or
proceeds shall be paid to the Group Contract Owner or the Annuitant.
Subject to these limits, the Group Contract Owner shall designate the
person to whom payments shall be made, and may make or change any such
designation at any time subject to any prior action taken by us.
This is a part of your Certificate. It is not a contract. In all cases of
conflict with the other terms of your Certificate, the provisions of this
endorsement shall control. It changes your Certificate only as and to the extent
stated.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
- -------------------------------------------
<PAGE>
NY3483GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
ROTH INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a Roth
Individual Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions that qualify for special tax treatment under Internal
Revenue Code ("IRC") Section 408A. It is restricted as required by federal
tax law. We may change the terms of this annuity contract or administer
this annuity contract at any time as needed to comply with that law. Any
such change may be applied retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of the participants and their beneficiaries. A participant's
interest in this annuity contract is nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. A participant cannot assign, sell, or transfer
his or her interest in this annuity contract. A participant cannot pledge
it to secure a loan or the performance of an obligation, or for any other
purpose. The only exceptions to these rules are:
1) an interest in this annuity contract may be transferred to a spouse or
former spouse of a participant under a divorce or separation instrument
described in IRC Section 71(b)(2)(A); and
2) a participant may designate another person to receive payments with the
participant based on joint lives or joint life expectancies, but any
such designation shall not give that other person any present rights
under the annuity contract during the participant's lifetime.
CONTRIBUTIONS. This annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. An interest in this annuity contract will
not lapse if a participant does not make contributions. An interest in this
annuity contract will remain subject to cancellation under any involuntary
surrender or termination provision of this annuity contract; provided,
however, that in no event shall any such cancellation occur unless, at a
minimum, contributions have not been made for the participant for at least
two full years and the value of the participant's interest in this annuity
contract (increased by any guaranteed interest) would provide a benefit at
its stated maturity date of less than $20 a month under the regular
settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
Total contributions made to this annuity contract for a participant with
respect to any one tax year may not exceed $2,000, excluding any payment
which is a qualified rollover contribution under IRC Section 408A(e).
This annuity contract will not accept contributions made by an employer
through Simplified Employee Pension (SEP) program under IRC Section 408(k)
or a SIMPLE plan under IRC Section 408(p). No rollover contributions will
be accepted other than a qualified rollover contribution from an IRA or
Roth IRA under IRC Section 408A(e). This annuity contract will not accept a
transfer or rollover of any funds attributable to contributions made for a
participant by an employer through a SEP program or SIMPLE plan except to
the extent provided by the Secretary of the Treasury.
ANNUAL REPORT. Following the end of each calendar year, we will send each
participant a report concerning the status of his or her interest in this
annuity contract. This report will include (i) the amount of all regular
contributions received for the participant during or after the calendar
year which relate to such calendar year, (ii) the amount of all rollover
contributions received for the participant during such calendar year, (iii)
the contract value(s) of the participant's interest determined as of the
end of such calendar year, and (iv) such other information as may be
required under federal tax law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. During the participant's
lifetime, distributions from the participant's interest in this annuity
contract need not meet the requirements of IRC Section 401(a)(9) or the
incidental death benefit requirements of IRC Section 401(a)(9)(G).
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. The participant's entire
interest in this annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the
participant's death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract to
receive payments after the participant's death with payments beginning
by December 31 of the first calendar year after the participant's
death.
However, if the participant's surviving spouse is the individual designated
to receive the participant's entire interest in this annuity contract, this
annuity contract will be treated as the Roth IRA of such spouse if he or
she becomes Successor Owner of the participant's interest, makes a rollover
from the participant's interest, or fails to receive distributions from the
participant's interest otherwise required by this provision. No
contributions or rollover to the participant's interest in this annuity
contract may be made after the participant's death unless the participant's
spouse becomes Successor Owner. In any case, if a surviving spouse dies
before payments begin under this provision, then this provision shall apply
upon the death of the participant's spouse as if the spouse was the owner
of the participant's interest in this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. The life expectancy
of the participant's surviving spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the date payments are required to begin. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3623E99
[GRAPHIC OMITTED]
ROTH INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract is changed as set out below to make it a Roth Individual
Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions that qualify for special tax treatment under Internal
Revenue Code ("IRC") Section 408A. It is restricted as required by federal
tax law. We may change the terms of this annuity contract or administer
this annuity contract at any time as needed to comply with that law. Any
such change may be applied retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of you and your beneficiaries. Your interest in this annuity
contract is nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in this annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) an interest in this annuity contract may be transferred to a spouse or
former spouse under a divorce or separation instrument described in IRC
Section 71(b)(2)(A); and
2) you may designate another person to receive payments with you based on
joint lives or joint life expectancies, but any such designation shall
not give that other person any present rights under the annuity
contract during your lifetime.
CONTRIBUTIONS. This annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. This annuity contract will not lapse if you
do not make contributions. This annuity contract will remain subject to
cancellation under any involuntary surrender or termination provision of
this annuity contract; provided, however, that in no event shall any such
cancellation occur unless, at a minimum, contributions have not been made
for at least two full years and the value of this annuity contract
(increased by any guaranteed interest) would provide a benefit at its
stated maturity date of less than $20 a month under the regular settlement
option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
Total contributions made to this annuity contract with respect to any one
tax year may not exceed $2,000, excluding any payment which is a qualified
rollover contribution under IRC Section 408A(e).
This annuity contract will not accept contributions made by an employer
through Simplified Employee Pension (SEP) program under IRC Section 408(k)
or a SIMPLE plan under IRC Section 408(p). No rollover contributions will
be accepted other than a qualified rollover contribution from an IRA or
Roth IRA under IRC Section 408A(e). This annuity contract will not accept a
transfer or rollover of any funds attributable to contributions made by an
employer through a SEP program or SIMPLE plan except to the extent provided
by the Secretary of the Treasury.
<PAGE>
ANNUAL REPORT. Following the end of each calendar year, we will send you a
report concerning the status of your annuity contract. This report will
include (i) the amount of all regular contributions received during or
after the calendar year which relate to such calendar year, (ii) the amount
of all rollover contributions received during such calendar year, (iii) the
contract value(s) determined as of the end of such calendar year, and (iv)
such other information as may be required under federal tax law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. During your lifetime,
distributions from your annuity contract need not meet the requirements of
IRC Section 401(a)(9) or the incidental death benefit requirements of IRC
Section 401(a)(9)(G).
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. Your entire interest in this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after your death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract to
receive payments after your death with payments beginning by December
31 of the first calendar year after your death.
However, if your surviving spouse is the individual designated to receive
your entire interest in this annuity contract, this annuity contract will
be treated as the Roth IRA of such spouse if he or she becomes Successor
Owner of this contract, makes a rollover from this contract, or fails to
receive distributions from this contract otherwise required by this
provision. No contributions or rollover to this annuity contract may be
made after your death unless your spouse becomes Successor Owner. In any
case, if a surviving spouse dies before payments begin under this
provision, then this provision shall apply upon the death of your spouse as
if your spouse was the owner of this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. The life expectancy
of your surviving spouse shall be recalculated annually unless periodic
payments for a fixed period begin irrevocably (subject to acceleration) by
the date payments are required to begin. The life expectancy of any other
individual may not be recalculated. Any life expectancy which is not being
recalculated shall be determined using the attained age of such individual
in the calendar year in which payments are required to begin or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first determined. Therefore, if a life expectancy
is not recalculated, payments will be made over a fixed period which could
end before that person's actual death.
This is part of your annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control. This Endorsement shall supersede any other Individual Retirement
Annuity endorsement(s) which may have previously been a part of the contract.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3484CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
ROTH INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The Certificate of Participation under the annuity contract (your "Certificate")
is changed as set out below to add provisions for a Roth Individual Retirement
Annuity.
APPLICABLE TAX LAW RESTRICTIONS. The annuity contract is intended to
receive contributions that qualify for special tax treatment under Internal
Revenue Code ("IRC") Section 408A. It is restricted as required by federal
tax law. We may change the terms of the annuity contract and your
Certificate, or administer the annuity contract and your interest in it, at
any time as needed to comply with that law. Any such change may be applied
retroactively.
EXCLUSIVEBENEFIT. Your interest in the annuity contract is established for
the exclusive benefit of you and your beneficiaries. Your interest in the
annuity contract is nonforfeitable.
NON-PARTICIPATING. The annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in the annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) all or part of your interest in the annuity contract may be transferred
to a spouse or former spouse under a divorce or separation instrument
described in IRC Section 71(b)(2)(A); and
2) you may designate another person to receive payments with you based on
joint lives or joint life expectancies, but any such designation shall
not give that other person any present rights under the annuity
contract during your lifetime.
CONTRIBUTIONS. The annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. An interest in the annuity contract will not
lapse if you do not make contributions. An interest in the annuity contract
will remain subject to cancellation under any involuntary surrender or
termination provision of the annuity contract; provided, however, that in
no event shall any such cancellation occur unless, at a minimum,
contributions have not been made for you for at least two full years and
the value of your interest in the annuity contract (increased by any
guaranteed interest) would provide a benefit at its stated maturity date of
less than $20 a month under the regular settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
Total contributions made to the annuity contract for you with respect to
any one tax year may not exceed $2,000, excluding any payment which is a
qualified rollover contribution under IRC Section 408A(e).
<PAGE>
The annuity contract will not accept contributions made by an employer
through Simplified Employee Pension (SEP) program under IRC Section 408(k)
or a SIMPLE plan under IRC Section 408(p). No rollover contributions will
be accepted other than a qualified rollover contribution from an IRA or
Roth IRA under IRC Section 408A(e). The annuity contract will not accept a
transfer or rollover of any funds attributable to contributions made for
you by an employer through a SEP program or SIMPLE plan except to the
extent provided by the Secretary of the Treasury.
ANNUAL REPORT. Following the end of each calendar year, we will send you a
report concerning the status of your interest in the annuity contract. This
report will include (i) the amount of all regular contributions received
for you during or after the calendar year which relate to such calendar
year, (ii) the amount of all rollover contributions received for you during
such calendar year, (iii) the contract value(s) of your interest determined
as of the end of such calendar year, and (iv) such other information as may
be required under federal tax law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. During your lifetime,
distributions from your interest in the annuity contract need not meet the
requirements of IRC Section 401(a)(9) or the incidental death benefit
requirements of IRC Section 401(a)(9)(G).
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. Your entire interest in the
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after your death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under the annuity contract to
receive payments after your death with payments beginning by December
31 of the first calendar year after your death.
However, if your surviving spouse is the individual designated to receive
your entire interest in the annuity contract, the annuity contract will be
treated as the Roth IRA of such spouse if he or she becomes Successor Owner
of your interest, makes a rollover from your interest, or fails to receive
distributions from your interest otherwise required by this provision. No
contributions or rollover to your interest in the annuity contract may be
made after your death unless your spouse becomes Successor Owner. In any
case, if a surviving spouse dies before payments begin under this
provision, then this provision shall apply upon the death of your spouse as
if your spouse was the owner of your interest in the annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. The life expectancy
of your surviving spouse shall be recalculated annually unless periodic
payments for a fixed period begin irrevocably (subject to acceleration) by
the date payments are required to begin. The life expectancy of any other
individual may not be recalculated. Any life expectancy which is not being
recalculated shall be determined using the attained age of such individual
in the calendar year in which payments are required to begin or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first determined. Therefore, if a life expectancy
is not recalculated, payments will be made over a fixed period which could
end before that person's actual death.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3523GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
GOVERNMENTAL SECTION 457 PLAN
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a
governmental Section 457 plan. This endorsement and the annuity contract to
which it is attached are not valid without additional endorsement(s) defining
the Plan and Plan Administrator.
APPLICABLE RESTRICTIONS. This annuity contract is intended to receive
contributions pursuant to a deferred compensation plan established under
Section 5 of the State Finance Law of New York and qualified under Internal
Revenue Code ("IRC") Section 457. It is subject to Section 5 of the State
Finance Law of the State of New York and the rules and regulations issued
by the Deferred Compensation Board of said State, which are made a part
hereof. It is restricted as required by federal tax law. We may change the
terms of this annuity contract or administer this annuity contract at any
time as needed to comply with such laws. Any such change may be applied
retroactively.
EXCLUSIVE BENEFIT. This annuity contract is for the exclusive benefit of
the participants and their beneficiaries. No amounts held under this
annuity contract may be used for or diverted to any purpose other than the
provision of Plan benefits except as permitted by the Plan after the
complete satisfaction of all liabilities to persons covered by the Plan and
their beneficiaries. Until distributed, the Plan retains all legal
ownership rights and control over a participant's interest in the annuity
contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. A participant cannot assign, sell, or transfer
his or her interest in this annuity contract. A participant cannot pledge
it to secure a loan or the performance of an obligation, or for any other
purpose. The only exceptions to these rules are:
1) a participant's interest in this annuity contract may secure a
loan to the participant made under any loan provisions of this
annuity contract;
2) all or part of a participant's interest in this annuity contract
may be transferred under a Qualified Domestic Relations Order as
defined in IRC Section 414(p); and
3) payments from a participant's interest in this annuity contract
may be made based on joint lives or joint life expectancies of the
participant and another person, but such other person shall have
no present rights under this annuity contract during the
participant's lifetime.
Any distributions from a participant's interest in this annuity contract
shall be paid to the annuity contract owner or to the participant or other
person entitled to Plan benefits through the participant, as may be
directed by the annuity contract owner.
<PAGE>
LIMITS ON CONTRIBUTIONS. Contributions to a participant's interest in this
annuity contract which represent contributions to the Plan for the
participant's benefit must not exceed the limits set forth in IRC Section
457(b) and (c). No elective contributions may be made by the participant
with respect to any month unless the participant has entered an agreement
for deferral before the first day of that month. However, an elective
contribution may be made for the first month of employment of the
participant if the agreement for deferral is made on or before the date
service with the Employer begins. Additional limits may apply under the
terms of the Plan. The Plan Administrator shall ensure compliance with
these IRC limits and any Plan limits.
DISTRIBUTION RESTRICTIONS. As required under IRC Section 457(d), no
distributions from a participant's interest in this annuity contract can be
made until:
1) the calendar year in which the participant reaches age 70-1/2; or
2) the participant's separation from service with the Employer; or
3) the participant is faced with an unforeseeable emergency as
defined under the IRC; or
4) the conditions are met for an in-service distribution to the
participant under IRC Section 457(e)(9).
Additional limits may apply under the terms of the Plan. The Plan
Administrator shall determine when a distribution is allowed under this IRC
section and the Plan.
DATE BENEFITS TO BEGIN. A distribution of a participant's interest in this
annuity contract shall begin no later than 60 days after the end of the
Plan year in which the later of the following occurs:
1) the participant reaches normal retirement age as determined under
the Plan; or
2) the participant separates from service with the Employer.
If the Plan permits benefit payments upon separation from service to begin
before the latest date required under this provision, then prior to the
date a participant's payments actually begin the Plan may allow the
participant to elect irrevocably to delay payment to a later fixed and
determinable date within the limits of this provision. The participant may
make only one such election after the earliest date on which the Plan
permits benefit payments upon separation from service.
The Plan Administrator shall make any determination required under this
provision.
In no event can the payment of benefits to a participant be delayed beyond
the Required Beginning Date stated in the REQUIRED MINIMUM DISTRIBUTIONS
DURING LIFE provision, below.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions with respect to a participant's interest in this annuity
contract is April 1 following the later of the calendar year in which the
participant reaches age 70-1/2 or the calendar year in which the
participant separates from service with the Employer. No later than the
Required Beginning Date:
1) the participant's interest in this annuity contract must be paid
in full; or
2) distributions of the participant's interest in this annuity
contract must begin in the form of periodic payments made at least
annually (i) for the participant's life or as joint and survivor
payments for the lives of the participant and one other
individual, or (ii) over a period certain not to exceed the
participant's life expectancy or the joint and last survivor life
expectancy of the participant and one other individual entitled to
receive any amount payable after the participant's death, with
payments which do not increase or increase only as provided in Q&A
F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax
Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirement of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations and any guidance which may be issued by the Secretary of the
Treasury under IRC Section 457.
<PAGE>
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of the participant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year in which the
participant reaches age 70-1/2 or in any earlier year in which payments
begin irrevocably, and any payment calculations for subsequent years shall
be based on such life expectancy reduced by one for each calendar year
which has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If a participant dies after the
Required Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of the participant's interest in
annuity contract must continue to be distributed at least as rapidly as
under the method of distribution being used prior to the participant's
death.
If a participant dies before the Required Beginning Date and before
payments begin irrevocably, then the participant's entire interest in this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the
participant's death;
2) if someone other than the participant's surviving spouse is
entitled to receive part or all of the participant's interest
after the participant's death, over a period certain not greater
than fifteen years and not greater than the life expectancy of the
eldest person entitled to benefits, with payments beginning by
December 31 of the first calendar year after the participant's
death; or
3) if the participant's spouse is the sole person entitled to receive
the participant's interest after the participant's death, over the
life or over a period certain not greater than the life expectancy
of the surviving spouse, with payments beginning by December 31 of
the later of first calendar year after the participant's death or
the calendar year in which the participant would have attained age
70-1/2.
If the participant's surviving spouse is the sole person entitled to
receive the participant's interest in this annuity contract after the
participant's death and the surviving spouse dies before payments begin
under this provision, then this provision shall apply upon the death of the
participant's spouse as if the spouse were the owner of the participant's
interest in this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after the participant's death, the life expectancy of his or her
surviving spouse shall be recalculated annually unless periodic payments
for a fixed period begin irrevocably (subject to acceleration) by the date
payments are required to begin. The life expectancy of any other individual
may not be recalculated. Any life expectancy which is not being
recalculated shall be determined using the attained age of such individual
in the calendar year in which payments are required to begin or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first determined. Therefore, if a life expectancy
is not recalculated, payments will be made over a fixed period which could
end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3524CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
GOVERNMENTAL SECTION 457 PLAN
ENDORSEMENT
Your Certificate of Participation under the annuity contract (your
"Certificate") is changed as set out below to add provisions for a governmental
Section 457 plan. This endorsement and the Certificate to which it is attached
are not valid without additional endorsement(s) defining the Plan and Plan
Administrator.
APPLICABLE RESTRICTIONS. The annuity contract is intended to receive
contributions pursuant to a deferred compensation plan established under
Section 5 of the State Finance Law of New York and qualified under Internal
Revenue Code ("IRC") Section 457. It is subject to Section 5 of the State
Finance Law of the State of New York and the rules and regulations issued
by the Deferred Compensation Board of said State, which are made a part
hereof. It is restricted as required by federal tax law. We may change the
terms of the annuity contract and your Certificate, or administer the
annuity contract and your interest in it, at any time as needed to comply
with such laws. Any such change may be applied retroactively.
EXCLUSIVE BENEFIT. Your interest in the annuity contract is for the
exclusive benefit of you and your beneficiaries. No amounts held under your
interest in the annuity contract may be used for or diverted to any purpose
other than the provision of Plan benefits except as permitted by the Plan
after the complete satisfaction of all liabilities to persons covered by
the Plan and their beneficiaries. Until distributed, the Plan retains all
legal ownership rights and control over your interest in the annuity
contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in the annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) your interest in the annuity contract may secure a loan to you made
under any loan provisions of the annuity contract;
2) all or part of your interest in the annuity contract may be transferred
under a Qualified Domestic Relations Order as defined in IRC Section
414(p); and
3) payments from your interest in the annuity contract may be made based
on joint lives or joint life expectancies of you and another person,
but such other person shall have no present rights under the annuity
contract during your lifetime.
Any distributions from your interest in the annuity contract shall be paid
to the annuity contract owner or to you or other person entitled to Plan
benefits through you, as may be directed by the annuity contract owner.
<PAGE>
LIMITS ON CONTRIBUTIONS. Contributions to your interest in the annuity
contract which represent contributions to the Plan for your benefit must
not exceed the limits set forth in IRC Section 457(b) and (c). No elective
contributions may be made by you with respect to any month unless you have
entered an agreement for deferral before the first day of that month.
However, an elective contribution may be made for your first month of
employment if the agreement for deferral is made on or before the date your
service with the Employer begins. Additional limits may apply under the
terms of the Plan. The Plan Administrator shall ensure compliance with
these IRC limits and any Plan limits.
DISTRIBUTION RESTRICTIONS. As required under IRC Section 457(d), no
distributions from your interest in the annuity contract can be made until:
1) the calendar year in which you reach age 70-1/2; or
2) your separation from service with the Employer; or
3) you are faced with an unforeseeable emergency as defined under the IRC;
or
4) the conditions are met for an in-service distribution you under IRC
Section 457(e)(9).
Additional limits may apply under the terms of the Plan. The Plan
Administrator shall determine when a distribution is allowed under this IRC
section and the Plan.
DATE BENEFITS TO BEGIN. A distribution of your interest in the annuity
contract shall begin no later than 60 days after the end of the Plan year
in which the later of the following occurs:
1) you reach normal retirement age as determined under the Plan; or
2) you separate from service with the Employer.
If the Plan permits benefit payments upon separation from service to begin
before the latest date required under this provision, then prior to the
date your payments actually begin the Plan may allow you to elect
irrevocably to delay payment to a later fixed and determinable date within
the limits of this provision. You may make only one such election after the
earliest date on which the Plan permits benefit payments upon separation
from service.
The Plan Administrator shall make any determination required under this
provision.
In no event can the payment of your benefits be delayed beyond the Required
Beginning Date stated in the REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE
provision, below.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions with respect to your interest in the annuity contract is
April 1 following the later of the calendar year in which you reach age
70-1/2 or the calendar year in which you separate from service with the
Employer. No later than the Required Beginning Date:
1) your interest in the annuity contract must be paid in full; or
2) distributions of your interest in the annuity contract must begin
in the form of periodic payments made at least annually (i) for
your life or as joint and survivor payments for the lives of you
and one other individual, or (ii) over a period certain not to
exceed your life expectancy or the joint and last survivor life
expectancy of you and one other individual entitled to receive any
amount payable after your death, with payments which do not
increase or increase only as provided in Q&A F-3 of Section
1.401(a)(9)-1 of the Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirement of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations and any guidance which may be issued by the Secretary of the
Treasury under IRC Section 457.
<PAGE>
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of you and your spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the Required Beginning Date. The life expectancy of any
other individual may not be recalculated. Any life expectancy which is not
being recalculated shall be determined using the attained age of the
individual in the calendar year in which you reach age 70-1/2 or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year such life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of your interest in annuity contract
must continue to be distributed at least as rapidly as under the method of
distribution being used prior to your death.
If you die before the Required Beginning Date and before payments begin
irrevocably, then your entire interest in the annuity contract must be paid
either:
1) in full by December 31 of the fifth calendar year after your death;
2) if someone other than your surviving spouse is entitled to receive part
or all of your interest after your death, over a period certain not
greater than fifteen years and not greater than the life expectancy of
the eldest person entitled to benefits, with payments beginning by
December 31 of the first calendar year after your death; or
3) if your spouse is the sole person entitled to receive your interest
after your death, over the life or over a period certain not greater
than the life expectancy of the surviving spouse, with payments
beginning by December 31 of the later of first calendar year after your
death or the calendar year in which you would have attained age 70-1/2.
If your surviving spouse is the sole person entitled to receive your
interest in the annuity contract after your death and the surviving spouse
dies before payments begin under this provision, then this provision shall
apply upon the death of your spouse as if the spouse were the owner of your
interest in the annuity contract. Life expectancy is computed using the
expected return multiples in Tables V and VI of Section 1.72-9 of the
Income Tax Regulations. For distributions beginning after your death, the
life expectancy of your surviving spouse shall be recalculated annually
unless periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the date payments are required to begin. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3663E99
[GRAPHIC OMITTED]
GOVERNMENTAL SECTION 457 PLAN
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a
governmental Section 457 plan. This endorsement and the annuity contract to
which it is attached are not valid without additional endorsement(s) defining
the Plan and Plan Administrator.
APPLICABLE RESTRICTIONS. This annuity contract is intended to receive
contributions pursuant to a deferred compensation plan established under
Section 5 of the State Finance Law of New York and qualified under Internal
Revenue Code ("IRC") Section 457. It is subject to Section 5 of the State
Finance Law of the State of New York and the rules and regulations issued
by the Deferred Compensation Board of said State, which are made a part
hereof. It is restricted as required by federal tax law. We may change the
terms of this annuity contract or administer this annuity contract at any
time as needed to comply with such laws. Any such change may be applied
retroactively.
ANNUITANT. "Annuitant" means the designated person covered under the Plan
for whose benefit this annuity contract was purchased. If the owner of this
annuity contract is the Employer or Plan trustee, then any reference in
this annuity contract to the owner's life, age, death, or spouse shall be
treated as a reference to the Annuitant's life, age, death, or spouse.
EXCLUSIVE BENEFIT. This annuity contract is for the exclusive benefit of
the Annuitant and his or her beneficiaries. No amounts held under this
annuity contract may be used for or diverted to any purpose other than the
provision of Plan benefits except as permitted by the Plan after the
complete satisfaction of all liabilities to persons covered by the Plan and
their beneficiaries. Until distributed, the Plan retains all legal
ownership rights and control over the Annuitant's interest in the annuity
contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. No interest in this annuity contract may be
assigned, sold, or transferred. No interest in this annuity contract may be
pledged to secure a loan or the performance of an obligation, or for any
other purpose. The only exceptions to these rules are:
1) if this annuity contract is owned by the Employer or Plan trustee, it
may be transferred to a successor Employer or Plan trustee or to the
Annuitant or another person entitled to Plan benefits through the
Annuitant;
2) this annuity contract may secure a loan to the Annuitant made under any
loan provisions of this annuity contract;
3) the Annuitant's interest in this annuity contract may be transferred
under a Qualified Domestic Relations Order as defined in IRC Section
414(p); and
4) payments may be made based on joint lives or joint life expectancies of
the Annuitant and another person, but such other person shall have no
present rights under this annuity contract during the lifetime of the
Annuitant.
Any distributions under this annuity contract shall be paid to the owner or
to the Annuitant or other person entitled to Plan benefits through the
Annuitant, as may be directed by the owner of the annuity contract.
LIMITS ON CONTRIBUTIONS. Contributions to this annuity contract which
represent contributions to the Plan must not exceed the limits set forth in
IRC Section 457(b) and (c). No elective contributions may be made by the
Annuitant with respect to any month unless the Annuitant has entered an
agreement for deferral before the first day of that month. However, an
elective contribution may be made for the first month of employment of the
Annuitant if the agreement for deferral is made on or before the date
service with the Employer begins. Additional limits may apply under the
terms of the Plan. The Plan Administrator shall ensure compliance with
these IRC limits and any Plan limits.
DISTRIBUTION RESTRICTIONS. As required under IRC Section 457(d), no
distributions from this annuity contract can be made until:
1) the calendar year in which the Annuitant reaches age 70-1/2; or
2) the Annuitant's separation from service with the Employer; or
3) the Annuitant is faced with an unforeseeable emergency as defined under
the IRC; or
4) the conditions are met for an in-service distribution under IRC Section
457(e)(9).
Additional limits may apply under the terms of the Plan. The Plan
Administrator shall determine when a distribution is allowed under this IRC
section and the Plan.
DATE BENEFITS TO BEGIN. A distribution of the Annuitant's interest in this
annuity contract shall begin no later than 60 days after the end of the
Plan year in which the later of the following occurs:
1) the Annuitant reaches normal retirement age as determined under the
Plan; or
2) the Annuitant separates from service with the Employer.
If the Plan permits benefit payments upon separation from service to begin
before the latest date required under this provision, then prior to the
date payments actually begin the Plan may allow the Annuitant to elect
irrevocably to delay payment to a later fixed and determinable date within
the limits of this provision. The Annuitant may make only one such election
after the earliest date on which the Plan permits benefit payments upon
separation from service.
The Plan Administrator shall make any determination required under this
provision.
In no event can the payment of benefits be delayed beyond the Required
Beginning Date stated in the REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE
provision, below.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions under this annuity contract is April 1 following the later of
the calendar year in which the Annuitant reaches age 70-1/2 or the calendar
year in which the Annuitant separates from service with the Employer. No
later than the Required Beginning Date:
1) the entire amount payable under this annuity contract must be paid in
full; or
2) distributions from this annuity contract must begin in the form of
periodic payments made at least annually (i) for the Annuitant's life
or as joint and survivor payments for the lives of the Annuitant and
one other individual, or (ii) over a period certain not to exceed the
Annuitant's life expectancy or the joint and last survivor life
expectancy of the Annuitant and one other individual entitled to
receive any amount payable after the Annuitant's death, with payments
which do not increase or increase only as provided in Q&A F-3 of
Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
<PAGE>
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirement of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations and any guidance which may be issued by the Secretary of the
Treasury under IRC Section 457.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of the Annuitant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year in which the Annuitant
reaches age 70-1/2 or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the Annuitant dies after the
Required Beginning Date or after payments begin irrevocably (subject to
acceleration), any amount remaining payable under this annuity contract
must continue to be distributed at least as rapidly as under the method of
distribution being used prior to the Annuitant's death.
If the Annuitant dies before the Required Beginning Date and before
payments begin irrevocably, then any amount remaining payable under this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the Annuitant's
death;
2) if someone other than the Annuitant's surviving spouse is entitled to
receive part or all of the amount remaining payable after the
Annuitant's death, over a period certain not greater than fifteen years
and not greater than the life expectancy of the eldest person entitled
to benefits, with payments beginning by December 31 of the first
calendar year after the Annuitant's death; or
3) if the Annuitant's spouse is the sole person entitled to receive the
amount remaining payable after the Annuitant's death, over the life or
over a period certain not greater than the life expectancy of the
surviving spouse, with payments beginning by December 31 of the later
of first calendar year after the Annuitant's death or the calendar year
in which the Annuitant would have attained age 70-1/2.
If the Annuitant's surviving spouse is the sole person entitled to receive
the amount remaining payable after the Annuitant's death and the surviving
spouse dies before payments begin under this provision, then this provision
shall apply upon the death of the Annuitant's spouse as if the spouse were
the Annuitant under this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after the Annuitant's death, the life expectancy of his or her
surviving spouse shall be recalculated annually unless periodic payments
for a fixed period begin irrevocably (subject to acceleration) by the date
payments are required to begin. The life expectancy of any other individual
may not be recalculated. Any life expectancy which is not being
recalculated shall be determined using the attained age of such individual
in the calendar year in which payments are required to begin or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first determined. Therefore, if a life expectancy
is not recalculated, payments will be made over a fixed period which could
end before that person's death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3553GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
ENDORSEMENT
The contract is changed by adding a new provision as follows:
SUCCESSOR OWNER-STEP UP IN ACCOUNT VALUE. If a Participant's spouse becomes the
Successor Owner of the Participant's participation interest under the Contract,
the Account Value of the Participant's participation interest will be increased,
as of the date that would have been the Death Benefit Valuation Date, to equal
the amount of the Death Benefit which would have been payable if the
Participant's spouse had not become the Successor Owner of the Participant's
participation interest. If the Death Benefit which would have been payable is
equal to the Account Value as of the date that would have been the Death Benefit
Valuation Date, there will be no change in the Account Value of the Certificate.
If a Participant's Account Value is increased to equal the Purchase Payments
accumulated with interest at the rate of 3% per year, as described in the Death
Benefit Amount provision of this Contract, the Account Value as of the date of
the increase, plus any Purchase Payments received by us after that date, will
accumulate with interest at the rate of 3% per year for purposes of determining
the amount of the Death Benefit payable under that Certificate on the death of
the next owner to die.
For purposes of determining the date that would have been the Death Benefit
Valuation Date, the election to become Successor Owner will be deemed to be
instructions as to the form of death benefit. Therefore, the date that would
have been the Death Benefit Valuation Date will be the later of the date we
receive Due Proof of Death of the Participant, or the date we receive a
Successor Owner election, but never later than one year after the date of death
of the Participant.
If the Participant's spouse becomes the Successor Owner of the Participant's
participation interest, any Contingent Deferred Sales Charge which would
otherwise apply on surrender will be waived, except that if any additional
Purchase Payments are paid by the Successor Owner, Contingent Deferred Sales
Charges will apply as described in this Contract.
If the Account Value of a Certificate is stepped-up under this provision, the
Company will deposit the amount of the increase into the Fixed Accumulation
Account Option.
This is part of the contract. It is not a separate contract. It changes the
policy only as and to the extent stated. In all cases of conflict with the other
terms of the contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3554CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
ENDORSEMENT
The certificate is changed by adding a new provision as follows:
SUCCESSOR OWNER--STEP UP IN ACCOUNT VALUE. If your spouse becomes the Successor
Owner of your participation interest under the Contract, the Account Value of
your participation interest will be increased, as of the date that would have
been the Death Benefit Valuation Date, to equal the amount of the Death Benefit
which would have been payable if your spouse had not become the Successor Owner
of your participation interest. If the Death Benefit which would have been
payable is equal to the Account Value as of the date that would have been the
Death Benefit Valuation Date, there will be no change in the Account Value of
your Certificate. If the Account Value is increased to equal the Purchase
Payments accumulated with interest at the rate of 3% per year, as described in
the Death Benefit Amount provision of this Certificate, the Account Value as of
the date of the increase, plus any Purchase Payments received by us after that
date, will accumulate with interest at the rate of 3% per year for purposes of
determining the amount of the Death Benefit payable on the death of the next
owner to die.
For purposes of determining the date that would have been the Death Benefit
Valuation Date, the election to become Successor Owner will be deemed to be
instructions as to the form of death benefit. Therefore, the date that would
have been the Death Benefit Valuation Date will be the later of the date we
receive Due Proof of Death of the Participant, or the date we receive a
Successor Owner election, but never later than one year after the date of death
of the Participant.
If your spouse becomes the Successor Owner of your participation interest, any
Contingent Deferred Sales Charge which would otherwise apply on surrender will
be waived, except that if any additional Purchase Payments are paid by the
Successor Owner, Contingent Deferred Sales Charges will apply as described in
this Certificate.
If the Account Value of your Certificate is stepped-up under this provision, the
Company will deposit the amount of the increase into the Fixed Accumulation
Account Option.
This is part of the certificate. It is not a legal contract. It changes the
certificate only as and to the extent stated.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3443GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for an
Individual Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions that qualify for deferred tax treatment under
Internal Revenue Code ("IRC") Section 408(b). It is restricted as required
by federal tax law. We may change the terms of this annuity contract or
administer this annuity contract at any time as needed to comply with that
law. Any such change may be applied retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of the participants and their beneficiaries. A participant's
interest in this annuity contract is nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. A participant cannot assign, sell, or transfer
his or her interest in this annuity contract. A participant cannot pledge
it to secure a loan or the performance of an obligation, or for any other
purpose. The only exceptions to these rules are:
1) an interest in this annuity contract may be transferred to a spouse or
former spouse of a participant under a divorce or separation instrument
described in IRC Section 71(b)(2)(A); and
2) a participant may designate another person to receive payments with
the participant based on joint lives or joint life expectancies, but
any such designation shall not give that other person any present
rights under the annuity contract during the participant's lifetime.
CONTRIBUTIONS. This annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. An interest in this annuity contract will
not lapse if a participant does not make contributions. An interest in this
annuity contract will remain subject to cancellation under any involuntary
surrender or termination provision of this annuity contract; provided,
however, that in no event shall any such cancellation occur unless, at a
minimum, contributions have not been made for the participant for at least
two full years and the value of the participant's interest in this annuity
contract (increased by any guaranteed interest) would provide a benefit at
age 70-1/2 of less than $20 a month under the regular settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
<PAGE>
Total contributions made to this annuity contract for a participant with
respect to any one tax year may not exceed $2,000, excluding any payment
which is:
1) allowed as a rollover under IRC Section 402(c), 403(a)(4), 403(b)(8),
or 408(d)(3); or
2) made through a Simplified Employee Pension (SEP) program under IRC
Section 408(k).
This annuity contract will not accept contributions made by an employer
through a SIMPLE plan under IRC Section 408(p). This annuity contract will
not accept a transfer or rollover of any funds attributable to
contributions made for a participant by an employer through a SIMPLE plan
until at least 2-years after the date the participant first participated in
that employer's SIMPLE plan.
ANNUAL REPORT. Following the end of each calendar year, we will send each
participant a report concerning the status of his or her interest in this
annuity contract. This report will include (i) the amount of all regular
contributions received for the participant during or after the calendar
year which relate to such calendar year, (ii) the amount of all rollover
contributions received for the participant during such calendar year, (iii)
the contract value(s) of the participant's interest determined as of the
end of such calendar year, and (iv) such other information as may be
required under federal tax law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions of a participant's interest in this annuity contract is April
1 following the calendar year in which the participant reaches age 70-1/2.
No later than the Required Beginning Date:
1) the participant's entire interest in this annuity contract must be paid
in full; or
2) distributions of the participant's interest in this annuity contract
must begin in the form of periodic payments made at least annually (i)
for the participant's life or as joint and survivor payments to the
participant and one other individual, or (ii) over a period certain not
to exceed the participant's life expectancy or the joint and last
survivor expectancy of the participant and one other individual
designated to receive any remaining payments after the participant's
death, with payments which do not increase or increase only as provided
in Q&A F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax
Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of the participant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year in which the
participant reaches age 70-1/2 or in any earlier year in which payments
begin irrevocably, and any payment calculations for subsequent years shall
be based on such life expectancy reduced by one for each calendar year
which has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the participant dies after
the Required Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of the participant's interest in this
annuity contract must continue to be distributed at least as rapidly as
under the method of distribution being used prior to the participant's
death.
<PAGE>
If the participant dies before the Required Beginning Date and before
payments begin irrevocably, the participant's entire interest in this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the
participant's death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract to
receive payments after the participant's death with payments beginning
by December 31 of the first calendar year after the participant's
death.
However, if the participant's surviving spouse is the individual designated
to receive the participant's entire interest in this annuity contract, the
starting date for payments under clause 2) above may be delayed to a date
not later than December 31 of the calendar year in which the participant
would have reached age 70-1/2. Alternatively, the participant's interest in
this annuity contract will be treated as the IRA of such spouse if he or
she becomes Successor Owner of the participant's interest, makes a rollover
from the participant's interest, or fails to receive distributions from the
participant's interest otherwise required by this provision. No
contributions or rollover to the participant's interest in this annuity
contract may be made after the participant's death unless the participant's
spouse becomes Successor Owner. In any case, if a surviving spouse dies
before payments begin under this provision, then this provision shall apply
upon the death of the participant's spouse as if the spouse was the owner
of the participant's interest in this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after the participant's death, the life expectancy of the
participant's surviving spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the date payments are required to begin. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3444CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The Certificate of Participation under the annuity contract (your "Certificate")
is changed as set out below to add provisions for an Individual Retirement
Annuity.
APPLICABLE TAX LAW RESTRICTIONS. The annuity contract is intended to
receive contributions that qualify for deferred tax treatment under
Internal Revenue Code ("IRC") Section 408(b). It is restricted as required
by federal tax law. We may change the terms of the annuity contract and
your Certificate, or administer the annuity contract and your interest in
it, at any time as needed to comply with that law. Any such change may be
applied retroactively.
EXCLUSIVE BENEFIT. Your interest in the annuity contract is established for
the exclusive benefit of you and your beneficiaries. Your interest in the
annuity contract is nonforfeitable.
NON-PARTICIPATING. The annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in the annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) all or part of your interest in the annuity contract may be transferred
to a spouse or former spouse under a divorce or separation instrument
described in IRC Section 71(b)(2)(A); and
2) you may designate another person to receive payments with you based on
joint lives or joint life expectancies, but any such designation shall
not give that other person any present rights under the annuity
contract during your lifetime.
CONTRIBUTIONS. The annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. Your interest in the annuity contract will
not lapse if you do not make contributions. Your interest in the annuity
contract will remain subject to cancellation under any involuntary
surrender or termination provision of the annuity contract; provided,
however, that in no event shall any such cancellation occur unless, at a
minimum, contributions have not been made for you for at least two full
years and the value of your interest in the annuity contract (increased by
any guaranteed interest) would provide a benefit at age 70-1/2 of less than
$20 a month under the regular settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
<PAGE>
Total contributions made to the annuity contract for you with respect to
any one tax year may not exceed $2,000, excluding any payment which is:
1) allowed as a rollover under IRC Section 402(c), 403(a)(4), 403(b)(8),
or 408(d)(3); or
2) made through a Simplified Employee Pension (SEP) program under IRC
Section 408(k).
The annuity contract will not accept contributions made by an employer
through a SIMPLE plan under IRC Section 408(p). The annuity contract will
not accept a transfer or rollover of any funds attributable to
contributions made for you by an employer through a SIMPLE plan until at
least 2-years after the date you first participated in that employer's
SIMPLE plan.
ANNUAL REPORT. Following the end of each calendar year, we will send you a
report concerning the status of your interest in the annuity contract. This
report will include (i) the amount of all regular contributions received
for you during or after the calendar year which relate to such calendar
year, (ii) the amount of all rollover contributions received for you during
such calendar year, (iii) the contract value(s) of your interest determined
as of the end of such calendar year, and (iv) such other information as may
be required under federal tax law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions of your interest in the annuity contract is April 1 following
the calendar year in which you reach age 70-1/2. No later than the Required
Beginning Date:
1) your entire interest in the annuity contract must be paid in full; or
2) distributions of your interest in the annuity contract must begin in
the form of periodic payments made at least annually (i) for your life
or as joint and survivor payments to you and one other individual, or
(ii) over a period certain not to exceed your life expectancy or the
joint and last survivor expectancy of you and one other individual
designated to receive any remaining payments after your death, with
payments which do not increase or increase only as provided in Q&A F-3
of Section 1.401(a)(9)-1 of the Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of you and your spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the Required Beginning Date. The life expectancy of any
other individual may not be recalculated. Any life expectancy which is not
being recalculated shall be determined using the attained age of the
individual in the calendar year in which you reach age 70-1/2 or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year such life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of your interest in the annuity
contract must continue to be distributed at least as rapidly as under the
method of distribution being used prior to your death.
<PAGE>
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in the annuity contract must be paid
either:
1) in full by December 31 of the fifth calendar year after your death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under the annuity contract to
receive payments after your death with payments beginning by December
31 of the first calendar year after your death.
However, if your surviving spouse is the individual designated to receive
your entire interest in the annuity contract, the starting date for
payments under clause 2) above may be delayed to a date not later than
December 31 of the calendar year in which you would have reached age
70-1/2. Alternatively, your interest in the annuity contract will be
treated as the IRA of such spouse if he or she becomes Successor Owner of
your interest, makes a rollover from your interest, or fails to receive
distributions from your interest otherwise required by this provision. No
contributions or rollover to your interest in the annuity contract may be
made after your death unless your spouse becomes Successor Owner. In any
case, if a surviving spouse dies before payments begin under this
provision, then this provision shall apply upon the death of your spouse as
if your spouse was the owner of your interest in the annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after your death, the life expectancy of your surviving spouse
shall be recalculated annually unless periodic payments for a fixed period
begin irrevocably (subject to acceleration) by the date payments are
required to begin. The life expectancy of any other individual may not be
recalculated. Any life expectancy which is not being recalculated shall be
determined using the attained age of such individual in the calendar year
in which payments are required to begin or in any earlier year in which
payments begin irrevocably, and any payment calculations for subsequent
years shall be based on such life expectancy reduced by one for each
calendar year which has elapsed since the calendar year life expectancy was
first determined. Therefore, if a life expectancy is not recalculated,
payments will be made over a fixed period which could end before that
person's actual death.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3513GE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
SAVINGS INCENTIVE MATCH PLAN FOR EMPLOYEES
INDIVIDUAL RETIREMENT ANNUITY ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a SIMPLE
Individual Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to
receive contributions under a Savings Incentive Match Plan for Employees of
Small Employers ("SIMPLE IRA plan") that qualifies under Internal Revenue
Code ("IRC") Section 408(p). It is restricted as required by federal tax
law. We may change the terms of this annuity contract or administer this
annuity contract at any time as needed to comply with that law. Any such
change may be applied retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive
benefit of the participants and their beneficiaries. A participant's
interest in this annuity contract is nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. A Participant cannot assign, sell, or transfer
his or her interest in this annuity contract. A participant cannot pledge
it to secure a loan or the performance of an obligation, or for any other
purpose. The only exceptions to these rules are:
1) an interest in this annuity contract may be transferred to a spouse or
former spouse of a participant under a divorce or separation instrument
described in IRC Section 71(b)(2)(A); and
2) a participant may designate another person to receive payments with the
participant based on joint lives or joint life expectancies, but any
such designation shall not give that other person any present rights
under the annuity contract during the participant's lifetime.
CONTRIBUTIONS. This annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. An interest in this annuity contract will
not lapse if a participant does not make contributions. An interest in this
annuity contract will remain subject to cancellation under any involuntary
surrender or termination provision of this annuity contract; provided,
however, that in no event shall any such cancellation occur unless, at a
minimum, contributions for the participant have not been made for at least
two full years and the value of the participant's interest in this annuity
contract (increased by any guaranteed interest) would provide a benefit at
age 70-1/2 of less than $20 a month under the regular settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
<PAGE>
This annuity contract will only accept contributions made by an employer
under a SIMPLE IRA plan that meets the requirements of IRC Section 408(p),
and rollover contributions or transfers from another SIMPLE IRA owned by a
participant. No other contributions to this annuity contract will be
accepted.
ANNUAL REPORT. Following the end of each calendar year, we will send each
participant a report concerning the status of his or her interest in this
annuity contract. This report will include (i) the amount of all regular
contributions received for the participant during or after the calendar
year which relate to such calendar year, (ii) the amount of all rollover
contributions received for the participant during such calendar year, (iii)
the contract value(s) of the participant's interest determined as of the
end of such calendar year, and (iv) such other information as may be
required under federal tax law.
If contributions to this annuity contract are paid directly by the employer
under a SIMPLE IRA plan, we will provide the employer with the summary
description required by IRC Section 408(l)(2)(B).
DESIGNATED FINANCIAL INSTITUTION. If we are the designated financial
institution for the employer's SIMPLE IRA plan, as defined in IRC Section
408(p)(7), then a participant may direct that contributions paid on his or
her behalf be transferred to another qualified SIMPLE IRA without cost or
penalty, provided that the participant elects such a transfer either before
the beginning of the calendar year to which such contribution relates or
within the 60-day election period which includes the date the participant
first become eligible to participate in the SIMPLE IRA plan.
LIMITS ON ROLLOVERS AND TRANSFERS; ADDITIONAL TAXES. During the first two
years that a participant in this annuity contract participates in the
SIMPLE IRA plan of the employer, any rollover or transfer otherwise
permitted under this annuity contract must be made to another SIMPLE IRA
owned by the participant. If a participant is under age 59-1/2, any
distribution to the participant during this two-year period may be subject
to a twenty-five percent additional penalty tax if the participant does not
roll over the amount distributed into a SIMPLE IRA. After the end of this
two-year period, a rollover or transfer otherwise permitted under this
annuity contract may be made to any IRA owned by the participant that is
qualified under IRC Section 408(a), (b), or (p).
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions of a participant's interest in this annuity contract is April
1 following the calendar year in which the participant reaches age 70-1/2.
No later than the Required Beginning Date:
1) the participant's entire interest in this annuity contract must be paid
in full; or
2) distributions of the participant's interest in this annuity contract
must begin in the form of periodic payments made at least annually (i)
for the participant's life or as joint and survivor payments to the
participant and one other individual, or (ii) over a period certain not
to exceed the participant's life expectancy or the joint and last
survivor expectancy of the participant and one other individual
designated to receive any remaining payments after the participant's
death, with payments which do not increase or increase only as provided
in Q&A F-3 of Section 1.401(a)(9)-1 of the Proposed Income Tax
Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of the participant and his or her spouse shall be recalculated
annually unless periodic payments for a fixed period begin irrevocably
(subject to acceleration) by the Required Beginning Date. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of the individual in the calendar year in which the
participant reaches age 70-1/2 or in any earlier year in which payments
begin irrevocably, and any payment calculations for subsequent years shall
be based on such life expectancy reduced by one for each calendar year
which has elapsed since the calendar year such life expectancy was first
determined. Therefore, if a life expectancy is not recalculated, payments
will be made over a fixed period which could end before that person's
actual death.
<PAGE>
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the participant dies after
the Required Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of the participant's interest in this
annuity contract must continue to be distributed at least as rapidly as
under the method of distribution being used prior to the participant's
death.
If the participant dies before the Required Beginning Date and before
payments begin irrevocably, the participant's entire interest in this
annuity contract must be paid either:
1) in full by December 31 of the fifth calendar year after the
participant's death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under this annuity contract to
receive payments after the participant's death with payments beginning
by December 31 of the first calendar year after the participant's
death.
However, if the participant's surviving spouse is the individual designated
to receive the participant's entire interest in this annuity contract, the
starting date for payments under clause (2) above may be delayed to a date
not later than December 31 of the calendar year in which the participant
would have reached age 70-1/2. Alternatively, this annuity contract will be
treated as the IRA of such spouse if he or she becomes Successor Owner of
the participant's interest, makes a rollover from the participant's
interest, or fails to receive distributions from the participant's interest
otherwise required by this provision. No contributions or rollover to the
participant's interest in this annuity contract may be made after the
participant's death unless the participant's spouse becomes Successor
Owner. In any case, if a surviving spouse dies before payments begin under
this provision, then this provision shall apply upon the death of the
participant's spouse as if the spouse was the owner of the participant's
interest in this annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after the participant's death, the life expectancy of the
participant's surviving spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the date payments are required to begin. The life
expectancy of any other individual may not be recalculated. Any life
expectancy which is not being recalculated shall be determined using the
attained age of such individual in the calendar year in which payments are
required to begin or in any earlier year in which payments begin
irrevocably, and any payment calculations for subsequent years shall be
based on such life expectancy reduced by one for each calendar year which
has elapsed since the calendar year life expectancy was first determined.
Therefore, if a life expectancy is not recalculated, payments will be made
over a fixed period which could end before that person's actual death.
This is part of the annuity contract. It is not a separate contract. It changes
the annuity contract only as and to the extent stated. In all cases of conflict
with the other terms of the annuity contract, the provisions of this Endorsement
shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3514CE99
[GRAPHIC OMITTED]
A Stock Insurance Company
P.O. Box 21029, New York, New York 10129-1029
Administrative Office:
[P.O. Box 5423 Cincinnati, Ohio 45201-5423]
SAVINGS INCENTIVE MATCH PLAN FOR EMPLOYEES
INDIVIDUAL RETIREMENT ANNUITY ENDORSEMENT
The Certificate of Participation under the annuity contract (your "Certificate")
is changed as set out below to add provisions for a SIMPLE Individual Retirement
Annuity.
APPLICABLE TAX LAW RESTRICTIONS. The annuity contract is intended to
receive contributions under a Savings Incentive Match Plan for Employees of
Small Employers ("SIMPLE IRA plan") that qualifies under Internal Revenue
Code ("IRC") Section 408(p). It is restricted as required by federal tax
law. We may change the terms of the annuity contract and your Certificate,
or administer the annuity contract and your interest in it, at any time as
needed to comply with that law. Any such change may be applied
retroactively.
EXCLUSIVE BENEFIT. Your interest in the annuity contract is established for
the exclusive benefit of you and your beneficiaries. Your interest in the
annuity contract is nonforfeitable.
NON-PARTICIPATING. The annuity contract does not pay dividends or share in
our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your
interest in the annuity contract. You cannot pledge it to secure a loan or
the performance of an obligation, or for any other purpose. The only
exceptions to these rules are:
1) all or part of your interest in the annuity contract may be
transferred to a spouse or former spouse under a divorce or
separation instrument described in IRC Section 71(b)(2)(A); and
2) you may designate another person to receive payments with you
based on joint lives or joint life expectancies, but any such
designation shall not give that other person any present rights
under the annuity contract during your lifetime.
CONTRIBUTIONS. The annuity contract does not require fixed premiums,
purchase payments, or other contributions, but we may decline to accept any
contribution of less than $50. Your interest in the annuity contract will
not lapse if you do not make contributions. Your interest in the annuity
contract will remain subject to cancellation under any involuntary
surrender or termination provision of the annuity contract; provided,
however, that in no event shall any such cancellation occur unless, at a
minimum, contributions for you have not been made for at least two full
years and the value of your interest in the annuity contract (increased by
any guaranteed interest) would provide a benefit at age 70-1/2 of less than
$20 a month under the regular settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE
PAYABLE TO US.
The annuity contract will only accept contributions made by an employer
under a SIMPLE IRA plan that meets the requirements of IRC Section 408(p),
and rollover contributions or transfers from another SIMPLE IRA owned by
you. No other contributions to the annuity contract will be accepted.
<PAGE>
ANNUAL REPORT. Following the end of each calendar year, we will send you a
report concerning the status of your interest in the annuity contract. This
report will include (i) the amount of all regular contributions received
for you during or after the calendar year which relate to such calendar
year, (ii) the amount of all rollover contributions received for you during
such calendar year, (iii) the contract value(s) of your interest determined
as of the end of such calendar year, and (iv) such other information as may
be required under federal tax law.
If contributions to the annuity contract are paid directly by your employer
under a SIMPLE IRA plan, we will provide your employer with the summary
description required by IRC Section 408(l)(2)(B).
DESIGNATED FINANCIAL INSTITUTION. If we are the designated financial
institution for your employer's SIMPLE IRA plan, as defined in IRC Section
408(p)(7), then you may direct that contributions paid on your behalf be
transferred to another qualified SIMPLE IRA without cost or penalty,
provided that you elect such a transfer either before the beginning of the
calendar year to which such contribution relates or within the 60-day
election period which includes the date you first become eligible to
participate in the SIMPLE IRA plan.
LIMITS ON ROLLOVERS AND TRANSFERS; ADDITIONAL TAXES. During the first two
years that you participate in the SIMPLE IRA plan of your employer, any
rollover or transfer otherwise permitted under the annuity contract must be
made to another SIMPLE IRA owned by you. If you are under age 59-1/2, any
distribution to you during this two-year period may be subject to a
twenty-five percent additional penalty tax if you do not roll over the
amount distributed into a SIMPLE IRA. After the end of this two-year
period, a rollover or transfer otherwise permitted under the annuity
contract may be made to any IRA owned by you that is qualified under IRC
Section 408(a), (b), or (p).
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. The Required Beginning Date for
distributions of your interest in the annuity contract is April 1 following
the calendar year in which you reach age 70-1/2. No later than the Required
Beginning Date:
1) your entire interest in the annuity contract must be paid in full;
or
2) distributions of your interest in the annuity contract must begin
in the form of periodic payments made at least annually (i) for
your life or as joint and survivor payments to you and one other
individual, or (ii) over a period certain not to exceed your life
expectancy or the joint and last survivor expectancy of you and
one other individual designated to receive any remaining payments
after your death, with payments which do not increase or increase
only as provided in Q&A F-3 of Section 1.401(a)(9)-1 of the
Proposed Income Tax Regulations.
All distributions made hereunder shall be made in accordance with the
requirements of IRC Section 401(a)(9), including the incidental death
benefit requirements of IRC Section 401(a)(9)(G), and the regulations
thereunder, including the minimum distribution incidental benefit
requirements of Section 1.401(a)(9)-2 of the Proposed Income Tax
Regulations.
Life expectancies are computed using the expected return multiples in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations. The life
expectancies of you and your spouse shall be recalculated annually unless
periodic payments for a fixed period begin irrevocably (subject to
acceleration) by the Required Beginning Date. The life expectancy of any
other individual may not be recalculated. Any life expectancy which is not
being recalculated shall be determined using the attained age of the
individual in the calendar year in which you reach age 70-1/2 or in any
earlier year in which payments begin irrevocably, and any payment
calculations for subsequent years shall be based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year such life expectancy was first determined. Therefore, if a life
expectancy is not recalculated, payments will be made over a fixed period
which could end before that person's actual death.
<PAGE>
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after the Required
Beginning Date or after payments begin irrevocably (subject to
acceleration), the remaining portion of your interest in the annuity
contract must continue to be distributed at least as rapidly as under the
method of distribution being used prior to your death.
If you die before the Required Beginning Date and before payments begin
irrevocably, your entire interest in the annuity contract must be paid
either:
1) in full by December 31 of the fifth calendar year after your
death; or
2) over the life or over a period certain not greater than the life
expectancy of the individual designated under the annuity contract
to receive payments after your death with payments beginning by
December 31 of the first calendar year after your death.
3) However, if your surviving spouse is the individual designated to
receive your entire interest in the annuity contract, the starting
date for payments under clause (2) above may be delayed to a date
not later than December 31 of the calendar year in which you would
have reached age 70-1/2. Alternatively, the annuity contract will
be treated as the IRA of such spouse if he or she becomes
Successor Owner of your interest, makes a rollover from your
interest, or fails to receive distributions from your interest
otherwise required by this provision. No contributions or rollover
to your interest in the annuity contract may be made after your
death unless your spouse becomes Successor Owner. In any case, if
a surviving spouse dies before payments begin under this
provision, then this provision shall apply upon the death of your
spouse as if the spouse was the owner of your interest in the
annuity contract.
Life expectancy is computed using the expected return multiples in Tables V
and VI of Section 1.72-9 of the Income Tax Regulations. For distributions
beginning after your death, the life expectancy of your surviving spouse
shall be recalculated annually unless periodic payments for a fixed period
begin irrevocably (subject to acceleration) by the date payments are
required to begin. The life expectancy of any other individual may not be
recalculated. Any life expectancy which is not being recalculated shall be
determined using the attained age of such individual in the calendar year
in which payments are required to begin or in any earlier year in which
payments begin irrevocably, and any payment calculations for subsequent
years shall be based on such life expectancy reduced by one for each
calendar year which has elapsed since the calendar year life expectancy was
first determined. Therefore, if a life expectancy is not recalculated,
payments will be made over a fixed period which could end before that
person's actual death.
This is part of your Certificate. It is not a contract. It changes your
Certificate only as and to the extent stated. In all cases of conflict with the
other terms of your Certificate, the provisions of this Endorsement shall
control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3683E99
[GRAPHIC OMITTED]
ENDORSEMENT
The contract is changed by adding a new provision as follows:
SUCCESSOR OWNER--STEP UP IN ACCOUNT VALUE: If your spouse becomes the
Successor Owner of this Contract, the Account Value of the Contract will
be increased, as of the date that would have been the Death Benefit
Valuation Date, to equal the amount of the Death Benefit which would
have been payable if your spouse had not become the Successor Owner of
the Contract. If the Death Benefit which would have been payable is
equal to the Account Value as of the date that would have been the Death
Benefit Valuation Date, there will be no change in the Account Value of
the Contract. If the Account Value is increased to equal the Purchase
Payments accumulated with interest at the rate of 3% per year, as
described in the Death Benefit Amount provision of this Contract, the
Account Value as of the date of the increase, plus any Purchase Payments
received by us after that date, will accumulate with interest at the
rate of 3% per year for purposes of determining the amount of the Death
Benefit payable on the death of the next owner to die.
For purposes of determining the date that would have been the Death
Benefit Valuation Date, the election to become Successor Owner will be
deemed to be instructions as to the form of death benefit. Therefore,
the date that would have been the Death Benefit Valuation Date will be
the later of the date we receive Due Proof of Death of the owner, or the
date we receive a Successor Owner election, but never later than one
year after the date of death of the owner.
If your spouse becomes the Successor Owner of this Contract, any
Contingent Deferred Sales Charge which would otherwise apply on
surrender will be waived, except that if any additional Purchase
Payments are paid by the Successor Owner, Contingent Deferred Sales
Charges will apply as described in this Contract.
If the Account Value is stepped-up under this provision, the Company
will deposit the amount of the increase into the Fixed Accumulation
Account Option.
This is part of your contract. It is not a separate contract. It changes the
policy only as and to the extent stated. In all cases of conflict with the other
terms of the contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[GRAPHIC OMITTED][GRAPHIC OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
Senior Vice President & Assistant Treasurer Executive Vice President
<PAGE>
NY3334GMA99
<TABLE>
<CAPTION>
[GRAPHIC OMITTED][GRAPHIC OMITTED]
- ------------------------------------------------------------------------------------------------------------------------------------
APPLICATION FOR GROUP FLEXIBLE PREMIUM DEFERRED ANNUITY CONTRACT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
PROPOSED CONTRACT OWNER: Anytown Trucking Company
---------------------------------------------------------------------------------------
MAILING ADDRESS: C/O XYZ Street
-----------------------------------------------------------------------------------------------------
Anytown, USA 99999
-----------------------------------------------------------------------------------------------------
BILLING CONTACT: Ann Trustee, Trust Division
-----------------------------------------------------------------------------------------------------
Telephone Number ( 800 ) 555-1212 Fax Number ( 800 ) 555-1211
--------------------------------------- -------------------------------------------
Mail Billing Statement to (If other than above): Third Party Administrator (If Applicable):
Name: N/A Firm: N/A
------------------------------------------------------ -------------------------------------------------
Address: N/A Address: N/A
------------------------------------------------------ -------------------------------------------------
City, State Zip: N/A City, State Zip: N/A
------------------------------------------------- -------------------------------------------
Contact: N/A
-------------------------------------------------
Telephone Number: ( ) N/A
--------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
The Application is for investment in the following GALIC of NY Contract:_______________________________________________
- ------------------------------------------------------------------------------------------------------------------------------------
Plan Name: Plan Number
- ----------------- ----------------------------------------------------
Tax ID Number: 000-00-0000 Plan Year End: Month 06 Day 01
---------------------------------------------- ------------- ----------
Plan Type: 401(a) 401(k) ERISA403(b) NonERISA 403(b) 457 Other (Specify)
---------------
Plan Administrator/Trustee Ann Trustee, Trust Officer Telephone Number: ( 800 ) 555-1212
- --------------------------------- ------------------------------------ ----------------------- -------------------------------------
- --------------------------------- ------------------------------------ ----------------------- -------------------------------------
</TABLE>
Application is hereby made for a Group Flexible Premium Deferred Annuity
Contract. The Owner acknowledges that Great American Life Insurance Company of
New York will provide the investment vehicle for, but will not be responsible
for the administration of the plan. The Owner hereby agrees that the Contract
shall not take effect and be in force unless and until the first premium is
received by the Company. The Owner has read and understands this entire
application. The Owner has also received current copies of the prospectuses for
the Group Flexible Premium Deferred Annuity Contract which correspond to the
product selected in section 2 of this application.
IT IS FURTHER UNDERSTOOD THAT PAYMENTS AND VALUES PROVIDED UNDER EACH
CERTIFICATE, WHEN BASED ON THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT,
ARE VARIABLE AND ARE NOT GUARANTEED AS TO DOLLAR AMOUNT.
The information provided herein is true, correct, and complete to the best of my
knowledge and belief.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Signed at: Anytown, USA , this 1st day of April ,in the year 98
-------------------------------------------- ------------------ ------------------------- ---------
City, State Day Month Year
Signature for Owner: Anytown Trucking Company Title: Ann Trustee
------------------------------------------------------ -----------------------------------------
Signature of Company Representative:
----------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
AP aiapp
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED][GRAPHIC OMITTED]
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Application for a Tax Qualified or Nonqualified variable annuity. Initial payment or the original of our Transfer/Rollover/Exchange
Request form must accompany this application, if applicable. Please make check payable to GREAT AMERICAN LIFE INSURANCE COMPANY OF
NEW YORK and mail to [P.O. BOX 5423, CINCINNATI, OH 45201-5423].
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
OWNER/PARTICIPANT Allocate my Purchase Payment(s) as indicated below.
Allocations must be in whole percentages and must total 100%.
Name: John Doe
------------------------------------------------------------
Rollover/
Address: 123 Any Street Single Flexible PORTFOLIOS
----------------------------------------------------------
Premium Premium
City, State, Anytown, USA 99999 (%) (%)
Zip:
---------------------------------------------------
[The Dreyfus Corporation]
Daytime Phone #: (513) 555-1000 [Small Cap Portfolio-VIF]
------------------------------------------------ -----------------------
25 [Capital Appreciation Portfolio-VIF]
-----------------------
Evening Phone #: (513) 555-2000 [The Socially Responsible Growth
------------------------------------------------- -----------------------Fund]
[Dreyfus Stock Index Fund]
-----------------------
Date of Birth: 07/13/43 X Male Female [Growth and Income Portfolio-VIF]
-------------------------- -----------------------
[Money Market Portfolio-VIF]
-----------------------
Social Security #: 111-11-1111 [INVESCO]
-------------------------------------------------
[Equity Income Fund-VIF]
-----------------------
JOINT OWNER (If Applicable) 25 [Total Return Portfolio-VIF]
----------
-------------
Name: Jane Doe [High Yield Portfolio-VIF]
------------------------------------------------------------ -----------------------
[Janus Capital Corporation (Aspen
Series)]
Date of 04/29/45 Male Female [International Growth Portfolio]
Birth:
-------------------------- -----------------------
25 [Worldwide Growth Portfolio]
----------
-------------
Social Security ###-##-#### [Aggressive Growth Portfolio]
#:
------------------------------------------------- -----------------------
[Growth Portfolio]
-----------------------
Relationship to Owner: Wife [Balanced Portfolio]
------------------------------------------- -----------------------
[Morgan Stanley Universal Funds Inc.]
ANNUITANT (If Other than Owner) [Emerging Markets Equity Portfolio]
-----------------------
Name: N/A [Mid-Cap Value Portfolio]
------------------------------------------------------------ -----------------------
[Value Portfolio]
-----------------------
Date of Male Female [U.S. Real Estate Portfolio]
Birth:
-------------------------- -----------------------
[Fixed Income Portfolio]
-----------------------
Social Security [PBHG Insurance Series Fund, Inc.]
#:
-------------------------------------------------
25 [Technology & Communications
----------------------- Portfolio]
[Growth II Portfolio]
-----------------------
[Large-Cap Growth Portfolio]
-----------------------
PRIMARY [Strong Capital Management, Inc.]
Name: Jim Doe [Strong Growth Fund II]
----------------------------------------------------------- -----------------------
[Strong Opportunity Fund II, Inc.]
-----------------------
Relationship to Owner: Child [Timothy Partners, Ltd.]
------------------------------------------
[The Timothy Plan (VS)]
-----------------------
Name: Sally Doe [Fixed Account Options]
-----------------------------------------------------------
[Fixed Accumulation Account]
-----------------------
Relationship to Owner: Child N/A [Fixed Option 1-Year Guarantee]
------------------------------------------ -----------------------
N/A [Fixed Option 3-Year Guarantee]
-----------------------
CONTINGENT N/A [Fixed Option 5-Year Guarantee]
-----------------------
Name: N/A N/A [Fixed Option 7-Year Guarantee]
----------------------------------------------------------- -----------------------
Relationship to Owner: 100% 100% TOTAL
------------------------------------------ -----------------------
Enclose a signed letter of instruction if further designations
are needed.
--------------------------------------------------------------------- ------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Tax Qualification
IRA Tax Year TSA/403 (b) 457
---------------------
IRA Transfer IRA Rollover 401
Nonqualified OR SEP IRA Tax Year Other
---------------------- ---------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Single Premium: $ 50,000
------------------- ------------------------------------------
Amount
Salary Reduction/Flexible Premiums: Check here and enclose a voided check, if you would like to have payments
-----------------------------------------
electronically transferred from your checking account.
$ $
-------------------- ------------------------------------------ ------------------------ ----------------------------
First Payment Date Periodic Payment Amount Frequency Projected Annual Premium
Name of Employer (Salary Reduction Plan Only)
----------------------------------------------------------------------------
Replacement: Will the proposed contract replace any existing annuity or life insurance contract or certificate? Yes X No
-------------------
Please include all state specific Replacement forms with this application.
- ----- --------------- --------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
The Application is for investment in the following AILIC Contract: Commodore Navigator
---------------------------------
7) REMARKS
- ------------------------------------------------------------------------------------------------------------------------------------
Owner's Statement:
-----------------------
I agree that the information provided is true and complete to the best of my knowledge. I have read and understand each of the
statements and answers on this form. The contract I have applied for is suitable for my investment objectives and financial
situation. I also understand that the Annuity Commencement Date will be the Contract (or Certificate) Anniversary following the 85th
birthday of the oldest owner or five years after the Contract (or Certificate) Effective Date, whichever is later, but in no event
will it be later than your 90th birthday. I HAVE RECEIVED A CURRENT COPY OF THE PROSPECTUS FOR GREAT AMERICAN OF NEW YORK SEPARATE
ACCOUNT I. I UNDERSTAND THAT ANNUITY PAYMENTS OR SURRENDER VALUES, WHEN BASED UPON THE INVESTMENT EXPERIENCE OF THE SEPARATE
ACCOUNT, ARE VARIABLE AND NOT GUARANTEED AS TO DOLLAR AMOUNT. I UNDERSTAND THAT THIS APPLICATION WILL BE ATTACHED TO AND BECOME A
PART OF THE CONTRACT.
Please initial here if you wish to give the Registered Representative identified below authorization to make transfers,
____________ on your behalf and at your direction, on this contract.
SIGNED AT: Anytown, USA this 17 day of March in the year 1998.
-------------------------------------- --------------- -------------------- -------------
City State Day Month Year
John Doe Jane Doe
---------------------------------------------------------------- ---------------------------------------------------------
Signature of Owner/Participant Signature of Joint Owner (If Applicable)
Agent's Statement:
------------------------------
To the best of my knowledge and belief, the annuity applied for [is] [is no] intended to replace insurance or an annuity on the
proposed Owner/Participant with this or any other company. I also certify that an appropriate exclusion allowance was calculated (if
applicable) for the named Owner/Participant, in accordance with current tax laws and regulations.
Dummy Agent Dummy
Agent 03/17/98
---------------------------------------------------------------------------------------------------------------------------------
Agent Signature Agent Name Printed Date
XYZ
Brokerage 12345
---------------------------------------------------------------------------------------------------------------------------------
Name of Broker/Dealer Firm Brokerage Account Number
00000
000-000-0000 54321
---------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------
Agent Number Agent Phone Number Agent State License ID
For Agent Use Only
-------------------------
NT T1 T2 T3 T4 (Default: T1)
- --------------------------------------------- ----------------------------------------------------------------- --------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL GUARANTEE OPTION
(Minimum payment of $5,000)
__________Initial here to enroll in the Principal Guarantee Option. This authorizes the Company to allocate a portion of the initial
Purchase Payment to the Fixed 7-Year Guarantee option such that, at the end of the 7-Year Guarantee period, the amount allocated
will grow to an amount equal to at least the initial Purchase Payment. The remaining balance will be allocated per your instructions
on your application.
- ------------------------------------------------------------------------------------------------------------------------------------
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<S> <C> <C>
INTEREST SWEEP
(Minimum account value required for each Fixed Account selected for Interest Sweep is $5,000.)
______________Initial here to activate Interest Sweep. Interest Sweep transfers will take place on the last valuation date of each
calendar quarter, from the following fixed accounts:
[Fixed Accumulation Option] [1-Year Guarantee Option] [3-Year Guarantee Option]
[5-Year Guarantee Option] [7-Year Guarantee Option]
Interest Sweep transfers are to be allocated among portfolio sub-accounts, as indicated in the Allocation Instructions on page 4 of
this application. NOTE: Interest Sweep is not permitted into a sub-account from which Dollar Cost Averaging transfers are currently
taking place, nor from a Fixed Accumulation Option from which Dollar Cost Averaging transfers are currently taking place.
- ------------------------------------------------------------------------------------------------------------------------------------
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DOLLAR COST AVERAGING
(Minimum account value required to activate Dollar Cost Averaging is $10,000.)
______________ Initial here to activate Dollar Cost Averaging. Please transfer $_________________ (minimum $500) on the last
valuation date of each calendar month quarter, as indicated in the Allocation Instructions on page 4 of this application. If no
selection is made, transfers will occur on a quarterly basis. Dollar Cost Averaging will remain in effect until the selected source
sub-account is depleted, or until canceled. Automatic transfers are only available from either the Money Market or Fixed
Accumulation Account, but not from both concurrently.
Source Account:
[Fixed Accumulation Account] [Dreyfus Money Market Portfolio-VIF]
Destination Sub-Accounts:
Please allocate the amount transferred to the sub-account(s) as listed on page 4. Allocations must be in whole percentages and must
equal 100%. Dollar Cost Averaging is not available for clients currently enrolled in Portfolio Rebalancing.
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PORTFOLIO REBALANCING
(Minimum account value required to activate Portfolio Rebalancing is $10,000.)
______________Initial here to activate Portfolio Rebalancing. If this service option is selected, the Owner/Participant's Account
Value (excluding amounts in all the Fixed Accounts) will be automatically rebalanced to maintain the allocation percentage levels in
the variable portfolios, as indicated in the Allocation Instructions on page 4 of this application. Portfolio Rebalancing will occur
on the last valuation date of each calendar quarter. If Portfolio Rebalancing is selected, the total value of all sub-accounts will
be included in the rebalancing process. Portfolio Rebalancing is not available for clients currently enrolled in Dollar Cost
Averaging.
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CONSENT TO DELIVERY IN ELECTRONIC MEDIA
______________By initialing here, the applicant acknowledges receipt of the applicable Commodore annuity prospectus in electronic
format and consents to the delivery of any prospectus, supplement thereto, statement of additional information or any other
information required to be furnished to contract holders in electronic format, where available. Great American Life Insurance
Company of New York is not required to make all such documents available in electronic format, and may provide any document or
supplement to a document in paper format. Electronically formatted documents will be provided on diskette and mailed to your address
of record via U.S. Mail. System requirements for electronic documents are 386, 486 or Pentium Class PC with Windows 3.1 or higher
and Windows Compatible Web Browser Software. You may revoke your consent to deliver in electronic media at any time, or receive a
paper copy of any document delivered in electronic format, by contacting Great American Life Insurance Company of New York.
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</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
- ------------------------------------------------ ----------------------------- ------------------------------ ---------------------
PORTFOLIOS PORTFOLIO DOLLAR COST INTEREST
REBALANCING AVERAGING SWEEP
ALLOCATION % ALLOCATION % ALLOCATION %
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[The Dreyfus Corporation]
[Small Cap Portfolio-VIF]
------------------------------------------------ ----------------------------- ----------------------------- ---------------------
[Capital Appreciation Portfolio-VIF]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[The Socially Responsible Growth Fund, Inc.]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Dreyfus Stock Index Fund]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Growth and Income Portfolio-VIF]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Money Market Portfolio-VIF]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[INVESCO]
[Industrial Income Portfolio-VIF]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Total Return Portfolio-VIF]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[High Yield Portfolio-VIF]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Janus Capital Corporation (Aspen Series)]
[International Growth Portfolio]
------------------------------------------------ ------------------------------ ----------------------------- ---------------------
[Worldwide Growth Portfolio]
------------------------------------------------ ------------------------------ ----------------------------- ---------------------
[Aggressive Growth Portfolio]
------------------------------------------------ ------------------------------ ----------------------------- ---------------------
[Growth Portfolio]
------------------------------------------------ ------------------------------ ----------------------------- ---------------------
[Balanced Portfolio]
------------------------------------------------ ----------------------------- ----------------------------- ---------------------
[Morgan Stanley Universal Funds Inc.]
[Emerging Markets Equity Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Mid-Cap Value Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Value Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[U.S. Real Estate Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Fixed Income Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[PBHG Insurance Series Fund, Inc.]
[Technology & Communications Portfolio]
------------------------------------------------ ----------------------------- ----------------------------- ----------------------
[Growth II Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Large-Cap Growth Portfolio]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Strong Capital Management, Inc.]
[Strong Growth Fund II]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Strong Opportunity Fund II, Inc.]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
[Timothy Partners, Ltd.]
[The Timothy Plan (VS)]
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
TOTAL 100% 100% 100%
------------------------------------------------ ----------------------------- ------------------------------ ---------------------
By signing my name to this form I hereby authorize Great American Life Insurance Company of New York to make the elections as
indicated on this form. I have read this entire form and agree to hold harmless and indemnify Annuity Investors Life Insurance
Company as to any and all claims or demands which may be made by reason of the elections so made. You may change your current
instructions or elect to discontinue your participation in these programs by calling the Great American Life Insurance Company of
New York Variable Annuity Service Center at [1-800-789-6771].
John Doe 03/17/98 Jane Doe 03/17/98
-------------------------------------------------- --------------- -------------------------------------------- ---------
Signature of Owner/Participant Date Signature of Joint Owner (If Applicable) Date
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</TABLE>
DREYFUS
FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the ___ day of August, 1999, between Great
American Life Insurance Company of New York ("Insurance Company"), a life
insurance company organized under the laws of the State of New York, DREYFUS
VARIABLE INVESTMENT FUND, an unincorporated business trust organized under the
laws of the Commonwealth of Massachusetts, DREYFUS LIFE AND ANNUITY INDEX FUND,
INC. (d/b/a Dreyfus Stock Index Fund), a corporation organized under the laws of
the State of Maryland, and THE DREYFUS SOCIALLY RESPONSIBLE GROWTH FUND, INC. a
corporation organized under the laws of the State of Maryland (each a "Fund" and
collectively the "Fund").
ARTICLE I
DEFINITIONS
1.1 "Act" shall mean the Investment Company Act of 1940, as amended.
1.2 "Board" shall mean the Board of Trustees of the Fund having the
responsibility for management and control of the Fund.
1.3 "Business Day" shall mean any day for which the Fund calculates net
asset value per share as described in the Fund's Prospectus.
1.4 "Commission" shall mean the Securities and Exchange Commission.
1.5 "Contract" shall mean a variable annuity contract that uses the Fund as
an underlying investment medium. Individuals who participate under a
group Contract are "Participants".
1.6 "Contractholder" shall mean any entity that is a party to a Contract
with a Participating Company.
1.7 "Disinterested Board Members" shall mean those members of the Board
that are not deemed to be "interested persons" of the Fund, as defined
by the Act.
1.8 "Dreyfus" shall mean The Dreyfus Corporation and its affiliates,
including Dreyfus Service Corporation.
1.9 "Participating Companies" shall mean any insurance company (including
Insurance Company), which offers variable annuity and/or variable life
insurance contracts to the public and which has entered into an
agreement with the Fund for the purpose of making Fund shares available
to serve as an underlying investment medium for the aforesaid
Contracts.
1.10 "Prospectus" shall mean the Fund's current prospectus and statement of
additional information, as most recently filed with the Commission.
1.11 "Separate Account" shall mean GALIC of New York Separate Account I, a
separate account established by Insurance Company in accordance with
the laws of the State of New York.
1.12 "Software Program" shall mean the software program used by the Fund for
providing Fund and account balance information including net asset
value per share. Such Program may include the Lion System. In
situations where the Lion System or any other Software Program used by
the Fund is not available, such information may be provided by
telephone and confirmed by facsimiles. The Lion System shall be
provided to Insurance Company at no charge.
ARTICLE II
REPRESENTATIONS
2.1 Insurance Company represents and warrants that (a) it is an insurance
company duly organized and in good standing under applicable law; (b)
it has legally and validly established the Separate Account pursuant to
the laws of the State of New York for the purpose of offering to the
public certain individual and group variable annuity contracts; (c) it
has registered or will register the Separate Account as a unit
investment trust under the Act to serve as the segregated investment
account for the Contracts; and (d) each Separate Account is eligible to
invest in shares of the Fund without such investment disqualifying the
Fund as an investment medium for insurance company separate accounts
supporting variable annuity contracts or variable life insurance
contracts.
2.2 Insurance Company represents and warrants that (a) the Contracts will
be described in a registration statement filed under the Securities Act
of 1933, as amended ("1933 Act"); (b) the Contracts will be issued and
sold in compliance in all material respects with all applicable federal
and state laws; and (c) the sale of the Contracts shall comply in all
material respects with state insurance law requirements. Insurance
Company agrees to inform the Fund promptly of any investment
restrictions imposed by state insurance law and applicable to the Fund.
2.3 Insurance Company represents and warrants that the income, gains and
losses, whether or not realized, from assets allocated to the Separate
Account are, in accordance with the applicable Contracts, to be
credited to or charged against such Separate Account without regard to
other income, gains or losses from assets allocated to any other
accounts of Insurance Company. Insurance Company represents and
warrants that the assets of the Separate Account are and will be kept
separate from Insurance Company's General Account and any other
separate accounts Insurance Company may have, and will not be charged
with liabilities from any business that Insurance Company may conduct
or the liabilities of any companies affiliated with Insurance Company.
2.4 Fund represents that the Fund is registered with the Commission under
the Act as an open-end, diversified management investment company and
possesses, and shall maintain, all legal and regulatory licenses,
approvals, consents and/or exemptions required for Fund to operate and
offer its shares as an underlying investment medium for Participating
Companies. The Fund has established eight series of shares (each, a
"Series") and may in the future establish other series of shares.
2.5 Fund represents that it is currently qualified as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"), and that it will make every effort to
maintain such qualification (under Subchapter M or any successor or
similar provision) and that it will notify Insurance Company
immediately upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
2.6 Insurance Company represents and agrees that the Contracts are
currently, and at the time of issuance will be, treated as life
insurance policies or annuity contracts, whichever is appropriate,
under applicable provisions of the Code, and that it will make every
effort to maintain such treatment and that it will notify the Fund and
Dreyfus immediately upon having a reasonable basis for believing that
the Contracts have ceased to be so treated or that they might not be so
treated in the future. Insurance Company agrees that any prospectus
offering a Contract that is a "modified endowment contract," as that
term is defined in Section 7702A of the Code, will identify such
Contract as a modified endowment contract (or policy).
2.7 Fund agrees that the Fund's assets shall be managed and invested in a
manner that complies with the requirements of Section 817(h) of the
Code.
2.8 Insurance Company agrees that the Fund shall be permitted (subject to
the other terms of this Agreement) to make Series' shares available to
other Participating Companies and contractholders.
2.9 Fund represents and warrants that any of its trustees, officers,
employees, investment advisers, and other individuals/entities who deal
with the money and/or securities of the Fund are and shall continue to
be at all times covered by a blanket fidelity bond or similar coverage
for the benefit of the Fund in an amount not less than that required by
Rule 17g-1 under the Act. The aforesaid Bond shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding
company.
2.10 Insurance Company represents and warrants that all of its employees and
agents who deal with the money and/or securities of the Fund are and
shall continue to be at all times covered by a blanket fidelity bond or
similar coverage in an amount not less than the coverage required to be
maintained by the Fund. The aforesaid Bond shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding
company.
2.11 Insurance Company agrees that Dreyfus shall be deemed a third party
beneficiary under this Agreement and may enforce any and all rights
conferred by virtue of this Agreement.
ARTICLE III
FUND SHARES
3.1 The Contracts funded through the Separate Account will provide for the
investment of certain amounts in
the Series' shares.
3.2 Fund agrees to make the shares of its Series available for purchase at
the then applicable net asset value per share by the Separate Account
on each Business Day pursuant to rules of the Commission.
Notwithstanding the foregoing, the Fund may refuse to sell the shares
of any Series to any person, or suspend or terminate the offering of
the shares of any Series if such action is required by law or by
regulatory authorities having jurisdiction or is, in the sole
discretion of the Board, acting in good faith and in light of its
fiduciary duties under federal and any applicable state laws, necessary
and in the best interests of the shareholders of such Series.
3.3 Fund agrees that shares of the Fund will be sold only to Participating
Companies and their separate accounts and to the general accounts of
those Participating Companies and their affiliates. No shares of any
Series will be sold to the general public.
3.4 Fund shall use its best efforts to provide closing net asset value,
dividend and capital gain (loss) information for each Series available
on a per-share and Series basis to Insurance Company by 6:00 p.m.
Eastern Time on each Business Day. Any material errors in the
calculation of net asset value, dividend and capital gain (loss)
information shall be reported immediately upon discovery to Insurance
Company. Non-material errors will be corrected in the next Business
Day's net asset value per share for the Series in question.
3.5 At the end of each Business Day, Insurance Company will use the
information described in Sections 3.2 and 3.4 to calculate the Separate
Account unit values for the day. Using this unit value, Insurance
Company will process the day's Separate Account transactions received
by it by the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m. Eastern time) to determine the net dollar
amount of Series shares which will be purchased or redeemed at that
day's closing net asset value per share for such Series. The net
purchase or redemption orders will be transmitted to the Fund by
Insurance Company by 11:00 a.m. Eastern Time on the Business Day next
following Insurance Company's receipt of that information.
3.6 Fund appoints Insurance Company as its agent for the limited purpose of
accepting orders for the purchase and redemption of shares of each
Series for the Separate Account. Fund will execute orders for any
Series at the applicable net asset value per share determined as of the
close of trading on the day of receipt of such orders by Insurance
Company acting as agent ("effective trade date"), provided that the
Fund receives notice of such orders by 11:00 a.m. Eastern Time on the
next following Business Day and, if such orders request the purchase of
Series shares, the conditions specified in Section 3.8, as applicable,
are satisfied. A redemption or purchase request for any Series that
does not satisfy the conditions specified in this Section and in
Section 3.8, as applicable, will be effected at the net asset value
computed for such Series on the Business Day immediately preceding the
Business Day upon which such conditions have been satisfied in
accordance with the requirements of this Section and Section 3.8.
3.7 Insurance Company will use its best efforts to notify Fund in advance
of any unusually large purchase or redemption orders.
3.8 If Insurance Company's order requests the purchase of Series shares,
Insurance Company will pay for such purchases by wiring Federal Funds
to Fund or its designated custodial account on the day the order is
transmitted. Insurance Company shall make all reasonable efforts to
transmit to the Fund payment in Federal Funds by 12:00 noon Eastern
Time on the Business Day the Fund receives the notice of the order
pursuant to Section 3.5. Fund will execute such orders at the
applicable net asset value per share determined as of the close of
trading on the effective trade date if Fund receives payment in Federal
Funds by 12:00 midnight Eastern Time on the Business Day the Fund
receives the notice of the order pursuant to Section 3.5. If payment in
Federal Funds for any purchase is not received or is received by the
Fund after 12:00 noon Eastern Time on such Business Day, Insurance
Company shall promptly upon the Fund's request, reimburse the Fund for
any charges, costs, fees, interest or other expenses incurred by the
Fund in connection with any advances to, or borrowings or overdrafts
by, the Fund, or any similar expenses incurred by the Fund, as a result
of portfolio transactions effected by the Fund based upon such purchase
request. Payment for Series shares redeemed by the Separate Account or
the Insurance Company shall be made in Federal Funds transmitted by
wire to the Insurance Company or any other designated person on the
next Business Day after the Fund is properly notified of the redemption
order of Series shares (unless redemption proceeds are to be applied to
the purchase of Fund shares of other Series), except that the Fund
reserves the right to delay payment of redemption proceeds to the
extent permitted under Section 22(e) of the 1940 Act. The Fund shall
not bear any responsibility whatsoever for the proper disbursement or
crediting of redemption proceeds by the Insurance Company; the
Insurance Company alone shall be responsible for such action.
3.9 Fund has the obligation to ensure that Series shares are registered
with applicable federal agencies at all times.
3.10 Fund will confirm each purchase or redemption order made by Insurance
Company. Transfer of Series shares will be by book entry only. No share
certificates will be issued to Insurance Company. Insurance Company
will record shares ordered from Fund in an appropriate title for the
corresponding account.
3.11 Fund shall credit Insurance Company with the appropriate number of
shares.
3.12 On each ex-dividend date of the Fund or, if not a Business Day, on the
first Business Day thereafter, Fund shall communicate to Insurance
Company the amount of dividend and capital gain, if any, per share of
each Series. All dividends and capital gains of any Series shall be
automatically reinvested in additional shares of the relevant Series at
the applicable net asset value per share of such Series on the payable
date. Fund shall, on the day after the payable date or, if not a
Business Day, on the first Business Day thereafter, notify Insurance
Company of the number of shares so issued.
3.13 This Agreement does not cover the sale of any Fund shares to the
Insurance Company general account.
ARTICLE IV
STATEMENTS AND REPORTS
4.1 Fund shall provide monthly statements of account as of the end of each
month for all of Insurance Company's accounts by the fifteenth (15th)
Business Day of the following month.
4.2 Fund shall distribute to Insurance Company copies of the Fund's
Prospectuses, proxy materials, notices, periodic reports and other
printed materials (which the Fund customarily provides to its
shareholders) in quantities as Insurance Company may reasonably request
for distribution to each Contractholder and Participant.
4.3 Fund will provide to Insurance Company at least one complete copy of
all registration statements, Prospectuses, reports, proxy statements,
sales literature and other promotional materials, applications for
exemptions, requests for no-action letters, and all amendments to any
of the above, that relate to the Fund or its shares, contemporaneously
with the filing of such document with the Commission or other
regulatory authorities.
4.4 Insurance Company will provide to the Fund at least one copy of all
registration statements, Prospectuses, reports, proxy statements, sales
literature and other promotional materials, applications for
exemptions, requests for no-action letters, and all amendments to any
of the above, that relate to the Contracts or the Separate Account,
contemporaneously with the filing of such document with the Commission.
ARTICLE V
EXPENSES
5.1 The charge to the Fund for all expenses and costs of the Series,
including but not limited to management fees, administrative expenses
and legal and regulatory costs, will be made in the determination of
the relevant Series' daily net asset value per share so as to
accumulate to an annual charge at the rate set forth in the Fund's
Prospectus. Excluded from the expense limitation described herein shall
be brokerage commissions and transaction fees and extraordinary
expenses.
5.2 Except as provided in this Article V and, in particular in the next
sentence, Insurance Company shall not be required to pay directly any
expenses of the Fund or expenses relating to the distribution of its
shares. Insurance Company shall pay the following expenses or costs:
a. Such amount of the production expenses of any Fund materials,
including the cost of printing the Fund's Prospectus, or
marketing materials for prospective Insurance Company
Contractholders and Participants as Dreyfus and Insurance
Company shall agree from time to time.
b. Distribution expenses of any Fund materials or marketing
materials for prospective Insurance Company Contractholders
and Participants.
c. Distribution expenses of Fund materials or marketing materials
for Insurance Company Contractholders and Participants.
Except as provided herein, all other Fund expenses shall not be borne
by Insurance Company.
ARTICLE VI
EXEMPTIVE RELIEF
6.1 Insurance Company has reviewed a copy of the order dated December 23,
1987 of the Securities and Exchange Commission under Section 6(c) of
the Act and, in particular, has reviewed the conditions to the relief
set forth in the related Notice. As set forth therein, Insurance
Company agrees to report any potential or existing conflicts promptly
to the Board, and in particular whenever contract voting instructions
are disregarded, and recognizes that it will be responsible for
assisting the Board in carrying out its responsibilities under such
application. Insurance Company agrees to carry out such
responsibilities with a view to the interests of existing
Contractholders.
6.2 If a majority of the Board, or a majority of Disinterested Board
Members, determines that a material irreconcilable conflict exists with
regard to Contractholder investments in the Fund, the Board shall give
prompt notice to all Participating Companies. If the Board determines
that Insurance Company is responsible for causing or creating said
conflict, Insurance Company shall at its sole cost and expense, and to
the extent reasonably practicable (as determined by a majority of the
Disinterested Board Members), take such action as is necessary to
remedy or eliminate the irreconcilable material conflict.
Such necessary action may include, but shall not be limited to:
a. Withdrawing the assets allocable to the Separate Account from
the Series and reinvesting such assets in a different
investment medium, or submitting the question of whether such
segregation should be implemented to a vote or all affected
Contractholders; and/or
b. Establishing a new registered management investment company.
6.3 If a material irreconcilable conflict arises as a result of a decision
by Insurance Company to disregard Contractholder voting instructions
and said decision represents a minority position or would preclude a
majority vote by all Contractholders having an interest in the Fund,
Insurance Company may be required, at the Board's election, to withdraw
the Separate Account's investment in the Fund.
6.4 For the purpose of this Article, a majority of the Disinterested Board
Members shall determine whether or not any proposed action adequately
remedies any irreconcilable material conflict, but in no event will the
Fund be required to bear the expense of establishing a new funding
medium for any Contract. Insurance Company shall not be required by
this Article to establish a new funding medium for any Contract if an
offer to do so has been declined by vote of a majority of the
Contractholders materially adversely affected by the irreconcilable
material conflict.
6.5 No action by Insurance Company taken or omitted, and no action by the
Separate Account or the Fund taken or omitted as a result of any act or
failure to act by Insurance Company pursuant to this Article VI shall
relieve Insurance Company of its obligations under, or otherwise affect
the operation of, Article V.
ARTICLE VII
VOTING OF FUND SHARES
7.1 Fund shall provide Insurance Company with copies at no cost to
Insurance Company, of the Fund's proxy material, annual and semi-annual
reports to shareholders and other communications to shareholders in
such quantity as Insurance Company shall reasonably require for
distributing to Contractholders or Participants.
Insurance Company shall:
a. solicit voting instructions from Contractholders or
Participants on a timely basis and in accordance with
applicable law;
b. vote the Series shares in accordance with instructions
received from Contractholders or Participants; and
c. vote Series shares for which no instructions have been
received in the same proportion as Series shares for which
instructions have been received.
Insurance Company agrees to be responsible for assuring that voting
Fund shares for the Separate Account is conducted in a manner
consistent with other Participating Companies.
7.2 Insurance Company agrees that it shall not, without the prior written
consent of the Fund and Dreyfus, solicit, induce or encourage
Contractholders to (a) change or supplement the Fund's current
investment adviser or (b) change, modify, substitute, add to or delete
the Fund from the current investment media for the Contracts.
ARTICLE VIII
MARKETING AND REPRESENTATIONS
8.1 The Fund or its underwriter shall periodically furnish Insurance
Company with the following documents, in quantities as Insurance
Company may reasonably request:
a. Current Prospectus and any supplements thereto;
b. other marketing materials.
Expenses for the production of such documents shall be borne by
Insurance Company in accordance with Section 5.2 of this Agreement.
8.2 Insurance Company shall designate certain persons or entities which
shall have the requisite licenses to solicit applications for the sale
of Contracts. No representation is made as to the number or amount of
Contracts that are to be sold by Insurance Company. Insurance Company
shall make reasonable efforts to market the Contracts and shall comply
with all applicable federal and state laws in connection therewith.
8.3 Insurance Company shall furnish, or shall cause to be furnished, to the
Fund, each piece of sales literature or other promotional material in
which the Fund, its investment adviser or the administrator is named,
at least fifteen Business Days prior to its use. No such material shall
be used unless the Fund approves such material. Such approval (if
given) must be in writing and shall be presumed not given if not
received within ten Business Days after receipt of such material. The
Fund shall use all reasonable efforts to respond within ten days of
receipt.
8.4 Insurance Company shall not give any information or make any
representations or statements on behalf of the Fund or concerning the
Fund or any Series in connection with the sale of the Contracts other
than the information or representations contained in the registration
statement or Prospectus, as may be amended or supplemented from time to
time, or in reports or proxy statements for the Fund, or in sales
literature or other promotional material approved by the Fund.
8.5 Fund shall furnish, or shall cause to be furnished, to Insurance
Company, each piece of the Fund's sales literature or other promotional
material in which Insurance Company or the Separate Account is named,
at least fifteen Business Days prior to its use. No such material shall
be used unless Insurance Company approves such material. Such approval
(if given) must be in writing and shall be presumed not given if not
received within ten Business Days after receipt of such material.
Insurance Company shall use all reasonable efforts to respond within
ten days of receipt.
8.6 Fund shall not, in connection with the sale of Series shares, give any
information or make any representations on behalf of Insurance Company
or concerning Insurance Company, the Separate Account, or the Contracts
other than the information or representations contained in a
registration statement or prospectus for the Contracts, as may be
amended or supplemented from time to time, or in published reports for
the Separate Account which are in the public domain or approved by
Insurance Company for distribution to Contractholders or Participants,
or in sales literature or other promotional material approved by
Insurance Company.
8.7 For purposes of this Agreement, the phrase "sales literature or other
promotional material" or words of similar import include, without
limitation, advertisements (such as material published, or designed for
use, in a newspaper, magazine or other periodical, radio, television,
telephone or tape recording, videotape display, signs or billboards,
motion pictures or other public media), sales literature (such as any
written communication distributed or made generally available to
customers or the public, including brochures, circulars, research
reports, market letters, form letters, seminar texts, or reprints or
excerpts of any other advertisement, sales literature, or published
article), educational or training materials or other communications
distributed or made generally available to some or all agents or
employees, registration statements, prospectuses, statements of
additional information, shareholder reports and proxy materials, and
any other material constituting sales literature or advertising under
National Association of Securities Dealers, Inc. rules, the Act or the
1933 Act.
ARTICLE IX
INDEMNIFICATION
9.1 Insurance Company agrees to indemnify and hold harmless the Fund,
Dreyfus, any sub-investment adviser of a Series, and their affiliates,
and each of their directors, trustees, officers, employees, agents and
each person, if any, who controls or is associated with any of the
foregoing entities or persons within the meaning of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of Section 9.1),
against any and all losses, claims, damages or liabilities joint or
several (including any investigative, legal and other expenses
reasonably incurred in connection with, and any amounts paid in
settlement of, any action, suit or proceeding or any claim asserted)
for which the Indemnified Parties may become subject, under the 1933
Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect to thereof) (i) arise out of or are
based upon any untrue statement or alleged untrue statement of any
material fact contained in information furnished by Insurance Company
for use in the registration statement or Prospectus or sales literature
or advertisements of the Fund or with respect to the Separate Account
or Contracts, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(ii) arise out of or as a result of conduct, statements or
representations (other than statements or representations contained in
the Prospectus and sales literature or advertisements of the Fund) of
Insurance Company or its agents, with respect to the sale and
distribution of Contracts for which Series' shares are an underlying
investment; (iii) arise out of the wrongful conduct of Insurance
Company or persons under its control with respect to the sale or
distribution of the Contracts or Series' shares; (iv) arise out of
Insurance Company's incorrect calculation and/or untimely reporting of
net purchase or redemption orders; or (v) arise out of any breach by
Insurance Company of a material term of this Agreement or as a result
of any failure by Insurance Company to provide the services and furnish
the materials or to make any payments provided for in this Agreement.
Insurance Company will reimburse any Indemnified Party in connection
with investigating or defending any such loss, claim, damage, liability
or action; provided, however, that with respect to clauses (i) and (ii)
above Insurance Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or
is based upon any untrue statement or omission or alleged omission made
in such registration statement, prospectus, sales literature, or
advertisement in conformity with written information furnished to
Insurance Company by the Fund specifically for use therein. This
indemnity agreement will be in addition to any liability which
Insurance Company may otherwise have.
9.2 The Fund agrees to indemnify and hold harmless Insurance Company and
each of its directors, officers, employees, agents and each person, if
any, who controls Insurance Company within the meaning of the 1933 Act
against any losses, claims, damages or liabilities to which Insurance
Company or any such director, officer, employee, agent or controlling
person may become subject, under the 1933 Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect
thereof) (1) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
registration statement or Prospectus or sales literature or
advertisements of the Fund; (2) arise out of or are based upon the
omission to state in the registration statement or Prospectus or sales
literature or advertisements of the Fund any material fact required to
be stated therein or necessary to make the statements therein not
misleading; or (3) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in the
registration statement or Prospectus or sales literature or
advertisements with respect to the Separate Account or the Contracts
and such statements were based on information provided to Insurance
Company by the Fund; and the Fund will reimburse any legal or other
expenses reasonably incurred by Insurance Company or any such director,
officer, employee, agent or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Fund will not be liable in any such
case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or omission or
alleged omission made in such Registration Statement, Prospectus, sales
literature or advertisements in conformity with written information
furnished to the Fund by Insurance Company specifically for use
therein. This indemnity agreement will be in addition to any liability
which the Fund may otherwise have.
9.3 The Fund shall indemnify and hold Insurance Company harmless against
any and all liability, loss, damages, costs or expenses which Insurance
Company may incur, suffer or be required to pay due to the Fund's (1)
incorrect calculation of the daily net asset value, dividend rate or
capital gain (loss) distribution rate of a Series; (2) incorrect
reporting of the daily net asset value, dividend rate or capital gain
(loss) distribution rate; and (3) untimely reporting of the net asset
value, dividend rate or capital gain (loss) distribution rate; provided
that the Fund shall have no obligation to indemnify and hold harmless
Insurance Company if the incorrect calculation or incorrect or untimely
reporting was the result of incorrect information furnished by
Insurance Company or information furnished untimely by Insurance
Company or otherwise as a result of or relating to a breach of this
Agreement by Insurance Company.
9.4 Promptly after receipt by an indemnified party under this Article of
notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying
party under this Article, notify the indemnifying party of the
commencement thereof. The omission to so notify the indemnifying party
will not relieve the indemnifying party from any liability under this
Article IX, except to the extent that the omission results in a failure
of actual notice to the indemnifying party and such indemnifying party
is damaged solely as a result of the failure to give such notice. In
case any such action is brought against any indemnified party, and it
notified the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may wish, assume the defense thereof, with counsel
satisfactory to such indemnified party, and to the extent that the
indemnifying party has given notice to such effect to the indemnified
party and is performing its obligations under this Article, the
indemnifying party shall not be liable for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof, other than reasonable costs of investigation.
Notwithstanding the foregoing, in any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified party shall
have mutually agreed to the retention of such counsel or (ii) the named
parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. The indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent.
A successor by law of the parties to this Agreement shall be entitled
to the benefits of the indemnification contained in this Article IX.
9.5 Insurance Company shall indemnify and hold the Fund, Dreyfus and any
sub-investment adviser of a Series harmless against any tax liability
incurred by the Fund under Section 851 of the Code arising from
purchases or redemptions by Insurance Company's General Accounts or the
account of its affiliates.
ARTICLE X
COMMENCEMENT AND TERMINATION
10.1 This Agreement shall be effective as of the date hereof and shall
continue in force until terminated in accordance with the provisions
herein.
10.2 This Agreement shall terminate without penalty as to one or more Series
at the option of the terminating party:
a. At the option of Insurance Company or the Fund at any time
from the date hereof upon 180 days' notice, unless a shorter
time is agreed to by the parties;
b. At the option of Insurance Company, if shares of any Series
are not reasonably available to meet the requirements of the
Contracts as determined by Insurance Company. Prompt notice of
election to terminate shall be furnished by Insurance Company,
said termination to be effective ten days after receipt of
notice unless the Fund makes available a sufficient number of
shares to meet the requirements of the Contracts within said
ten-day period;
c. At the option of Insurance Company, upon the institution of
formal proceedings against the Fund by the Commission,
National Association of Securities Dealers or any other
regulatory body, the expected or anticipated ruling, judgment
or outcome of which would, in Insurance Company's reasonable
judgment, materially impair the Fund's ability to meet and
perform the Fund's obligations and duties hereunder. Prompt
notice of election to terminate shall be furnished by
Insurance Company with said termination to be effective upon
receipt of notice;
d. At the option of the Fund, upon the institution of formal
proceedings against Insurance Company by the Commission,
National Association of Securities Dealers or any other
regulatory body, the expected or anticipated ruling, judgment
or outcome of which would, in the Fund's reasonable judgment,
materially impair Insurance Company's ability to meet and
perform Insurance Company's obligations and duties hereunder.
Prompt notice of election to terminate shall be furnished by
the Fund with said termination to be effective upon receipt of
notice;
e. At the option of the Fund, if the Fund shall determine, in its
sole judgment reasonably exercised in good faith, that
Insurance Company has suffered a material adverse change in
its business or financial condition or is the subject of
material adverse publicity and such material adverse change or
material adverse publicity is likely to have a material
adverse impact upon the business and operation of the Fund or
Dreyfus, the Fund shall notify Insurance Company in writing of
such determination and its intent to terminate this Agreement,
and after considering the actions taken by Insurance Company
and any other changes in circumstances since the giving of
such notice, such determination of the Fund shall continue to
apply on the sixtieth (60th) day following the giving of such
notice, which sixtieth day shall be the effective date of
termination;
f. Upon termination of the Investment Advisory Agreement between
the Fund and Dreyfus or its successors unless Insurance
Company specifically approves the selection of a new Fund
investment adviser. The Fund shall promptly furnish notice of
such termination to Insurance Company;
g. In the event the Fund's shares are not registered, issued or
sold in accordance with applicable federal law, or such law
precludes the use of such shares as the underlying investment
medium of Contracts issued or to be issued by Insurance
Company. Termination shall be effective immediately upon such
occurrence without notice;
h. At the option of the Fund upon a determination by the Board in
good faith that it is no longer advisable and in the best
interests of shareholders for the Fund to continue to operate
pursuant to this Agreement. Termination pursuant to this
Subsection (h) shall be effective upon notice by the Fund to
Insurance Company of such termination;
i. At the option of the Fund if the Contracts cease to qualify as
annuity contracts or life insurance policies, as applicable,
under the Code, or if the Fund reasonably believes that the
Contracts may fail to so qualify;
j. At the option of either party to this Agreement, upon the
breach by a party of any material provision of this Agreement,
which breach has not been cured to the reasonable satisfaction
of the other party within 10 days after written notice of such
breach is delivered to such other party;
k. At the option of the Fund, if the Contracts are not
registered, issued or sold in accordance with applicable
federal and/or state law; or
l. Upon assignment of this Agreement, unless made with the
written consent of the non-assigning party.
Any such termination pursuant to Section 10.2a, 10.2d, 10.2e, 10.2f or
10.2k herein shall not affect the operation of Article V of this
Agreement. Any termination of this Agreement shall not affect the
operation of Article IX of this Agreement.
10.3 Notwithstanding any termination of this Agreement pursuant to Section
10.2 hereof, the Fund and Dreyfus may, at the option of the Fund,
continue to make available additional Series shares for so long as the
Fund desires pursuant to the terms and conditions of this Agreement as
provided below, for all Contracts in effect on the effective date of
termination of this Agreement (hereinafter referred to as "Existing
Contracts"). Specifically, without limitation, if the Fund or Dreyfus
so elects to make additional Series shares available, the owners of the
Existing Contracts or Insurance Company, whichever shall have legal
authority to do so, shall be permitted to reallocate investments in the
Series, redeem investments in the Fund and/or invest in the Fund upon
the making of additional purchase payments under the Existing
Contracts, if permitted by the terms of the Existing Contracts. In the
event of a termination of this Agreement pursuant to Section 10.2
hereof, the Fund and Dreyfus, as promptly as is practicable under the
circumstances, shall notify Insurance Company whether Dreyfus and the
Fund will continue to make Series shares available after such
termination. If Series shares continue to be made available after such
termination, the provisions of this Agreement shall remain in effect
and thereafter either the Fund or Insurance Company may terminate the
Agreement, as so continued pursuant to this Section 10.3, upon prior
written notice to the other party, such notice to be for a period that
is reasonable under the circumstances but, if given by the Fund, need
not be for more than six months.
<PAGE>
ARTICLE XI
AMENDMENTS
11.1 Any other changes in the terms of this Agreement shall be made by
agreement in writing between Insurance Company and Fund.
ARTICLE XII
NOTICE
12.1 Each notice required by this Agreement shall be given by certified
mail, return receipt requested, to the appropriate parties at the
following addresses:
Insurance Company: Great American Life Insurance Company of New York
10th Floor, Chiquita Center
250 East Fifth Street
Cincinnati, Ohio 45202
Attn: Mark F. Muething
Fund: Dreyfus Variable Investment Fund
200 Park Avenue
New York, New York 10166
Attn: Daniel C. Maclean
Fund: Dreyfus Life and Annuity Index Fund, Inc.
200 Park Avenue
New York, New York 10166
Attn: Daniel C. Maclean
Fund: The Dreyfus Socially Responsible Growth Fund, Inc.
200 Park Avenue
New York, New York 10166
Attn: Daniel C. Maclean
with copies to: Stroock & Stroock & Lavan
7 Hanover Square
New York, New York 10004-2696
Attn: Lewis G. Cole, Esq.
Stuart H. Coleman, Esq.
Notice shall be deemed to be given on the date of receipt by the
addresses as evidenced by the return receipt.
ARTICLE XIII
MISCELLANEOUS
13.1 This Agreement has been executed on behalf of the Fund by the
undersigned officer of the Fund in his capacity as an officer of the
Fund. The obligations of this Agreement shall only be binding upon the
assets and property of the Fund and shall not be binding upon any
Trustee, officer or shareholder of the Fund individually.
<PAGE>
ARTICLE XIV
LAW
14.1 This Agreement shall be construed in accordance with the internal laws
of the State of New York, without giving effect to principles of
conflict of laws.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
By:
Its:
Attest:
DREYFUS VARIABLE INVESTMENT FUND
By:
Its:
Attest:
DREYFUS LIFE AND ANNUITY INDEX FUND, INC.
(d/b/a DREYFUS STOCK INDEX FUND)
By:
Its:
Attest:
THE DREYFUS SOCIALLY RESPONSIBLE GROWTH
FUND, INC.
By:
Its:
Attest:
<PAGE>
AGREEMENT
AGREEMENT made as of the _____ day of ______, 1999 by and between (i)
The Dreyfus Corporation ("Dreyfus"), a New York corporation; and (ii) Great
American Life Insurance Company of New York ("Client"), a New York corporation.
WITNESSETH:
WHEREAS, each of the investment companies listed on Schedule A hereto as such
Schedule may be amended from time to time (collectively the "Dreyfus Funds,"
each a "Fund") are investment companies registered under the Investment Company
Act of 1940, as amended (the "Act"); and
WHEREAS, Client has entered into a Fund Participation Agreement (the
"Participation Agreement") with each of the Dreyfus Funds listed on Schedule A
hereto; and
WHEREAS, Dreyfus provides investment advisory and/or administrative services to
the Dreyfus Funds; and
WHEREAS, Premier Mutual Fund Services, Inc. ("Premier") is the distributor for
the Dreyfus Funds; and
WHEREAS, the parties hereto have agreed to arrange separately for the
performance of sub-accounting services for owners of shares of the Dreyfus Funds
who maintain their shares in a variable annuity account with Client; and
WHEREAS, Dreyfus desires Client to perform such services and Client is willing
and able to furnish such services on the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter contained, each party hereto severally agrees as follows:
1. Client agrees to perform the administrative services specified in
Exhibit A hereto (the "Administrative Services") for the benefit of the
shareholders of the Dreyfus Funds who maintain their shares of any such
Dreyfus Funds in variable annuity and variable life insurance accounts
with Client and whose shares are included in the master account
("Master Account") referred to in paragraph 1 of Exhibit A
(collectively, the "Client Customers").
2. Client represents and agrees that it will maintain and preserve all
records as required by law to be maintained and preserved in connection
with providing the Administrative Services, and will otherwise comply
with all laws, rules and regulations applicable to the Administrative
Services. Upon the request of Dreyfus or its representatives, Client
shall provide copies of all the historical records relating to
transactions between the Dreyfus Funds and Client Customers, and
written communications regarding the Fund(s) to or from such Customers
and other materials, in each case as may reasonably be requested to
enable Dreyfus or its representatives, including without limitation its
auditors, legal counsel or distributor, to monitor and review the
Administrative Services, or to comply with any request of the board of
directors, or trustees or general partners (collectively, the
"Directors") of any Fund or of a governmental body, self-regulatory
organization or a shareholder. Client agrees that it will permit
Dreyfus, the Dreyfus Funds or their representatives to have reasonable
access to its personnel and records in order to facilitate the
monitoring of the quality of the services.
3. Client may, with the consent of Dreyfus, contract with or establish
relationships with other parties for the provision of the
Administrative Services or other activities of Client required by the
Agreement, provided that Client shall be fully responsible for the acts
and omissions of such other parties.
4. Client hereby agrees to notify Dreyfus promptly if for any reason it is
unable to perform fully and promptly any of its obligations under this
Agreement.
5. Client hereby represents and covenants that it does not, and will not,
own or hold or control with power to vote any shares of the Dreyfus
Funds which are registered in the name of Client or the name of its
nominee and which are maintained in Client variable annuity accounts.
Client represents further that it is registered as a broker-dealer
under the Securities Exchange Act of 1934, as amended (the "1934 Act"),
and any applicable state securities laws, and as a transfer agent under
the 1934 Act, or is not required to be so registered, including as a
result of entering into this Agreement and performing the
Administrative Services.
6. The provisions of the Agreement shall in no away limit the authority of
Dreyfus, or any Dreyfus Fund or Premier to take such action as any of
such parties may deem appropriate or advisable in connection with all
matters relating to the operations of any of such Funds and/or sale of
its shares.
7. In consideration of the performance of the Administrative Services by
Client, Dreyfus agrees to pay Client a monthly fee at an annual rate
which shall equal .20 of 1% of the value of each Fund's (except Dreyfus
Stock Index Fund) average daily net assets maintained in the Master
Account for Client Customers. The payments by Dreyfus to Client relate
solely to administrative services only and do not constitute payment in
any manner for administrative services provided by Client to Client
Customers or any separate account organized by Client, for any
investment advisory services or for costs of distribution of any
variable insurance contracts.
8. Client shall indemnify and hold harmless the Dreyfus Funds, The Dreyfus
Corporation, Dreyfus Service Corporation ("DSC"), Premier, and each of
their respective officers, directors, employees and agents from and
against any and all losses, claims, damages, expenses, or liabilities
that any one or more of them may incur including without limitation
reasonable attorneys' fees, expenses and costs arising out of or
related to the performance or non-performance of Client of its
responsibilities under this Agreement.
9. This Agreement may be terminated without penalty at any time by Client
or by Dreyfus as to all of the Dreyfus Funds collectively, upon 180
days written notice to the other party. The provisions of paragraphs 2,
8 and 10 shall continue in full force and effect after termination of
this Agreement. Notwithstanding the foregoing, this Agreement shall not
require Client to preserve any records (in any medium or format)
relating to this Agreement beyond the time periods otherwise required
by the laws to which Client or the Dreyfus Funds are subject provided
that such records shall be offered to the Dreyfus Funds in the event
Client decides to no longer preserve such records following such time
periods.
10. After the date of any termination of this Agreement in accordance with
paragraph 9, no fee will be due with respect to any amounts first
placed in the Master Account for Client Customers after the date of
such termination. However, notwithstanding any such termination,
Dreyfus will remain obligated to pay Client the fee specified in
paragraph 7 with respect to the value of each Fund's average daily net
assets maintained in the Master Account as of the date of such
termination, for so long as such amounts are held in the Master Account
and Client continues to provide the Administrative Services with
respect to such amounts in conformity with this Agreement. This
Agreement, or any provision hereof, shall survive termination to the
extent necessary for each party to perform its obligations with respect
to amounts for which a fee continues to be due subsequent to such
termination.
11. Client understands and agrees that the obligations of Dreyfus under
this Agreement are not binding upon any of the Dreyfus Funds, upon any
of their Board members or upon any shareholder of any of the Funds.
12. It is understood and agreed that in performing the services under this
Agreement Client, acting in its capacity described herein, shall at no
time be acting as an agent for Dreyfus, or DSC, or Premier or any of
the Dreyfus Funds. Client agrees, and agrees to cause its agents, not
to make any representations concerning a Fund except those contained in
the Fund's then-current prospectus, in current sales literature
furnished by the Fund, Dreyfus or Premier to Client, or in the then
current prospectus for a variable annuity contract or variable life
insurance policy issued by Client, or then current sales literature
with respect to such variable annuity contract or variable life
insurance policy, approved by Dreyfus.
13. This Agreement, including the provisions set forth herein in Section 7,
may only be amended pursuant to a written instrument signed by the
party to be charged. This Agreement may not be assigned by a party
hereto, by operation of law or otherwise, without the prior, written
consent of the other party.
14. This Agreement shall be governed by the laws of the State of New York,
without giving effect to the principles of conflicts of law of such
jurisdiction.
15. This Agreement, including its Exhibit and Schedule, constitutes the
entire agreement between the parties with respect to the matters dealt
with herein, and supersedes any previous agreements and documents with
respect to such matters.
IN WITNESS HEREOF, the parties hereto have executed and delivered this Agreement
as of the date first above written.
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
By:
Authorized Signatory
Print or Type Name
THE DREYFUS CORPORATION
By:
Authorized Signatory
Print or Type Name
<PAGE>
SCHEDLUE A
GALIC of New York Separate Account I (May 7, 1999)
Fund Code Fund Name
112 Dreyfus Variable Investment Fund, Capital Appreciation Portfolio
108 Dreyfus Variable Investment Fund, Growth and Income Portfolio
121 Dreyfus Variable Investment Fund, Small Cap Portfolio
117 Dreyfus Variable Investment Fund, Money Market Portfolio
111 The Dreyfus Socially Responsible Growth Fund, Inc.
763 Dreyfus Stock Index Fund
<PAGE>
EXHIBIT A
Pursuant to the Agreement by and among the parties hereto, Client shall perform
the following Administrative Services:
1. Maintain separate records for each Client Customer, which records shall
reflect shares purchased and redeemed and share balances. Client shall
maintain the Master Account with the transfer agent of the Fund on
behalf of Client Customers and such Master Account shall be in the name
of Client or its nominee as the record owner of the shares owned by
such Client Customers.
2. For each Fund, disburse or credit to Client Customers all proceeds of
redemptions of shares of the Fund and all dividends and other
distributions not reinvested in shares of the Fund.
3. Prepare and transmit to Client Customers periodic account statements
showing the total number of shares owned by the Customer as of the
statement closing date, purchases and redemptions of Fund shares by the
Customer during the period covered by the statement, and the dividends
and other distributions paid to the Customer during the statement
period (whether paid in cash or reinvested in Fund shares).
4. Transmit to Client Customers proxy materials and reports and other
information received by Client from any of the Funds and required to be
sent to shareholders under the federal securities laws and, upon
request of the Fund's transfer agent, transmit to Client Customers
material fund communications deemed by the Fund, through its Board of
Directors or other similar governing body, to be necessary and proper
for receipt by all fund beneficial shareholders.
5. Transmit to the Fund's transfer agent purchase and redemption orders on
behalf of Client Customers.
6. Provide to the Funds, or to the transfer agent for any of the Funds, or
any of the agents designated by any of them, such periodic reports as
shall reasonably be concluded to be necessary to enable each of the
Funds and its distributor to comply with State Blue Sky requirements.
<PAGE>
JANUS ASPEN SERIES
FUND PARTICIPATION AGREEMENT
THIS AGREEMENT is made this ____ day of __________, 1999, between JANUS
ASPEN SERIES, an open-end management investment company organized as a Delaware
business trust (the "Trust"), and GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW
YORK, a life insurance company organized under the laws of the State of New York
(the "Company"), on its own behalf and on behalf of each segregated asset
account of the Company set forth on Schedule A, as may be amended from time to
time (the "Accounts").
W I T N E S S E T H:
WHEREAS, the Trust has registered with the Securities and Exchange
Commission as an open-end management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), and has registered the offer
and sale of its shares under the Securities Act of 1933, as amended (the "1933
Act"); and
WHEREAS, the Trust desires to act as an investment vehicle for separate
accounts established for variable life insurance policies and variable annuity
contracts to be offered by insurance companies that have entered into
participation agreements with the Trust (the "Participating Insurance
Companies"); and
WHEREAS, the beneficial interest in the Trust is divided into several
series of shares, each series representing an interest in a particular managed
portfolio of securities and other assets (the "Portfolios"); and
WHEREAS, the Trust has received an order from the Securities and
Exchange Commission granting Participating Insurance Companies and their
separate accounts exemptions from the provisions of Sections 9(a), 13(a), 15(a)
and 15(b) of the 1940 Act, and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder,
to the extent necessary to permit shares of the Trust to be sold to and held by
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies and certain qualified
pension and retirement plans (the "Exemptive Order"); and
WHEREAS, the Company has registered or will register certain variable
life insurance policies and/or variable annuity contracts under the 1933 Act
(the "Contracts"); and
WHEREAS, the Company has registered or will register each Account as a
unit investment trust under the 1940 Act; and
WHEREAS, the Company desires to utilize shares of one or more
Portfolios as an investment vehicle of the Accounts;
<PAGE>
NOW THEREFORE, in consideration of their mutual promises, the parties
agree as follows:
ARTICLE I.
Sale of Trust Shares
1.1 The Trust shall make shares of its Portfolios available to the
Accounts at the net asset value next computed after receipt of such purchase
order by the Trust (or its agent), as established in accordance with the
provisions of the then current prospectus of the Trust. Shares of a particular
Portfolio of the Trust shall be ordered in such quantities and at such times as
determined by the Company to be necessary to meet the requirements of the
Contracts. The Trustees of the Trust (the "Trustees") may refuse to sell shares
of any Portfolio to any person, or suspend or terminate the offering of shares
of any Portfolio if such action is required by law or by regulatory authorities
having jurisdiction or is, in the sole discretion of the Trustees acting in good
faith and in light of their fiduciary duties under federal and any applicable
state laws, necessary in the best interests of the shareholders of such
Portfolio.
1.2 The Trust will redeem any full or fractional shares of any
Portfolio when requested by the Company on behalf of an Account at the net asset
value next computed after receipt by the Trust (or its agent) of the request for
redemption, as established in accordance with the provisions of the then current
prospectus of the Trust. The Trust shall make payment for such shares in the
manner established from time to time by the Trust, but in no event shall payment
be delayed for a greater period than is permitted by the 1940 Act.
1.3 For the purposes of Sections 1.1 and 1.2, the Trust hereby appoints
the Company as its agent for the limited purpose of receiving and accepting
purchase and redemption orders resulting from investment in and payments under
the Contracts. Receipt by the Company shall constitute receipt by the Trust
provided that i) such orders are received by the Company in good order prior to
the time the net asset value of each Portfolio is priced in accordance with its
prospectus and ii) the Trust receives notice of such orders by 11:00 a.m. New
York time on the next following Business Day. "Business Day" shall mean any day
on which the New York Stock Exchange is open for trading and on which the Trust
calculates its net asset value pursuant to the rules of the Securities and
Exchange Commission.
1.4 Purchase orders that are transmitted to the Trust in accordance
with Section 1.3 shall be paid for no later than 12:00 noon New York time on the
same Business Day that the Trust receives notice of the order.
Payments shall be made in federal funds transmitted by wire.
1.5 Issuance and transfer of the Trust's shares will be by book entry
only. Stock certificates will not be issued to the Company or the Account.
Shares ordered from the Trust will be recorded in the appropriate title for each
Account or the appropriate subaccount of each Account.
<PAGE>
1.6 The Trust shall furnish prompt notice to the Company of any income
dividends or capital gain distributions payable on the Trust's shares. The
Company hereby elects to receive all such income dividends and capital gain
distributions as are payable on a Portfolio's shares in additional shares of
that Portfolio. The Trust shall notify the Company of the number of shares so
issued as payment of such dividends and distributions by the close of the
following Business Day.
1.7 The Trust shall make the net asset value per share for each
Portfolio available to the Company on a daily basis as soon as reasonably
practical after the net asset value per share is calculated and shall use its
best efforts to make such net asset value per share available by 6 p.m. New York
time. When available, the net asset value will be communicated to the Company by
telephone and confirmed by facsimile.
1.8 The Trust agrees that its shares will be sold only to Participating
Insurance Companies and their separate accounts and to certain qualified pension
and retirement plans to the extent permitted by the Exemptive Order. No shares
of any Portfolio will be sold directly to the general public. The Company agrees
that Trust shares will be used only for the purposes of funding the Contracts
and Accounts listed in Schedule A, as amended from time to time.
1.9 The Trust agrees that all Participating Insurance Companies shall
have the obligations and responsibilities regarding pass-through voting and
conflicts of interest corresponding to those contained in Section 2.8 and
Article IV. of this Agreement.
ARTICLE II.
Obligations of the Parties
2.1 The Trust shall prepare and be responsible for filing with the
Securities and Exchange Commission and any state regulators requiring such
filing all shareholder reports, notices, proxy materials (or similar materials
such as voting instruction solicitation materials), prospectuses and statements
of additional information of the Trust. The Trust shall bear the costs of
registration and qualification of its shares, preparation and filing of the
documents listed in this Section 2.1 and all taxes to which an issuer is subject
on the issuance and transfer of its shares.
2.2 At the option of the Company, the Trust shall either (a) provide
the Company (at the Company's expense) with as many copies of the Trust's
current prospectus, annual report, semi-annual report and other shareholder
communications, including any amendments or supplements to any of the foregoing,
as the Company shall reasonably request; or (b) provide the Company with a
camera ready copy of such documents in a form suitable for printing. The Trust
shall provide the Company with a copy of its statement of additional information
in a form suitable for duplication by the Company. The Trust (at its expense)
shall provide the Company with copies of any Trust-sponsored proxy materials in
such quantity as the Company shall reasonably require for distribution to
Contract owners.
<PAGE>
2.3 The Company shall bear the costs of printing and distributing the
Trust's prospectus, statement of additional information, shareholder reports and
other shareholder communications to owners of and applicants for policies for
which the Trust is serving or is to serve as an investment vehicle. The Company
shall bear the costs of distributing proxy materials (or similar materials such
as voting solicitation instructions) to Contract owners. The Company assumes
sole responsibility for ensuring that such materials are delivered to Contract
owners in accordance with applicable federal and state securities laws.
2.4 The Company agrees and acknowledges that the Trust's adviser, Janus
Capital Corporation ("Janus Capital"), is the sole owner of the name and mark
"Janus" and that all use of any designation comprised in whole or part of Janus
(a "Janus Mark") under this Agreement shall inure to the benefit of Janus
Capital. Except as provided in Section 2.5, the Company shall not use any Janus
Mark on its own behalf or on behalf of the Accounts or Contracts in any
registration statement, advertisement, sales literature or other materials
relating to the Accounts or Contracts without the prior written consent of Janus
Capital. Upon termination of this Agreement for any reason, the Company shall
cease all use of any Janus Mark(s) as soon as reasonably practicable.
2.5 The Company shall furnish, or cause to be furnished, to the Trust
or its designee, a copy of each Contract prospectus or statement of additional
information in which the Trust or its investment adviser is named prior to the
filing of such document with the Securities and Exchange Commission. The Company
shall furnish, or shall cause to be furnished, to the Trust or its designee,
each piece of sales literature or other promotional material in which the Trust
or its investment adviser is named, at least ten Business Days prior to its use.
No such material shall be used if the Trust or its designee reasonably objects
to such use within ten Business Days after receipt of such material.
2.6 The Company shall not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust or
its investment adviser in connection with the sale of the Contracts other than
information or representations contained in and accurately derived from the
registration statement or prospectus for the Trust shares (as such registration
statement and prospectus may be amended or supplemented from time to time),
reports of the Trust, Trust-sponsored proxy statements, or in sales literature
or other promotional material approved by the Trust or its designee, except as
required by legal process or regulatory authorities or with the written
permission of the Trust or its designee.
2.7 The Trust shall not give any information or make any
representations or statements on behalf of the Company or concerning the
Company, the Accounts or the Contracts other than information or representations
contained in and accurately derived from the registration statement or
prospectus for the Contracts (as such registration statement and prospectus may
be amended or supplemented from time to time), or in materials approved by the
Company for distribution including sales literature or other promotional
materials, except as required by legal process or regulatory authorities or with
the written permission of the Company.
<PAGE>
2.8 So long as, and to the extent that the Securities and Exchange
Commission interprets the 1940 Act to require pass-through voting privileges for
variable policyowners, the Company will provide pass-through voting privileges
to owners of policies whose cash values are invested, through the Accounts, in
shares of the Trust. The Trust shall require all Participating Insurance
Companies to calculate voting privileges in the same manner and the Company
shall be responsible for assuring that the Accounts calculate voting privileges
in the manner established by the Trust. With respect to each Account, the
Company will vote shares of the Trust held by the Account and for which no
timely voting instructions from policyowners are received as well as shares it
owns that are held by that Account, in the same proportion as those shares for
which voting instructions are received. The Company and its agents will in no
way recommend or oppose or interfere with the solicitation of proxies for Trust
shares held by Contract owners without the prior written consent of the Trust,
which consent may be withheld in the Trust's sole discretion.
ARTICLE III.
Representations and Warranties
3.1 The Company represents and warrants that it is an insurance company
duly organized and in good standing under the laws of the State of New York and
that it has legally and validly established each Account as a segregated asset
account under such law on the date set forth in Schedule A.
3.2 The Company represents and warrants that it has registered or,
prior to any issuance or sale of the Contracts, will register each Account as a
unit investment trust in accordance with the provisions of the 1940 Act to serve
as a segregated investment account for the Contracts.
3.3 The Company represents and warrants that the Contracts will be
registered under the 1933 Act prior to any issuance or sale of the Contracts;
the Contracts will be issued and sold in compliance in all material respects
with all applicable federal and state laws; and the sale of the Contracts shall
comply in all material respects with state insurance suitability requirements.
3.4 The Trust represents and warrants that it is duly organized and
validly existing under the laws of the State of Delaware.
3.5 The Trust represents and warrants that the Trust shares offered and
sold pursuant to this Agreement will be registered under the 1933 Act and the
Trust shall be registered under the 1940 Act prior to any issuance or sale of
such shares. The Trust shall amend its registration statement under the 1933 Act
and the 1940 Act from time to time as required in order to effect the continuous
offering of its shares. The Trust shall register and qualify its shares for sale
in accordance with the laws of the various states only if and to the extent
deemed advisable by the Trust.
<PAGE>
3.6 The Trust represents and warrants that the investments of each
Portfolio will comply with the diversification requirements set forth in Section
817(h) of the Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder.
ARTICLE IV.
Potential Conflicts
4.1 The parties acknowledge that the Trust's shares may be made
available for investment to other Participating Insurance Companies. In such
event, the Trustees will monitor the Trust for the existence of any material
irreconcilable conflict between the interests of the contract owners of all
Participating Insurance Companies. An irreconcilable material conflict may arise
for a variety of reasons, including: (a) an action by any state insurance
regulatory authority; (b) a change in applicable federal or state insurance,
tax, or securities laws or regulations, or a public ruling, private letter
ruling, no-action or interpretative letter, or any similar action by insurance,
tax, or securities regulatory authorities; (c) an administrative or judicial
decision in any relevant proceeding; (d) the manner in which the investments of
any Portfolio are being managed; (e) a difference in voting instructions given
by variable annuity contract and variable life insurance contract owners; or (f)
a decision by an insurer to disregard the voting instructions of contract
owners. The Trustees shall promptly inform the Company if they determine that an
irreconcilable material conflict exists and the implications thereof.
4.2 The Company agrees to promptly report any potential or existing
conflicts of which it is aware to the Trustees. The Company will assist the
Trustees in carrying out their responsibilities under the Exemptive Order by
providing the Trustees with all information reasonably necessary for the
Trustees to consider any issues raised including, but not limited to,
information as to a decision by the Company to disregard Contract owner voting
instructions.
<PAGE>
4.3 If it is determined by a majority of the Trustees, or a majority of
its disinterested Trustees, that a material irreconcilable conflict exists that
affects the interests of Contract owners, the Company shall, in cooperation with
other Participating Insurance Companies whose contract owners are also affected,
at its expense and to the extent reasonably practicable (as determined by the
Trustees) take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, which steps could include: (a) withdrawing the
assets allocable to some or all of the Accounts from the Trust or any Portfolio
and reinvesting such assets in a different investment medium, including (but not
limited to) another Portfolio of the Trust, or submitting the question of
whether or not such segregation should be implemented to a vote of all affected
Contract owners and, as appropriate, segregating the assets of any appropriate
group (i.e., annuity contract owners, life insurance contract owners, or
variable contract owners of one or more Participating Insurance Companies) that
votes in favor of such segregation, or offering to the affected Contract owners
the option of making such a change; and (b) establishing a new registered
management investment company or managed separate account.
4.4 If a material irreconcilable conflict arises because of a decision
by the Company to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, the Company
may be required, at the Trust's election, to withdraw the affected Account's
investment in the Trust and terminate this Agreement with respect to such
Account; provided, however that such withdrawal and termination shall be limited
to the extent required by the foregoing material irreconcilable conflict as
determined by a majority of the disinterested Trustees. Any such withdrawal and
termination must take place within six (6) months after the Trust gives written
notice that this provision is being implemented. Until the end of such six (6)
month period, the Trust shall continue to accept and implement orders by the
Company for the purchase and redemption of shares of the Trust.
4.5 If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company conflicts with
the majority of other state regulators, then the Company will withdraw the
affected Account's investment in the Trust and terminate this Agreement with
respect to such Account within six (6) months after the Trustees inform the
Company in writing that it has determined that such decision has created an
irreconcilable material conflict; provided, however, that such withdrawal and
termination shall be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the disinterested
Trustees. Until the end of such six (6) month period, the Trust shall continue
to accept and implement orders by the Company for the purchase and redemption of
shares of the Trust.
4.6 For purposes of Sections 4.3 through 4.6 of this Agreement, a
majority of the disinterested Trustees shall determine whether any proposed
action adequately remedies any irreconcilable material conflict, but in no event
will the Company be required to establish a new funding medium for the Contracts
if an offer to do so has been declined by vote of a majority of Contract owners
materially adversely affected by the irreconcilable material conflict. In the
event that the Trustees determine that any proposed action does not adequately
remedy any irreconcilable material conflict, then the Company will withdraw the
Account's investment in the Trust and terminate this Agreement within six (6)
months after the Trustees inform the Company in writing of the foregoing
determination; provided, however, that such withdrawal and termination shall be
limited to the extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested Trustees.
<PAGE>
4.7 The Company shall at least annually submit to the Trustees such
reports, materials or data as the Trustees may reasonable request so that the
Trustees may fully carry out the duties imposed upon them by the Exemptive
Order, and said reports, materials and data shall be submitted more frequently
if deemed appropriate by the Trustees.
4.8 If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
1940 Act or the rules promulgated thereunder with respect to mixed or shared
funding (as defined in the Exemptive Order) on terms and conditions materially
different from those contained in the Exemptive Order, then the Trust and/or the
Participating Insurance Companies, as appropriate, shall take such steps as may
be necessary to comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3,
as adopted, to the extent such rules are applicable.
ARTICLE V.
Indemnification
5.1 Indemnification By the Company. The Company agrees to indemnify and
hold harmless the Trust and each of its Trustees, officers, employees and agents
and each person, if any, who controls the Trust within the meaning of Section 15
of the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
Article V.) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Company) or expenses
(including the reasonable costs of investigating or defending any alleged loss,
claim, damage, liability or expense and reasonable legal counsel fees incurred
in connection therewith) (collectively, "Losses"), to which the Indemnified
Parties may become subject under any statute or regulation, or at common law or
otherwise, insofar as such Losses:
(a) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in a
registration statement or prospectus for the Contracts or in the
Contracts themselves or in sales literature generated or approved by
the Company on behalf of the Contracts or Accounts (or any amendment or
supplement to any of the foregoing) (collectively, "Company Documents"
for the purposes of this Article V.), or arise out of or are based upon
the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, provided that this indemnity shall not apply as
to any Indemnified Party if such statement or omission or such alleged
statement or omission was made in reliance upon and was accurately
derived from written information furnished to the Company by or on
behalf of the Trust for use in Company Documents or otherwise for use
in connection with the sale of the Contracts or Trust shares; or
<PAGE>
(b) arise out of or result from statements or representations
(other than statements or representations contained in and accurately
derived from Trust Documents as defined in Section 5.2(a)) or wrongful
conduct of the Company or persons under its control, with respect to
the sale or acquisition of the Contracts or Trust shares; or
(c) arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Trust
Documents as defined in Section 5.2(a) or the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading if such
statement or omission was made in reliance upon and accurately derived
from written information furnished to the Trust by or on behalf of the
Company; or
(d) arise out of or result from any failure by the Company to
provide the services or furnish the materials required under the terms
of this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this Agreement or
arise out of or result from any other material breach of this Agreement
by the Company.
5.2 Indemnification By the Trust. The Trust agrees to indemnify and
hold harmless the Company and each of its directors, officers, employees and
agents and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act (collectively, the "Indemnified Parties" for purposes
of this Article V.) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the Trust) or
expenses (including the reasonable costs of investigating or defending any
alleged loss, claim, damage, liability or expense and reasonable legal counsel
fees incurred in connection therewith) (collectively, "Losses"), to which the
Indemnified Parties may become subject under any statute or regulation, or at
common law or otherwise, insofar as such Losses:
(a) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
registration statement or prospectus for the Trust or in sales
literature generated or approved by the Trust or on behalf of the Trust
(or any amendment or supplement thereto), (collectively, "Trust
Documents" for the purposes of this Article V.), or arise out of or are
based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, provided that this indemnity shall
not apply as to any Indemnified Party if such statement or omission or
such alleged statement or omission was made in reliance upon and was
accurately derived from written information furnished to the Trust by
or on behalf of the Company for use in Trust Documents or otherwise for
use in connection with the sale of the Contracts or Trust shares; or
<PAGE>
(b) arise out of or result from statements or representations
(other than statements or representations contained in and accurately
derived from Company Documents) or wrongful conduct of the Trust or
persons under its control, with respect to the sale or acquisition of
the Contracts or Trust shares; or
(c) arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Company
Documents or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission was
made in reliance upon and accurately derived from written information
furnished to the Company by or on behalf of the Trust; or
(d) arise out of or result from any failure by the Trust to
provide the services or furnish the materials required under the terms
of this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by the Trust in this Agreement or
arise out of or result from any other material breach of this Agreement
by the Trust.
5.3 Neither the Company nor the Trust shall be liable under the
indemnification provisions of Sections 5.1 or 5.2, as applicable, with respect
to any Losses incurred or assessed against an Indemnified Party that arise from
such Indemnified Party's willful misfeasance, bad faith or negligence in the
performance of such Indemnified Party's duties or by reason of such Indemnified
Party's reckless disregard of obligations or duties under this Agreement.
5.4 Neither the Company nor the Trust shall be liable under the
indemnification provisions of Sections 5.1 or 5.2, as applicable, with respect
to any claim made against an Indemnified Party unless such Indemnified Party
shall have notified the other party in writing within a reasonable time after
the summons, or other first written notification, giving information of the
nature of the claim shall have been served upon or otherwise received by such
Indemnified Party (or after such Indemnified Party shall have received notice of
service upon or other notification to any designated agent), but failure to
notify the party against whom indemnification is sought of any such claim shall
not relieve that party from any liability which it may have to the Indemnified
Party in the absence of Sections 5.1 and 5.2.
5.5 In case any such action is brought against the Indemnified Parties,
the indemnifying party shall be entitled to participate, at its own expense, in
the defense of such action. The indemnifying party also shall be entitled to
assume the defense thereof, with counsel reasonably satisfactory to the party
named in the action. After notice from the indemnifying party to the Indemnified
Party of an election to assume such defense, the Indemnified Party shall bear
the fees and expenses of any additional counsel retained by it, and the
indemnifying party will not be liable to the Indemnified Party under this
Agreement for any legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than reasonable costs
of investigation.
<PAGE>
ARTICLE VI.
Termination
6.1 This Agreement may be terminated by either party for any reason by
ninety (90) days advance written notice delivered to the other party.
6.2 Notwithstanding any termination of this Agreement, the Trust shall,
at the option of the Company, continue to make available additional shares of
the Trust (or any Portfolio) pursuant to the terms and conditions of this
Agreement for all Contracts in effect on the effective date of termination of
this Agreement, provided that the Company continues to pay the costs set forth
in Section 2.3.
6.3 The provisions of Article V. shall survive the termination of this
Agreement, and the provisions of Article IV. and Section 2.8 shall survive the
termination of this Agreement as long as shares of the Trust are held on behalf
of Contract owners in accordance with Section 6.2.
ARTICLE VII.
Notices
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth below
or at such other address as such party may from time to time specify in writing
to the other party.
If to the Trust:
100 Fillmore Street
Denver, Colorado 80206
Attention: General Counsel
<PAGE>
If to the Company:
10th Floor, Chiquita Center
250 East Fifth Street
Cincinnati, Ohio 45202
Attention: Mark F. Muething, Esq.
ARTICLE VIII.
Miscellaneous
8.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
8.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
8.3 If any provision of this Agreement shall be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
8.4 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of State of Colorado.
8.5 The parties to this Agreement acknowledge and agree that all
liabilities of the Trust arising, directly or indirectly, under this Agreement,
of any and every nature whatsoever, shall be satisfied solely out of the assets
of the Trust and that no Trustee, officer, agent or holder of shares of
beneficial interest of the Trust shall be personally liable for any such
liabilities.
8.6 Each party shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
Securities and Exchange Commission, the National Association of Securities
Dealers, Inc., and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any investigation
or inquiry relating to this Agreement or the transactions contemplated hereby.
8.7 The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to under
state and federal laws.
8.8 The parties to this Agreement acknowledge and agree that this
Agreement shall not be exclusive in any respect.
<PAGE>
8.9 Neither this Agreement nor any rights or obligations hereunder may
be assigned by either party without the prior written approval of the other
party.
8.10 No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by both
parties.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Participation Agreement as of the date and year first
above written.
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
By: --------------------------------------
Name:--------------------------------------
Title: ------------------------------------
JANUS ASPEN SERIES
By: ---------------------------------------
Name: Bonnie M. Howe
Title: Assistant Vice President
<PAGE>
Schedule A
Separate Accounts and Associated Contracts
Name of Separate Account and Contracts Funded
Date Established by Board of Directors By Separate Account
GALIC of NY Separate Account I The Commodore Navigator Individual
May 7, 1999 and Group Deferred Variable Annuities
The Commodore Advantage Individual
and Group Deferred Variable Annuities
The Commodore Independence Individual
and Group Deferred Variable Annuities
<PAGE>
May 19, 1999
Mr. Mark F. Muething
Senior Vice President
Annuity Investors Life Insurance Company
10th Floor, Chiquita Center
250 East Fifth Street
Cincinnati, Ohio 45202
Dear Mr. Muething:
This letter sets forth the agreement between Great American Life
Insurance Company of New York (the "Company"), and Janus Capital Corporation
(the "Adviser"), concerning certain administrative services.
1. Administrative Services and Expenses. Administrative services for the
separate accounts of the Company (the "Accounts") which invest in one
or more portfolios (collectively, the "Portfolios") of Janus Aspen
Series (the "Trust") pursuant to the Participation Agreement between
the Company and the Trust dated ______________ (the "Participation
Agreement"), and for purchasers of variable annuity or life insurance
contracts (the "Contracts") issued through the Accounts are the
responsibility of the Company. Administrative services for the
Portfolios, in which the Accounts invest, and for purchasers of shares
of the Portfolios, are the responsibility of the Trust. These
administrative services the Company intends to provide to the Trust and
its Portfolios are set forth in Schedule A attached to this letter
agreement, which may be amended from time to time.
2. Service Fee. In consideration of the anticipated administrative expense
savings resulting to the Trust from the Company's services, the Adviser
agrees to pay the Company a fee ("Service Fee"), computed daily and
paid monthly in arrears, at an annual rate equal to fifteen (15) basis
points (0.15%) of the average monthly value of the shares of the
Portfolios held in the Accounts, such payments to commence following
the month in which the average monthly value of investments by the
Accounts (together with the average monthly value of investments by the
separate accounts of Annuity Investors Life Insurance Company) reach
$50 million. The Service Fee will be correspondingly suspended if the
average monthly value of such investments drops below $50 million in
any month. For purposes of this Paragraph 2, the average monthly value
of the shares of the Portfolios will be based on the sum of the daily
net asset values calculated by the Portfolios in a month divided by the
number of days in the month.
3. Nature of Payments. The parties to this letter agreement recognize and
agree that the Adviser's payments to the Company relate to
administrative services only and do not constitute payment in any
manner for administrative services provided by the Company to the
Account or to the Contracts, for investment advisory services or for
costs of distribution of Contracts or of shares of the Portfolios, and
that these payments are not otherwise related to investment advisory or
distribution services or expenses.
4. Representations and Warranties.
a. The Adviser represents and warrants that in the event the
Trustees of the Trust approve the payment of all or any
portion of the Service Fee by the Trust, the Trust will
calculate in the same manner the Service Fee to all insurance
companies that have entered into Service Fee arrangements with
the Adviser and/or the Trust (the "Participating Insurance
Companies").
b. The Company represents and warrants that: (1) it and its
employees and agents meet the requirements of applicable law,
including but not limited to federal and state securities law
and state insurance law, for the performance of services
contemplated herein; and (2) it will not purchase Trust shares
of the Portfolios with Account assets derived from
tax-qualified retirement plans except indirectly, through
Contracts purchased in connection with such plans and that the
Service Fee does not include any payment to the Company that
is prohibited under the Employee Retirement Income Securities
Act of 1974 ("ERISA") with respect to any assets of a Contract
owner invested in a Contract using the Portfolios as
investment vehicles.
c. The Company represents, warrants and agrees that: (1) the
payment of the Service Fee by the Adviser is designed to
reimburse the Company for providing administrative services to
the Trust that the Trust would customarily pay and does not
represent reimbursement to the Company for providing
administrative services to the Contract or Account as
described in Section 26 of the Investment Company Act of 1940
(the "1940 Act") and the rules and regulations thereunder; (2)
no portion of the Service Fee will be rebated by the Company
to any Contract owner; and (3) if required by applicable law,
the Company will disclose to each Contract owner the existence
of the Service Fee received by the Company pursuant to this
letter agreement in a form consistent with the requirements of
applicable law and will disclose the amount of the Service
Fee, if any, that is paid by the Trust.
5. Indemnification
a. The Company agrees to indemnify and hold harmless the Adviser
and its directors, officers, and employees from any and all
loss, liability and expense resulting from any gross
negligence or willful wrongful act of the Company in
performing its services under this letter agreement, from the
inaccuracy or breach of any representation made in this letter
agreement, or from a breach of a material provision of this
letter agreement, except to the extent such loss, liability or
expense is the result of the Adviser's willful misfeasance,
bad faith or gross negligence in the performance of its
duties.
b. The Adviser agrees to indemnify and hold harmless the Company
and its directors, officers, agents and employees from any and
all loss, liability and expense resulting from any gross
negligence or willful wrongful act of the Adviser in
performing its services under this letter agreement, from the
inaccuracy or breach of any representation made in this letter
agreement, or from a breach of a material provision of this
letter agreement, except to the extent such loss, liability or
expense is the result of the Company's willful misfeasance,
bad faith or gross negligence in the performance if its
duties.
6. Termination.
a. Either party may terminate this letter agreement, without
penalty, on sixty (60) days' written notice to the other
party.
b. This letter agreement will terminate at the option of either
party in the event of the termination of the Participation
Agreement.
c. This letter agreement will terminate immediately upon the
determination of either party, with the advice of counsel,
that the payment of the Service Fee is in conflict with
applicable law.
7. Amendment. This letter agreement may be amended only upon mutual
agreement of the parties hereto in writing.
8. Confidentiality. The terms of this letter agreement will be treated as
confidential and will not be disclosed to the public or any outside
party except with each party's prior written consent, as required by
law or judicial process or as provided in paragraph 4c herein.
<PAGE>
9. Assignment. This letter agreement may not be assigned (as that term is
defined in the 1940 Act) by either party without the prior written
approval of the other party, which approval will not be unreasonably
withheld, except that the Adviser may assign its obligations under this
letter agreement, including the payment of all or any portion of the
Service Fee, to the Trust upon thirty (30) days' written notice to the
Company.
10. Governing Law. This letter agreement will be construed and the
provisions hereof interpreted under and in accordance with the laws of
the State of Colorado.
11. Counterparts. This letter agreement may be executed in counterparts,
each of which will be deemed an original but all of which will together
constitute one and the same instrument.
<PAGE>
If this letter agreement is consistent with your understanding of the matters we
discussed concerning administrative expense payments, kindly sign below and
return a signed copy to us.
Very truly yours,
JANUS CAPITAL CORPORATION
By: _______________________________
Name: _______________________________
Title: _______________________________
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
By: _______________________________
Name: _______________________________
Title: _______________________________
Attachment: Schedule A
<PAGE>
Schedule A
Pursuant to the letter agreement to which this Schedule is attached, the Company
will perform administrative services including, but not limited to, the
following:
1. Print and mail to Contract owners copies of the Portfolios'
prospectuses, proxy materials, periodic fund reports to shareholders and other
materials that the Trust is required by law or otherwise to provide to its
shareholders.
2. Provide Contract owner services including, but not limited to,
financial consultants' advice with respect to inquiries related to the
Portfolios (not including information about performance or related to sales) and
communicating with Contract owners about Portfolio (and subaccount) performance.
3. Provide other administrative support for the Trust as mutually
agreed to by the Company and the Adviser and relieve the Trust of other usual or
incidental administrative services provided to individual Contract owners.
<PAGE>
PARTICIPATION AGREEMENT
THIS AGREEMENT, is made as of _____________, 1999, by and
among Great American Life Insurance Company of New York ("Company"), on its own
behalf and on behalf of GALIC of New York Separate Account I, a segregated asset
account of the Company ("Account"), Strong Variable Insurance Funds, Inc.
("Strong Variable") on behalf of the Portfolios of Strong Variable listed on the
attached Exhibit A as such Exhibit may be amended from time to time (the
"Designated Portfolios"), Strong Opportunity Fund II, Inc. ("Opportunity Fund
II"), Strong Capital Management, Inc. (the "Adviser"), the investment adviser
and transfer agent for the Opportunity Fund II and Strong Variable, and Strong
Investments, Inc. ("Distributors"), the distributor for Strong Variable and the
Opportunity Fund II (each, a "Party" and collectively, the "Parties").
PRELIMINARY STATEMENTS
A. Beneficial interests in Strong Variable are divided into several
series of shares, each representing the interest in a particular managed
portfolio of securities and other assets (each, a "Portfolio").
B. To the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares of Opportunity Fund II and
the Designated Portfolios ("Fund" or "Funds" shall be deemed to refer to each
Designated Portfolio and to the Opportunity Fund II to the extent the context
requires), on behalf of the Account to fund the variable annuity contracts that
use the Funds as an underlying investment medium (the "Contracts").
C. The Company, Adviser and Distributors desire to facilitate the
purchase and redemption of shares of the Funds by the Company for the Account
through one or more accounts, which number shall be as mutually agreed upon by
the parties, in each Fund (each an "Omnibus Account"), to be maintained of
record by the Company, subject to the terms and conditions of this Agreement.
D. The Company desires to provide administrative services and functions
(the "Services") for purchasers of Contracts ("Owners") who are beneficial
owners of shares of the Funds on the terms and conditions set forth in this
Agreement.
AGREEMENTS
The parties to this Agreement agree as follows:
1. Performance of Services. Company agrees to perform the administrative
functions and services specified in Exhibit B attached to this Agreement with
respect to the shares of the Funds beneficially owned by the Owners and included
<PAGE>
in the Account. Nothing in this Agreement shall limit Company's right to engage
one or more of its wholly owned subsidiaries (each, a "Designee") to provide all
or any portion of the Services, but no such engagement shall relieve Company of
its duties, responsibilities or liabilities under this Agreement.
2. The Omnibus Accounts.
2.1 Each Omnibus Account will be opened based upon the information
contained in Exhibit C to this Agreement. In connection with each Omnibus
Account, Company represents and warrants that it is authorized to act on behalf
of each Owner effecting transactions in the Omnibus Account and that the
information specified on Exhibit C to this Agreement is correct.
2.2 Each Fund shall designate each Omnibus Account with an account
number. These account numbers will be the means of identification when the
Parties are transacting in the Omnibus Accounts. The assets in the Accounts are
segregated from the Company's own assets. The Adviser agrees to cause the
Omnibus Accounts to be kept open on each Fund's books, as applicable, regardless
of a lack of activity or small position size except to the extent the Company
takes specific action to close an Omnibus Account or to the extent a Fund's
prospectus reserves the right to close accounts which are inactive or of a small
position size. In the latter two cases, the Adviser will give prior notice to
the Company before closing an Omnibus Account.
2.3 The Company agrees to provide Adviser such information as Adviser
or Distributors may reasonably request concerning Owners as may be necessary or
advisable to enable Adviser and Distributors to comply with applicable laws,
including state "Blue Sky" laws relating to the sales of shares of the Funds to
the Accounts.
3. Fund Shares Transactions.
3.1 In General. Shares of the Funds shall be sold on behalf of the
Funds by Distributors and purchased by Company for the Account and, indirectly
for the appropriate subaccount thereof at the net asset value next computed
after receipt by Distributors of each order of the Company or its Designee, in
accordance with the provisions of this Agreement, the then current prospectuses
of the Funds, and the Contracts. Company may purchase shares of the Funds for
its own account subject to (a) receipt of prior written approval by
Distributors; and (b) such purchases being in accordance with the then current
prospectuses of the Fund and the Contracts. The Board of Directors of each Fund
("Directors") may refuse to sell shares of the applicable Fund to any person, or
suspend or terminate the offering of shares of the Fund if such action is
required by law or by regulatory authorities having jurisdiction. Company agrees
to purchase and redeem the shares of the Funds in accordance with the provisions
of this Agreement, of the Contracts and of the then current prospectuses for the
<PAGE>
Contracts and Funds. Except as necessary to implement transactions initiated by
Owners, or as otherwise permitted by state or federal laws or regulations,
Company shall not redeem shares of Funds attributable to the Contracts.
3.2 Purchase and Redemption Orders. On each day that a Fund is open for
business (a "Business Day"), the Company or its Designee shall aggregate and
calculate the net purchase or redemption order it receives for the Account from
the Owners for shares of the Fund that it received prior to the close of trading
on the New York Stock Exchange (the "NYSE") (i.e. 3:00 p.m., Central time,
unless the NYSE closes at an earlier time in which case such earlier time shall
apply) and communicate to Distributors, by telephone or facsimile (or by such
other means as the Parties to this Agreement may agree to in writing), the net
aggregate purchase or redemption order (if any) for the Omnibus Account for such
Business Day (such Business Day is sometimes referred to herein as the "Trade
Date"). The Company or its Designee will communicate such orders to Distributors
prior to 8:00 a.m., Central time, on the next Business Day following the Trade
Date. All trades communicated to Distributors by the foregoing deadline shall be
treated by Distributors as if they were received by Distributors prior to the
close of trading on the Trade Date.
3.3 Settlement of Transactions.
(a) Purchases. Company or its Designee will wire, or arrange
for the wire of, the purchase price of each purchase order to the custodian for
the Fund in accordance with written instructions provided by Distributors to the
Company so that either (i) such funds are received by the custodian for the Fund
prior to 12:00 (noon), Central time, on the next Business Day following the
Trade Date, or (ii) Distributors is provided with a Federal Funds wire system
reference number prior to such 12:00 noon deadline evidencing the entry of the
wire transfer of the purchase price to the applicable custodian into the Federal
Funds wire system prior to such time. Company agrees that if it fails to provide
funds to the Fund's custodian by the close of business on the next Business Day
following the Trade Date, then, at the option of Distributors, (A) the
transaction may be canceled, or (B) the transaction may be processed at the
next-determined net asset value for the applicable Fund after purchase order
funds are received. In such event, the Company shall indemnify and hold harmless
Distributors, Adviser and the Funds from any liabilities, costs and damages
either may suffer as a result of such failure.
(b) Redemptions. The Adviser will use its best efforts to
cause to be transmitted to such custodial account as Company shall direct in
writing, the proceeds of all redemption orders placed by Company or its Designee
by 8:00 a.m., Central time, on the Business Day immediately following the Trade
Date, by wire transfer on that Business Day. Should Adviser need to extend the
settlement on a trade, it will contact Company to discuss the extension. For
purposes of determining the length of settlement, Adviser agrees to treat the
Account no less favorably than other shareholders of the Funds. Each wire
<PAGE>
transfer of redemption proceeds shall indicate, on the Federal Funds wire
system, the amount thereof attributable to each Fund; provided, however, that if
the number of entries would be too great to be transmitted through the Federal
Funds wire system, the Adviser shall, on the day the wire is sent, fax such
entries to Company or if possible, send via direct or indirect systems access
until otherwise directed by the Company in writing.
3.4 Book Entry Only. Issuance and transfer of shares of a Fund will be
by book entry only. Stock certificates will not be issued to the Company or the
Account. Shares of the Funds ordered from Distributors will be recorded in the
appropriate book entry title for the Account.
3.5 Distribution Information. The Adviser or Distributors shall provide
the Company with all distribution announcement information as soon as it is
announced by the Funds. The distribution information shall set forth, as
applicable, ex-dates, record date, payable date, distribution rate per share,
record date share balances, cash and reinvested payment amounts and all other
information reasonably requested by the Company. Where possible, the Adviser or
Distributors shall provide the Company with direct or indirect systems access to
the Adviser's systems for obtaining such distribution information.
3.6 Reinvestment. All dividends and capital gains distributions will be
automatically reinvested on the payable date in additional shares of the
applicable Fund at net asset value in accordance with each Fund's then current
prospectus.
3.7 Pricing Information. Distributors shall use its best efforts to
furnish to the Company prior to 6:00 p.m., Central time, on each Business Day
each Fund's closing net asset value for that day, and for those Funds for which
such information is calculated, the daily accrual for interest rate factor (mil
rate). Such information shall be communicated via fax, or indirect or direct
systems access acceptable to the Company.
3.8 Price Errors.
(a) Notification. If an adjustment is required in accordance
with a Fund's then current policies on reimbursement ("Fund Reimbursement
Policies") to correct any error in the computation of the net asset value of
Fund shares ("Price Error"), Adviser or Distributors shall notify Company as
soon as practicable after discovering the Price Error. Notice may be made via
facsimile or via direct or indirect systems access and shall state the incorrect
price, the correct price and, to the extent communicated to the Fund's
shareholders, the reason for the price change.
(b) Underpayments. If a Price Error causes an Account to
receive less than the amount to which it otherwise would have been entitled,
Adviser shall make all necessary adjustments (subject to the Fund Reimbursement
Policies) so that the Account receives the amount to which it would have been
entitled
<PAGE>
(c) Overpayments. If a Price Error causes an Account to
receive more than the amount to which it otherwise would have been entitled,
Company, when requested by Adviser (in accordance with the Fund Reimbursement
Policies), will use its best efforts to collect such excess amounts from the
applicable Owners.
(d) Fund Reimbursement Policies. Adviser agrees to treat
Company's customers no less favorably than Adviser treats its retail
shareholders in applying the provisions of paragraphs 3.8(b) and 3.8(c).
(e) Expenses. Adviser shall reimburse Company for all
reasonable and necessary out-of-pocket expenses incurred by Company for payroll
overtime, stationery and postage in adjusting Owner accounts affected by a Price
Error described in paragraphs 3.8(b) and 3.8(c). Company shall use its best
efforts to mitigate all expenses which may be reimbursable under this section
3.8(e) and agrees that payroll overtime shall not include any time spent
programming computers or otherwise customizing Company's recordkeeping system.
Upon requesting reimbursement, Company shall present an itemized bill to Adviser
detailing the costs for which it seeks reimbursement.
3.9 Agency. Distributors hereby appoints the Company or its Designee as
its agents for the limited purpose of accepting purchase and redemption
instructions from the Owners for the purchase and redemption of shares of the
Funds by the Company on behalf of Account.
3.10 Quarterly Reports. Adviser agrees to provide Company a statement
of Fund assets as soon as practicable and in any event within 30 days after the
end of each fiscal quarter, and a statement certifying the compliance by the
Funds during that fiscal quarter with the diversification requirements and
qualification as a regulated investment company. In the event of a breach of
Section 6.4(a), Adviser will take all reasonable steps (a) to notify Company of
such breach and (b) to adequately diversify the Fund so as to achieve compliance
within the grace period afforded by Treasury Regulation 1.817-5.
4. Proxy Solicitations and Voting. The Company shall, at its expense, distribute
or arrange for the distribution of all proxy materials furnished by the Funds to
the Account and shall: (a) solicit voting instructions from Owners; (b) vote the
Fund shares in accordance with instructions received from Owners; and (c) vote
the Fund shares for which no instructions have been received, as well as shares
attributable to it, in the same proportion as Fund shares for which instructions
have been received from Owners, so long as and to the extent that the Securities
and Exchange Commission (the "SEC") continues to interpret the Investment
Company Act of 1940, as amended (the "1940 Act"), to require pass-through voting
privileges for various contract owners. The Company and its Designees will not
recommend action in connection with, or oppose or interfere with, the
solicitation of proxies for the Fund shares held for Owners.
<PAGE>
5. Customer Communications.
5.1 Prospectuses. The Adviser or Distributors, at its expense, will
provide the Company with as many copies of the current prospectus for the Funds
as the Company may reasonably request for distribution, at the Company's
expense, to existing or prospective Owners.
5.2 Shareholder Materials. The Adviser and Distributors shall, as
applicable, provide in bulk to the Company or its authorized representative, at
a single address and at no expense to the Company, the following shareholder
communications materials prepared for circulation to Owners in quantities
requested by the Company which are sufficient to allow mailing thereof by the
Company and, to the extent required by applicable law, to all Owners: proxy or
information statements, annual reports, semi-annual reports, and all initial and
updated prospectuses, supplements and amendments thereof. None of the Funds, the
Adviser or Distributors shall be responsible for the cost of distributing such
materials to Owners.
6. Representations and Warranties.
6.1 The Company represents and warrants that:
(a) It is an insurance company duly organized and in good
standing under the laws of the State of New York and that it has legally and
validly established the Account prior to any issuance or sale thereof as a
segregated asset account and that the Company has and will maintain the capacity
to issue all Contracts that may be sold; and that it is and will remain duly
registered, licensed, qualified and in good standing to sell the Contracts in
all the jurisdictions in which such Contracts are to be offered or sold;
(b) It and each of its Designees is and will remain duly
registered and licensed in all material respects under all applicable federal
and state securities and insurance laws and shall perform its obligations under
this Agreement in compliance in all material respects with any applicable state
and federal laws;
(c) The Contracts are and will be registered under the
Securities Act of 1933, as amended (the "1933 Act"), and are and will be
registered and qualified for sale in the states where so required; and the
Account is and will be registered as a unit investment trust in accordance with
the 1940 Act and shall be a segregated investment account for the Contracts;
(d) The Contracts are currently treated as annuity contracts,
under applicable provisions of the Internal Revenue Code of 1986, as amended
(the "Code"), and the Company will maintain such treatment and will notify
Adviser, Distributors and Funds promptly upon having a reasonable basis for
believing that the Contracts have ceased to be so treated or that they might not
be so treated in the future;
<PAGE>
(e) It and each of its Designees is registered as a transfer
agent pursuant to Section 17A of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), or is not required to be registered as such;
(f) The arrangements provided for in this Agreement will be
disclosed to the Owners; and
(g) It is registered as a broker-dealer under the 1934 Act and
any applicable state securities laws, including as a result of entering into and
performing the Services set forth in this Agreement, or is not required to be
registered as such.
6.2 The Funds each represent and warrant that Fund shares sold pursuant
to this Agreement are and will be registered under the 1933 Act and the Fund is
and will be registered as a registered investment company under the Investment
Company Act of 1940, in each case, except to the extent the Company is so
notified in writing;
6.3 Distributors represents and warrants that:
(a) It is and will be a member in good standing of the
National Association of Securities Dealers, Inc. ("NASD")and is and will be
registered as a broker-dealer with the SEC; and
(b) It will sell and distribute Fund shares in accordance with
all applicable state and federal laws and regulations.
6.4 Adviser represents and warrants that:
(a) It will cause each Fund to invest money from the Contracts
in such a manner as to ensure that the Contracts will be treated as variable
annuity contracts under the Code and the regulations issued thereunder, and that
each Fund will comply with Section 817(h) of the Code as amended from time to
time and with all applicable regulations promulgated thereunder; and
(b) It is and will remain duly registered and licensed in all
material respects under all applicable federal and state securities and
insurance laws and shall perform its obligations under this Agreement in
compliance in all material respects with any applicable state and federal laws.
<PAGE>
6.5 Each of the Parties to this Agreement represents and warrants to
the others that:
(a) It has full power and authority under applicable law, and
has taken all action necessary, to enter into and perform this Agreement and the
person executing this Agreement on its behalf is duly authorized and empowered
to execute and deliver this Agreement;
(b) This Agreement constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms and it shall
comply in all material respects with all laws, rules and regulations applicable
to it by virtue of entering into this Agreement;
(c) No consent or authorization of, filing with, or other act
by or in respect of any governmental authority, is required in connection with
the execution, delivery, performance, validity or enforceability of this
Agreement;
(d) The execution, performance and delivery of this Agreement
will not result in it violating any applicable law or breaching or otherwise
impairing any of its contractual obligations;
(e) Each Party to this Agreement is entitled to rely on any
written records or instructions provided to it by another Party; and
(f) Its directors, officers, employees, and investment
advisers, and other individuals/entities dealing with the money or securities of
a Fund are and shall continue to be at all times covered by a blanket fidelity
bond or similar coverage for the benefit of the Fund in an amount not less than
the amount required by the applicable rules of the NASD and the federal
securities laws, which bond shall include coverage for larceny and embezzlement
and shall be issued by a reputable bonding company.
7. Sales Material and Information
7.1 NASD Filings. The Company shall promptly inform Distributors as to
the status of all sales literature filings pertaining to the Funds and shall
promptly notify Distributors of all approvals or disapprovals of sales
literature filings with the NASD. For purposes of this Section 7, the phrase
"sales literature or other promotional material" shall be construed in
accordance with all applicable securities laws and regulations.
7.2 Company Representations. Neither the Company nor any of its
Designees shall make any material representations concerning the Adviser, the
Distributors, or a Fund other than the information or representations contained
in: (a) a registration statement of the Fund or prospectus of a Fund, as amended
or supplemented from time to time; (b) published reports or statements of the
Funds which are in the public domain or are approved by Distributors or the
Funds; or (c) sales literature or other promotional material of the Funds.
<PAGE>
7.3 Adviser, Distributors and Fund Representations. None of Adviser,
Distributors or any Fund shall make any material representations concerning the
Company or its Designees other than the information or representations contained
in: (a) a registration statement or prospectus for the Contracts, as amended or
supplemented from time to time; (b) published reports or statements of the
Contracts or the Account which are in the public domain or are approved by the
Company; or (c) sales literature or other promotional material of the Company.
7.4 Trademarks, etc. Except to the extent required by applicable law,
no Party shall use any other Party's names, logos, trademarks or service marks,
whether registered or unregistered, without the prior consent of such Party.
7.5 Information From Distributors and Adviser. Upon request,
Distributors or Adviser will provide to Company at least one complete copy of
all registration statements, prospectuses, Statements of Additional Information,
reports, proxy statements, solicitations for voting instructions, applications
for exemptions, requests for no action letters, and all amendments to any of the
above, that relate to the Funds, in final form as filed with the SEC, NASD and
other regulatory authorities.
7.6 Information From Company. Company will provide to Distributors at
least one complete copy of all registration statements, prospectuses, Statements
of Additional Information, reports, solicitations for voting instructions, sales
literature and other promotional materials, applications for exemptions,
requests for no action letters and all amendments to any of the above, that
relate to a Fund and the Contracts, in final form as filed with the SEC, NASD
and other regulatory authorities.
7.7 Review of Marketing Materials. If so requested by Company, the
Adviser or Distributors will use its best efforts to review sales literature and
other marketing materials prepared by Company which relate to the Funds, the
Adviser or Distributors for factual accuracy as to such entities, provided that
the Adviser or Distributors is provided at least five (5) Business Days to
review such materials. Neither the Adviser nor Distributors will review such
materials for compliance with applicable laws. Company shall provide the Adviser
with copies of all sales literature and other marketing materials which refer to
the Funds, the Adviser or Distributors within five (5) Business Days after their
first use, regardless of whether the Adviser or Distributors has previously
reviewed such materials. If so requested by the Adviser or Distributors, Company
shall cease to use any sales literature or marketing materials which refer to
the Funds, the Adviser or Distributors that the Adviser or Distributors
determines to be inaccurate, misleading or otherwise unacceptable.
<PAGE>
8. Fees and Expenses.
8.1 Fund Registration Expenses. Fund or Distributors shall bear the
cost of registration and qualification of Fund shares; preparation and filing of
Fund prospectuses and registration statements, proxy materials and reports;
preparation of all other statements and notices relating to the Fund or
Distributors required by any federal or state law; payment of all applicable
fees, including, without limitation, any fees due under Rule 24f-2 of the 1940
Act, relating to a Fund; and all taxes on the issuance or transfer of Fund
shares on the Fund's records.
8.2 Contract Registration Expenses. The Company shall bear the expenses
for the costs of preparation and filing of the Company's prospectus and
registration statement with respect to the Contracts; preparation of all other
statements and notices relating to the Account or the Contracts required by any
federal or state law; expenses for the solicitation and sale of the Contracts
including all costs of printing and distributing all copies of advertisements,
prospectuses, Statements of Additional Information, proxy materials, and reports
to Owners or potential purchasers of the Contracts as required by applicable
state and federal law; payment of all applicable fees relating to the Contracts;
all costs of drafting, filing and obtaining approvals of the Contracts in the
various states under applicable insurance laws; filing of annual reports on form
N-SAR, and all other costs associated with ongoing compliance with all such laws
and its obligations under this Agreement.
9. Indemnification.
9.1 Indemnification By Company.
(a) Company agrees to indemnify and hold harmless the Funds,
Adviser and Distributors and each of their directors, officers, employees and
agents, and each person, if any, who controls any of them within the meaning of
Section 15 of the 1933 Act (each, an "Indemnified Party" and collectively, the
"Indemnified Parties" for purposes of this Section 9.1) from and against any and
all losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of Company), and expenses including reasonable legal
fees and expenses, (collectively, hereinafter "Losses"), to which the
Indemnified Parties may become subject under any statute, regulation, at common
law or otherwise insofar as such Losses:
(i) arise out of or are based upon any untrue statements
or alleged untrue statements of any material fact contained in the registration
statement, prospectus or sales literature for the Contracts or contained in the
Contracts (or any amendment or supplement to any of the foregoing), or arise out
of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, provided that this paragraph 9.1(a) shall not apply as
to any Indemnified Party if such statement or omission or such alleged statement
<PAGE>
or omission was made in reliance upon and in conformity with written information
furnished to Company by or on behalf of a Fund, Distributors or Adviser for use
in the registration statement or prospectus for the Contracts or in the
Contracts (or any amendment or supplement) or otherwise for use in connection
with the sale of the Contracts or Fund shares; or
(ii) arise out of, or as a result of, statements or
representations or wrongful conduct of Company, its Designees or its agents,
with respect to the sale or distribution of the Contracts or Fund shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration statement, prospectus,
or sales literature covering a Fund or any amendment thereof or supplement
thereto, or the omission or alleged omission to state therein a material fact
required to be stated therein, or necessary to make the statements therein not
misleading, if such a statement or omission was made in reliance upon written
information furnished to a Fund, Adviser or Distributors by or on behalf of
Company; or
(iv) arise out of, or as a result of, any failure by
Company, its Designees or persons under the Company's or Designees' control to
provide the Services and furnish the materials contemplated under the terms of
this Agreement; or
(v) arise out of, or result from, any material breach of
any representation or warranty made by Company, its Designees or persons under
the Company's or Designees' control in this Agreement or arise out of or result
from any other material breach of this Agreement by Company, its Designees or
persons under the Company's or Designees' control; as limited by and in
accordance with the provisions of Sections 9.1(b) and 9.1(c) hereof; or
(vi) arise out of, or as a result of, adherence by Adviser
or Distributors to instructions that it reasonably believes were originated by
authorized agents of Company.
This indemnification provision is in addition to any liability
which the Company or its Designees may otherwise have.
(b) Company shall not be liable under this indemnification
provision with respect to any Losses to which an Indemnified Party would
otherwise be subject by reason of such Indemnified Party's willful misfeasance,
bad faith, or gross negligence in the performance of such Indemnified Party's
duties or by reason of such Indemnified Party's reckless disregard of
obligations or duties under this Agreement.
(c) Company shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
<PAGE>
such Indemnified Party shall have notified Company in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify Company of any such
claim shall not relieve Company from any liability which it may have to the
Indemnified Party otherwise than on account of this indemnification provision.
In case any such action is brought against any Indemnified Party, and it
notified the indemnifying Party of the commencement thereof, the indemnifying
Party will be entitled to participate therein and, to the extent that it may
wish, assume the defense thereof, with counsel satisfactory to such Indemnified
Party. After notice from the indemnifying Party of its intention to assume the
defense of an action, the Indemnified Party shall bear the expenses of any
additional counsel obtained by it, and the indemnifying Party shall not be
liable to such Indemnified Party under this Section for any legal or other
expenses subsequently incurred by such Indemnified Party in connection with the
defense thereof other than reasonable costs of investigation. The Indemnified
Party may not settle any action without the written consent of the indemnifying
Party. The indemnifying Party may not settle any action without the written
consent of the Indemnified Party unless such settlement completely and finally
releases the Indemnified Party from any and all liability. In either event,
consent shall not be unreasonably withheld.
(d) The Indemnified Parties will promptly notify Company of
the commencement of any litigation or proceedings against the Indemnified
Parties in connection with the issuance or sale of Fund shares or the Contracts
or the operation of a Fund.
9.2 Indemnification by Adviser and Distributors.
(a) Adviser and Distributors agrees to indemnify and hold
harmless Company and each of its directors, officers, employees and agents and
each person, if any, who controls Company within the meaning of Section 15 of
the 1933 Act (each, an "Indemnified Party" and collectively, the "Indemnified
Parties" for purposes of this Section 9.2) from and against any and all Losses
to which the Indemnified Parties may become subject under any statute,
regulation, at common law or otherwise, insofar as such Losses:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the registration
statement or prospectus or sales literature of a Fund (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
provided that this Section 9.2(a) shall not apply as to any Indemnified Party if
such statement or omission or such alleged statement or omission was made in
reliance upon and in conformity with written information furnished to a Fund,
Adviser or Distributors by or on behalf of Company for use in the registration
<PAGE>
statement or prospectus for a Fund or in sales literature (or any amendment or
supplement) or otherwise for use in connection with the sale of the Contracts or
Fund shares; or
(ii) arise out of, or as a result of, statements or
representations or wrongful conduct of Adviser or Distributors or persons under
its control, with respect to the sale or distribution of Fund shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration statement, prospectus,
or sales literature covering the Contracts, or any amendment thereof or
supplement thereto, or the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading, if such statement or omission was made in reliance upon
written information furnished to Company by or on behalf of Adviser or
Distributors; or
(iv) arise out of, or as a result of, any failure by
Adviser or Distributors or persons under its control to provide the services and
furnish the materials contemplated under the terms of this Agreement; or
(v) arise out of or result from any material breach of any
representation or warranty made by Adviser or Distributors or persons under its
control in this Agreement or arise out of or result from any other material
breach of this Agreement by Adviser or Distributors or persons under its
control; as limited by and in accordance with the provisions of Sections 9.2(b)
and 9.2(c) hereof.
This indemnification provision is in addition to any liability
which Adviser and Distributors may otherwise have.
(b) Adviser and Distributors shall not be liable under this
indemnification provision with respect to any Losses to which an Indemnified
Party would otherwise be subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's reckless
disregard of obligations and duties under this Agreement.
(c) Adviser and Distributors shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have notified Adviser and Distributors
in writing within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been served
upon such Indemnified Party (or after such Indemnified Party shall have received
notice of such service on any designated agent), but failure to notify Adviser
and Distributors of any such claim shall not relieve Adviser and Distributors
from any liability which it may have to the Indemnified Party otherwise than on
account of this indemnification provision. In case any such action is brought
<PAGE>
against any Indemnified Party, and it notified the indemnifying Party of the
commencement thereof, the indemnifying Party will be entitled to participate
therein and, to the extent that it may wish, assume the defense thereof, with
counsel satisfactory to such Indemnified Party. After notice from the
indemnifying Party of its intention to assume the defense of an action, the
Indemnified Party shall bear the expenses of any additional counsel obtained by
it, and the indemnifying Party shall not be liable to such Indemnified Party
under this Section for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof other than reasonable
costs of investigation. The Indemnified Party may not settle any action without
the written consent of the indemnifying Party. The indemnifying Party may not
settle any action without the written consent of the Indemnified Party unless
such settlement completely and finally releases the Indemnified Party from any
and all liability. In either event, consent shall not be unreasonably withheld.
(d) The Indemnified Parties will promptly notify Adviser and
Distributors of the commencement of any litigation or proceedings against the
Indemnified Parties in connection with the issuance or sale of the Contracts or
the operation of the Account.
10. Potential Conflicts.
10.1 Monitoring by Directors for Conflicts of Interest. The Directors
of each Fund will monitor the Fund for any potential or existing material
irreconcilable conflict of interest between the interests of the contract owners
of all separate accounts investing in the Fund, including such conflict of
interest with any other separate account of any other insurance company
investing in the Fund. An irreconcilable material conflict may arise for a
variety of reasons, including: (a) an action by any state insurance regulatory
authority; (b) a change in applicable federal or state insurance, tax, or
securities laws or regulations, or a public ruling, private letter ruling,
no-action or interpretive letter, or any similar action by insurance, tax or
securities regulatory authorities; (c) an administrative or judicial decision in
any relevant proceeding; (d) the manner in which the investments of the Fund are
being managed; (e) a difference in voting instructions given by variable annuity
contract owners and variable life insurance contract owners or by contract
owners of different life insurance companies utilizing the Fund; or (f) a
decision by Company to disregard the voting instructions of Owners. The
Directors shall promptly inform the Company, in writing, if they determine that
an irreconcilable material conflict exists and the implications thereof.
10.2 Monitoring by the Company for Conflicts of Interest. The Company
will promptly notify the Directors, in writing, of any potential or existing
material irreconcilable conflicts of interest, as described in Section 10.1
above, of which it is aware. The Company will assist the Directors in carrying
out their responsibilities under any applicable provisions of the federal
securities laws and any exemptive orders granted by the SEC ("Exemptive Order"),
by providing the Directors, in a timely manner, with all information reasonably
<PAGE>
necessary for the Directors to consider any issues raised. This includes, but is
not limited to, an obligation by the Company to inform the Directors whenever
Owner voting instructions are disregarded.
10.3 Remedies. If it is determined by a majority of the Directors, or a
majority of disinterested Directors, that a material irreconcilable conflict
exists, as described in Section 10.1 above, the Company shall, at its own
expense take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, up to and including, but not limited to: (a)
withdrawing the assets allocable to some or all of the separate accounts from
the applicable Fund and reinvesting such assets in a different investment
medium, including (but not limited to) another fund managed by the Adviser, or
submitting the question whether such segregation should be implemented to a vote
of all affected Owners and, as appropriate, segregating the assets of any
particular group that votes in favor of such segregation, or offering to the
affected owners the option of making such a change; and (b) establishing a new
registered management investment company or managed separate account.
10.4 Causes of Conflicts of Interest.
(a) State Insurance Regulators. If a material irreconcilable
conflict arises because a particular state insurance regulator's decision
applicable to the Company conflicts with the majority of other state regulators,
then the Company will withdraw the affected Account's investment in the
applicable Fund and terminate this Agreement with respect to such Account within
the period of time permitted by such decision, but in no event later than six
months after the Directors inform the Company in writing that it has determined
that such decision has created an irreconcilable material conflict; provided,
however, that such withdrawal and termination shall be limited to the extent
required by the foregoing material irreconcilable conflict as determined by a
majority of the disinterested Directors. Until the end of the foregoing period,
the Distributors and Funds shall continue to accept and implement orders by the
Company for the purchase (and redemption) of shares of the Fund to the extent
such actions do not violate applicable law.
(b) Disregard of Owner Voting. If a material irreconcilable
conflict arises because of Company's decision to disregard Owner voting
instructions and that decision represents a minority position or would preclude
a majority vote, Company may be required, at the applicable Fund's election, to
withdraw the Account's investment in said Fund. No charge or penalty will be
imposed against the Account as a result of such withdrawal.
10.5 Limitations on Consequences. For purposes of Sections 10.3 through
10.5 of this Agreement, a majority of the disinterested Directors shall
determine whether any proposed action adequately remedies any irreconcilable
material conflict. In no event will a Fund, the Adviser or the Distributors be
<PAGE>
required to establish a new funding medium for any of the Contracts. The Company
shall not be required by Section 10.3 to establish a new funding medium for the
Contracts if an offer to do so has been declined by vote of a majority of Owners
affected by the irreconcilable material conflict. In the event that the
Directors determine that any proposed action does not adequately remedy any
irreconcilable material conflict, then the Company will withdraw the Account's
investment in the applicable Fund and terminate this Agreement as quickly as may
be required to comply with applicable law, but in no event later than six (6)
months after the Directors inform the Company in writing of the foregoing
determination, provided, however, that such withdrawal and termination shall be
limited to the extent required by any such material irreconcilable conflict.
10.6 Changes in Laws. If and to the extent that Rule 6e-2 and Rule
6e-3(T) are amended, or Rule 6e-3 is adopted, to provide exemptive relief from
any provision of the Act or the rules promulgated thereunder with respect to
mixed or shared funding (as defined in the Funds' Exemptive Order) on terms and
conditions materially different from those contained in the Funds' Exemptive
Order, then (a) the Funds and/or the Adviser, as appropriate, shall take such
steps as may be necessary to comply with Rules 6e-2 and 6e-3(T), as amended, and
Rule 6e-3, as adopted, to the extent such rules are applicable; and (b) Sections
10.1, 10.2, 10.3 and 10.4 of this Agreement shall continue in effect only to the
extent that terms and conditions substantially identical to such Sections are
contained in such Rule(s) as so amended or adopted.
11. Maintenance of Records.
(a) Recordkeeping and other administrative services to Owners
shall be the responsibility of the Company and shall not be the responsibility
of the Funds, Adviser or Distributors. None of the Funds, the Adviser or
Distributors shall maintain separate accounts or records for Owners. Company
shall maintain and preserve all records as required by law to be maintained and
preserved in connection with providing the Services and in making shares of the
Funds available to the Account.
(b) Upon the request of the Adviser or Distributors, the
Company shall provide copies of all the historical records relating to
transactions between the Funds and the Account, written communications regarding
the Funds to or from the Account and other materials, in each case (1) as are
maintained by the Company in the ordinary course of its business and in
compliance with applicable law, and (2) as may reasonably be requested to enable
the Adviser and Distributors, or its representatives, including without
limitation its auditors or legal counsel, to (A) monitor and review the
Services, (B) comply with any request of a governmental body or self-regulatory
organization or the Owners, (C) verify compliance by the Company with the terms
of this Agreement, (D) make required regulatory reports, (E) verify to Advisor's
reasonable satisfaction that all purchase and redemption orders aggregated for
each Trade Date were received by Company prior to the close of trading on the
NYSE on such Trade Date, or (F) perform general customer supervision. The
<PAGE>
Company agrees that it will permit the Adviser and Distributors or such
representatives of either to have reasonable access to its personnel and records
in order to facilitate the monitoring of the quality of the Services.
(c) Upon the request of the Company, the Adviser and
Distributors shall provide copies of all the historical records relating to
transactions between the Funds and the Account, written communications regarding
the Funds to or from the Account and other materials, in each case (1) as are
maintained by the Adviser and Distributors, as the case may be, in the ordinary
course of its business and in compliance with applicable law, and (2) as may
reasonably be requested to enable the Company, or its representatives, including
without limitation its auditors or legal counsel, to (A) comply with any request
of a governmental body or self-regulatory organization or the Owners, (B) verify
compliance by the Adviser and Distributors with the terms of this Agreement, (C)
make required regulatory reports, or (D) perform general customer supervision.
(d) The Parties agree to cooperate in good faith in providing
records to one another pursuant to this Section 11.
12. Term and Termination.
12.1 Term and Termination Without Cause. The initial term of this
Agreement shall be for a period of one year from the date hereof. Unless
terminated as to any Fund upon not less than thirty (30) days prior written
notice to the other Parties, this Agreement shall thereafter automatically renew
for the remaining Funds from year to year, subject to termination at the next
applicable renewal date upon not less than 30 days prior written notice. Any
Party may terminate this Agreement as to any Fund following the initial term
upon six (6) months advance written notice to the other Parties.
12.2 Termination by Fund, Distributors or Adviser for Cause. Adviser,
Fund or Distributors may terminate this Agreement by written notice to the
Company, if any of them shall determine, in its sole judgment exercised in good
faith, that (a) the Company has suffered a material adverse change in its
business, operations, financial condition or prospects since the date of this
Agreement or is the subject of material adverse publicity; or (b) any of the
Contracts are not registered, issued or sold in accordance with applicable state
and federal law or such law precludes the use of Fund shares as the underlying
investment media of the Contracts issued or to be issued by the Company.
12.3 Termination by Company for Cause. Company may terminate this
Agreement by written notice to the Adviser, Funds and Distributors in the event
that (a) any of the Fund shares are not registered, issued or sold in accordance
with applicable state or federal law or such law precludes the use of such
shares as the underlying investment media of the Contracts issued or to be
<PAGE>
issued by the Company; (b) the Funds cease to qualify as Regulated Investment
Companies under Subchapter M of the Code or under any successor or similar
provision, or if the Company reasonably believes that the Funds may fail to so
qualify; or (c) a Fund fails to meet the diversification requirements specified
in Section 6.4(a).
12.4 Termination by any Party. This Agreement may be terminated as to
any Fund by any Party at any time (a) by giving 30 days' written notice to the
other Parties in the event of a material breach of this Agreement by the other
Party or Parties that is not cured during such 30-day period, and (b) (i) upon
institution of formal proceedings relating to the legality of the terms and
conditions of this Agreement against the Account, Company, any Designee, the
Funds, Adviser or Distributors by the NASD, the SEC or any other regulatory body
provided that the terminating Party has a reasonable belief that the institution
of formal proceedings is not without foundation and will have a material adverse
impact on the terminating Party, (ii) by the non-assigning Party upon the
assignment of this Agreement in contravention of the terms hereof, or (iii) as
is required by law, order or instruction by a court of competent jurisdiction or
a regulatory body or self-regulatory organization with jurisdiction over the
terminating Party.
12.5 Limit on Termination. Notwithstanding the termination of this
Agreement with respect to any or all Funds, for so long as any Contracts remain
outstanding and invested in a Fund each Party to this Agreement shall continue
to perform such of its duties under this Agreement as are necessary to ensure
the continued tax deferred status thereof and the payment of benefits
thereunder, except to the extent proscribed by law, the SEC or other regulatory
body. Notwithstanding the foregoing, nothing in this Section 12.5 obligates a
Fund to continue in existence. In the event that any Fund elects to terminate
its operations, the Company shall, as soon as practicable, obtain an exemptive
order or order of substitution from the SEC to remove all Owners from the
applicable Fund.
13. Notices.
All notices under this Agreement shall be given in writing (and shall
be deemed to have been duly given upon receipt) by delivery in person, by
facsimile, by registered or certified mail or by overnight delivery (postage
prepaid, return receipt requested) to the respective Parties as follows:
If to Strong Variable:
Strong Variable Insurance Funds, Inc.
100 Heritage Reserve
Milwaukee, WI 53051
Attention: General Counsel
Facsimile No.: 414/359-3948
<PAGE>
If to Opportunity Fund II:
Strong Opportunity Fund II, Inc.
100 Heritage Reserve
Milwaukee, WI 53051
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Adviser:
Strong Capital Management, Inc.
100 Heritage Reserve
Milwaukee, WI 53051
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Distributors:
Strong Investments, Inc.
100 Heritage Reserve
Milwaukee, WI 53051
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Company:
Annuity Investors Life Insurance Company
250 East Fifth Street, 9th Floor
Cincinnati, OH 45202
Attention: Mark F. Muething
Facsimile No.: (513) 357-3397
14. Miscellaneous.
14.1. Captions. The captions in this Agreement are included for
convenience of reference only and in no way affect the construction or effect of
any provisions hereof.
14.2. Enforceability. If any portion of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
the Agreement shall not be affected thereby.
<PAGE>
14.3. Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, each of which taken together shall constitute one and
the same instrument.
14.4. Remedies not Exclusive. The rights, remedies and obligations
contained in this Agreement are cumulative and are in addition to any and all
rights, remedies and obligations, at law or in equity, which the Parties to this
Agreement are entitled to under state and federal laws.
14.5. Confidentiality. Subject to the requirements of legal process and
regulatory authority, the Funds and Distributors shall treat as confidential the
names and addresses of the owners of the Contracts and all information
reasonably identified as confidential in writing by the Company to this
Agreement and, except as permitted by this Agreement, shall not disclose,
disseminate or utilize such names and addresses and other confidential
information without the express written consent of the Company until such time
as it may come into the public domain.
14.6. Governing Law. This Agreement shall be governed by and
interpreted in accordance with the internal laws of the State of Wisconsin
applicable to agreements fully executed and to be performed therein; exclusive
of conflicts of laws.
14.7. Survivability. Sections 6, 7.2, 7.3, 7.4, 9, 11 and 12.5 hereof
shall survive termination of this Agreement. In addition, all provisions of this
Agreement shall survive termination of this Agreement in the event that any
Contracts are invested in a Fund at the time the termination becomes effective
and shall survive for so long as such Contracts remain so invested.
14.8. Amendment and Waiver. No modification of any provision of this
Agreement will be binding unless in writing and executed by the Party to be
bound thereby. No waiver of any provision of this Agreement will be binding
unless in writing and executed by the Party granting such waiver.
Notwithstanding anything in this Agreement to the contrary, the Adviser may
unilaterally amend Exhibit A to this Agreement to add additional series of
Strong Variable Funds ("New Funds") as Funds by sending to the Company a written
notice of the New Funds. Any valid waiver of a provision set forth herein shall
not constitute a waiver of any other provision of this Agreement. In addition,
any such waiver shall constitute a present waiver of such provision and shall
not constitute a permanent future waiver of such provision.
14.9. Assignment. This Agreement shall be binding upon and shall inure
to the benefit of the Parties and their respective successors and assigns;
provided, however, that neither this Agreement nor any rights, privileges,
duties or obligations of the Parties may be assigned by any Party without the
written consent of the other Parties or as expressly contemplated by this
Agreement.
<PAGE>
14.10. Entire Agreement. This Agreement contains the full and complete
understanding between the Parties with respect to the transactions covered and
contemplated under this Agreement, and supersedes all prior agreements and
understandings between the Parties relating to the subject matter hereof,
whether oral or written, express or implied.
14.11. Relationship of Parties; No Joint Venture, Etc. Except for the
limited purpose provided in Section 3.8, it is understood and agreed that the
Company and each of its Designees shall be acting as an independent contractor
and not as an employee or agent of the Adviser, Distributors or the Funds, and
none of the Parties shall hold itself out as an agent of any other Party with
the authority to bind such Party. Neither the execution nor performance of this
Agreement shall be deemed to create a partnership or joint venture by and among
any of the Company, any Designees, Funds, Adviser, or Distributors.
14.12. Expenses. All expenses incident to the performance by each Party
of its respective duties under this Agreement shall be paid by that Party.
14.13. Time of Essence. Time shall be of the essence in this Agreement.
14.14. Non-Exclusivity. Each of the Parties acknowledges and agrees
that this Agreement and the arrangements described herein are intended to be
non-exclusive and that each of the Parties is free to enter into similar
agreements and arrangements with other entities.
<PAGE>
14.15. Operations of Funds. In no way shall the provisions of this
Agreement limit the authority of the Funds, the Adviser or Distributors to take
such action as it may deem appropriate or advisable in connection with all
matters relating to the operation of such Fund and the sale of its shares. In no
way shall the provisions of this Agreement limit the authority of the Company to
take such action as it may deem appropriate or advisable in connection with all
matters relating to the provision of Services or the shares of funds other than
the Funds offered to the Account.
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
----------------------------------------
By: Mark F. Muething
Title: Senior Vice President
STRONG CAPITAL MANAGEMENT, INC.
--------------------------------------
Stephen J. Shenkenberg, Vice President
STRONG INVESTMENTS, INC.
--------------------------------------
Stephen J. Shenkenberg, Vice President
STRONG VARIABLE INSURANCE FUNDS, INC. on behalf of the
Designated Portfolios
----------------------------------------
Stephen J. Shenkenberg, Vice President
STRONG OPPORTUNITY FUND II, INC.
----------------------------------------
Stephen J. Shenkenberg, Vice President
<PAGE>
EXHIBIT A
The following is a list of Designated Portfolios under this Agreement:
Strong Opportunity Fund II
Strong Mid Cap Growth Fund II
<PAGE>
EXHIBIT B
The Services
Company or its Designees shall perform the following services.
Such services shall be the responsibility of the Company and shall not be the
responsibility of the Funds, Adviser or Distributors.
1. Maintain separate records for each Account, which records shall
reflect Fund shares ("Shares") purchased and redeemed, including the date and
price for all transactions, Share balances, and the name and address of each
Owner, including zip codes and tax identification numbers.
2. Credit contributions to individual Owner accounts and invest such
contributions in shares of the Funds to the extent so designated by the Owner.
3. Disburse or credit to the Owners, and maintain records of, all
proceeds of redemptions of Fund shares and all other distributions not
reinvested in shares.
4. Prepare and transmit to the Owners, periodic account statements
showing, among other things, the total number of Fund shares owned as of the
statement closing date, purchases and redemptions of shares during the period
covered by the statement, the net asset value of the Funds as of a recent date,
and the dividends and other distributions paid during the statement period
(whether paid in cash or reinvested in shares).
5. Transmit to the Owners, as required by applicable law, prospectuses,
proxy materials, shareholder reports, and other information provided by the
Adviser, Distributors or Funds and required to be sent to shareholders under the
Federal securities laws.
6. Transmit to Distributors purchase orders and redemption requests
placed by the Account and arrange for the transmission of funds to and from the
Funds.
7. Transmit to Distributors such periodic reports as Distributors shall
reasonably conclude is necessary to enable the Funds to comply with applicable
Federal securities and state Blue Sky requirements.
8. Transmit to each Account confirmations of purchase orders and
redemption requests placed by each Account.
9. Maintain all account balance information for the Account and daily
and monthly purchase summaries expressed in shares and dollar amounts.
<PAGE>
10. Prepare, transmit and file any Federal, state and local government
reports and returns as required by law with respect to each account maintained
on behalf of the Account.
11. Respond to Owners' inquiries regarding, among other things, share
prices, account balances, dividend options, dividend amounts, and dividend
payment dates.
<PAGE>
Schedule C--Account Information
1. Entity in whose name each Account will be opened: ________________________
Mailing address: ________________________
========================
2. Employer ID number (For internal usage only): ________________________
3. Authorized contact persons: The following persons are authorized on behalf of
the Company to effect transactions in each Account:
Name:____________________________ Phone:____________________________
Name:____________________________ Phone:____________________________
Name:____________________________ Phone:____________________________
Name:____________________________ Phone:____________________________
4. Will the Accounts have telephone exchange? ____ Yes ____ No (This option
lets Company redeem shares by telephone and apply the proceeds for purchase
in another identically registered Account.)
5. Will the Accounts have telephone redemption? ____ Yes ____ No (This option
lets Company sell shares by telephone. The proceeds will be wired to the
bank account specified below.)
6. All dividends and capital gains will be reinvested automatically.
7. Instructions for all outgoing wire transfers:______________________________
================================================================================
- --------------------------------------------------------------------------------
<PAGE>
8. If this Account Information Form contains changed information, the
undersigned authorized officer has executed this amended Account Information
Form as of the date set forth below and acknowledges the agreements and
representations set forth in the Services Agreement between the Company, Strong
Capital Management, Inc. and Strong Investments, Inc.
9. Company certifies under penalty of perjury that:
(i) The number shown on this form is the correct Employer ID number (or
that Company is waiting to be issued an Employer ID number), and
(ii) Company is not subject to backup withholding because (a) Company
is exempt from backup withholding, or (b) Company has not been notified by the
Internal Revenue Service ("IRS") that it is subject to backup withholding as a
result of failure to report all interest or dividends, or (c) the IRS has
notified the Company that it is no longer subject to backup withholding.
(Cross out (ii) if Company has been notified by the IRS that it is subject to
backup withholding because of underreporting interest or dividends on its tax
return.)
The IRS does not require Company's consent to any provision of this
document other than the certifications required to avoid backup withholding.
--------------------------------- --------------------------------
(Signature of Authorized Officer) (Date)
(Company shall inform Adviser and Distributors of any changes to information
provided in this Account Information Form pursuant to Section 13 of the
Agreement.)
Please Note: Distributors employs reasonable procedures to confirm that
instructions communicated by telephone are genuine and may not be liable for
losses due to unauthorized or fraudulent instructions. Please see the prospectus
for the applicable Fund for more information on the telephone exchange and
redemption privileges.
<PAGE>
Schedule D
Billing and Count Information
1. Contact person to receive administrative fees:
Name: _________________________________
Title: _________________________________
Company Name:_____________________________
Address: _________________________________
City, State, Zip:_________________________
Phone Number:_____________________________
Fax Number:_______________________________
E-mail address:___________________________
2. Contact person that will furnish participant/shareholder counts:
Name: _________________________________
Title: _________________________________
Company Name:_____________________________
Address: _________________________________
City, State, Zip:_________________________
Phone Number:_____________________________
Fax Number:_______________________________
E-mail address:___________________________
<PAGE>
July 12, 1999
Great American Life Insurance Company
250 East Fifth Street, 9th Floor
Cincinnati, OH 45202
Attn: Mr. Mark Muething
Re: Fee Letter Relating to the Great American Life Insurance Company of
New York Participation Agreement.
Dear Mr. Muething:
Pursuant to the Participation Agreement by and among Strong Capital
Management, Inc. ("Strong"), Great American Life Insurance Company of New
York(the "Company"), Strong Variable Insurance Funds, Inc., Strong Opportunity
Fund II, Inc. and Strong Investments, Inc. ("Distributors") dated ___________,
1999 (the "Participation Agreement"), the Company will provide certain
administrative services on behalf of the registered investment companies or
series thereof specified in Exhibit A (each a "Fund" and collectively the
"Funds").
In recognition of the reduction in administrative expenses that derives
from the performance of said administrative services, Strong agrees to pay the
Company the fee specified below for each Fund specified in Exhibit A to this
Agreement.
(a) For average aggregate amounts (as calculated in paragraph
(b), below) invested through variable insurance products issued by the
Company with the Funds, the monthly fee shall equal the percentage
(calculated in paragraph (b), below) of the applicable annual fee for
each Fund specified in Exhibit A.
(b) For purposes of computing the fee contemplated in
paragraph (a) above, Strong shall calculate and pay to the Company an
amount with respect to each Fund equal to the product of: (a) the
product of (i) the number of calendar days in the applicable month
divided by the number of calendar days in that year (365 or 366 as
applicable) and (ii) the applicable percentage specified in Exhibit A,
to this Agreement, multiplied by (b) the average daily market value of
the investments held in such Fund pursuant to the Participation
Agreement computed by totaling the aggregate investment (share net
asset value multiplied by the total number of shares held) on each day
during the calendar month and dividing by the total number of days
during such month.
<PAGE>
(c) Strong shall calculate the amount of the payment to be
made pursuant to this Letter Agreement at the end of each calendar
month and will make such payment to the Company within 30 days after
receiving the report referenced in paragraph (e), below. Fees will be
paid, at Strong's election, by wire transfer or by check. All payments
under this Agreement shall be considered final unless disputed by the
Company in writing within 60 days of receipt.
(d) The parties agree that the fees contemplated herein are
solely for shareholder servicing and other administrative services
provided by the Company and do not constitute payment in any manner for
investment advisory, distribution, trustee, or custodial services.
(e) The Company agrees to provide Strong by the 15th day of
each month with a report which indicates the number of Owners that hold
through a Contract interests in each Account as of the last day of the
prior month.
(f) If requested in writing by Strong, and at Strong's
expense, the Company shall provide to Strong, by February 14th of each
year, a "Special Report" from a nationally recognized accounting firm
reasonably acceptable to Strong which substantiates for each month of
the prior calendar year: (a) the number of Owners that hold, through an
Account, interests in each Account maintained by the Company on the
last day of each month which held shares for which the fee provided for
in this Letter Agreement was received by the Company, (b) that any fees
billed to Strong for such month were accurately determined in
accordance with this Letter Agreement, and (c) such other information
in connection with this Agreement and the Participation Agreement as
may be reasonably requested by Strong.
(g) The parties to the Participation Agreement agree that
Strong may unilaterally amend Schedule A to the Participation Agreement
to add additional investment companies or series thereof ("New Funds")
as Funds subject to the provisions of this Letter Agreement by sending
to the Company a written notice of the New Funds and indicating therein
the fees to be paid to the Company with respect to the administrative
services provided pursuant to the Participation Agreement in connection
with such New Funds.
(h) The obligation to pay the fees specified in this Letter
Agreement shall survive the termination of the Participation Agreement
for a period of one year from the date of termination, provided that
Company continues to provide Services to the Owners with respect to
those assets invested in the Funds and provided that the Participation
Agreement has not been terminated because of an event described in
Sections 12.2, 12.3 or 12.4 of the Participation Agreement. Company
agrees that in the event of termination it will provide the Adviser
with any reports and certificates as requested by the Adviser to
determine that the continued payment of fees has been calculated in
accordance with this Letter Agreement.
<PAGE>
(i) Capitalized terms not otherwise defined herein shall have
the meaning assigned to them in the Participation Agreement.
If you are in agreement with the foregoing, please sign and date below
where indicated and return one copy of this signed letter agreement to me.
Very truly yours,
Stephen J. Shenkenberg
Strong Capital Management, Inc.
Accepted and agreed to as of _________, 1999.
Great American Life Insurance Company of New York
- ----------------------------------------
By: Mark F. Muething
Title: Senior Vice President
<PAGE>
EXHIBIT A to Fee Letter
The Funds subject to this Agreement and applicable annual fees are as follows:
Fund Annual Fee
Strong Opportunity Fund II, Inc. 0.20%
Strong Variable Insurance Funds, Inc.
Strong Mid Cap Growth Fund II 0.20%
<PAGE>
PARTICIPATION AGREEMENT
Among
INVESCO VARIABLE INVESTMENT FUNDS, INC.
INVESCO FUNDS GROUP, INC.
and
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
THIS AGREEMENT, made and entered into this 16th day of August, 1999 by
and among GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK, (hereinafter the
"Insurance Company"), a New York corporation, on its own behalf and on behalf of
each segregated asset account of the Insurance Company set forth on Schedule A
hereto as may be amended from time to time (each such account hereinafter
referred to as the "Account"), INVESCO VARIABLE INVESTMENT FUNDS, INC., a
Maryland corporation (the "Company") and INVESCO FUNDS GROUP, INC. ("INVESCO"),
a Delaware corporation.
WHEREAS, the Company engages in business as an open-end management
investment company and is available to act as the investment vehicle for
separate accounts established for variable annuity and life insurance contracts
to be offered by insurance companies which have entered into participation
agreements substantially identical to this Agreement ("Participating Insurance
Companies"); and
WHEREAS, the beneficial interest in the Company is divided into several
series of shares, each designated a "Fund" and representing the interest in a
particular managed portfolio of securities and other assets; and
WHEREAS, the Company has obtained an order from the Securities and
Exchange Commission (the "Commission"), dated December 29, 1993 (File No.
812-8590), granting Participating Insurance Companies and their separate
accounts exemptions from the provisions of sections 9(a), 13(a), 15(a), and
15(b) of the Investment Company Act of 1940, as amended, (the "1940 Act") and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Company to be sold to and held by variable annuity and
variable life insurance separate accounts of life insurance companies that may
or may not be affiliated with one another (the "Mixed and Shared Funding
Exemptive Order"); and
WHEREAS, the Company is registered as an open-end management investment
company under the 1940 Act and its shares are registered under the Securities
Act of 1933, as amended (hereinafter the "1933 Act"); and
WHEREAS, INVESCO is duly registered as an investment adviser under the
Investment Advisers Act of 1940 and any applicable state securities law and as a
broker dealer under the Securities Exchange Act of 1934, as amended, (the "1934
Act"), and is a member in good standing of the National Association of
Securities Dealers, Inc. (the "NASD"); and
WHEREAS, the Insurance Company has registered under the 1933 Act, or
will register under the 1933 Act, certain variable annuity contracts identified
by the form number(s) listed on Schedule B to this Agreement, as amended from
time to time hereafter by mutual written agreement of all the parties hereto
(the "Contracts"); and
WHEREAS, each Account is a duly organized, validly existing segregated
asset account, established by resolution of the board of directors of the
Insurance Company on the date shown for that Account on Schedule A hereto, to
set aside and invest assets attributable to the Contracts; and
WHEREAS, the Insurance Company has registered or will register each
Account as a unit investment trust under the 1940 Act; and
<PAGE>
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Insurance Company intends to purchase shares in the Funds on
behalf of the Accounts to fund the Contracts and INVESCO is authorized to sell
such shares to unit investment trusts such as the Account at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the
Insurance Company, the Company and INVESCO agree as follows:
ARTICLE I. Sale of Company Shares
1.1. INVESCO agrees to sell to the Insurance Company those shares of
the Company which each Account orders, executing such orders on a daily basis at
the net asset value next computed after receipt by the Company or its designee
of the order for the shares of the Company. For purposes of this Section 1.1,
the Insurance Company shall be the designee of the Company for receipt of such
orders from the Accounts and receipt by such designee shall constitute receipt
by the Company; provided that the Company receives notice of such order by 9:00
a.m., Mountain Time, on the next following Business Day. "Business Day" shall
mean any day on which the New York Stock Exchange is open for trading and on
which the Company calculates its net asset value pursuant to the rules of the
Commission.
1.2. The Company agrees to make its shares available for purchase at
the applicable net asset value per share by the Insurance Company and its
Accounts on those days on which the Company calculates its Funds' net asset
values pursuant to rules of the Commission and the Company shall use reasonable
efforts to calculate its Funds' net asset values on each day on which the New
York Stock Exchange is open for trading. Notwithstanding the foregoing, the
board of directors of the Company (hereinafter the "Board") may refuse to sell
shares of any Fund to any person, or suspend or terminate the offering of shares
of any Fund if such action is required by law or by regulatory authorities
having jurisdiction or is, in the sole discretion of the Board acting in good
faith and in light of their fiduciary duties under federal and any applicable
state laws, necessary in the best interests of the shareholders of that Fund.
1.3. The Company and INVESCO agree that shares of the Company will be
sold only to Participating Insurance Companies and their separate accounts. No
shares of any Fund will be sold to the general public.
1.4. The Company and INVESCO will not sell Company shares to any
insurance company or separate account unless an agreement containing provisions
substantially the same as Sections 2.1, 3.4, 3.5 and Article VII of this
Agreement is in effect to govern such sales.
1.5. The Company agrees to redeem, on the Insurance Company's request,
any full or fractional shares of the Company held by the Insurance Company,
executing such requests on a daily basis at the net asset value next computed
after receipt by the Company or its designee of the request for redemption. For
purposes of this Section 1.5, the Insurance Company shall be the designee of the
Company for receipt of requests for redemption from each Account and receipt by
that designee shall constitute receipt by the Company; provided that the Company
receives notice of the request for redemption by 9:00 a.m., Mountain Time, on
the next following Business Day.
1.6. The Insurance Company agrees to purchase and redeem the shares of
each Fund offered by the then-current prospectus of the Company in accordance
with the provisions of that prospectus.
1.7. The Insurance Company shall pay for Company shares by 9:00 a.m.,
Mountain Time, on the next Business Day after an order to purchase Company
shares is made in accordance with the provisions of Section 1.1 hereof. Payment
shall be in federal funds transmitted by wire. For the purpose of Sections 2.10
and 2.11, upon receipt by the Company of the federal funds so wired, such funds
shall cease to be the responsibility of the Insurance Company and shall become
the responsibility of the Company. Payment of aggregate redemption proceeds
(aggregate redemptions of a Fund's shares by an Account) ordinarily will be made
by wiring federal funds to the Insurance Company on the next Business Day after
receipt of the redemption request, but in any event within seven days after
receipt of the redemption request. Notwithstanding the foregoing, in the event
that one or more Funds has insufficient cash on hand to pay aggregate
<PAGE>
redemptions on the next Business Day, and if such Fund has determined to settle
redemption transactions for all of its shareholders on a delayed basis (more
than one Business Day, but in no event more than seven calendar days, after the
date on which the redemption order is received, unless otherwise permitted by an
order of the Commission under Section 22(e) of the 1940 Act), the Company shall
be permitted to delay sending redemption proceeds to the Insurance Company by
the same number of days that the Company is delaying sending redemption proceeds
to the other shareholders of the Fund.
Redemptions of up to the lesser of $250,000 or 1% of the net asset
value of the Fund whose shares are to be redeemed in any 90-day period will be
made in cash. Redemptions in excess of that amount in any 90-day period may, in
the sole discretion of the Company, be in-kind redemptions, with the securities
to be delivered in payment of redemptions selected by the Company and valued at
the value assigned to them in computing the Fund's net asset value per share,
provided that (i) such in-kind redemptions are permitted under applicable
provisions of the 1940 Act and (ii) the Company at such time utilizes in-kind
redemptions under this Section 1.7 with respect to other Participating Insurance
Companies with redemptions in excess of $250,000 within any 90-day period.
1.8. Issuance and transfer of the Company's shares will be by book
entry only. Stock certificates will not be issued to the Insurance Company or
any Account. Shares ordered from the Company will be recorded in an appropriate
title for each Account or the appropriate subaccount of each Account.
1.9. The Company shall furnish same day notice (by wire or telephone,
followed by written confirmation) to the Insurance Company of any income,
dividends or capital gain distributions payable on the Funds' shares. The
Insurance Company hereby elects to receive all income dividends and capital gain
distributions payable on a Fund's shares in additional shares of that Fund. The
Insurance Company reserves the right to revoke this election and to receive all
such income dividends and capital gain distributions in cash. The Company shall
notify the Insurance Company of the number of shares issued as payment of
dividends and distributions.
1.10. The Company shall make the net asset value per share for each
Fund available to the Insurance Company on a daily basis as soon as reasonably
practical after the net asset value per share is calculated and shall use its
best efforts to make those per-share net asset values available via facsimile by
5:00 p.m., Mountain Time.
ARTICLE II. Representations and Warranties
2.1. The Insurance Company represents and warrants that the Contracts
are, or will be, registered under the 1933 Act; that the Contracts will be
issued and sold in compliance in all material respects with all applicable
federal and state laws and that the sale of the Contracts shall comply in all
material respects with applicable state insurance suitability requirements. The
Insurance Company further represents and warrants that it is an insurance
company duly organized and in good standing under applicable law and that it has
legally and validly established the Account prior to any issuance or sale
thereof as a segregated asset account under New York Insurance Law Section 4240
and has registered, or prior to any issuance or sale of the Contracts will
register, the Account as a unit investment trust in accordance with the
provisions of the 1940 Act to serve as a segregated investment account for the
Contracts.
2.2. The Company represents and warrants that Company shares sold
pursuant to this Agreement shall be registered under the 1933 Act, duly
authorized for issuance and sale in compliance with the laws of the State of
Maryland and all applicable federal securities laws and that the Company is and
shall remain registered under the 1940 Act. The Company shall amend the
registration statement for its shares under the 1933 Act and the 1940 Act from
time to time as required in order to effect the continuous offering of its
shares. The Company shall register and qualify the shares for sale in accordance
with the laws of the various states only if and to the extent deemed advisable
by the Company or INVESCO.
2.3. The Company represents that it is currently qualified as a
Regulated Investment Company under Subchapter M of the Internal Revenue Code of
1986, as amended, (the "Code") and that it will make every effort to maintain
that qualification (under Subchapter M or any successor or similar provision)
and that it will notify the Insurance Company immediately upon having a
reasonable basis for believing that it has ceased to so qualify or that it might
not so qualify in the future.
<PAGE>
2.4. The Insurance Company represents and warrants that the Contracts
are currently treated as annuity contracts, under applicable provisions of the
Code and that it will make every effort to maintain such treatment and that it
will notify the Company and INVESCO immediately upon having a reasonable basis
for believing that the Contracts have ceased to be so treated or that they might
not be so treated in the future.
2.5. The Company currently does not intend to make any payments to
finance distribution expenses pursuant to Rule 12b-1 under the 1940 Act or
otherwise, although it may make such payments in the future. To the extent that
it decides to finance distribution expenses pursuant to Rule 12b-1, the Company
undertakes to have a board of directors, a majority of whom are not interested
persons of the Company, formulate and approve any plan under Rule 12b-1 to
finance distribution expenses.
2.6. The Company makes no representation as to whether any aspect of
its operations (including, but not limited to, fees and expenses and investment
policies) complies with the insurance laws or regulations of the various states.
2.7. INVESCO represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the Commission.
INVESCO further represents that it will sell and distribute the Company shares
in accordance with the laws of the State of New York and all applicable state
and federal securities laws, including without limitation the 1933 Act, the 1934
Act, and the 1940 Act.
2.8. The Company represents that it is lawfully organized and validly
existing under the laws of the State of Maryland and that it does and will
comply in all material respects with the 1940 Act.
2.9. INVESCO represents and warrants that it is and shall remain duly
registered in all material respects under all applicable federal and state
securities laws and that it shall perform its obligations for the Company in
compliance in all material respects with the laws of the State of Colorado and
any applicable state and federal securities laws.
2.10. The Company and INVESCO represent and warrant that all of their
officers, employees, investment advisers, investment sub-advisers, and other
individuals or entities dealing with the money and/or securities of the Company
are, and shall continue to be at all times, covered by a blanket fidelity bond
or similar coverage for the benefit of the Company in an amount not less than
the minimum coverage required currently by Section 17g-(1) of the 1940 Act or
related provisions as may be promulgated from time to time. That fidelity bond
shall include coverage for larceny and embezzlement and shall be issued by a
reputable bonding company.
2.11. The Insurance Company represents and warrants that all of its
officers, employees, investment advisers, and other individuals or entities
dealing with the money and/or securities of the Company are and shall continue
to be at all times covered by a blanket fidelity bond or similar coverage for
the benefit of the Company, in an amount not less than the minimum coverage
required currently for entities subject to the requirements of Rule 17g-1 of the
1940 Act or related provisions or may be promulgated from time to time. The
aforesaid Bond shall include coverage for larceny and embezzlement and shall be
issued by a reputable bonding company. The Insurance Company further represents
and warrants that the employees of Insurance Company, or such other persons
designated by Insurance Company, listed on Schedule C have been authorized by
all necessary action of Insurance Company to give directions, instructions and
certifications to the Company and INVESCO on behalf of Insurance Company. The
Company and INVESCO are authorized to act and rely upon any directions,
instructions and certifications received from such persons unless and until they
have been notified in writing by the Insurance Company of a change in such
persons, and the Company and INVESCO shall incur no liability in doing so.
2.12. The Insurance Company represents and warrants that it will not
purchase Company shares with Account assets derived from tax-qualified
retirement plans except indirectly, through Contracts purchased in connection
with such plans.
<PAGE>
ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1. INVESCO shall provide the Insurance Company (at the Insurance
Company's expense) with as many copies of the Company's current prospectus as
the Insurance Company may reasonably request. If requested by the Insurance
Company in lieu thereof, the Company shall provide such documentation (including
a final copy of the new prospectus as set in type at the Company's expense) and
other assistance as is reasonably necessary in order for the Insurance Company
once each year (or more frequently if the prospectus for the Company is amended)
to have the prospectus for the Contracts and the Company's prospectus printed
together in one document (at the Insurance Company's expense).
3.2. The Company's prospectus shall state that the Statement of
Additional Information for the Company (the "SAI") is available from INVESCO (or
in the Company's discretion, the Prospectus shall state that the SAI is
available from the Company), and INVESCO (or the Company), at its expense, shall
print and provide the SAI free of charge to the Insurance Company and to any
owner of a Contract or prospective owner who requests the SAI.
3.3. The Company, at its expense, shall provide the Insurance Company
with copies of its proxy material, reports to stockholders and other
communications to stockholders in such quantity as the Insurance Company shall
reasonably require for distributing to Contract owners.
3.4. If and to the extent required by law, the Insurance Company shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Company shares in accordance with
instructions received from Contract owners; and
(iii) vote Company shares for which no instructions have
been received in the same proportion as Company
shares of such portfolio for which instructions have
been received:
so long as and to the extent that the Commission continues to interpret the 1940
Act to require pass-through voting privileges for variable contract owners. The
Insurance Company reserves the right to vote Company shares held in any
segregated asset account in its own right, to the extent permitted by law.
Participating Insurance Companies shall be responsible for assuring that each of
their separate accounts participating in the Company calculates voting
privileges in a manner consistent with the standards set forth on Schedule D
attached hereto and incorporated herein by this reference, which standards will
also be provided to the other Participating Insurance Companies. The Insurance
Company shall fulfill its obligations under, and abide by the terms and
conditions of, the Mixed and Shared Funding Exemptive Order.
3.5. The Company will comply with all provisions of the 1940 Act
requiring voting by shareholders, and in particular the Company will either
provide for annual meetings (except insofar as the Commission may interpret
Section 16 of the 1940 Act not to require such meetings) or, as the Company
currently intends, comply with Section 16(c) of the 1940 Act (although the
Company is not one of the trusts described in Section 16(c) of that Act) as well
as with Sections 16(a) and, if and when applicable, 16(b). Further, the Company
will act in accordance with the Commission's interpretation of the requirements
of Section 16(a) with respect to periodic elections of directors and with
whatever rules the Commission may promulgate with respect thereto.
ARTICLE IV. Sales Material and Information
4.1. The Insurance Company shall furnish, or shall cause to be
furnished, to the Company or its designee, each piece of sales literature or
other promotional material in which the Company, a sub-adviser of one of the
<PAGE>
Funds, or INVESCO is named, at least fifteen calendar days prior to its use. No
such material shall be used if the Company or its designee objects to such use
within ten calendar days after receipt of such material.
4.2. The Insurance Company shall not give any information or make any
representations or statements on behalf of the Company or concerning the Company
in connection with the sale of the Contracts other than the information or
representations contained in the registration statement or prospectus for the
Company's shares, as such registration statement and prospectus may be amended
or supplemented from time to time, or in reports or proxy statements for the
Company, or in sales literature or other promotional material approved by the
Company or its designee or by INVESCO, except with the permission of the Company
or INVESCO.
4.3. The Company, INVESCO, or its designee shall furnish, or shall
cause to be furnished, to the Insurance Company or its designee, each piece of
sales literature or other promotional material in which the Insurance Company
and/or its separate account(s), is named at least fifteen calendar days prior to
its use. No such material shall be used if the Insurance Company or its designee
object to such use within ten calendar days after receipt of that material.
4.4. The Company and INVESCO shall not give any information or make any
representations on behalf of the Insurance Company or concerning the Insurance
Company, the Account, or the Contracts other than the information or
representations contained in a registration statement or prospectus for the
Contracts, as that registration statement and prospectus may be amended or
supplemented from time to time, or in published reports for the Account which
are in the public domain or approved by the Insurance Company for distribution
to Contract owners, or in sales literature or other promotional material
approved by the Insurance Company or its designee, except with the permission of
the Insurance Company.
4.5. The Company will provide to the Insurance Company at least one
complete copy of each registration statement, prospectus, statement of
additional information, report, proxy statement, piece of sales literature or
other promotional material, application for exemption, request for no-action
letter, and any amendment to any of the above, that relate to the Company or its
shares, contemporaneously with the filing of the document with the Commission,
the NASD, or other regulatory authorities.
4.6. The Insurance Company will provide to the Company at least one
complete copy of each registration statement, prospectus, statement of
additional information, report, solicitation for voting instructions, piece of
sales literature and other promotional material, application for exemption,
request for no action letter, and any amendment to any of the above, that
relates to the Contracts or the Account, contemporaneously with the filing of
the document with the Commission, the NASD, or other regulatory authorities.
4.7. For purposes of this Agreement, the phrase "sales literature or
other promotional material" includes, but is not limited to, advertisements,
newspaper, magazine, or other periodical, radio, television, telephone or tape
recording, videotape display, signs or billboards, motion pictures, or other
public media, sales literature (i.e., any written communication distributed or
made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts,
reprints or excerpts of any other advertisement, sales literature, or published
article), educational or training materials or other communications distributed
or made generally available to some or all agents or employees, and registration
statements, prospectuses, statements of additional information, shareholder
reports, and proxy materials.
4.8. At the request of any party to this Agreement, each other party
will make available to the other party's independent auditors and/or
representative of the appropriate regulatory agencies, all records, data and
access to operating procedures that may be reasonably requested. Company agrees
that Insurance Company shall have the right to inspect, audit and copy all
records pertaining to the performance of services under this Agreement pursuant
to the requirements of the Ohio Department of Insurance. However, Company and
INVESCO shall own and control all of their respective records pertaining to
their performance of the services under this Agreement.
ARTICLE V. Fees and Expenses
5.1. The Company and INVESCO shall pay no fee or other compensation to
the Insurance Company under this agreement, except that if the Company or any
Fund adopts and implements a plan pursuant to Rule 12b-1 to finance distribution
expenses, then INVESCO may make payments to the Insurance Company if and in
amounts agreed to by INVESCO in writing, subject to review by the board of
directors of the Company. No such payments shall be made directly by the
Company.
<PAGE>
5.2. All expenses incident to performance by the Company under this
Agreement shall be paid by the Company. The Company shall see to it that all its
shares are registered and authorized for issuance in accordance with applicable
federal law and, if and to the extent deemed advisable by the Company or
INVESCO, in accordance with applicable state laws prior to their sale. The
Company shall bear the expenses for the cost of registration and qualification
of the Company's shares, preparation and filing of the Company's prospectus and
registration statement, proxy materials and reports, setting the prospectus in
type, setting in type and printing the proxy materials and reports to
shareholders (including the costs of printing a prospectus that constitutes an
annual report), the preparation of all statements and notices required by any
federal or state law, and all taxes on the issuance or transfer of the Company's
shares.
5.3. The Insurance Company shall bear the expenses of printing and
distributing to Contract owners the Contract prospectuses and of distributing to
Contract owners the Company's prospectus, proxy materials and reports.
ARTICLE VI. Diversification
6.1. The Company will, at the end of each calendar quarter, comply with
Section 817(h) of the Code and Treasury Regulation 1.817-5 relating to the
diversification requirements for variable annuity, endowment, modified endowment
or life insurance contracts and any amendments or other modifications to that
Section or Regulation.
ARTICLE VII. Potential Conflicts
7.1. The Board will monitor the Company for the existence of any
material irreconcilable conflict between the interests of the variable contract
owners of all separate accounts investing in the Company. An irreconcilable
material conflict may arise for a variety of reasons, including: (a) an action
by any state insurance regulatory authority; (b) a change in applicable federal
or state insurance, tax, or securities laws or regulations, or a public ruling,
private letter ruling, no-action or interpretive letter, or any similar action
by insurance, tax, or securities regulatory authorities; (c) an administrative
or judicial decision in any relevant proceeding; (d) the manner in which the
investments of any Fund are being managed; (e) a difference in voting
instructions given by variable annuity contract and variable life insurance
contract owners; or (f) a decision by a Participating Insurance Company to
disregard the voting instructions of variable contract owners. The Board shall
promptly inform the Insurance Company if it determines that an irreconcilable
material conflict exists and the implications thereof. The Board shall have sole
authority to determine whether an irreconcilable material conflict exists and
such determination shall be binding upon the Insurance Company.
7.2 The Insurance Company will report promptly any potential or
existing conflicts of which it is aware to the Board. The Insurance Company will
assist the Board in carrying out its responsibilities under the Mixed and Shared
Funding Exemptive Order, by providing the Board with all information reasonably
necessary for the Board to consider any issues raised. This includes, but is not
limited to, an obligation by the Insurance Company to inform the Board whenever
Contract owner voting instructions are to be disregarded. Such responsibilities
shall be carried out by Insurance Company with a view only to the interests of
the Contract owners.
7.3. If it is determined by a majority of the Board, or a majority of
its directors who are not interested persons of the Company, INVESCO, or any
sub-adviser to any of the Funds (the "Independent Directors"), that a material
irreconcilable conflict exists, the Insurance Company and/or other Participating
Insurance Companies shall, at their expense and to the extent reasonably
practicable (as determined by a majority of the Independent Directors), take
whatever steps are necessary to remedy or eliminate the irreconcilable material
conflict, up to and including: (1), withdrawing the assets allocable to some or
all of the separate accounts from the Company or any Fund and reinvesting those
assets in a different investment medium, including (but not limited to) another
Fund of the Company, or submitting the question whether such segregation should
be implemented to a vote of all affected variable contract owners and, as
<PAGE>
appropriate, segregating the assets of any appropriate group (e.g., annuity
contract owners, life insurance contract owners, or variable contract owners of
one or more Participating Insurance Companies) that votes in favor of such
segregation, or offering to the affected variable contract owners the option of
making such a change; and (2), establishing a new registered management
investment company or managed separate account and obtaining approval thereof by
the Commission.
7.4. If a material irreconcilable conflict arises because of a decision
by the Insurance Company to disregard Contract owner voting instructions and
that decision represents a minority position or would preclude a majority vote,
the Insurance Company may be required, at the Company's election, to withdraw
the affected Account's investment in the Company and terminate this Agreement
with respect to that Account; provided, however that such withdrawal and
termination shall be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the Independent
Directors. Any such withdrawal and termination must take place within six (6)
months after the Company gives written notice that this provision is being
implemented, and until the end of that six month period INVESCO and the Company
shall continue to accept and implement orders by the Insurance Company for the
purchase (and redemption) of shares of the Company.
7.5. If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Insurance Company
conflicts with the majority of other state regulators, then the Insurance
Company will withdraw the affected Account's investment in the Company and
terminate this Agreement with respect to that Account within six months after
the Board informs the Insurance Company in writing that it has determined that
the state insurance regulator's decision has created an irreconcilable material
conflict; provided, however, that such withdrawal and termination shall be
limited to the extent required by the foregoing material irreconcilable conflict
as determined by a majority of the Independent Directors. Until the end of the
foregoing six month period, INVESCO and the Company shall continue to accept and
implement orders by the Insurance Company for the purchase (and redemption) of
shares of the Company.
7.6. For purposes of Sections 7.3 through 7.6 of this Agreement, a
majority of the Independent Directors shall determine whether any proposed
action adequately remedies any irreconcilable material conflict, but in no event
will the Company be required to establish a new funding medium for the
Contracts. The Insurance Company shall not be required by Section 7.3 to
establish a new funding medium for the Contracts if an offer to do so has been
declined by vote of a majority of Contract owners materially adversely affected
by the irreconcilable material conflict. In the event that the Board determines
that any proposed action does not adequately remedy any irreconcilable material
conflict, then the Insurance Company will withdraw the Account's investment in
the Company and terminate this Agreement within six (6) months after the Board
informs the Insurance Company in writing of the foregoing determination,
provided, however, that the withdrawal and termination shall be limited to the
extent required by the material irreconcilable conflict, as determined by a
majority of the Independent Directors.
7.7. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
Act or the rules promulgated thereunder with respect to mixed or shared funding
(as defined in the Mixed and Shared Funding Exemptive Order) on terms and
conditions materially different from those contained in the Mixed and Shared
Funding Exemptive Order, then (a) the Company and/or the Participating Insurance
Companies, as appropriate, shall take such steps as may be necessary to comply
with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to the
extent those rules are applicable; and (b) Sections 3.4, 3.5, 7.1, 7.2, 7.3,
7.4, and 7.5 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to those Sections are contained in
the Rule(s) as so amended or adopted.
ARTICLE VIII. Indemnification
8.1. Indemnification By The Insurance Company
8.1(a). The Insurance Company agrees to indemnify and hold harmless the
Company and each director of the Board and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.1)
<PAGE>
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Insurance Company) or litigation
(including reasonable legal and other expenses), to which the Indemnified
Parties may become subject under any statute, regulation, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements are related to the sale or
acquisition of the Company's shares or the Contracts and:
(i) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in
the registration statement or prospectus for the Contracts or
contained in the Contracts or sales literature for the
Contracts (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements
therein not misleading, provided that this agreement to
indemnify shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission
was made in reliance upon and in conformity with information
furnished in writing to the Insurance Company by or on behalf
of the Company for use in the registration statement or
prospectus for the Contracts or in the Contracts or sales
literature (or any amendment or supplement) or otherwise for
use in connection with the sale of the Contracts or shares of
the Company;
(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the registration statement, prospectus or sales
literature of the Company not supplied by the Insurance
Company, or persons under its control) or wrongful conduct of
the Insurance Company or persons under its control, with
respect to the sale or distribution of the Contracts or
Company Shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, or sales literature of the Company or
any amendment thereof or supplement thereto or the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein
not misleading if such a statement or omission was made in
reliance upon information furnished in writing to the Company
by or on behalf of the Insurance Company: or
(iv) arise as a result of any failure by the Insurance Company
to provide the services and furnish the materials under the
terms of this Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Insurance Company
in this Agreement or arise out of or result from any other
material breach of this Agreement by the Insurance Company,
as limited by and in accordance with the provisions of Sections 8.1(b) and
8.1(c) hereof.
8.1(b). The Insurance Company shall not be liable under this
indemnification provision with respect to any losses, claims, damages,
liabilities or litigation incurred or assessed against an Indemnified Party that
may arise from that Indemnified Party's willful misfeasance, bad faith, or
negligence in the performance of that Indemnified Party's duties or by reason of
that Indemnified Party's reckless disregard of obligations or duties under this
Agreement or to the Company, whichever is applicable.
8.1(c). The Insurance Company shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless that Indemnified Party shall have notified the Insurance Company in
<PAGE>
writing within a reasonable time after the summons or other first legal process
giving information of the nature of the claim shall have been served upon that
Indemnified Party (or after the Indemnified Party shall have received notice of
such service on any designated agent). Notwithstanding the foregoing, the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Insurance Company of its obligations hereunder except to the extent
that the Insurance Company has been prejudiced by such failure to give notice.
In addition, any failure by the Indemnified Party to notify the Insurance
Company of any such claim shall not relieve the Insurance Company from any
liability which it may have to the Indemnified Party against whom the action is
brought otherwise than on account of this indemnification provision. In case any
such action is brought against the Indemnified Parties, the Insurance Company
shall be entitled to participate, at its own expense, in the defense of the
action. The Insurance Company also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action; provided,
however, that if the Indemnified Party shall have reasonably concluded that
there may be defenses available to it which are different from or additional to
those available to the Insurance Company, the Insurance Company shall not have
the right to assume said defense, but shall pay the reasonable costs and
expenses thereof (except that in no event shall the Insurance Company be liable
for the fees and expenses of more than one counsel for Indemnified Parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances).
After notice from the Insurance Company to the Indemnified Party of the
Insurance Company's election to assume the defense thereof, and in the absence
of such a reasonable conclusion that there may be different or additional
defenses available to the Indemnified Party, the Indemnified Party shall bear
the fees and expenses of any additional counsel retained by it, and the
Insurance Company will not be liable to that party under this Agreement for any
legal or other expenses subsequently incurred by the party independently in
connection with the defense thereof other than reasonable costs of
investigation.
8.1(d). The Indemnified Parties will promptly notify the Insurance
Company of the commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Company's shares or the Contracts or
the operation of the Company.
8.2. Indemnification by INVESCO
8.2(a). INVESCO agrees to indemnify and hold harmless the Insurance
Company and each of its directors and officers and each person, if any, who
controls the Insurance Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.2)
against any and all losses, claims, damages, liabilities (including reasonable
amounts paid in settlement with the written consent of INVESCO) or litigation
(including legal and other expenses) to which the Indemnified Parties may become
subject under any statute, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the Company's shares or
the Contracts and:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
registration statement or prospectus or sales literature of
the Company (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements
therein not misleading, provided that this agreement to
indemnify shall not apply as to any Indemnified Party if the
statement or omission or alleged statement or omission was
made in reliance upon and in conformity with information
furnished in writing to INVESCO or the Company by or on behalf
of the Insurance Company for use in the registration statement
or prospectus for the Company or in sales literature (or any
amendment or supplement) or otherwise for use in connection
with the sale of the Contracts or Company shares: or
(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the registration statement, prospectus or sales
literature for the Contracts not supplied by INVESCO or
persons under its control) or wrongful conduct of the Company,
INVESCO or persons under their control, with respect to the
sale or distribution of the Contracts or shares of the
Company; or
<PAGE>
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, or sales literature covering the
Contracts, or any amendment thereof or supplement thereto, or
the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statement or statements therein not misleading, if such
statement or omission was made in reliance upon information
furnished in writing to the Insurance Company by or on behalf
of the Company; or
(iv) arise as a result of any failure by the Company to
provide the services and furnish the materials under the terms
of this Agreement (including a failure, whether unintentional
or in good faith or otherwise, to comply with the
diversification requirements specified in Article VI of this
Agreement); or
(v) arise out of or result from any material breach of any
representation and/or warranty made by INVESCO in this
Agreement or arise out of or result from any other material
breach of this Agreement by INVESCO; as limited by and in
accordance with the provisions of Sections 8.2(b) and 8.2(c)
hereof.
8.2(b) INVESCO shall not be liable under this indemnification provision
with respect to any losses, claims, damages, liabilities or litigation incurred
or assessed against an Indemnified Party that may arise from the Indemnified
Party's willful misfeasance, bad faith, or negligence in the performance of the
Indemnified Party's duties or by reason of the Indemnified Party's reckless
disregard of obligations and duties under this Agreement or to the Insurance
Company or the Account, whichever is applicable.
8.2(c) INVESCO shall not be liable under this indemnification provision
with respect to any claim made against an Indemnified Party unless the
Indemnified Party shall have notified INVESCO in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon the Indemnified Party (or after
the Indemnified Party shall have received notice of such service on any
designated agent). Notwithstanding the foregoing, the failure of any Indemnified
Party to give notice as provided herein shall not relieve INVESCO of its
obligations hereunder except to the extent that INVESCO has been prejudiced by
such failure to give notice. In addition, any failure by the Indemnified Party
to notify INVESCO of any such claim shall not relieve INVESCO from any liability
which it may have to the Indemnified Party against whom such action is brought
otherwise than on account of this indemnification provision. In case any such
action is brought against the Indemnified Parties, INVESCO will be entitled to
participate, at its own expense, in the defense thereof. INVESCO also shall be
entitled to assume the defense thereof, with counsel satisfactory to the party
named in the action; provided, however, that if the Indemnified Party shall have
reasonably concluded that there may be defenses available to it which are
different from or additional to those available to INVESCO, INVESCO shall not
have the right to assume said defense, but shall pay the reasonable costs and
expenses thereof (except that in no event shall INVESCO be liable for the fees
and expenses of more than one counsel for Indemnified Parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances).
After notice from INVESCO to the Indemnified Party of INVESCO's election to
assume the defense thereof, and in the absence of such a reasonable conclusion
that there may be different or additional defenses available to the Indemnified
Party, the Indemnified Party shall bear the fees and expenses of any additional
counsel retained by it, and INVESCO will not be liable to that party under this
Agreement for any legal or other expenses subsequently incurred by that party
independently in connection with the defense thereof other than reasonable costs
of investigation.
8.2(d) The Insurance Company agrees to notify INVESCO promptly of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with the issuance or sale of the Contracts or the
operation of the Account.
<PAGE>
8.3 Indemnification By the Company
8.3(a). The Company agrees to indemnify and hold harmless the Insurance
Company, and each of its directors and officers and each person, if any, who
controls the Insurance Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.3)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Company) or litigation (including
reasonable legal and other expenses) to which the Indemnified Parties may become
subject under any statute, at common law or otherwise, insofar as those losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements result from the gross negligence, bad faith, willful misconduct, or
reckless disregard of duty of the Board or any member thereof, are related to
the operations of the Company and:
(i) arise as a result of any failure by the Company to provide
the services and furnish the materials under the terms of this
Agreement (including a failure to comply with the
diversification requirements specified in Article VI of this
Agreement); or
(ii) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this
Agreement or arise out of or result from any other material
breach of this Agreement by the Company;
as limited by, and in accordance with the provisions of, Sections 8.3(b) and
8.3(c) hereof.
8.3(b). The Company shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
incurred or assessed against an Indemnified Party that may arise from the
Indemnified Party's willful misfeasance, bad faith, or negligence in the
performance of the Indemnified Party's duties or by reason of the Indemnified
Party's reckless disregard of obligations and duties under this Agreement or to
the Insurance Company, the Company, INVESCO or the Account, whichever is
applicable.
8.3(c). The Company shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless the
Indemnified Party shall have notified the Company in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon the Indemnified Party (or after
the Indemnified Party shall have received notice of such service on any
designated agent). Notwithstanding the foregoing, the failure of any Indemnified
Party to give notice as provided herein shall not relieve the Company of its
obligations hereunder except to the extent that the Company has been prejudiced
by such failure to give notice. In addition, any failure by the Indemnified
Party to notify the Company of any such claim shall not relieve the Company from
any liability which it may have to the Indemnified Party against whom such
action is brought otherwise than on account of this indemnification provision.
In case any such action is brought against the Indemnified Parties, the Company
will be entitled to participate, at its own expense, in the defense thereof. The
Company also shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action; provided, however, that if the
Indemnified Party shall have reasonably concluded that there may be defenses
available to it which are different from or additional to those available to the
Company, the Company shall not have the right to assume said defense, but shall
pay the costs and expenses thereof (except that in no event shall the Company be
liable for the fees and expenses of more than one counsel for Indemnified
Parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances). After notice from the Company to the Indemnified Party of the
Company's election to assume the defense thereof, and in the absence of such a
reasonable conclusion that there may be different or additional defenses
available to the Indemnified Party, the Indemnified Party shall bear the fees
and expenses of any additional counsel retained by it, and the Company will not
be liable to that party under this Agreement for any legal or other expenses
subsequently incurred by that party independently in connection with the defense
thereof other than reasonable costs of investigation.
8.3(d). The Insurance Company and INVESCO agree promptly to notify the
Company of the commencement of any litigation or proceedings against it or any
<PAGE>
of its respective officers or directors in connection with this Agreement, the
issuance or sale of the Contracts, the operation of the Account, or the sale or
acquisition of shares of the Company.
ARTICLE IX. Applicable Law
9.1. This Agreement shall be construed and provisions hereof
interpreted under and in accordance with the laws of the State of Colorado.
9.2. This Agreement shall be subject to the provisions of the 1933,
1934, and 1940 acts, and the rules and regulations and rulings thereunder,
including any exemptions from those statutes, rules and regulations the
Commission may grant (including, but not limited to, the Mixed and Shared
Funding Exemptive Order) and the terms hereof shall be interpreted and construed
in accordance therewith.
ARTICLE X. Termination
10.1. This Agreement shall terminate:
(a) at the option of any party upon one year advance written
notice to the other parties; provided, however such notice
shall not be given earlier than one year following the date of
this Agreement; or
(b) at the option of the Insurance Company to the extent that
shares of Funds are not reasonably available to meet the
requirements of the Contracts as determined by the Insurance
Company, provided however, that such a termination shall apply
only to the Fund(s) not reasonably available. Prompt written
notice of the election to terminate for such cause shall be
furnished by the Insurance Company; or
(c) at the option of the Company in the event that formal
administrative proceedings are instituted against the
Insurance Company by the NASD, the Commission, an insurance
commissioner or any other regulatory body regarding the
Insurance Company's duties under this Agreement or related to
the sale of the Contracts, the operation of any Account, or
the purchase of the Company's shares, and the Company
determines in its sole judgment exercised in good faith, that
any such administrative proceedings will have a material
adverse effect upon the ability of the Insurance Company to
perform its obligations under this Agreement; or
(d) at the option of the Insurance Company in the event that
formal administrative proceedings are instituted against the
Company or INVESCO by the NASD, the Commission, or any state
securities or insurance department or any other regulatory
body, and the Insurance Company determines in its sole
judgment exercised in good faith, that any such administrative
proceedings will have a material adverse effect upon the
ability of the Company or INVESCO to perform its obligations
under this Agreement; or
(e) with respect to any Account, upon requisite vote of the
Contract owners having an interest in that Account (or any
subaccount) to substitute the shares of another investment
company for the corresponding Fund shares in accordance with
the terms of the Contracts for which those Fund shares had
been selected to serve as the underlying investment media. The
Insurance Company will give at least 30 days' prior written
notice to the Company of the date of any proposed vote to
replace the Company's shares; or
(f) at the option of the Insurance Company, in the event any
of the Company's shares are not registered, issued or sold in
accordance with applicable state and/or federal law or
exemptions therefrom, or such law precludes the use of those
shares as the underlying investment media of the Contracts
issued or to be issued by the Insurance Company; or
<PAGE>
(g) at the option of the Insurance Company, if the Company
ceases to qualify as a regulated investment company under
Subchapter M of the Code or under any successor or similar
provision, or if the Insurance Company reasonably believes
that the Company may fail to so qualify; or
(h) at the option of the Insurance Company, if the Company
fails to meet the diversification requirements specified in
Article VI hereof; or
(i) at the option of either the Company or INVESCO, if (1) the
Company or INVESCO, respectively, shall determine, in their
sole judgment reasonably exercised in good faith, that the
Insurance Company has suffered a material adverse change in
its business or financial condition or is the subject of
material adverse publicity and that material adverse change or
material adverse publicity will have a material adverse impact
upon the business and operations of either the Company or
INVESCO, (2) the Company or INVESCO shall notify the Insurance
Company in writing of that determination and its intent to
terminate this Agreement, and (3) after considering the
actions taken by the Insurance Company and any other changes
in circumstances since the giving of such a notice, the
determination of the Company or INVESCO shall continue to
apply on the sixtieth (60th) day following the giving of that
notice, which sixtieth day shall be the effective date of
termination; or
(j) at the option of the Insurance Company, if (1) the
Insurance Company shall determine, in its sole judgment
reasonably exercised in good faith, that either the Company or
INVESCO has suffered a material adverse change in its business
or financial condition or is the subject of material adverse
publicity and that material adverse change or material adverse
publicity will have a material adverse impact upon the
business and operations of the Insurance Company, (2) the
Insurance Company shall notify the Company and INVESCO in
writing of the determination and its intent to terminate the
Agreement, and (3) after considering the actions taken by the
Company and/or INVESCO and any other changes in circumstances
since the giving of such a notice, the determination shall
continue to apply on the sixtieth (60th) day following the
giving of the notice, which sixtieth day shall be the
effective date of termination.
10.2. It is understood and agreed that the right of any party hereto to
terminate this Agreement pursuant to Section 10.1(a) may be exercised for any
reason or for no reason.
10.3 Notice Requirement. No termination of this Agreement shall be
effective unless and until the party terminating this Agreement gives prior
written notice to all other parties to this Agreement of its intent to
terminate, which notice shall set forth the basis for the termination.
Furthermore,
(a) in the event that any termination is based upon the
provisions of Article VII, or the provisions of Section
10.1(a), 10.1(i), or 10.1(j) of this Agreement, the prior
written notice shall be given in advance of the effective date
of termination as required by those provisions; and
(b) in the event that any termination is based upon the
provisions of Section 10.1(c) or 10.1(d) of this Agreement,
the prior written notice shall be given at least ninety (90)
days before the effective date of termination.
10.4. Effect of Termination. Notwithstanding any termination of this
Agreement, the Company and INVESCO shall at the option of the Insurance Company,
continue to make available additional shares of the Company pursuant to the
terms and conditions of this Agreement, for all Contracts in effect on the
effective date of termination of this Agreement ("Existing Contracts").
Specifically, without limitation, the owners of the Existing Contracts shall be
permitted to reallocate investments in the Company, redeem investments in the
Company and/or invest in the Company upon the making of additional purchase
payments under the Existing Contracts. The parties agree that this Section 10.4
shall not apply to any terminations under Article VII and the effect of Article
VII terminations shall be governed by Article VII of this Agreement.
<PAGE>
10.5. The Insurance Company shall not redeem Company shares
attributable to the Contracts (as opposed to Company shares attributable to the
Insurance Company's assets held in the Account) except (i) as necessary to
implement Contract-owner-initiated transactions, or (ii) as required by state
and/or federal laws or regulations or judicial or other legal precedent of
general application (a "Legally Required Redemption"). Upon request, the
Insurance Company will promptly furnish to the Company and INVESCO the opinion
of counsel for the Insurance Company (which counsel shall be reasonably
satisfactory to the Company and INVESCO) to the effect that any redemption
pursuant to clause (ii) above is a Legally Required Redemption.
ARTICLE XI. Notices.
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of that other party set forth
below or at such other address as the other party may from time to time specify
in writing.
If to the Company:
P.O. Box 173706
Denver, Colorado 80217-3706
Attention: General Counsel
If to the Insurance Company:
250 East Fifth Street
Cincinnati, Ohio 45202
Attention: General Counsel
If to INVESCO:
P.O. Box 173706
Denver, Colorado 80217-3706
Attention: General Counsel
ARTICLE XII. Miscellaneous
12.1. Subject to the requirements of legal process and regulatory
authority, each party hereto shall treat as confidential the names and addresses
of the owners of the Contracts and all information reasonably identified as
confidential in writing by any other party hereto and, except as permitted by
this Agreement, shall not disclose, disseminate or utilize such names and
addresses and other confidential information without the express written consent
of the affected party unless and until that information may come into the public
domain.
12.2. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
12.3. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
12.4. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
12.5. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
Commission, the NASD and state insurance regulators) and shall permit those
authorities reasonable access to its books and records in connection with any
investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
<PAGE>
12.6. The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to under
state and federal laws.
12.7. No party may assign this Agreement without the prior written
consent of the others.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed hereto as of the date
specified below.
Insurance Company:
GREAT AMERICAN LIFE INSURANCE COMPANY OF
NEW YORK
By its authorized officer,
By: Mark F. Muething
Title: Senior Vice President
Date: August 16, 1999
Company:
INVESCO VARIABLE INVESTMENT FUNDS, INC.
By its authorized officer,
By:
Title:Treasurer and Chief Financial
and Accounting Officer
Date:
INVESCO:
INVESCO FUNDS GROUP, INC.
By its authorized officer,
By:
Title:Senior Vice President and
Treasurer
Date:
<PAGE>
Schedule A
Accounts
Name of Account Date of Resolution of Insurance Company's Board which
Established the Account
GALIC of New York
Separate Account I May 7, 1999
<PAGE>
Schedule B
Contracts
1. Contract Form
NY3332G99 Group Deferred Variable Annuity Contract
NY3342G99 Group Deferred Variable Annuity Contract
NY3352G99 Group Deferred Variable Annuity Contract
NY3382NQ99 Individual Nonqualified Deferred Variable Annuity Contract
NY3383Q99 Individual Qualified Deferred Variable Annuity Contract
NY3384NQ99 Individual Nonqualified Deferred Variable Annuity Contract
NY3385Q99 Individual Qualified Deferred Variable Annuity Contract
NY3386NQ99 Individual Nonqualified Deferred Variable Annuity Contract
NY3387Q99 Individual Qualified Deferred Variable Annuity Contract
<PAGE>
Schedule C
Persons Authorized to Give Instructions to the Company and INVESCO
<TABLE>
<CAPTION>
NAME ADDRESS AND PHONE NUMBER
<S> <C> <C>
(1)____Brian Sponaugle __ _250 E. Fifth St., Cincinnati, OH 45202______
------------------------------ ---------------------------------------
Print or Type Name
____________________________________ Phone:____513/412-2931__________________
Signature
(2)_____Todd Gayhart___________________ _250 E. Fifth St., Cincinnati, OH 45202______
Print or Type Name
____________________________________ Phone:_____513/412-2932________________
Signature
(3)____John Burress_____________________ _250 E. Fifth St., Cincinnati, OH 45202______
Print or Type Name
____________________________________ Phone:___513/412-3194__________________
Signature
(4)____Scott Soudrette___________________ _250 E. Fifth St., Cincinnati, OH 45202______
Print or Type Name
____________________________________ Phone:____513/412-2938________________
Signature
</TABLE>
<PAGE>
Schedule D
PROXY VOTING PROCEDURE
The following is a list of procedures and corresponding responsibilities for the
handling of proxies relating to the Company by INVESCO, the Company and the
Insurance Company. The defined terms herein shall have the meanings assigned in
the Participation Agreement except that the term "Insurance Company" shall also
include the department or third party assigned by the Insurance Company to
perform the steps delineated below.
1. The number of proxy proposals is given to the Insurance Company by
INVESCO as early as possible before the date set by the Company for the
shareholder meeting to facilitate the establishment of tabulation
procedures. At this time INVESCO will inform the Insurance Company of
the Record, Mailing and Meeting dates. This will be done verbally
approximately two months before meeting.
2. Promptly after the Record Date, the Insurance Company will perform a
"tape run", or other activity, which will generate the names, addresses
and number of units which are attributed to each
contractowner/policyholder (the "Customer") as of the Record Date.
Allowance should be made for account adjustments made after this date
that could affect the status of the Customers' accounts of the Record
Date.
Note: The number of proxy statements is determined by the
activities described in Step #2. The Insurance
Company will use its best efforts to call in the
number of Customers to INVESCO, as soon as possible,
but no later than one week after the Record Date.
3. The text and format for the Voting Instruction Cards ("Cards" or
"Card") is provided to the Insurance Company by the Company. The
Insurance Company, at its expense, shall produce and personalize the
Voting Instruction cards. The Legal Department of INVESCO ("INVESCO
Legal") must approve the Card before it is printed. Allow approximately
2-4 business days for printing information on the Cards. Information
commonly found on the Cards includes:
a. name (legal name as found on account registration)
b. address
c. Fund or account number
d. coding to state number of units
e. individual Card number for use in tracking and
verification of votes (already on Cards as printed
by the Company).
(This and related steps may occur later in the chronological process
due to possible uncertainties relating to the proposals.)
4. During this time, INVESCO Legal will develop, produce, and the Company
will pay for the Notice of Proxy and the Proxy Statement (one
document). Printed and folded notices and statements will be sent to
Insurance Company for insertion into envelopes (envelopes and return
envelopes are provided and paid for by the Insurance Company). Contents
of envelope sent to customers by Insurance Company will include:
a. Voting Instruction Card(s)
b. One proxy notice and statement (one document)
c. Return envelope (postage pre-paid by Insurance Company)
addressed to the Insurance Company or its tabulation agent
d. "Urge buckslip" - optional, but recommended. (This is a small,
single sheet of paper that requests Customers to vote as
quickly as possible and that their vote is important. One copy
will be supplied by the Company.)
e. Cover letter - optional, supplied by Insurance Company and
reviewed and approved in advance by INVESCO Legal.
<PAGE>
5. The above contents should be received by the Insurance Company
approximately 3-5 business days before mail date. Individual in charge
at Insurance Company reviews and approves the contents of the mailing
package to ensure correctness and completeness. Copy of this approval
sent to INVESCO Legal.
6. Package mailed by the Insurance Company.
* The Company must allow at least a 15-day solicitation
time to the Insurance Company as the shareowner. (A 5-week
period is recommended.) Solicitation time is calculated as
calendar days from (but not including) the meeting, counting
backwards.
7. Collection and tabulation of Cards begins. Tabulation usually takes
place in another department or another vendor depending on process
used. An often used procedure is to sort cards on arrival by proposal
into vote categories of all yes, no, or mixed replies, and to begin
data entry.
Note: Postmarks are not generally needed. A need for postmark
information would be due to an insurance company's internal
procedure.
8. If Cards are mutilated, or for any reason are illegible or are not
signed properly, they are sent back to the Customer with an explanatory
letter, a new Card and return envelope. The mutilated or illegible Card
is disregarded and considered to be not received for purposes of vote
tabulation. Such mutilated or illegible Cards are "hand verified,"
i.e., examined as to why they did not complete the system. Any
questions on those Cards are usually remedied individually.
9. There are various control procedures used to ensure proper tabulation
of votes and accuracy of the tabulation. The most prevalent is to sort
the Cards as they first arrive into categories depending upon their
vote; an estimate of how the vote is progressing may then be
calculated. If the initial estimates and the actual vote do not
coincide, then an internal audit of that vote should occur. This may
entail a recount.
10. The actual tabulation of votes is done in units which are then
converted to shares. (It is very important that the Company receives
the tabulations stated in terms of a percentage and the number of
shares.) INVESCO Legal must review and approve tabulation format.
11. Final tabulation in shares is verbally given by the Insurance Company
to INVESCO Legal on the morning of the meeting not later than 10:00
a.m. Denver time. INVESCO Legal may request an earlier deadline if
required to calculate the vote in time for the meeting.
12. A Certificate of Mailing and Authorization to Vote Shares will be
required from the Insurance Company as well as an original copy of the
final vote. INVESCO Legal will provided a standard form for each
Certification.
13. The Insurance Company will be required to box and archive the Cards
received from the Customers. In the event that any vote is challenged
or if otherwise necessary for legal, regulatory, or accounting
purposes, INVESCO Legal will be permitted reasonable access to such
Cards.
14. All approvals and "signing-off" may be done orally, but must always be
followed up in writing.
<PAGE>
August 16, 1999
James F. Lummanick
Vice President/Assistant General Counsel
INVESCO Funds Group, Inc.
7800 East Union Avenue
Denver, Colorado 80237
RE: INVESCO Variable Investment Funds, Inc. - Participation Agreement
Dear Jim:
This purpose of this letter is to confirm certain financial arrangements between
INVESCO Funds Group, Inc. ("INVESCO"), the distributor for the INVESCO Variable
Investment Funds, Inc. (the "Company"), and Great American Life Insurance
Company of New York ("GALIC of NY") in connection with GALIC of NY's investment
in the Company through three of its funds, INVESCO VIF-Equity Income Fund,
INVESCO VIF-Total Return Fund and INVESCO VIF-High Yield Fund (individually, a
"Fund", collectively, the "Funds").
Administrative services to owners of variable annuity contracts offered by GALIC
of NY which are allocated into subaccounts invested in the Company shall be the
responsibility of GALIC of NY. GALIC of NY on behalf of its separate accounts
will be the sole shareholder of record of Company shares. The Company and
INVESCO recognize that they will derive a substantial savings in administrative
expense by virtue of having a sole shareholder rather than multiple
shareholders.
In consideration of the administrative savings resulting from having a sole
shareholder rather than multiple shareholders, INVESCO or its affiliates will
pay an administrative service fee to GALIC of NY equal, on an annual basis, to
0.20% per annum of the average aggregate net assets of the INVESCO VIF-Equity
Income and INVESCO VIF-Total Return Funds, and a service fee equal, on an annual
basis, equal to 0.15% per annum of the average aggregate net assets of the
INVESCO VIF-High Yield Fund, in each case on average aggregate net assets
attributable to variable annuity contracts offered by GALIC of NY (collectively,
"Eligible Contracts").
Such fee will be paid on a monthly basis in arrears. In no event will such fee
be paid by the Company, its shareholders, or by the contract holders, and in no
event will INVESCO have any responsibility under the Participation Agreement
dated August 16, 1999 or this letter to pay any amounts to any third party with
respect to GALIC of NY' or the Eligible Contracts' investments in the Funds.
Such payments, if any, shall be the responsibility of GALIC of NY. INVESCO's
payments to GALIC of NY are for administrative services only and do not
constitute payment in any manner for investment advisory services.
INVESCO shall have no obligation to make the above payments until such time as
the average net assets of a Fund, together with the average net assets of
Annuity Investors Variable Account B, reach $30 million. Beginning at such time,
INVESCO will make payments on the average aggregate net assets attributable to
the Eligible Contracts that hold investments in such Fund.
These financial arrangements shall continue so long as GALIC of NY holds shares
of the Company in its subaccounts and GALIC of NY therefore continues to provide
administrative services as set forth above. Please confirm your understanding of
this arrangement by having a copy of this letter signed where indicated below by
an appropriate officer of INVESCO and return this duplicate copy to me.
Very truly yours,
By:
Mark F. Muething
Senior Vice President
INVESCO Funds Group, Inc.
BY: ____________________________
Name: Ronald L. Grooms
Title: Senior Vice President and Treasurer
<PAGE>
FUND PARTICIPATION AGREEMENT
THIS AGREEMENT made as of the ____ day of _________, 1999, by and among
the PBHG INSURANCE SERIES FUND, INC. ("FUND"), a Maryland corporation, PILGRIM
BAXTER & ASSOCIATES, LTD. ("Adviser"), a Delaware corporation, and GREAT
AMERICAN LIFE INSURANCE COMPANY OF NEW YORK ("LIFE COMPANY"), a life insurance
company organized under the laws of the State of New York.
WHEREAS, FUND is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940, as amended (the "`40 Act"), as
an open-end, diversified management investment company; and
WHEREAS, FUND is organized as a series fund comprised of several
Portfolios ("Portfolios"), with those currently available being listed on
Appendix A hereto; and
WHEREAS, FUND was organized to act as the funding vehicle for certain
variable life insurance and/or variable annuity contracts ("Variable Contracts")
offered by life insurance companies through separate accounts ("Separate
Accounts") of such life insurance companies ("Participating Insurance
Companies"); and
WHEREAS, FUND may also offer its shares to certain qualified pension
and retirement plans ("Qualified Plans"); and
WHEREAS, FUND will apply for an order from the SEC, granting
Participating Insurance Companies and their separate accounts exemptions from
the provisions of Sections 9(a), 13(a), 15(a) and 15(b) of the `40 Act, and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Portfolios of the FUND to be sold to and held by Variable
Contract separate accounts of both affiliated and unaffiliated Participating
Insurance Companies and Qualified Plans ("Exemptive Order"); and
WHEREAS, LIFE COMPANY has established or will establish one or more
separate accounts ("Separate Accounts") to offer Variable Contracts and is
desirous of having FUND as one of the underlying funding vehicles for such
Variable Contracts; and
WHEREAS, ADVISER is registered with the SEC as an investment adviser
under the Investment Advisers Act of 1940 and as a broker-dealer under the
Securities Exchange Act of 1934, as amended and acts as the FUND's investment
adviser; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, LIFE COMPANY intends to purchase shares of FUND to fund the
aforementioned Variable Contracts and FUND is authorized to sell such shares to
LIFE COMPANY at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, LIFE
COMPANY, FUND, and ADVISER agree as follows:
<PAGE>
Article I. SALE OF FUND SHARES
1.1 FUND agrees to make available to the Separate Accounts of LIFE
COMPANY shares of the selected Portfolios as listed on Appendix B for investment
of purchase payments of Variable Contracts allocated to the designated Separate
Accounts as provided in FUND's Registration Statement.
1.2 FUND agrees to sell to LIFE COMPANY those shares of the selected
Portfolios of FUND which LIFE COMPANY orders, executing such orders on a daily
basis at the net asset value next computed after receipt by FUND or its designee
of the order for the shares of FUND. For purposes of this Section 1.2, LIFE
COMPANY shall be the designee of FUND for receipt of such orders from the
designated Separate Account and receipt by such designee shall constitute
receipt by FUND; provided that LIFE COMPANY receives the order by 4:00 p.m. New
York time and FUND receives notice from LIFE COMPANY by telephone or facsimile
(or by such other means as FUND and LIFE COMPANY may agree in writing) of such
order by 8:30 a.m. New York time on the next following Business Day. "Business
Day" shall mean any day on which the New York Stock Exchange is open for trading
and on which FUND calculates its net asset value pursuant to the rules of the
SEC.
1.3 FUND agrees to redeem on LIFE COMPANY's request, any full or
fractional shares of FUND held by LIFE COMPANY, executing such requests on a
daily basis at the net asset value next computed after receipt by FUND or its
designee of the request for redemption, in accordance with the provisions of
this agreement and FUND's Registration Statement. For purposes of this Section
1.3, LIFE COMPANY shall be the designee of FUND for receipt of requests for
redemption from the designated Separate Account and receipt by such designee
shall constitute receipt by FUND; provided that LIFE COMPANY receives the
request for redemption by 4:00 p.m. New York time and FUND receives notice from
LIFE COMPANY by telephone or facsimile (or by such other means as FUND and LIFE
COMPANY may agree in writing) of such request for redemption by 8:30 a.m. New
York time on the next following Business Day.
1.4 FUND shall furnish, on or before the ex-dividend date, notice to
LIFE COMPANY of any income dividends or capital gain distributions payable on
the shares of any Portfolio of FUND. LIFE COMPANY hereby elects to receive all
such income dividends and capital gain distributions as are payable on a
Portfolio's shares in additional shares of the Portfolio. FUND shall notify LIFE
COMPANY or its designee of the number of shares so issued as payment of such
dividends and distributions.
1.5 FUND shall make the net asset value per share for the selected
Portfolio(s) available to LIFE COMPANY on a daily basis as soon as reasonably
practicable after the net asset value per share is calculated but shall use its
best efforts to make such net asset value available by 7:00 p.m. New York time.
The FUND shall provide such net asset values to LIFE COMPANY by facsimile
<PAGE>
transmission or in such other manner as FUND and LIFE COMPANY may agree. If FUND
provides LIFE COMPANY with materially incorrect share net asset value
information through no fault of LIFE COMPANY, LIFE COMPANY on behalf of the
Separate Accounts, shall be entitled to an adjustment to the number of shares
purchased or redeemed to reflect the correct share net asset value. Any material
error in the calculation of net asset value per share, dividend or capital gain
information shall be reported promptly upon discovery to LIFE COMPANY.
1.6 At the end of each Business Day, LIFE COMPANY shall use the
information described in Section 1.5 to calculate Separate Account unit values
for the day. Using these unit values, LIFE COMPANY shall process each such
Business Day's Separate Account transactions based on requests and premiums
received by it by the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m. New York time) to determine the net dollar amount
of FUND shares which shall be purchased or redeemed at that day's closing net
asset value per share. The net purchase or redemption orders so determined shall
be transmitted to FUND by LIFE COMPANY by 8:30 a.m. New York Time on the
Business Day next following LIFE COMPANY's receipt of such requests and premiums
in accordance with the terms of Sections 1.2 and 1.3 hereof.
1.7 If LIFE COMPANY's order requests the purchase of FUND shares, LIFE
COMPANY shall pay for such purchase by wiring federal funds to FUND or its
designated custodial account on the day the order is transmitted by LIFE
COMPANY. If LIFE COMPANY's order requests a net redemption resulting in a
payment of redemption proceeds to LIFE COMPANY, FUND shall use its best efforts
to wire the redemption proceeds to LIFE COMPANY by the next Business Day. In any
event, proceeds shall be wired to LIFE COMPANY within three Business Days or
such longer period permitted by the '40 Act or the rules, orders or regulations
thereunder and FUND shall notify the person designated in writing by LIFE
COMPANY as the recipient for such notice of such delay by 3:00 p.m. New York
Time the same Business Day that LIFE COMPANY transmits the redemption order to
FUND.
1.8 FUND agrees that all shares of the Portfolios of FUND will be sold
only to Participating Insurance Companies which have agreed to participate in
FUND to fund their Separate Accounts and/or to Qualified Plans, all in
accordance with the requirements of Section 817(h) of the Internal Revenue Code
of 1986, as amended ("Code") and Treasury Regulation 1.817-5. Shares of the
Portfolios of FUND will not be sold directly to the general public.
1.9 FUND may refuse to sell shares of any Portfolio to any person, or
suspend or terminate the offering of the shares of or liquidate any Portfolio of
FUND if such action is required by law or by regulatory authorities having
jurisdiction or is, in the sole discretion of the Board of Directors of the FUND
(the "Board"), acting in good faith and in light of its duties under federal and
any applicable state laws, deemed necessary, desirable or appropriate and in the
best interests of the shareholders of such Portfolios.
1.10 Issuance and transfer of Portfolio shares will be by book entry
only. Stock certificates will not be issued to LIFE COMPANY or the Separate
<PAGE>
Accounts. Shares ordered from Portfolio will be recorded in appropriate book
entry titles for the Separate Accounts.
Article II. REPRESENTATIONS AND WARRANTIES
2.1 LIFE COMPANY represents and warrants that it is an insurance
company duly organized and in good standing under the laws of the State of New
York and that it has or will legally and validly established each Separate
Account as a segregated asset account under such laws, and that AAG Securities,
Inc., the principal underwriter for the Variable Contracts, is registered as a
broker-dealer under the Securities Exchange Act of 1934 (the "'34 Act").
2.2 LIFE COMPANY represents and warrants that it has registered or,
prior to any issuance or sale of the Variable Contracts, will register each
Separate Account as a unit investment trust ("UIT") in accordance with the
provisions of the `40 Act and cause each Separate Account to remain so
registered to serve as a segregated asset account for the Variable Contracts,
unless an exemption from registration is available.
2.3 LIFE COMPANY represents and warrants that the Variable Contracts
will be registered under the Securities Act of 1933 (the "33 Act") unless an
exemption from registration is available prior to any issuance or sale of the
Variable Contracts and that the Variable Contracts will be issued and sold in
compliance in all material respects with all applicable federal and state laws
and further that the sale of the Variable Contracts shall comply in all material
respects with applicable state insurance law suitability requirements.
2.4 LIFE COMPANY represents and warrants that the Variable Contracts
are currently and at the time of issuance will be treated as life insurance,
endowment or annuity contracts under applicable provisions of the Code, that it
will maintain such treatment and that it will notify FUND immediately upon
having a reasonable basis for believing that the Variable Contracts have ceased
to be so treated or that they might not be so treated in the future.
2.5 FUND represents and warrants that the Fund shares offered and sold
pursuant to this Agreement will be registered under the '33 Act and sold in
accordance with all applicable federal and state laws, and FUND shall be
registered under the `40 Act prior to and at the time of any issuance or sale of
such shares. FUND, subject to Section 1.9 above, shall amend its registration
statement under the `33 Act and the `40 Act from time to time as required in
order to effect the continuous offering of its shares. FUND shall register and
qualify its shares for sale in accordance with the laws of the various states
only if and to the extent deemed advisable by FUND.
2.6 FUND represents and warrants that each Portfolio will comply with
the diversification requirements set forth in Section 817(h) of the Code, and
the rules and regulations thereunder, including without limitation Treasury
Regulation 1.817-5, and will notify LIFE COMPANY immediately upon having a
reasonable basis for believing any Portfolio has ceased to comply or might not
so comply and will immediately take all reasonable steps to adequately diversify
the Portfolio to achieve compliance.
<PAGE>
2.7 FUND represents and warrants that each Portfolio invested in by the
Separate Account intends to elect to be treated as a "regulated investment
company" under Subchapter M of the Code, and to qualify for such treatment for
each taxable year and will notify LIFE COMPANY immediately upon having a
reasonable basis for believing it has ceased to so qualify or might not so
qualify in the future.
2.8. ADVISER represents and warrants that it is and will remain duly
registered and licensed in all material respects under all applicable federal
and state securities laws and shall perform its obligations hereunder in
compliance in all material respects with any applicable state and federal laws.
Article III. PROSPECTUS AND PROXY STATEMENTS
3.1 FUND shall prepare and be responsible for filing with the SEC and
any state regulators requiring such filing all shareholder reports, notices,
proxy materials (or similar materials such as voting instruction solicitation
materials), prospectuses and statements of additional information of FUND. FUND
shall bear the costs of registration and qualification of shares of the
Portfolios, preparation and filing of the documents listed in this Section 3.1
and all taxes and filing fees to which an issuer is subject on the issuance and
transfer of its shares.
3.2 At least annually, FUND or its designee shall provide LIFE COMPANY,
free of charge, with as many copies of the current prospectus for the shares of
the Portfolios as LIFE COMPANY may reasonably request for distribution to
existing Variable Contract owners whose Variable Contracts are funded by such
shares. FUND or its designee shall provide LIFE COMPANY, at LIFE COMPANY's
expense, with as many copies of the current prospectus for the shares as LIFE
COMPANY may reasonably request for distribution to prospective purchasers of
Variable Contracts. If requested by LIFE COMPANY in lieu thereof, FUND or its
designee shall provide such documentation (including a "camera ready" copy of
the new prospectus as set in type or, at the request of LIFE COMPANY, as a
diskette in the form sent to the financial printer) and other assistance as is
reasonably necessary in order for the parties hereto once a year (or more
frequently if the prospectus for the shares is supplemented or amended) to have
the prospectus for the Variable Contracts and the prospectus for the FUND shares
printed together in one document. The expenses of such printing will be
apportioned between (a) LIFE COMPANY and (b) FUND in proportion to the number of
pages of the Variable Contract and FUND's prospectus, taking account of other
relevant factors affecting the expense of printing, such as covers, columns,
graphs and charts; FUND to bear the cost of printing the FUND's prospectus
portion of such document for distribution only to owners of existing Variable
Contracts funded by the FUND's shares and LIFE COMPANY to bear the expense of
printing the portion of such documents relating to the Separate Account;
provided, however, LIFE COMPANY shall bear all printing expenses of such
combined documents where used for distribution to prospective purchasers or to
owners of existing Variable Contracts not funded by the FUND's shares. In the
event that LIFE COMPANY requests that FUND or its designee provide FUND's
<PAGE>
prospectus in a "camera ready" or diskette format, FUND shall be responsible for
providing the prospectus in the format in which it is accustomed to formatting
prospectuses and shall bear the expense of providing the prospectus in such
format (e.g. typesetting expenses), and LIFE COMPANY shall bear the expense of
adjusting or changing the format to conform with any of its prospectuses.
3.3 FUND will provide LIFE COMPANY with at least one complete copy of
all exemptive applications and all amendments or supplements to any of the above
that relate to the Portfolios promptly after the filing of each such document
with the SEC or other regulatory authority. FUND, at its expense, will provide
LIFE COMPANY with as many copies of its proxy statement, annual and semi-annual
reports to shareholders as LIFE COMPANY may reasonably require for distribution
to existing Variable Contract owners. LIFE COMPANY will provide FUND with at
least one complete copy of all prospectuses, statements of additional
information, annual and semi-annual reports, proxy statements, exemptive
applications and all amendments or supplements to any of the above that relate
to a Separate Account promptly after the filing of each such document with the
SEC or other regulatory authority.
Article IV. SALES MATERIALS
4.1 LIFE COMPANY will furnish, or will cause to be furnished, to FUND
and ADVISER, each piece of sales literature or other promotional material in
which FUND or ADVISER is named, at least fifteen (15) Business Days prior to its
intended use. No such material will be used if FUND or ADVISER reasonably
objects to its use in writing within ten (10) Business Days after receipt of
such material.
4.2 FUND and ADVISER will furnish, or will cause to be furnished, to
LIFE COMPANY, each piece of sales literature or other promotional material in
which LIFE COMPANY or its Separate Accounts are named, at least fifteen (15)
Business Days prior to its intended use. No such material will be used if LIFE
COMPANY reasonably objects to its use in writing within ten (10) Business Days
after receipt of such material.
4.3 FUND and its affiliates and agents shall not give any information
or make any representations on behalf of LIFE COMPANY or concerning LIFE
COMPANY, the Separate Accounts, or the Variable Contracts issued by LIFE
COMPANY, other than the information or representations contained in a
registration statement or prospectus for such Variable Contracts, as such
registration statement and prospectus may be amended or supplemented from time
to time, or in reports of the Separate Accounts or reports prepared for
distribution to owners of such Variable Contracts, or in sales literature or
other promotional material approved by LIFE COMPANY or its designee, except with
the written permission of LIFE COMPANY.
4.4 LIFE COMPANY and its affiliates and agents shall not give any
information or make any representations on behalf of FUND or concerning FUND
other than the information or representations contained in a registration
statement or prospectus for FUND, as such registration statement and prospectus
<PAGE>
may be amended or supplemented from time to time, or in sales literature or
other promotional material approved by FUND or its designee, except with the
written permission of FUND.
4.5 For purposes of this Agreement, the phrase "sales literature or
other promotional material" or words of similar import include, without
limitation, advertisements (such as material published, or designed for use, in
a newspaper, magazine or other periodical, radio, television, telephone or tape
recording, videotape display, signs or billboards, motion pictures or other
public media), sales literature (such as any written communication distributed
or made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts, or
reprints or excerpts of any other advertisement, sales literature, or published
article), educational or training materials or other communications distributed
or made generally available to some or all agents or employees, registration
statements, prospectuses, statements of additional information, shareholder
reports and proxy materials, and any other material constituting sales
literature or advertising under National Association of Securities Dealers, Inc.
("NASD") rules, the `40 Act or the '33 Act.
Article V. POTENTIAL CONFLICTS
5.1 The parties acknowledge that FUND will be filing an application
with the SEC to request an order granting relief from various provisions of the
'40 Act and the rules thereunder to the extent necessary to permit FUND shares
to be sold to and held by Variable Contract separate accounts of both affiliated
and unaffiliated Participating Insurance Companies and Qualified Plans. It is
anticipated that the Exemptive Order, when and if issued, shall require FUND and
each Participating Insurance Company to comply with conditions and undertakings
substantially as provided in this Section 5. If the Exemptive Order imposes
conditions materially different from those provided for in this Section 5, the
conditions and undertakings imposed by the Exemptive Order shall govern this
Agreement and the parties hereto agree to amend this Agreement consistent with
the Exemptive Order. The Fund will not enter into a participation agreement with
any other Participating Insurance Company unless it imposes the same conditions
and undertakings as are imposed on LIFE COMPANY hereby.
5.2 The Board will monitor FUND for the existence of any material
irreconcilable conflict between the interests of Variable Contract owners of all
separate accounts investing in FUND. An irreconcilable material conflict may
arise for a variety of reasons, which may include: (a) an action by any state
insurance regulatory authority; (b) a change in applicable federal or state
insurance, tax, or securities laws or regulations, or a public ruling, private
letter ruling or any similar action by insurance, tax or securities regulatory
authorities; (c) an administrative or judicial decision in any relevant
proceeding; (d) the manner in which the investments of FUND are being managed;
(e) a difference in voting instructions given by Variable Contract owners; (f) a
decision by a Participating Insurance Company to disregard the voting
instructions of Variable Contract owners and (g) if applicable, a decision by a
Qualified Plan to disregard the voting instructions of plan participants.
5.3 LIFE COMPANY will report any potential or existing conflicts to the
Board. LIFE COMPANY will be responsible for assisting the Board in carrying out
<PAGE>
its duties in this regard by providing the Board with all information reasonably
necessary for the Board to consider any issues raised. The responsibility
includes, but is not limited to, an obligation by the LIFE COMPANY to inform the
Board whenever it has determined to disregard Variable Contract owner voting
instructions. These responsibilities of LIFE COMPANY will be carried out with a
view only to the interests of the Variable Contract owners.
5.4 If a majority of the Board or majority of its disinterested
Directors, determines that a material irreconcilable conflict exists affecting
LIFE COMPANY, LIFE COMPANY, at its expense and to the extent reasonably
practicable (as determined by a majority of the Board's disinterested
Directors), will take any steps necessary to remedy or eliminate the
irreconcilable material conflict, including; (a) withdrawing the assets
allocable to some or all of the Separate Accounts from FUND or any Portfolio
thereof and reinvesting those assets in a different investment medium, which may
include another Portfolio of FUND, or another investment company; (b) submitting
the question as to whether such segregation should be implemented to a vote of
all affected Variable Contract owners and as appropriate, segregating the assets
of any appropriate group (i.e variable annuity or variable life insurance
Contract owners of one or more Participating Insurance Companies) that votes in
favor of such segregation, or offering to the affected Variable Contract owners
the option of making such a change; and (c) establishing a new registered
management investment company (or series thereof) or managed separate account.
If a material irreconcilable conflict arises because of LIFE COMPANY's decision
to disregard Variable Contract owner voting instructions, and that decision
represents a minority position or would preclude a majority vote, LIFE COMPANY
may be required, at the election of FUND, to withdraw the Separate Account's
investment in FUND, and no charge or penalty will be imposed as a result of such
withdrawal. The responsibility to take such remedial action shall be carried out
with a view only to the interests of the Variable Contract owners.
For the purposes of this Section 5.4, a majority of the disinterested
members of the Board shall determine whether or not any proposed action
adequately remedies any irreconcilable material conflict but in no event will
FUND or ADVISER (or any other investment adviser of FUND) be required to
establish a new funding medium for any Variable Contract. Further, LIFE COMPANY
shall not be required by this Section 5.4 to establish a new funding medium for
any Variable Contracts if any offer to do so has been declined by a vote of a
majority of Variable Contract owners materially and adversely affected by the
irreconcilable material conflict.
5.5 The Board's determination of the existence of an irreconcilable
material conflict and its implications shall be made known promptly and in
writing to LIFE COMPANY.
5.6 No less than annually, LIFE COMPANY shall submit to the Board such
reports, materials or data as the Board may reasonably request so that the Board
may fully carry out its obligations. Such reports, materials, and data shall be
submitted more frequently if deemed appropriate by the Board.
<PAGE>
Article VI. VOTING
6.1 LIFE COMPANY will provide pass-through voting privileges to all
Variable Contract owners so long as the SEC continues to interpret the `40 Act
as requiring pass-through voting privileges for Variable Contract owners.
Accordingly, LIFE COMPANY, where applicable, will vote shares of the Portfolio
held in its Separate Accounts in a manner consistent with voting instructions
timely received from its Variable Contract owners. LIFE COMPANY will be
responsible for assuring that each of its Separate Accounts that participates in
FUND calculates voting privileges in a manner consistent with other
Participating Insurance Companies. LIFE COMPANY will vote shares for which it
has not received timely voting instructions, as well as shares it owns, in the
same proportion as its votes those shares for which it has received voting
instructions.
6.2 If and to the extent Rule 6e-2 and Rule 6e-3(T) are amended, or if
Rule 6e-3 is adopted, to provide exemptive relief from any provision of the `40
Act or the rules thereunder with respect to mixed and shared funding on terms
and conditions materially different from any exemptions granted in the Exemptive
Order, then FUND, and/or the Participating Insurance Companies, as appropriate,
shall take such steps as may be necessary to comply with Rule 6e-2 and Rule
6e-3(T), as amended, and Rule 6e-3, as adopted, to the extent such Rules are
applicable.
Article VII. INDEMNIFICATION
7.1 Indemnification by LIFE COMPANY. LIFE COMPANY agrees to indemnify
and hold harmless FUND, ADVISER and each of their directors, principals,
officers, employees and agents and each person, if any, who controls FUND or
ADVISER within the meaning of Section 15 of the `33 Act (collectively, the
"Indemnified Parties" for purposes of this Article VII) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement with
the written consent of LIFE COMPANY, which consent shall not be unreasonably
withheld) or litigation (including reasonable legal and other expenses), to
which the Indemnified Parties may become subject under any statute, regulation,
at common law or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions in respect thereof) or settlements are related to the
sale or acquisition of FUND's shares or the Variable Contracts and:
(a) arise out of or are based upon any untrue statements or alleged
untrue statements of any material fact contained in the
Registration Statement or prospectus for the Variable Contracts
or contained in the Variable Contracts (or any amendment or
supplement to any of the foregoing), or arise out of or are
based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading,
provided that this agreement to indemnify shall not apply as to
any Indemnified Party if such statement or omission or such
alleged statement or omission was made in reliance upon and in
conformity with information furnished to LIFE COMPANY by or on
behalf of FUND for use in the registration statement or
prospectus for the Variable Contracts or in the Variable
Contracts or sales literature (or any amendment or supplement)
or otherwise for use in connection with the sale of the
Variable Contracts or FUND shares; or
<PAGE>
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature of FUND
not supplied by LIFE COMPANY, or persons under its control) or
wrongful conduct of LIFE COMPANY or persons under its control,
with respect to the sale or distribution of the Variable
Contracts or FUND shares; or
(c) arise out of any untrue statement or alleged untrue statement
of a material fact contained in a registration statement,
prospectus, or sales literature of FUND or any amendment
thereof or supplement thereto or the omission or alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading if such statement or omission or such alleged
statement or omission was made in reliance upon and in
conformity with information furnished to FUND by or on behalf
of LIFE COMPANY; or
(d) arise as a result of any failure by LIFE COMPANY to provide
substantially the services and furnish the materials under the
terms of this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by LIFE COMPANY in this
Agreement or arise out of or result from any other material
breach of this Agreement by LIFE COMPANY.
7.2 LIFE COMPANY shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
incurred or assessed against an Indemnified Party as such may arise from such
Indemnified Party's willful misfeasance, bad faith, or negligence in the
performance of such Indemnified Party's duties or by reason of such Indemnified
Party's reckless disregard of obligations or duties under this Agreement.
7.3 LIFE COMPANY shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified LIFE COMPANY in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify LIFE COMPANY of any
such claim shall not relieve LIFE COMPANY from any liability which it may have
to the Indemnified Party against whom such action is brought otherwise than on
account of this indemnification provision. In case any such action is brought
against an Indemnified Party, LIFE COMPANY shall be entitled to participate at
<PAGE>
its own expense in the defense of such action. LIFE COMPANY also shall be
entitled to assume the defense thereof, with counsel satisfactory to the party
named in the action. After notice from LIFE COMPANY to such party of LIFE
COMPANY's election to assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it, and LIFE
COMPANY will not be liable to such party under this Agreement for any legal or
other expenses subsequently incurred by such party independently in connection
with the defense thereof other than reasonable costs of investigation.
7.4 Indemnification by ADVISER. ADVISER agrees to indemnify and hold
harmless LIFE COMPANY and each of its directors, officers, employees, and agents
and each person, if any, who controls LIFE COMPANY within the meaning of Section
15 of the `33 Act (collectively, the "Indemnified Parties" for the purposes of
this Article VII) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of ADVISER which
consent shall not be unreasonably withheld) or litigation (including reasonable
legal and other expenses) to which the Indemnified Parties may become subject
under any statute, or regulation, at common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect thereof)
or settlements are related to the sale or acquisition of FUND's shares or the
Variable Contracts and:
(a) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
registration statement or prospectus or sales literature of
FUND (or any amendment or supplement to any of the foregoing),
or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, provided that this agreement to indemnify shall not
apply as to any Indemnified Party if such statement or omission
or such alleged statement or omission was made in reliance upon
and in conformity with information furnished to ADVISER or FUND
by or on behalf of LIFE COMPANY for use in the registration
statement or prospectus for FUND or in sales literature (or any
amendment or supplement) or otherwise for use in connection
with the sale of the Variable Contracts or FUND shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature for the
Variable Contracts not supplied by ADVISER or persons under its
control) or wrongful conduct of FUND or ADVISER or persons
under their control, with respect to the sale or distribution
of the Variable Contracts or FUND shares; or
(c) arise out of any untrue statement or alleged untrue statement
of a material fact containedin a registration statement,
prospectus, or sales literature covering the Variable
Contracts, or any amendment thereof or supplement thereto or
the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading, if such statement or
omission or such alleged statement or omission was made in
reliance upon and in conformity with information furnished to
LIFE COMPANY for inclusion therein by or on behalf of FUND; or
<PAGE>
(d) arise as a result of (i) a failure by FUND to provide
substantially the services and furnish the materials under the
terms of this Agreement; or (ii) a failure by a Portfolio(s)
invested in by the Separate Account to comply with the
diversification requirements of Section 817(h) of the Code; or
(iii) a failure by a Portfolio(s) invested in by the Separate
Account to qualify as a "regulated investment company" under
Subchapter M of the Code; or
(e) arise as a result of any failure by FUND or ADVISER to provide
substantially the services and furnish the materials under the
terms of this Agreement; or
(f) arise out of or result from any material breach of any
representation and/or warranty made by ADVISER in this
Agreement or arise out of or result from any other material
breach of this Agreement by ADVISER.
7.5 ADVISER shall not be liable under this indemnification provision
with respect to any losses, claims, damages, liabilities or litigation to which
an Indemnified Party would otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's reckless
disregard of obligations and duties under this Agreement.
7.6 ADVISER shall not be liable under this indemnification provision
with respect to any claim made against an Indemnified Party unless such
Indemnified Party shall have notified ADVISER in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon such Indemnified Party (or after
such Indemnified Party shall have received notice of such service on any
designated agent), but failure to notify ADVISER of any such claim shall not
relieve ADVISER from any liability which it may have to the Indemnified Party
against whom such action is brought otherwise than on account of this
indemnification provision. In case any such action is brought against the
Indemnified Parties, ADVISER shall be entitled to participate at its own expense
in the defense thereof. ADVISER also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action. After
notice from ADVISER to such party of ADVISER's election to assume the defense
thereof, the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and ADVISER will not be liable to such party
under this Agreement for any legal or other expenses subsequently incurred by
such party independently in connection with the defense thereof other than
reasonable costs of investigation.
Article VIII. TERM; TERMINATION
8.1 This Agreement shall be effective as of the date hereof and shall
continue in force until terminated in accordance with the provisions herein.
<PAGE>
8.2 This Agreement shall terminate in accordance with the following
provisions:
(a) At the option of LIFE COMPANY or FUND at any time from the
date hereof upon 60 days' notice, unless a shorter time is
agreed to by the parties;
(b) At the option of LIFE COMPANY, if FUND shares are not
reasonably available to meet the requirements of the
Variable Contracts as determined by LIFE COMPANY. Prompt
notice of election to terminate shall be furnished by LIFE
COMPANY, said termination to be effective ten days after
receipt of notice unless FUND makes available a sufficient
number of shares to reasonably meet the requirements of the
Variable Contracts within said ten-day period;
(c) At the option of LIFE COMPANY, upon the institution of
formal proceedings against FUND by the SEC, the NASD, or any
other regulatory body, the expected or anticipated ruling,
judgment or outcome of which would, in LIFE COMPANY's
reasonable judgment, materially impair FUND's ability to
meet and perform FUND's obligations and duties hereunder.
Prompt notice of election to terminate shall be furnished by
LIFE COMPANY with said termination to be effective upon
receipt of notice;
(d) At the option of FUND, upon the institution of formal
proceedings against LIFE COMPANY by the SEC, the NASD, or
any other regulatory body, the expected or anticipated
ruling, judgment or outcome of which would, in FUND's
reasonable judgment, materially impair LIFE COMPANY's
ability to meet and perform its obligations and duties
hereunder. Prompt notice of election to terminate shall be
furnished by FUND with said termination to be effective upon
receipt of notice;
(e) In the event FUND's shares are not registered, issued or
sold in accordance with applicable state or federal law, or
such law precludes the use of such shares as the underlying
investment medium of Variable Contracts issued or to be
issued by LIFE COMPANY. Termination shall be effective upon
such occurrence without notice;
(f) At the option of FUND if the Variable Contracts cease to
qualify as annuity contracts or life insurance contracts, as
applicable, under the Code, or if FUND reasonably believes
that the Variable Contracts may fail to so qualify.
Termination shall be effective upon receipt of notice by
LIFE COMPANY;
(g) At the option of LIFE COMPANY, upon FUND's breach of any
material provision of this Agreement, which breach has not
been cured to the satisfaction of LIFE COMPANY within ten
days after written notice of such breach is delivered to
FUND;
<PAGE>
(h) At the option of FUND, upon LIFE COMPANY's breach of any
material provision of this Agreement, which breach has not
been cured to the satisfaction of FUND within ten days after
written notice of such breach is delivered to LIFE COMPANY;
(i) At the option of FUND, if the Variable Contracts are not
registered, issued or sold in accordance with applicable
federal and/or state law. Termination shall be effective
immediately upon such occurrence without notice;
(j) In the event this Agreement is assigned without the prior
written consent of LIFE COMPANY, FUND, and ADVISER,
termination shall be effective immediately upon such
occurrence without notice.
8.3 Notwithstanding any termination of this Agreement pursuant to
Section 8.2 hereof, FUND shall, at the option of LIFE COMPANY, continue to make
available additional FUND shares, as provided below, pursuant to the terms and
conditions of this Agreement, for all Variable Contracts in effect on the
effective date of termination of this Agreement (hereinafter referred to as
"Existing Contracts"). Specifically, without limitation, if LIFE COMPANY so
elects, the owners of the Existing Contracts or LIFE COMPANY, whichever shall
have legal authority to do so, shall be permitted to reallocate investments in
FUND, redeem investments in FUND and/or invest in FUND upon the payment of
additional premiums under the Existing Contracts. In the event of a termination
of this Agreement pursuant to Section 8.2 hereof, LIFE COMPANY, as promptly as
is practicable under the circumstances, shall notify FUND and ADVISER whether
LIFE COMPANY elects to continue to make FUND shares available after such
termination. If FUND shares continue to be made available after such
termination, the provisions of this Agreement shall remain in effect and
thereafter either FUND or LIFE COMPANY may terminate the Agreement, as so
continued pursuant to this Section 8.3, upon sixty (60) days prior written
notice to the other party.
8.4 Except as necessary to implement Variable Contract owner initiated
transactions, or as required by state insurance laws or regulations, LIFE
COMPANY shall not redeem the shares attributable to the Variable Contracts (as
opposed to the shares attributable to LIFE COMPANY's assets held in the Separate
Accounts), and LIFE COMPANY shall not prevent Variable Contract owners from
allocating payments to a Portfolio that was otherwise available under the
Variable Contracts until thirty (30) days after the LIFE COMPANY shall have
notified FUND of its intention to do so.
<PAGE>
Article IX. NOTICES
Any notice hereunder shall be given by registered or certified mail
return receipt requested to the other party at the address of such party set
forth below or at such other address as such party may from time to time specify
in writing to the other party.
If to FUND:
PBHG Insurance Series Fund, Inc.
825 Duportail Road
Wayne, PA 19087
Attention: Mr. Brian F. Bereznak
With a copy to:
PBHG Insurance Series Fund, Inc.
825 Duportail Road
Wayne, PA 19087
Attention: John M. Zerrr, Esq.
If to the ADVISER:
PBHG Insurance Series Fund, Inc.
825 Duportail Road
Wayne, PA 19087
Attention: Mr. Brian F. Bereznak
With a copy to:
PBHG Insurance Series Fund, Inc.
825 Duportail Road
Wayne, PA 19087
Attention: John M. Zerr, Esq.
If to LIFE COMPANY:
Great American Life Insurance Company of New York
250 E. Fifth Street
Cincinnati, OH 45202
Attn: Mark F. Muething
Notice shall be deemed given on the date of receipt by the addressee as
evidenced by the return receipt.
<PAGE>
Article X. MISCELLANEOUS
10.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
10.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
10.3 If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
10.4 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the Commonwealth of
Pennsylvania. It shall also be subject to the provisions of the federal
securities laws and the rules and regulations thereunder and to any orders of
the SEC granting exemptive relief therefrom and the conditions of such orders.
10.5 It is understood and expressly stipulated that neither the
shareholders of shares of any Portfolio nor the Directors or officers of FUND or
any Portfolio shall be personally liable hereunder. No Portfolio shall be liable
for the liabilities of any other Portfolio. All persons dealing with FUND or a
Portfolio must look solely to the property of FUND or that Portfolio,
respectively, for enforcement of any claims against FUND or that Portfolio. It
is also understood that each of the Portfolios shall be deemed to be entering
into a separate Agreement with LIFE COMPANY so that it is as if each of the
Portfolios had signed a separate Agreement with LIFE COMPANY and that a single
document is being signed simply to facilitate the execution and administration
of the Agreement.
10.6 Each party shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any investigation
or inquiry relating to this Agreement or the transactions contemplated hereby.
10.7 The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to under
state and federal laws.
10.8 No provision of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by FUND,
ADVISER and the LIFE COMPANY.
<PAGE>
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Fund Participation Agreement as of the date and year
first above written.
PBHG INSURANCE SERIES FUND, INC.
By:_____________________________
Name:___________________________
Title:__________________________
PILGRIM BAXTER & ASSOCIATES, LTD.
By:_____________________________
Name:___________________________
Title:__________________________
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
By:______________________________
Name: Mark. F. Muething
Title: Senior Vice President
<PAGE>
Appendix A
PBHG Insurance Series Fund, Inc. - Portfolios
PBHG Growth II Portfolio
PBHG Large Cap Growth Portfolio
PBHG Technology & Communications Portfolio
<PAGE>
Appendix B
Separate Accounts Selected Portfolios
GALIC of New York Separate Account I PBHG Growth II Portfolio
PBHG Large Cap Growth Portfolio
PBHG Technology & Communications
Portfolio
<PAGE>
SERVICE AGREEMENT
THIS SERVICE AGREEMENT (hereinafter called "Agreement") dated February
17, 1999, by and between AMERICAN ANNUITY GROUP, INC and GREAT AMERICAN LIFE
INSURANCE COMPANY OF NEW YORK (hereinafter called "GALIC OF NY").
WHEREAS, AAG and its subsidiaries (hereinafter called "AAG") has
extensive experience in the administration of annuity, traditional life, long
term care and supplemental health insurance business; and
WHEREAS, GALIC OF NY is a subsidiary of AAG, and desires that AAG
perform certain administrative, accounting and other services (hereinafter
called "Services") for GALIC OF NY in its business operations and desires
further to make use in its day-to-day operations of certain property, equipment,
and facilities (hereinafter called "Facilities") of AAG as GALIC OF NY may
request; and
WHEREAS, AAG and GALIC OF NY contemplate that such an arrangement will
achieve certain operating economies and improve Services to the benefit of AAG,
GALIC OF NY and GALIC OF NY's policyholders; and
WHEREAS, AAG and GALIC OF NY wish to assure that all charges for
Services and the use of Facilities incurred hereunder are reasonable and in
accordance with the requirements of applicable law and regulations and to the
extent practicable reflect actual costs and are arrived at in a fair and
equitable manner, and that estimated costs, whenever used, are adjusted
periodically, to bring them into alignment with actual costs; and
<PAGE>
WHEREAS, AAG and GALIC OF NY wish to identify the Services to be
rendered to GALIC OF NY, the Facilities to be used by GALIC OF NY and to provide
a method for determining the charges to be made to GALIC OF NY.
NOW, THEREFORE, in consideration of the premises and of the promises
set forth herein, and intending to be legally bound hereby, AAG and GALIC OF NY
agree as follows:
1. PERFORMANCE OF SERVICES AND USE OF FACILITIES.
AAG agrees to the extent requested by GALIC OF NY to perform such
Services for GALIC OF NY as GALIC OF NY determines to be reasonably necessary in
the conduct of its business and operations.
AAG agrees to the extent requested by GALIC OF NY to make available its
personnel and Facilities to GALIC OF NY as GALIC OF NY may determine to be
reasonably necessary in the conduct of its business and operations, including
but not limited to the following functions: policy administration; accounting
and auditing services; actuarial; marketing; legal; administrative and other
regulatory matters; general corporate matters; contract matters; use of data
processing and computer equipment; use of business property, whether owned or
leased; and use of communications equipment. It is the intent of the parties
that AAG will provide all services which GALIC OF NY requires in connection with
its business of marketing, issuing and servicing fixed and variable annuities
traditional life products, long term care insurance and supplemental
<PAGE>
health products, and provide all Facilities needed in connection with such
business. Notwithstanding the foregoing, this Agreement is not intended to cover
investment services or policy distribution which may be the subject of separate
agreements.
AAG agrees at all times to use its best efforts to maintain sufficient
personnel and Facilities of the kind necessary to perform the Services set forth
in this Agreement. AAG shall have the right upon thirty (30) days prior written
notice to and non-disapproval by the New York Department of Insurance to
subcontract with those subsidiaries, affiliates or unrelated third parties
(hereinafter "Subcontractors") accepted in writing by GALIC OF NY to perform any
Services and provide any personnel and Facilities which AAG is obligated to
provide to GALIC OF NY pursuant to this Agreement and in strict accordance with
the terms, conditions and limitations contained in this Agreement; provided,
however, AAG shall not be relieved of its obligations, or of any liability
hereunder to GALIC OF NY arising as a result of any failures of SUBCONTRACTORS
to perform. Until changed in accordance with the foregoing, Services shall be
provided by AAG.
(a) CAPACITY OF PERSONNEL; STATUS OF FACILITIES, Whenever AAG utilizes
its personnel to perform Services for GALIC OF NY pursuant to this Agreement,
such personnel shall at all times remain employees of AAG subject solely to its
direction and control and AAG shall alone retain full liability to such
employees for their welfare, salaries, fringe benefits, legally required
employer contributions and tax obligations.
No facility of AAG used in performing Services for or subject to use by
GALIC OF NY shall be deemed to be transferred, assigned, conveyed or leased by
performance or use pursuant to this Agreement.
<PAGE>
(b) EXERCISE OF JUDGMENT IN RENDERING SERVICES. In providing any
Services hereunder which require the exercise of judgment by AAG, AAG shall
perform any such Services in accordance with any standards and guidelines GALIC
OF NY develops and communicates to AAG. In performing any Services hereunder,
AAG shall at all times act in a manner reasonably calculated to be in, or not
opposed to, the best interests of GALIC OF NY. AAG shall have no liability for
any action taken or omitted by it in furnishing Services and Facilities under
this Agreement, in good faith and without gross negligence or willful
misconduct.
(c) CONTROL. The performance of Services by AAG for GALIC OF NY
pursuant to this Agreement shall in no way impair the absolute control of the
business and operations of AAG or GALIC OF NY by their respective Boards of
Directors. AAG shall act hereunder so as to assure the separate operating
identity of GALIC OF NY as required pursuant to the laws of the State of New
York.
2. SERVICES.
The performance of services by AAG under this Agreement with respect to
the business and operations of GALIC OF NY shall at all times be subject to the
direction and control of the Board of Directors of GALIC OF NY.
Subject to the foregoing and to the terms and conditions of this
Agreement, AAG shall provide to GALIC OF NY, under the general supervision of
its Board of Directors the Services set forth below.
(a) POLICY ADMINISTRATION. AAG shall provide all services in connection
with policy administration and policyholder services including:
policy issuance, premium processing, loan processing, surrender and
annuity processing and policyholder services.
(b) ACCOUNTING AND AUDITING. AAG shall provide the following accounting
services: preparation and maintenance of the financial statements
and reports including annual and quarterly statements on both
statutory and GAAP basis and tax returns, and processing of the
related financial records and transactions of GALIC OF NY. AAG
shall also provide such assistance as may be required with respect
to tax and auditing services.
(c) ACTUARIAL. AAG shall provide all actuarial services needed in
connection with GALIC OF NY's business including policy design and
development and reserve valuation.
(d) MARKETING. AAG shall provide all marketing services needed in
connection with GALIC OF NY's business including market research,
development of marketing materials and campaigns and recruitment of
agents.
(e) LEGAL. AAG shall provide all legal services and compliance services
needed in connection with GALIC OF NY's business including company
licensing, product approval and other regulatory matters.
(f) ADMINISTRATIVE AND OTHER REGULATORY MATTERS. AAG shall provide all
administrative and regulatory services needed in connection with
GALIC OF NY's business.
(g) CORPORATE MATTERS. AAG shall provide services with respect to
general corporate matters involving GALIC OF NY.
(h) POLICY MATTERS. AAG shall provide all services in connection with
the development of policies and products to be marketed by GALIC OF
NY.
(i) DATA PROCESSING AND COMPUTER EQUIPMENT. AAG shall provide
telecommunications services and electronic data processing
services, Facilities and integration, including software
programming and documentation and hardware utilization.
3. CHARGES. The charge to GALIC OF NY for such Services and Facilities
provided by AAG shall be at a rate as mutually agreed upon plus a reasonable
charge for direct overhead, the amount of such charge for overhead to be agreed
upon by the parties from time to time and reported annually. The basis for
determining such charges for Services and Facilities to GALIC OF NY shall be
those used by AAG for internal cost distribution including, where appropriate,
activity based costing records. Such basis shall be modified and adjusted by
mutual agreement where necessary or appropriate to reflect fairly and equitably
the actual incidence of cost incurred by AAG and/or SUBCONTRACTORS on behalf of
GALIC OF NY.
4. PAYMENT. AAG and/or SUBCONTRACTORS shall submit to GALIC OF NY
within thirty (30) days of the end of each calendar month a written statement of
the amount estimated to be owed by GALIC OF NY for Services and the use of
personnel or Facilities pursuant to this Agreement in that calendar month and
GALIC OF NY shall pay to the party rendering the statement within thirty (30)
days following receipt of such written statement the amount set forth in the
statement. Within thirty (30) days after the end of each calendar quarter, AAG
and/or SUBCONTRACTORS will submit to GALIC OF NY a detailed written statement of
the charges due from GALIC OF NY to AAG and/or SUBCONTRACTORS in the preceding
calendar quarter, including charges not included in any previous statements, and
any balance payable as shown in such statement shall be paid within fifteen (15)
days following receipt of such written statement by GALIC OF NY.
5. ACCOUNTING RECORDS AND DOCUMENTS. AAG and/or SUBCONTRACTORS shall be
responsible for maintaining full and accurate accounting records of all Services
rendered and Facilities used pursuant to this Agreement and such additional
information as GALIC OF NY may reasonably request for purposes of its internal
bookkeeping and accounting operations. The accounting records to be maintained
by AAG shall include any records required to be maintained by GALIC OF NY under
applicable laws. AAG and/or SUBCONTRACTORS shall keep such accounting records
insofar as they pertain to the computation of charges hereunder available at its
principal offices for audit, inspection and copying by GALIC OF NY or any
governmental agency having jurisdiction over GALIC OF NY during all reasonable
business hours. With respect to accounting and statistical records prepared by
AAG by reason of its performance under this Agreement, summaries of such records
shall be delivered to GALIC OF NY within thirty (30) days from the end of the
month to which the records pertain.
6. OTHER RECORDS AND DOCUMENTS. All books, records, and files
established and maintained by AAG and/or SUBCONTRACTORS by reason of its
performance under this Agreement which, absent this Agreement, would have been
held by GALIC OF NY shall be deemed the property of GALIC OF NY, and shall be
subject to examination by GALIC OF NY and persons authorized by it at all times,
and shall be delivered to GALIC OF NY at least quarterly. With respect to
original documents other than those provided for in Section 5 hereof which would
otherwise be held by GALIC OF NY and which may be obtained by AAG in performing
under this Agreement, AAG shall deliver such documents to GALIC OF NY within
thirty (30) days of their receipt by AAG except where continued custody of such
original documents is necessary to perform hereunder.
7. LICENSING. AAG shall be responsible for obtaining any licenses or
permits needed to provide the services described herein and shall be responsible
for providing personnel who have any required license or permit.
8. RIGHT TO CONTRACT WITH THIRD PARTIES. Nothing herein shall be deemed
to grant AAG an exclusive right to provide Services to GALIC OF NY, and GALIC OF
NY retains the right to contract with any third party, affiliated or
unaffiliated, for the performance of Services or for the use of Facilities as
are available to or have been requested by GALIC OF NY pursuant to this
Agreement. Similarly, AAG retains the right to contract with any third party,
affiliated or unaffiliated, to perform services or to provide facilities,
identical or similar to those being performed or provided herein.
9. TERMINATION AND MODIFICATION. This Agreement shall remain in effect
until terminated by either AAG or GALIC OF NY upon giving thirty (30) days or
more advance written notice, provided that GALIC OF NY shall have the right to
elect to continue to receive data processing Services and/or to continue to
utilize data processing Facilities and related software for up to one year from
the date of such notice. Upon termination, AAG shall promptly deliver to GALIC
OF NY all books and records that are, or are deemed by this Agreement to be, the
property of GALIC OF NY.
10. SETTLEMENT ON TERMINATION. No later than ninety (90) days after the
effective date of termination of this Agreement, AAG shall deliver to GALIC OF
NY a detailed written statement for all charges incurred and not included in any
previous statement to the effective date of termination. The amount owned
hereunder shall be due and payable within thirty (30) days of receipt of such
statement.
11. EFFECTIVE DATE. This Agreement shall become effective upon the
later of (I) the date hereof, or (ii) the receipt of any required approval of
the New York Department of Insurance or the expiration of any waiting period
provided for by the laws or regulations of the State of New York
12. ASSIGNMENT. This Agreement and any rights pursuant hereto shall not
be assignable by either party hereto, except as set forth herein or by operation
of law. Except as and to the extent specifically provided in this Agreement,
nothing in this Agreement, expressed or implied, is intended to confer on any
person other than the parties hereto, or their respective legal successors, any
rights, remedies, obligations or liabilities, or to relieve any person other
than the parties hereto, or their respective legal successors, from any
obligations or liabilities that would otherwise be applicable. The covenants and
agreements contained in this Agreement shall be binding upon, extend to and
inure to the benefit of the parties hereto, their, and each of their, successors
and assigns respectively.
13. GOVERNING LAW. This Agreement is made pursuant to and shall be
governed by, interpreted under, and the rights of the parties determined in
accordance with, the laws of the State of New York.
14. ARBITRATION. Any unresolved difference of opinion between the
parties arising out of or relating to this Agreement, or the breach thereof,
except as provided in Section 3, shall be settled by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration Association
and the Expedited Procedures thereof, and judgment upon the award rendered by
the Arbitrator may be entered in any Court having jurisdiction thereof. The
arbitration shall take place in Cincinnati, Ohio.
15. NOTICE. All notices, statements or requests provided for hereunder
shall be deemed to have been duly given when delivered by hand to an officer of
the other party, or when deposited with the U.S. Postal Service, as certified or
registered mail, postag e prepaid, addressed or to such other person or place as
each party may from time to time designate by written notice sent as aforesaid.
If to AAG: AMERICAN ANNUITY GROUP, INC. 250 East Fifth Street, 10th Floor
Cincinnati, OH 45202 Attention: General Counsel Phone Number (513) 333-5515 Fax
Number (513) 357-3397
If to GALIC OF NY:
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
250 East Fifth Street, 10th Floor
Cincinnati, OH 45202
Attention: President
Phone Number (513) 412-3301
Fax Number (513) 412-3129
16. ENTIRE AGREEMENT. This Agreement, together with such Amendments as
may from time to time be executed in writing by the parties, constitutes the
entire Agreement between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereunto set their hands as of the date
first above written.
AMERICAN ANNUITY GROUP, INC.
By:____________________________
Its:___________________________
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
By:____________________________
Its:___________________________
<PAGE>
INVESTMENT SERVICES AGREEMENT
THIS INVESTMENT SERVICES AGREEMENT ("Agreement"), dated and effective
as of February 17, 1999 between GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW
YORK, an New York life insurance company ("Company"), and AMERICAN ANNUITY
GROUP, INC., a Delaware corporation ("American").
WHEREAS, Company seeks to obtain information and advice with respect to
the investment of its assets; and
WHEREAS, American, utilizing its own employees along with services
provided by its affiliate, American Money Management ("AMM"), is willing and
able to supply such investment services pursuant to the terms and conditions set
forth below;
NOW, THEREFORE, for the consideration herein stated, the parties agree
as follows:
<PAGE>
1.0 INVESTMENT SERVICES.
1.1 American shall furnish investment services to Company, which services
shall include the following:
1.1.1 to counsel and advise Company in connection with the formulation of
investment programs and strategies designed to accomplish Company's
investment objectives; and
1.1.2 to manage the investment of Company's portfolios of Invested Assets
(as later defined) in accordance with investment policies, objectives,
directions and guidelines established by Company, as set forth in
Section 1.3 below, and, in connection therewith, to have full
discretion and authority, without prior consultation or prior
approval, to buy, sell and otherwise trade in stocks, bonds and other
securities or assets and take such other actions which American shall
deem requisite, appropriate or advisable.
1.2 Custody and control of the securities and all other assets comprising
Company's investment portfolio shall at all times be subject to the
direction and control of Company, acting through its Board of
Directors or an appropriate committee thereof. All purchases and sales
of securities shall be in the name of Company, and all certificates or
other instruments representing its investments shall be held by
Company or in accounts at depository institutions designated by
Company or in book form where appropriate. Such securities will be
held in accounts segregated from those of American or its affiliates.
1.3 American agrees that the investment services it furnishes will be in
accordance with the general, investment policies, objectives and
guidelines (collectively, "Guidelines") submitted by American to
Company and approved by the Board of Directors of Company or an
appropriate committee of the Board of Directors of Company.
1.4 The Company shall at all times keep American fully informed as to the
funds available, or to become available, for investment, and generally
as to its financial condition. The Company shall furnish American with
copies of financial statements and with other information with regard
to its affairs, as American may from time to time request.
1.5 Notwithstanding Section 1.1 above, American shall not (i) invest any
of the Invested Assets in securities of American or any of its
affiliates or any entity controlled by any of them, (ii) cause Company
to purchase any securities from, or sell any securities to, American
or any of its affiliates or any entity controlled by any of them or
(iii) invest any of such Invested Assets in any investment opportunity
which was previously made available to and declined by American, in
each case without first obtaining the approval of the Board of
Directors of the Company or a appropriate Committee thereof.
1.6 For purposes of this Agreement, "Invested Assets" shall mean bonds,
stocks (common and preferred), short term investments and similar invested
assets carried on the Company's statutory convention statements on Schedules BA,
DA and D as admitted assets as permitted by applicable law.
2.0 PURCHASE AND SALE OF SECURITIES.
American shall place all orders for the purchase and sale of portfolio
securities for Company accounts with brokers or dealers selected by American and
shall seek to execute portfolio transactions on terms which are advantageous to
Company in selecting brokers or dealers to execute transactions. American shall
not be obligated to solicit competitive bids or seek the lowest available
commission cost.
3.0 OTHER SERVICES; REPORTS AND RECORDS.
3.1 American shall maintain adequate records relating to the furnishing of
investment services under this Agreement, including those with respect
to the acquisition and disposition of securities, and shall provide
Company with all reports and documentation necessary for proper
accounting and regulatory reporting. American shall provide to Company
such oral or written reports as to its services provided under this
Agreement as Company shall reasonably require.
3.2 All records maintained pursuant to this Agreement shall be deemed the
property of Company and shall be subject to examination by Company and
by persons authorized by it, or by governmental authorities, at all
times upon reasonable notice. Except as expressly authorized in this
Agreement or directed by Company in writing, American shall keep
confidential such records and other information obtained by reason of
this Agreement. Upon termination of this Agreement, American shall
promptly return all such records to Company.
4.0 INVESTMENT FEES; EXPENSES.
4.1 In full compensation and consideration for the performance of its
obligations hereunder, Company shall pay to American an annual fee
equal to .15% of the statutory carrying value of Invested Assets. The
fee paid by the Company shall not in any case exceed the actual cost
of the services provided by American. In addition, American shall be
entitled to reimbursement for the reasonable fees and expenses of its
outside legal counsel for necessary legal services rendered to
American in connection with the performance of its obligations
hereunder. All such fees and expenses shall be paid by Company.
Payments due hereunder shall be computed by American and paid by
Company on a quarterly basis measured as of the end of the preceding
calendar quarter based on the statutory carrying value of Invested
Assets at such date. The quarterly portion of the fee shall be billed
within 30 days after the end of each calendar quarter or portion
thereof in which services are rendered under this Agreement and paid
within 10 days after receipt of the bill.
<PAGE>
<PAGE>
4.2 American shall furnish at its own expense necessary executive and
other personnel for providing investment services to Company
hereunder, including personnel to perform clerical, bookkeeping,
accounting and other office functions. Company shall be responsible
for the expenses of (a) brokerage commissions, issue and transfer
taxes and other costs in connection with securities transactions to
which Company is a party, including any portion of such commissions
attributable to research and brokerage services, (b) taxes payable by
Company to federal, state and other governmental agencies, and (c)
custodial fees and expenses.
5.0 NON-EXCLUSIVITY OF SERVICES.
The services of American to be provided hereunder are not to be deemed
exclusive and American shall be free to provide similar services for its own
account and the accounts of other affiliates, provided that such services do not
materially interfere with services to be rendered hereunder.
6.0 SUBCONTRACTING.
Company acknowledges that American intends to subcontract with American
Money Management Corporation to provide a portion of the services to be rendered
hereunder. The arrangement with American Money Management Corporation to provide
those services shall not relieve American of any liability or responsibility
hereunder and any cost or expense of obtaining such services shall be the sole
responsibility of American.
7.0 LIABILITY; INDEMNIFICATION.
7.1 Neither American nor any of its directors, officers or employees or
other persons affiliated with American shall have any liability
hereunder for any act, omission, misstatement or error in judgment in
the course of, or in connection with, providing investment advisory
services under this Agreement, or for any losses that may be sustained
from such investment advisory services. Company shall indemnify and
hold harmless American and its directors, officers, employees and
other affiliated persons from and against any and all liability,
claims and damages arising from or in connection with providing
services hereunder; provided, however, that the foregoing shall not
relieve American from liability for negligence, gross negligence or
willful misfeasance in providing services under this Agreement.
7.2 As to all other services provided by American hereunder, neither
American nor any of its directors, officers or employees or other
persons affiliated with American shall have any liability hereunder
for any act, omission, misstatement or error in judgment in the course
of, or in connection with, providing such other services, or for any
losses that may be sustained from such other services, and Company
shall indemnify and hold harmless American and its directors,
officers, employees and other affiliated persons from and against any
and all liability, claims and damages arising from or in connection
with providing such other services hereunder; provided, however, that
the foregoing shall not relieve American from liability for
negligence, gross negligence or willful misfeasance in providing such
other services.
8.0 TERMINATION; RENEGOTIATION.
8.1 This Agreement shall remain in effect until terminated by any party
thereto at any time upon ninety (90) days written notice to the other
party's normal business address. Upon termination of this Agreement,
Company shall pay pro rata any investment fees due for any portion of
a calendar quarter within ten (10) days following the date of
termination.
8.2 This Agreement shall be subject to renegotiations upon the request of
either party at the end of each three (3) year period during which
this Agreement continues in effect. The party requesting renegotiation
shall provide written notice thereof to the other party's normal
business address during the thirty (30) day period preceding the end
of any three (3) year period. If such renegotiations result in an
Agreement which is unsatisfactory to Company, it shall be entitled to
terminate this Agreement in accordance with the terms hereof.
9.0 NOTICES.
Notices or other writings given or sent under or pursuant to this
Agreement shall be in writing and be deemed to have been given or sent
if delivered to the party at its address listed below in person or by
telex or telecopy or within two (2) days of mailing if mailed postage
prepaid to such address. The addresses of the parties are:
GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
250 East Fifth Street
Cincinnati, Ohio 45202
Attn: General Counsel
with a copy to:
American Annuity Group, Inc.
250 East Fifth Street
Cincinnati, Ohio 45202
Attn: General Counsel
Each party may change its address by giving notice as herein required.
<PAGE>
10.0 SOLE INSTRUMENT.
This instrument constitutes the sole and only agreement of the parties
hereto relating to the subject matter hereof and correctly sets forth the
rights, duties, and obligations of each party to the other as of its date.
11.0 WAIVER OR MODIFICATION.
No waiver or modification of this Agreement shall be effective unless
reduced to a written document signed by the party to be charged.
12.0 GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
13.0 ASSIGNMENT.
No party to this Agreement shall have the right to sell, transfer,
delegate, or assign this Agreement or any of its rights or duties hereunder to
any person, firm or corporation at any time during the term hereof, and any
proposed assignee shall acquire no rights nor be able to assume any obligations
unless the written consent of the other party to this Agreement is given before
such assignment or delegation takes place. However, subject to this paragraph,
this Agreement binds and inures to the benefit of the parties, their successors
and assigns.
14.0 COMPLIANCE WITH APPLICABLE LAW.
This Agreement shall be performed in accordance with the requirements
of the Securities Act of 1933, Securities Exchange Act of 1934, Investment
Company Act of 1940, Investment Advisors Act of 1940 and the applicable rules
and regulations of the Securities and Exchange Commission promulgated
thereunder, to the extent that any of the foregoing are applicable to the
subject matter of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above, effective for all purposes as of such date for
services rendered subsequent to such date.
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
BY: /s/_________________________
Title: ______________________
AMERICAN ANNUITY GROUP, INC.
BY: /s/_________________________
Title: Senior Vice President
<PAGE>
SERVICE AGREEMENT
THIS SERVICE AGREEMENT (hereinafter called "Agreement") dated December
1, 1995, by and between AMERICAN ANNUITY GROUP, INC.(hereinafter called "AAG")
and GREAT AMERICAN LIFE INSURANCE COMPANY OF NEW YORK (hereinafter called "GALIC
OF NY").
WHEREAS, AAG has extensive experience in the administration of annuity
business; and
WHEREAS, GALIC OF NY is a subsidiary of AAG, and desires that AAG
perform certain administrative, accounting and other services (hereinafter
called "Services") for GALIC OF NY in its business operations and desires
further to make use in its day-to-day operations of certain property, equipment,
and facilities (hereinafter called "Facilities") of AAG and its subsidiaries as
GALIC OF NY may request; and
WHEREAS, AAG and GALIC OF NY contemplate that such an arrangement will
achieve certain operating economies and improve Services to the benefit of AAG,
GALIC OF NY and GALIC OF NY's policyholders; and
WHEREAS, AAG and GALIC OF NY wish to assure that all charges for
Services and the use of Facilities incurred hereunder are reasonable and in
accordance with the requirements of applicable law and regulations and to the
extent practicable reflect actual costs and are arrived at in a fair and
equitable manner, and that estimated costs, whenever used, are adjusted
periodically, to bring them into alignment with actual costs; and
WHEREAS, AAG and GALIC OF NY wish to identify the Services to be
rendered to GALIC OF NY and AAG and its subsidiaries and the Facilities to be
used by GALIC OF NY and to provide a method for determining the charges to be
made to GALIC OF NY.
NOW, THEREFORE, in consideration of the premises and of the promises set
forth herein, and intending to be legally bound hereby, AAG and GALIC OF NY
agree as follows:
1. PERFORMANCE OF SERVICES AND USE OF FACILITIES. AAG agrees to the
extent requested by GALIC OF NY to perform such Services for GALIC OF NY as
GALIC OF NY determines to be reasonably necessary in the conduct of its business
and operations.
AAG agrees to the extent requested by GALIC OF NY to make available its
personnel and Facilities to GALIC OF NY as GALIC OF NY may determine to be
reasonably necessary in the conduct of its business and operations, including
but not limited to the following functions: policy administration; accounting
and auditing services; actuarial; marketing; legal; administrative and other
regulatory matters; general corporate matters; contract matters; use of data
processing and computer equipment; use of business property, whether owned or
leased; and use of communications equipment. It is the intent of the parties
that AAG will perform all services which GALIC OF NY requires in connection with
its business of marketing, issuing and servicing fixed and variable annuities
and provide all Facilities needed in connection with such business.
Notwithstanding the foregoing, this Agreement is not intended to cover
investment services or policy distribution which may be the subject of separate
agreements.
AAG agrees at all times to use its best efforts to maintain sufficient
personnel and Facilities of the kind necessary to perform the Services sent
forth in this Agreement. AAG shall have the right upon thirty (30) days prior
written notice to and non-disapproval by the Ohio Department of Insurance to
subcontract with those subsidiaries, affiliates or unrelated third parties
(hereinafter "Subcontractors") accepted in writing by GALIC OF NY to perform any
Services and provide any personnel and Facilities which AAG is obligated to
provide to GALIC OF NY pursuant to this Agreement and in strict accordance with
the terms, conditions and limitations contained in this Agreement; provided,
however, AAG shall not be relieved of its obligations, or of any liability
hereunder to GALIC OF NY arising as a result of any failures of SUBCONTRACTORS
to perform. Until changed in accordance with the foregoing, Services shall be
provided by AAG.
(a) CAPACITY OF PERSONNEL; STATUS OF FACILITIES, Whenever AAG utilizes
its personnel to perform Services for GALIC OF NY pursuant to this Agreement,
such personnel shall at all times remain employees of AAG subject solely to its
direction and control and AAG shall alone retain full liability to such
employees for their welfare, salaries, fringe benefits, legally required
employer contributions and tax obligations.
No facility of AAG used in performing Services for or subject to use by
GALIC OF NY shall be deemed to be transferred, assigned, conveyed or leased by
performance or use pursuant to this Agreement.
(b) EXERCISE OF JUDGMENT IN RENDERING SERVICES. In providing any
Services hereunder which require the exercise of judgment by AAG, AAG shall
perform any such Services in accordance with any standards and guidelines GALIC
OF NY develops and communicates to AAG. In performing any Services hereunder,
AAG shall at all times act in a manner reasonably calculated to be in, or not
opposed to, the best interests of GALIC OF NY. AAG shall have no liability for
any action taken or omitted by it in furnishing Services and Facilities under
this Agreement, in good faith and without gross negligence or willful
misconduct.
(c) CONTROL. The performance of Services by AAG for GALIC OF NY pursuant
to this Agreement shall in no way impair the absolute control of the business
and operations of AAG or GALIC OF NY by their respective Boards of Directors.
AAG shall act hereunder so as to assure the separate operating identity of GALIC
OF NY as required pursuant to the laws of the State of Ohio.
2. SERVICES. The performance of services by AAG under this Agreement
with respect to the business and operations of GALIC OF NY shall at all times be
subject to the direction and control of the Board of Directors of GALIC OF NY.
Subject to the foregoing and to the terms and conditions of this Agreement, AAG
shall provide to GALIC OF NY the Services set forth below.
(a) POLICY ADMINISTRATION. Under the general supervision of the Board of
Directors of GALIC OF NY, AAG shall provide all services in connection with
policy administration and policyholder services including: policy issuance,
premium processing, loan processing, surrender and annuity processing and
policyholder services.
(b) ACCOUNTING AND AUDITING. Under the general supervision of the Board
of Directors of GALIC OF NY, AAG shall provide the following accounting
services: preparation and maintenance of the financial statements and reports
including annual and quarterly statements on both statutory and GAAP bases and
tax returns, and processing of the related financial records and transactions of
GALIC OF NY. AAG shall also provide such assistance as may be required with
respect to tax and auditing services.
(c) ACTUARIAL. Under the general supervision of the Board of Directors
of GALIC OF NY, AAG shall provide all actuarial services needed in connection
with GALIC OF NY's business including policy design and development and reserve
valuation.
(d) MARKETING. Under the general supervision of the Board of Directors
of GALIC OF NY, AAG shall provide all marketing services needed in connection
with GALIC OF NY's business including market research, development of marketing
materials and campaigns and recruitment of agents.
(e) LEGAL. Under the general supervision of the Board of Directors of
GALIC OF NY, AAG shall provide all legal services and compliance services needed
in connection with GALIC OF NY's business including company licensing, product
approval and other regulatory matters.
(f) ADMINISTRATIVE AND OTHER REGULATORY MATTERS. Under the general
supervision of the Board of Directors of GALIC OF NY, AAG shall provide all
administrative and regulatory services needed in connection with GALIC OF NY's
business.
(g) CORPORATE MATTERS. Under the general supervision of the Board of
Directors of GALIC OF NY, AAG shall provide services with respect to general
corporate matters involving GALIC OF NY.
(h) POLICY MATTERS. Under the general supervision of the Board of
Directors of GALIC OF NY, AAG shall provide all services in connection with the
development of policies and products to be marketed by GALIC OF NY.
(i) DATA PROCESSING AND COMPUTER EQUIPMENT. Under the general
supervision of the Board of Directors of GALIC OF NY, AAG shall provide
telecommunications services and electronic data processing services, Facilities
and integration, including software programming and documentation and hardware
utilization.
3. CHARGES. GALIC OF NY shall not be charged by AAG for the Services and
Facilities provided by AAG until such time as GALIC OF NY becomes an operating
entity issuing annuity contracts. All expenses incurred prior to such time in
the development of the annuity contracts shall be borne by AAG under the general
supervision of the Board of Directors of GALIC OF NY.
After such time, the charge to GALIC OF NY for such Services and
Facilities shall be at a rate as mutually agreed upon plus a reasonable charge
for direct overhead, the amount of such charge for overhead to be agreed upon by
the parties from time to time and reported annually.
The bases for determining such charges for Services and Facilities to
GALIC OF NY shall be those used by AAG for internal cost distribution including,
where appropriate, Activity Based Costing records. Such bases shall be modified
and adjusted by mutual agreement where necessary or appropriate to reflect
fairly and equitably the actual incidence of cost incurred by AAG and/or
SUBCONTRACTORS on behalf of GALIC OF NY.
4. PAYMENT. AAG and/or SUBCONTRACTORS shall submit to GALIC OF NY within
thirty (30) days of the end of each calendar month a written statement of the
amount estimated to be owed by GALIC OF NY for Services and the use of personnel
or Facilities pursuant to this Agreement in that calendar month and GALIC OF NY
shall pay to the party rendering the statement within thirty (30) days following
receipt of such written statement the amount set forth in the statement.
Within thirty (30) days after the end of each calendar quarter, AAG
and/or SUBCONTRACTORS will submit to GALIC OF NY a detailed written statement of
the charges due from GALIC OF NY to AAG and/or SUBCONTRACTORS in the preceding
calendar quarter, including charges not included in any previous statements, and
any balance payable as shown in such statement shall be paid within fifteen (15)
days following receipt of such written statement by GALIC OF NY.
5. ACCOUNTING RECORDS AND DOCUMENTS. AAG and/or SUBCONTRACTORS shall be
responsible for maintaining full and accurate accounting records of all Services
rendered and Facilities used pursuant to this Agreement and such additional
information as GALIC OF NY may reasonably request for purposes of its internal
bookkeeping and accounting operations. The accounting records to be maintained
by AAG shall include any records required to be maintained by GALIC OF NY under
applicable laws. AAG and/or SUBCONTRACTORS shall keep such accounting records
insofar as they pertain to the computation of charges hereunder available at its
principal offices for audit, inspection and copying by GALIC OF NY or any
governmental agency having jurisdiction over GALIC OF NY during all reasonable
business hours. With respect to accounting and statistical records prepared by
AAG by reason of its performance under this Agreement, summaries of such records
shall be delivered to GALIC OF NY within thirty (30) days from the end of the
month to which the records pertain.
6. OTHER RECORDS AND DOCUMENTS. All books, records, and files
established and maintained by AAG and/or SUBCONTRACTORS by reason of its
performance under this Agreement which, absent this Agreement, would have been
held by GALIC OF NY shall be deemed the property of GALIC OF NY, and shall be
subject to examination by GALIC OF NY and persons authorized by it at all times,
and shall be delivered to GALIC OF NY at least quarterly. With respect to
original documents other than those provided for in Section 5 hereof which would
otherwise be held by GALIC OF NY and which may be obtained by AAG in performing
under this Agreement, AAG shall deliver such documents to GALIC OF NY within
thirty (30) days of their receipt by AAG except where continued custody of such
original documents is necessary to perform hereunder
7. LICENSING. AAG shall be responsible for obtaining any licenses or
permits needed to provide the services described herein and shall be responsible
for providing personnel who have any required license or permit.
8. RIGHT TO CONTRACT WITH THIRD PARTIES. Nothing herein shall be deemed
to grant AAG an exclusive right to provide Services to GALIC OF NY, and GALIC OF
NY retains the right to contract with any third party, affiliated or
unaffiliated, for the performance of Services or for the use of Facilities as
are available to or have been requested by GALIC OF NY pursuant to this
Agreement. Similarly, AAG retains the right to contract with any third party,
affiliated or unaffiliated, to perform services or to provide facilities,
identical or similar to those being performed or provided herein.
9. TERMINATION AND MODIFICATION. This Agreement shall remain in effect
until terminated by either AAG or GALIC OF NY upon giving thirty (30) days or
more advance written notice, provided that GALIC OF NY shall have the right to
elect to continue to receive data processing Services and/or to continue to
utilize data processing Facilities and related software for up to one year from
the date of such notice. Upon termination, AAG shall promptly deliver to GALIC
OF NY all books and records that are, or are deemed by this Agreement to be, the
property of GALIC OF NY.
10. SETTLEMENT ON TERMINATION. No later than ninety (90) days after the
effective date of termination of this Agreement, AAG shall deliver to GALIC OF
NY a detailed written statement for all charges incurred and not included in any
previous statement to the effective date of termination. The amount owned
hereunder shall be due and payable within thirty(30) days of receipt of such
statement.
11. EFFECTIVE DATE. This Agreement shall become effective upon the later
of (i) the date hereof, or (ii) the receipt of any required approval of the Ohio
Department of Insurance or the expiration of any waiting period provided for by
the laws or regulations of the State of Ohio.
12. ASSIGNMENT. This Agreement and any rights pursuant hereto shall not
be assignable by either party hereto, except as set forth herein or by operation
of law. Except as and to the extent specifically provided in this Agreement,
nothing in this Agreement, expressed or implied, is intended to confer on any
person other than the parties hereto, or their respective legal successors, any
rights, remedies, obligations or liabilities, or to relieve any person other
than the parties hereto, or their respective legal successors, from any
obligations or liabilities that would otherwise be applicable. The covenants and
agreements contained in this Agreement shall be binding upon, extend to and
inure to the benefit of the parties hereto, their, and each of their, successors
and assigns respectively.
13. GOVERNING LAW. This Agreement is made pursuant to and shall be
governed by, interpreted under, and the rights of the parties determined in
accordance with, the laws of the State of Ohio.
14. ARBITRATION. Any unresolved difference of opinion between the
parties arising out of or relating to this Agreement, or the breach thereof,
except as provided in Section 3, shall be settled by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration Association
and the Expedited Procedures thereof, and judgment upon the award rendered by
the Arbitrator may be entered in any Court having jurisdiction thereof. The
arbitration shall take place in Cincinnati, Ohio.
15. NOTICE. All notices, statements or requests provided for hereunder
shall be deemed to have been duly given when delivered by hand to an officer of
the other party, or when deposited with the U.S. Postal Service, as certified or
registered mail, postage prepaid, addressed or to such other person or place as
each party may from time to time designate by written notice sent as aforesaid.
If to AAG:
AMERICAN ANNUITY GROUP, INC.
250 East Fifth Street, 10th Floor
Cincinnati, OH 45202
Attention: General Counsel
Phone Number (513) 333-5515
Fax Number (513) 357-3397
If to GALIC OF NY:
GREAT AMERICAN LIFE INSURANCE COMPANY
OF NEW YORK
250 East Fifth Street, 10th Floor
Cincinnati, OH 45202
Attention: General Counsel
Phone Number (513) 333-5515
Fax Number (513) 357-3397
16. ENTIRE AGREEMENT. This Agreement, together with such Amendments as
may from time to time be executed in writing by the parties, constitutes the
entire Agreement between the parties with respect to the subject matter hereof.
In witness whereof, the parties hereunto set their hands as of the date
first above written.
American Annuity Group, Inc.
By:____________________________
Its:___________________________
Great American Life Insurance
Company of New York
By:____________________________
Its:___________________________
<PAGE>
Mr. Mark F. Muething
May 19, 1999
May 19, 1999
Mr. Mark F. Muething
Senior Vice President
Annuity Investors Life Insurance Company
10th Floor, Chiquita Center
250 East Fifth Street
Cincinnati, Ohio 45202
Dear Mr. Muething:
This letter sets forth the agreement between Great American Life
Insurance Company of New York (the "Company"), and Janus Capital Corporation
(the "Adviser"), concerning certain administrative services.
1. Administrative Services and Expenses. Administrative services for the
separate accounts of the Company (the "Accounts") which invest in one
or more portfolios (collectively, the "Portfolios") of Janus Aspen
Series (the "Trust") pursuant to the Participation Agreement between
the Company and the Trust dated ______________ (the "Participation
Agreement"), and for purchasers of variable annuity or life insurance
contracts (the "Contracts") issued through the Accounts are the
responsibility of the Company. Administrative services for the
Portfolios, in which the Accounts invest, and for purchasers of shares
of the Portfolios, are the responsibility of the Trust. These
administrative services the Company intends to provide to the Trust and
its Portfolios are set forth in Schedule A attached to this letter
agreement, which may be amended from time to time.
2. Service Fee. In consideration of the anticipated administrative expense
savings resulting to the Trust from the Company's services, the Adviser
agrees to pay the Company a fee ("Service Fee"), computed daily and
paid monthly in arrears, at an annual rate equal to fifteen (15) basis
points (0.15%) of the average monthly value of the shares of the
Portfolios held in the Accounts, such payments to commence following
the month in which the average monthly value of investments by the
Accounts (together with the average monthly value of investments by the
separate accounts of Annuity Investors Life Insurance Company) reach
$50 million. The Service Fee will be correspondingly suspended if the
average monthly value of such investments drops below $50 million in
any month. For purposes of this Paragraph 2, the average monthly value
of the shares of the Portfolios will be based on the sum of the daily
net asset values calculated by the Portfolios in a month divided by the
number of days in the month.
3. Nature of Payments. The parties to this letter agreement recognize and
agree that the Adviser's payments to the Company relate to
administrative services only and do not constitute payment in any
manner for administrative services provided by the Company to the
Account or to the Contracts, for investment advisory services or for
costs of distribution of Contracts or of shares of the Portfolios, and
that these payments are not otherwise related to investment advisory or
distribution services or expenses.
4. Representations and Warranties.
a. The Adviser represents and warrants that in the event the
Trustees of the Trust approve the payment of all or any
portion of the Service Fee by the Trust, the Trust will
calculate in the same manner the Service Fee to all insurance
companies that have entered into Service Fee arrangements with
the Adviser and/or the Trust (the "Participating Insurance
Companies").
b. The Company represents and warrants that: (1) it and its
employees and agents meet the requirements of applicable law,
including but not limited to federal and state securities law
and state insurance law, for the performance of services
contemplated herein; and (2) it will not purchase Trust shares
of the Portfolios with Account assets derived from
tax-qualified retirement plans except indirectly, through
Contracts purchased in connection with such plans and that the
Service Fee does not include any payment to the Company that
is prohibited under the Employee Retirement Income Securities
Act of 1974 ("ERISA") with respect to any assets of a Contract
owner invested in a Contract using the Portfolios as
investment vehicles.
c. The Company represents, warrants and agrees that: (1) the
payment of the Service Fee by the Adviser is designed to
reimburse the Company for providing administrative services to
the Trust that the Trust would customarily pay and does not
represent reimbursement to the Company for providing
administrative services to the Contract or Account as
described in Section 26 of the Investment Company Act of 1940
(the "1940 Act") and the rules and regulations thereunder; (2)
no portion of the Service Fee will be rebated by the Company
to any Contract owner; and (3) if required by applicable law,
the Company will disclose to each Contract owner the existence
of the Service Fee received by the Company pursuant to this
letter agreement in a form consistent with the requirements of
applicable law and will disclose the amount of the Service
Fee, if any, that is paid by the Trust.
5. Indemnification
a. The Company agrees to indemnify and hold harmless the Adviser
and its directors, officers, and employees from any and all
loss, liability and expense resulting from any gross
negligence or willful wrongful act of the Company in
performing its services under this letter agreement, from the
inaccuracy or breach of any representation made in this letter
agreement, or from a breach of a material provision of this
letter agreement, except to the extent such loss, liability or
expense is the result of the Adviser's willful misfeasance,
bad faith or gross negligence in the performance of its
duties.
b. The Adviser agrees to indemnify and hold harmless the Company
and its directors, officers, agents and employees from any and
all loss, liability and expense resulting from any gross
negligence or willful wrongful act of the Adviser in
performing its services under this letter agreement, from the
inaccuracy or breach of any representation made in this letter
agreement, or from a breach of a material provision of this
letter agreement, except to the extent such loss, liability or
expense is the result of the Company's willful misfeasance,
bad faith or gross negligence in the performance if its
duties.
6. Termination.
a. Either party may terminate this letter agreement, without
penalty, on sixty (60) days' written notice to the other
party.
b. This letter agreement will terminate at the option of either
party in the event of the termination of the Participation
Agreement.
c. This letter agreement will terminate immediately upon the
determination of either party, with the advice of counsel,
that the payment of the Service Fee is in conflict with
applicable law.
7. Amendment. This letter agreement may be amended only upon mutual
agreement of the parties hereto in writing.
8. Confidentiality. The terms of this letter agreement will be treated as
confidential and will not be disclosed to the public or any outside
party except with each party's prior written consent, as required by
law or judicial process or as provided in paragraph 4c herein.
9. Assignment. This letter agreement may not be assigned (as that term is
defined in the 1940 Act) by either party without the prior written
approval of the other party, which approval will not be unreasonably
withheld, except that the Adviser may assign its obligations under this
letter agreement, including the payment of all or any portion of the
Service Fee, to the Trust upon thirty (30) days' written notice to the
Company.
10. Governing Law. This letter agreement will be construed and the
provisions hereof interpreted under and in accordance with the laws of
the State of Colorado.
11. Counterparts. This letter agreement may be executed in counterparts,
each of which will be deemed an original but all of which will together
constitute one and the same instrument.
<PAGE>
If this letter agreement is consistent with your understanding of the matters we
discussed concerning administrative expense payments, kindly sign below and
return a signed copy to us.
Very truly yours,
JANUS CAPITAL CORPORATION
By: _______________________________
Name: _______________________________
Title: _______________________________
GREAT AMERICAN LIFE INSURANCE
COMPANY OF NEW YORK
By: _______________________________
Name: _______________________________
Title: _______________________________
Attachment: Schedule A
<PAGE>
Schedule A
Pursuant to the letter agreement to which this Schedule is attached, the Company
will perform administrative services including, but not limited to, the
following:
1. Print and mail to Contract owners copies of the Portfolios'
prospectuses, proxy materials, periodic fund reports to shareholders and other
materials that the Trust is required by law or otherwise to provide to its
shareholders.
2. Provide Contract owner services including, but not limited to,
financial consultants' advice with respect to inquiries related to the
Portfolios (not including information about performance or related to sales) and
communicating with Contract owners about Portfolio (and subaccount) performance.
3. Provide other administrative support for the Trust as mutually
agreed to by the Company and the Adviser and relieve the Trust of other usual or
incidental administrative services provided to individual Contract owners.
<PAGE>
Timothy Plan
Participation Agreement
THIS AGREEMENT is made as of July 9, 1999, by and among Great American Life
Insurance Company of New York ("Company"), on its own behalf and on behalf of
each separate account of the Company set forth on Exhibit A-1 to this Agreement
as it may be amended from time to time (collectively, "Account"), The Timothy
Plan ("Fund") on its own behalf and on behalf of the portfolios listed on
Exhibit A to this Agreement as it may be amended from time to time
("Portfolios"), and Timothy Partners, Ltd. (the "Advisor" and "Distributor"),
who serves as both advisor and distributor for The Timothy Plan (each, a "Party"
and collectively, the "Parties").
WHEREAS, to the extent permitted by applicable insurance laws and regulations,
the Company intends to purchase shares of the Fund, on behalf of the Account to
fund the variable annuity contracts that use the Fund as an underlying
investment medium (the "Contracts");
WHEREAS, the Company, Adviser and Distributor desires to facilitate the purchase
and redemption of shares of the Fund by the Company for the Account through one
account in the Fund (an "Omnibus Account") to be maintained of record by the
Company, subject to the terms and conditions of this Agreement;
WHEREAS, the Company desires to provide administrative services and functions
(the "Services") for purchasers of Contracts ("Owners") on the terms and
conditions set forth herein;
WHEREAS, the Company has registered or will register certain variable life
insurance policies and/or variable annuity contracts under the Securities Act of
1933, as amended (the "1933 Act");
WHEREAS, the Company has registered or will register the Account as a unit
investment trust under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Company desires to utilize the Fund and/or one or more Portfolios
as an investment vehicle of the Account.
NOW, THEREFORE, in consideration of the mutual promises set forth herein, the
Company, Fund, Adviser and Distributor agree as follows:
1. Performance of Services. Company agrees to perform the administrative
functions and services specified in Exhibit B attached hereto with respect
to the shares of the Fund included in the Account.
2. The Omnibus Accounts.
2.1 The Omnibus Account will be opened based upon the information contained
in Exhibit C hereto: In connection with the Omnibus Account, Company
represents and warrants that it is authorized to act on behalf of each
Owner effecting transactions in the Omnibus Account and that the
information specified on Exhibit C hereto is correct.
2.2 The Fund shall designate the Omnibus Account with an account number.
This account number will be the means of identification when the
Parties are transacting in the Omnibus Account. The assets in the
Account are segregated from the Company's own assets. The Adviser
agrees to cause the Omnibus Account to be kept open on the Fund's
books, as applicable, regardless of a lack of activity or small
position size except to the extent the Company takes specific action to
close an Omnibus Account or to the extent the Fund's prospectus
reserves the right to close accounts which are inactive or of a small
position size. In the latter two cases, the Adviser will give prior
notice to the Company before closing an Omnibus Account.
2.3 The Company agrees to provide Adviser such information as Adviser or
Distributor may reasonably request concerning Owners as may be
necessary or advisable to enable Company and Distributor to comply with
applicable laws, including state "Blue Sky" laws relating to the sales
of shares of the Fund to the Accounts.
<PAGE>
3. Fund Shares Transactions.
3.1 In General. Shares of the Fund shall be sold on behalf of the Fund by
Distributor and purchased by Company for the Account and indirectly for
the appropriate subaccount thereof at the net asset value next computed
after receipt by Distributor of each order of the Company or its
designee, in accordance with the provisions of this Agreement, the then
current prospectus of the Fund, and the Contracts. The Board of
Directors of the Fund ("Directors") may refuse to sell shares of the
applicable Fund to any person, or suspend or terminate the offering of
shares of the Fund if such action is required by law or by regulatory
authorities having jurisdiction. Company agrees to purchase and redeem
the shares of the Fund in accordance with the provisions of this
Agreement, of the Contract and of the then current prospectus for the
Contract and Fund. Except as necessary to implement transactions as
specified in the Contracts or as initiated by the Owners, or as
otherwise permitted by state or federal laws or regulations, Company
shall not redeem shares of Fund attributable to the contract.
3.2 Purchase and Redemption Orders. On each day that the Fund is open for
business (a "Business Day"), the Company shall aggregate and calculate
the net purchase or redemption order resulting from investment in and
redemptions under the Contracts for shares of the Fund that it received
prior to the close of trading on the New York Stock Exchange (the
"NYSE") (i.e. 4:00 p.m., Eastern time, unless the NYSE closes at an
earlier time in which case such earlier time shall apply) and
communicate to Distributor, by telephone or facsimile (or by such other
means as the Parties hereto may agree to in writing), the net aggregate
purchase or redemption order (if any) for the Omnibus Account for such
Business Day (such Business Day is sometimes referred to herein as the
"Trade Date"). The Company will communicate such orders to Distributor
prior to 9:00 a.m., Eastern Time, on the next Business Day following
the Trade Date. All trades communicated to Distributor by the foregoing
deadline shall be treated by Distributor as if they were received by
Distributor prior to the close of trading on the Trade Date.
3.3 Settlement of Transactions.
(a) Purchases. Company will wire, or arrange for the wire of the
purchase price of each purchase order to the custodian for the
Fund in accordance with written instructions provided by
Distributor to the Company so that either (1) such funds are
received by the custodian for the Fund prior to 1:00 p.m.,
Eastern time, on the next Business Day following the Trade
Date, or (2) Distributor is provided with a Federal Funds wire
system reference number prior to such 1:00 p.m. deadline
evidencing the entry of the wire transfer of the purchase
price to the applicable custodian into the Federal Funds wire
system prior to such time. Company agrees that if it fails to
provide funds to the Fund's custodian by the close of business
on the next Business Day following the Trade Date, then, at
the option of Distributor, (i) the transaction may be
canceled, or (ii) the transaction may be processed at the
next-determined net asset value for the applicable Fund after
purchase order funds are received. In such event, the Company
shall indemnity and hold harmless Distributor, Adviser, and
the Fund from any liabilities, costs and damages either may
suffer as a result of such failure.
(b) Redemptions. The Adviser will use its best efforts to cause to
be transmitted to such custodial account as Company shall
direct in writing, the proceeds of all redemption orders
placed by Company by 9:00 a.m., Eastern time, on the Business
Day immediately following the Trade Date, by wire transfer on
that Business Day. Should Company need to extend the
settlement on a trade, it will contact Adviser to discuss the
extension. For purposes of determining the length of
settlement, Adviser agrees to treat the Account no less
favorably than other shareholders of the Fund. Each wire
transfer of redemption proceeds shall indicate, on the Federal
Funds wire system, the amount thereof attributable to the
Fund; provided, however, that if the number of entries would
be too great to be transmitted through the Federal Funds wire
system, the Adviser shall, on the day the wire is sent, fax
such entries to Company or, if possible, send via direct or
indirect systems access until otherwise directed by the
Company in writing.
(c) Authorized Persons. The following persons are each duly
authorized to act on behalf of the Company and the Account
under this Agreement. The Fund, Adviser and Distributor are
entitled to conclusively rely on verbal or written
instructions that Adviser or Distributor reasonably believes
were originated by any one of said persons. The Company shall
inform Adviser and Distributor of additions to or subtractions
from this list of authorized persons pursuant to Section 13,
hereof:
Lynn Laswell
Brian Sponaugle
Todd Gayhart
John Burress
Scott Soudrette
3.4 Book Entry Only. Issuance and transfer of shares of the Fund will be by
book entry only. Stock certificates will not be issued to the Company
or the Account. Shares of the Fund ordered from Distributor will he
recorded in the appropriate book entry title for the Account.
3.5 Distribution Information. The Adviser or Distributor shall provide the
Company with all distribution announcement information as soon as it is
announced by the Fund. The distribution information shall set forth, as
applicable, ex-date, record date, payable date, distribution rate per
share, record date share balances, cash and reinvested payment amounts
and all other information reasonably requested by the Company. Where
possible, the Adviser or Distributor shall provide the Company with
direct or indirect systems access to the Adviser's systems for
obtaining such distribution information
3.6 Reinvestment. All dividends and capital gains distributions will be
automatically reinvested on the payable date in additional shares of
the Fund at net asset value in accordance with the Fund's then current
prospectus.
3.7 Pricing Information. Distributor shall use its best efforts to furnish
to the Company prior to 7:00 p.m., Eastern time, on each Business Day
the Fund's closing net asset value for that day, and if appropriate,
the daily accrual for interest rate factor, (mil rate). Such
information shall be communicated via fax, or indirect or direct
systems access acceptable to the Company.
3.8 Price Errors.
(a) In the event adjustments are required to correct any error in
the computation of the net asset value of shares of the Fund,
the Fund or Adviser shall promptly notify Company after
discovering the need for those adjustments which result in a
reimbursement to an Account in accordance with such Fund's
then current policies on reimbursement. Notification may be
made orally or via direct or indirect systems access. Any such
notification shall be promptly followed by a letter written on
Fund or Adviser letterhead and shall state for each day for
which an error occurred the incorrect price, the correct
price, and, to the extent communicated to the Fund's
shareholder, the reason for the price change. Fund and Adviser
agree that Company may send this writing, or derivation
thereof (so long as such derivation is approved in advance by
Fund or Adviser, which approval shall not be unreasonably
withheld) to Owners that are affected by the price change.
(b) If the Account received amounts in excess of the amounts to
which it otherwise would have been entitled prior to an
adjustment for an error, Company, when requested by Fund or
Adviser, will use its best efforts to collect such excess
amounts from the Account. In no event, however, shall Company
be liable to Fund or Adviser for any such amounts.
(c) If an adjustment is to be made in accordance with subsection
(a) above to correct an error which has caused the Account to
receive an amount less than that to which it is entitled, Fund
or Adviser shall make all necessary adjustments (within the
parameters specified in subsection (a)) to the number of
shares owned in the Account and distribute to the Company the
amount of such underpayment for credit to the Account.
3.9 Agency. Distributor hereby appoints the Company as its agent for the
limited purpose of accepting purchase and redemption instructions
pursuant to Sections 3.1, 3.2 and 3.3.
3.10 Quarterly Reports. Adviser agrees to provide Company a statement of
Fund assets as soon as practicable and in any event within 30 days
after the end of each fiscal year quarter, and a statement certifying
the compliance by the Fund during that fiscal quarter with the
diversification requirements and qualification as a regulated
investment company. In the event of a breach of Section 6.4(a), Adviser
will take all reasonable steps (a) to notify Company of such breach and
(b) to adequately diversify the Fund so as to achieve compliance within
the grace period afforded by Treasury Regulation 1.817-5.
4. Proxy Solicitations and Voting. The Company shall, at its expense,
distribute or arrange for the distribution of all proxy materials
furnished by the Fund to the Account and shall:
(i) solicit voting instructions from Owners;
(ii) vote the Fund shares in accordance with
instructions received from Owners; and
(iii) vote the Fund shares for which no instructions
have been received, as well as shares attributable
to it, in the same proportion as Fund shares for
which instructions have been received from Owners,
so long as and to the extent that the Securities
and Exchange Commission (the "SEC") continues to
interpret the 1940 Act, to require pass-through
voting privileges for various contract owners. The
Company and its agents will not recommend action in
connection with, or oppose or interfere with, the
solicitation of proxies for the Fund shares held
for Owners.
5. Customer Communications.
5.1 Prospectuses. The Adviser or Distributor, at its expense, will provide
the Company with as many printed copies of the current prospectus(es)
for the Fund and/or Portfolios as the Company may reasonably request
for distribution to existing or prospective Owners, and/or, at the
Company's request, a single camera ready copy of each such prospectus,
which the Company will print at its expense, and/or, at the Company's
request, a single digital copy of each such prospectus, which the
Company will reproduce in digital format at its expense. The Company
will distribute the Fund and/or Portfolio prospectus(es) to existing
and prospective Owners at its expense.
<PAGE>
5.2 Shareholder Materials. The Adviser and Distributor shall, as
applicable, provide in bulk to the Company or its authorized
representative, at a single address and at no expense to the Company,
the following shareholder communications materials prepared for
circulation to Owners in quantities requested by the Company which are
sufficient to allow mailing thereof by the Company and, to the extent
required by applicable law, to all Owners: proxy or information
statements, annual reports, semi-annual reports, and all updated
prospectuses, supplements and amendments thereof. Neither the Fund, the
Advisor nor Distributor shall be responsible for the cost of
distributing such materials to Owners.
6. Representations and Warranties.
6.1 The Company represents and warrants that:
(a) It is an insurance company duly organized and in good standing
under the laws of the State of New York and that it has
legally and validly established the Account prior to any
issuance or sale thereof as a segregated asset account and
that the Company has and will maintain the capacity to issue
all Contracts that may be sold; and that it is and will remain
duly registered, licensed, qualified and in good standing to
sell the Contracts in all the jurisdictions in which such
Contracts are to be offered or sold;
(b) It is and will remain duly registered and licensed in all
material respects under all applicable federal and state
securities and insurance laws and shall perform its
obligations hereunder in compliance in all material respects
with any applicable state and federal laws;
(c) The Contracts are and will be registered under the 1933 Act,
and are and will be registered and qualified for sale in the
states where so required; and the Account is and will be
registered as a unit investment trust in accordance with the
1940 Act and shall be a segregated investment account for the
Contracts;
(d) The Contracts are currently treated as annuity contracts,
under applicable provisions of the Internal Revenue Code of
1986, as amended (the "Code"), and the Company will maintain
such treatment and will notify Adviser, Distributor and Fund
promptly upon having a reasonable basis for believing that the
Contracts have ceased to be so treated or that they might not
be so treated in the future;
(e) It is registered as a transfer agent pursuant to Section 17A
of the Securities Exchange Act of 1934, as amended (the "1934
Act") unless it is not required to be registered as such.
(f) The arrangements provided for in this Agreement will be
disclosed to the Owners; and
(g) It or its subsidiary is registered as a broker-dealer under
the 1934 Act and any applicable state securities laws,
including as a result of entering into and performing the
Services set forth in this Agreement, unless it is not
required to be registered as such.
6.2 The Fund represents and warrants that Fund shares sold pursuant to this
Agreement are and will be registered under the 1933 Act and the Fund is
and will be registered as a registered investment company under the
Investment Company Act of 1940, in each case, except to the extent the
Company is so notified in writing.
6.3 Distributor represents and warrants that:
(a) It is and will be a member in good standing of the NASD and is
and will be registered as a broker-dealer with the SEC; and
(b) It will sell and distribute Fund shares in accordance with all
applicable state and federal laws and regulations.
6.4 Adviser represents and warrants that:
(a) It will cause each Fund to invest money from the Contracts in
such a manner as to ensure that the Contracts will be treated
as variable annuity contracts under the Code and the
regulations issued thereunder, and that each Fund will comply
with Section 817(h) of the Code as amended from time to time
and with all applicable regulations promulgated thereunder;
(b) It is and will remain duly registered and licensed in all
material respects under all applicable federal and state
securities and insurance laws and shall perform its
obligations hereunder in compliance in all material respects
with any applicable state and federal laws; and
6.5 Each of the Parties hereto represents and warrants to the others that:
(a) It has full power and authority under applicable law and has
taken all action necessary, to enter into and perform this
Agreement and the person executing this Agreement on its
behalf is duly authorized and empowered to execute and deliver
this Agreement;
(b) This Agreement constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its
terms and it shall comply in all material respects with all
laws, rules and regulations applicable to it by virtue of
entering into this Agreement;
(c) Except for the effectiveness of the Registration Statement
filed by the Fund under the 1933 Act and 1940 Act, no consent
or authorization of, filing with, or other act by or in
respect of any governmental authority, is required in
connection with the execution, delivery, performance, validity
or enforceability of this Agreement.
<PAGE>
(d) The execution, performance and delivery of this Agreement will
not result in it violating any applicable law or breaching or
otherwise impairing any of its contractual obligations;
(e) Each Party hereto is entitled to rely on any written records
or instructions provided to it by another Party; and
(f) Its directors, officers, employees. and investment advisers,
and other individuals/entities dealing with the money or
securities of the Fund are and shall continue to be at all
times covered by a blanket fidelity bond or similar coverage
for the benefit of the Fund in an amount not less than the
amount required by the applicable rules of the National
Association of Securities Dealers, Inc. ("NASD") and the
federal securities laws, which bond shall include coverage for
larceny and embezzlement and shall be issued by a reputable
bonding company.
7. Sales Material and Information.
7.1 NASD Filings. The Company shall promptly inform Distributor as to the
status of all sales literature filings pertaining to the Fund and shall
promptly notify Distributor of all approvals or disapprovals of sales
literature filings with the NASD. For purposes of this Section 7, the
phrase "sales literature or other promotional material" shall be
construed in accordance with all applicable securities laws and
regulations.
7.2 Company Representations. The Company shall not make any material
representations concerning the Adviser, the Distributor or the Fund
other than the information or representations contained in: (a) a
registration statement of the Fund or prospectus of the Fund, as
amended or supplemented from time to time; (b) published reports or
statements of the Fund which are in the public domain or approved by
Distributor or the Fund; or (c) sales literature or, other promotional
material of the Fund.
7.3 The Advisor. Distributor and Fund Representations. None of Adviser,
Distributor or the Fund shall make any material representations
concerning the Company other than the information or representations
contained in: (a) a registration statement or prospectus for the
Contracts, as amended or supplemented from time to time; (b) published
reports or statements of the Contracts or the Account which are in the
public domain or are approved by the Company; or (c) sales literature
or other promotional material of the Company.
7.4 Trademarks etc. Except to the extent required by applicable law, no
Party shall use any other Party's names, logos, trademarks or service
marks, whether registered or unregistered, without the prior consent of
such Party.
7.5 Information from Distributor and Adviser. Upon request, Distributor or
Adviser will provide to Company at least one complete copy of all
registration statements, prospectuses, Statements of Additional
Information, reports, proxy statements, solicitations for voting
instructions, applications for exemptions, requests for no action
letters, and all amendments to any of the above, that relate to the
Fund, in final form as filed with the SEC, NASD and other regulatory
authorities.
7.6 Information from Company. Company will provide to Distributor at least
one complete copy of all registration statements, prospectuses,
Statements of Additional Information, reports, solicitations for voting
instructions, sales literature and other promotional materials,
applications for exemptions, requests for no action letters and all
amendments to any of the above, that relate to the Fund and the
Contracts, in final form as filed with the SEC, NASD and other
regulatory authorities.
<PAGE>
7.7 Review of Marketing Materials. If so requested by Company, the Adviser
or Distributor will use its best efforts to review sales literature and
other marketing materials prepared by Company which relate to the Fund,
the Adviser or Distributor for factual accuracy as to such entities,
provided that the Adviser or Distributor is provided at least five (5)
Business Days to review such materials. Neither the Adviser nor
Distributor will review such materials for compliance with applicable
laws. Company shall provide the Adviser with copies of all sales
literature and other marketing materials which refer to the Fund, the
Company or Distributor within five (5) Business Days after their first
use, regardless of whether the Adviser or Distributor has previously
reviewed such materials. If so requested by the Adviser or Distributor,
Company shall cease to use any sales literature or marketing materials
which refer to the Fund, the Adviser or Distributor that the Adviser or
Distributor determines to be inaccurate, misleading or otherwise
unacceptable.
8. Fees and Expenses.
8.1 Fund Registration Expenses. Fund or Distributor shall bear the cost of
registration and qualification of Fund shares; preparation and filing
of Fund prospectuses and registration statements, proxy materials and
reports; preparation of all other statements and notices relating to
the Fund or Distributor required by any federal or state law; payment
of all applicable fees, including, without limitation, any fees due
under Rule 24f-2 of the 1940 Act, relating to the Fund; and all taxes
on the issuance or transfer of Fund shares on the Fund's records.
8.2 Contract Registration Expenses. The Company shall bear the expenses for
the costs of preparation and filing of the Company's prospectus and
registration statement with respect to the Contracts; preparation of
all other statements and notices relating to the Account or the
Contracts required by any federal or state law; expenses for the
solicitation and sale of the Contracts including all costs of printing
and distributing all copies of advertisements, prospectuses, Statements
of Additional Information, proxy materials, and reports to Owners or
potential purchasers of the Contracts as required by applicable state
and federal law; payment of all applicable fees relating to the
Contracts; all costs of drafting, filing and obtaining approvals of the
Contracts in the various states under applicable insurance laws; filing
of annual reports on form N-SAR, and all other costs associated with
ongoing compliance with all such laws and its obligations hereunder.
9. Indemnification.
9.1 Indemnification by Company.
(a) Company agrees to indemnify and hold harmless the Fund,
Adviser and Distributor and each of their directors, officers,
employees and agents, and each person, if any, who controls
any of them within the meaning of Section 15 of the 1933 Act
(each, an "Indemnified Party" and collectively, the
"Indemnified Parties" for purposes of this Section 9.1) from
and against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent
of Company), and expenses (including reasonable legal fees and
expenses), to which the Indemnified Parties may become subject
under any statute, regulation, at common law or otherwise
(collectively, hereinafter "Losses"), insofar as such Losses:
(i) arise out of or are based upon any untrue statements
or alleged untrue statements of any material fact
contained in the registration statement, prospectus
or sales literature for the Contracts or contained in
the Contracts (or any amendment or supplement to any
of the foregoing), or arise out of or are based upon
the omission or the alleged omission to state therein
a material fact required to be stated therein or
necessary to make the statements therein not
misleading, provided that this paragraph 9.1(a) shall
not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with written information furnished to Company by or
on behalf of the Fund, Distributor or Adviser for use
in the registration statement or prospectus for the
Contracts or in the Contracts (or any amendment or
supplement) or otherwise for use in connection with
the sale of the Contracts or Fund shares; or
(ii) arise out of, or as a result of, statements or
representations or wrongful conduct of Company or its
agents, with respect to the sale or distribution of
the Contracts or Fund shares; or
(iii)arise out of any untrue statement or alleged untrue
statement of a material fact contained in a
registration statement, prospectus, or sales
literature covering the Fund or any amendment thereof
or supplement thereto, or the omission or alleged
omission to State therein a material fact required to
be stated therein, or necessary to make the
statements therein not misleading, if such a
statement or omission was made in reliance upon
written information furnished to the Fund, Adviser or
Distributor or on behalf of Company; or
(iv) arise out of, or as a result of, any failure by
Company or persons under its control to provide the
Services and furnish the materials contemplated under
the terms of this Agreement; or
(v) arise out of, or result from, any material breach of
any representation or warranty made by Company or
persons under its control in this Agreement or arise
out of or result from any other material breach of
this Agreement by Company or persons under its
control: as limited by and in accordance with the
provisions of Sections 9.1(b) and 9.1(c) hereof; or
(vi) arise out of, or as a result of, adherence by Adviser
or Distributor to instructions that it reasonably
believes were originated by persons specified in
Section 32(c), hereof
This indemnification provision is in addition to any
liability, which the Company may otherwise have.
(b) Company shall not be liable under this indemnification
provision with respect to any Losses to which an Indemnified
Party would otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or gross negligence in
the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of
obligations or duties under this Agreement.
(c) Company shall not be liable under this indemnification
provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have
notified Company in writing within a reasonable time after the
summons or other first legal process giving information of the
nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have
received notice of such service on any designated agent), but
failure to notify Company of any such claim shall not relieve
Company from any liability which it may have to the
Indemnified Party otherwise than on account of this
indemnification provision. In case any such action is brought
against any Indemnified Party, and it notified the
Indemnifying Party of the commencement thereof, the
Indemnifying Party will be entitled to participate therein
and, to the extent that it may wish, assume the defense
thereof, with counsel satisfactory to such Indemnified Party.
After notice from the Indemnifying Party of its intention to
assume the defense of an action, the Indemnified Party shall
bear the expenses of any additional counsel obtained by it,
and the Indemnifying Party shall not be liable to such
Indemnified Party under this Section for any legal or other
expenses subsequently incurred by such Indemnified Party in
connection with the defense thereof other than reasonable
costs of investigation. The Indemnified Party may not settle
any action without the written consent of the Indemnifying
Party. The Indemnifying Party may not settle any action
without the written consent of the Indemnified Party unless
such settlement completely and finally releases the
Indemnified Party from any and all liability. In either event,
consent shall not be unreasonably withheld.
(d) The Indemnified Parties will promptly notify Company of the
commencement of any litigation or proceedings against the
Indemnified Parties in connection with the issuance or sale of
Fund shares or the Contracts or the operation of the Fund.
9.2 Indemnification by Adviser and Distributor.
(a) Adviser and Distributor agrees to indemnify and hold harmless
Company and each of its directors, officers, employees and
agents and each person, if any, who controls Company within
the meaning of Section 15 of the 1933 Act ("Indemnified Party"
and collectively, the "Indemnified Parties" for purposes of
this Section 9.2) against any and all Losses to which the
Indemnified Parties may become subject under any statute,
regulation, at common law or otherwise, insofar as such
Losses:
(i) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact
contained in the registration statement or prospectus
or sales literature of the Fund (or any amendment or
supplement to any of the foregoing), or arise out of
or are based upon the omission or the alleged
omission to state therein a material fact required to
be stated therein or necessary to make the statements
therein not misleading, provided that this Section
9.2(a) shall not apply as to any Indemnified Party if
such statement or omission or such alleged statement
or omission was made in reliance upon and in
conformity with written information furnished to the
Fund, Adviser or Distributor by or on behalf of
Company for use in the registration statement or
prospectus for the Fund or in sales literature (or
any amendment or supplement) or otherwise for use in
connection with the sale of the Contracts or Fund
shares; or
(ii) arise out of, or as a result of, statements or
representations or wrongful conduct of Adviser or
Distributor or persons under its control, with
respect to the sale or distribution of Fund shares;
or
(iii)arise out of any untrue statement or alleged untrue
statement of a material fact contained in a
registration statement, prospectus, or sales
literature covering the Contracts, or any amendment
thereof or supplement thereto, or the omission or
alleged omission to state therein a material fact
required to be stated therein, or necessary to make
the statements therein not misleading, if such
statement or omission was made in reliance upon
written information furnished to Company by or on
behalf of Adviser or Distributor; or
(iv) arise out of, or as a result of, any failure by
Adviser or Distributor or persons under its control
to provide the services and furnish the materials
contemplated under the terms of this Agreement; or
(v) arise out of or result from any material breach of
any representation or warranty made by Adviser or
Distributor or persons under its control in this
Agreement or arise out of or result from any other
material breach of this Agreement by Adviser or
Distributor or persons under its control; as limited
by and in accordance with the provisions of Sections
9.2(b) and 9.2(c) hereof.
This indemnification provision is in addition to any liability
which Adviser and Distributor may otherwise have.
(b) Adviser and Distributor shall not be liable under this
indemnification provision with respect to any Losses to which
an Indemnified Party would otherwise be subject by reason of
such Indemnified Party's willful misfeasance, bad faith, or
gross negligence in the performance of such Indemnified
Party's duties or by reason of such Indemnified Party's
reckless disregard of obligations and duties under this
Agreement or to Company.
(c) Adviser and Distributor shall not be liable under this
indemnification provision with respect to any claim made
against an Indemnified Party unless such Indemnified Party
shall have notified Adviser and Distribution in writing within
a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall
have been served upon such Indemnified Party (or after such
Indemnified Party shall have received notice of such service
on any designated agent), but failure to notify Adviser and
Distributor of any such claim shall not relieve Adviser and
Distributor from any liability which it may have to the
Indemnified Party otherwise than on account of this
indemnification provision. In case any such action is brought
against any Indemnified Party, and it notified the
Indemnifying Party of the commencement thereof, the
Indemnifying Party will be entitled to participate therein
and, to the extent that it may wish, assume the defense
thereof, with counsel satisfactory to such Indemnified Party.
After notice from the Indemnifying Party of its intention to
assume the defense of an action, the Indemnified Party shall
bear the expenses of any additional counsel obtained by it,
and the Indemnifying Party shall not be liable to such
Indemnified Party under this Section for any legal or other
expenses subsequently incurred by such Indemnified Party in
connection with the defense thereof other than reasonable
costs of investigation. The Indemnified Party may not settle
any action without the written consent of the Indemnifying
Party. The Indemnifying Party may not settle any action
without the written consent of the Indemnified Party unless
such settlement completely and finally releases the
Indemnified Party from any and all liability. In either event,
consent shall not be unreasonably withheld.
(d) The Indemnified Parties will promptly notify Adviser and
Distributor of the commencement of any litigation or
proceedings against the Indemnified Parties in connection with
the issuance or sale of the Contracts or the operation of the
Account.
10. Potential Conflicts.
10.1 Monitoring by Directors for Conflicts of Interest. The Directors of
each Fund will monitor the Fund for any potential or existing material
irreconcilable conflict of interest between the interests of the
contract owners of all separate accounts investing in the Fund. An
irreconcilable material conflict may arise for a variety of reasons,
including: (a) an action by any state insurance regulatory authority;
(b) a change in applicable federal or state insurance, tax, or
securities laws or regulations, or a public ruling, private letter
ruling, no-action or interpretive letter, or any similar action by
insurance, tax or securities regulatory authorities; (c) an
administrative or judicial decision in any relevant proceeding; (d) the
manner in which the investments of the Fund are being managed; (e) a
difference in voting instructions given by variable annuity contract
owners; or (f) a decision by Company to disregard the voting
instructions of Owners. The Directors shall promptly inform the
company, in writing, if they determine that an irreconcilable material
conflict exists and the implications thereof.
10.2 Monitoring by the Company for Conflicts of Interest. The Company will
promptly notify the Directors, in writing, of any potential or existing
material irreconcilable conflicts of interest, as described in Section
10.1 above, of which it is aware. The Company will assist the Directors
in carrying out their responsibilities under any applicable provisions
of the federal securities laws and any exemptive orders granted by the
SEC ("Exemptive Order") by providing the Directors, in a timely manner,
with all information reasonably necessary for the Directors to consider
any issues raised. This includes, but is not limited to, an obligation
by the Company to inform the Directors whenever Owner voting
instructions are disregarded.
10.3 Remedies. If it is determined by a majority of the Directors, or a
majority of disinterested Directors, that a material irreconcilable
conflict exists, as described in Section 10.1 above, the Company shall,
at its own expense take whatever steps are necessary to remedy or
eliminate the irreconcilable material conflict, up to and including,
but not limited to: (a) withdrawing the assets allocable to some or all
of the separate accounts from the applicable Fund and reinvesting such
assets in a different investment medium, including (but not limited to)
another fund managed by the Adviser, or submitting the question whether
such segregation should be implemented to a vote of all affected owners
and, as appropriate, the assets of any particular group that votes in
favor of such segregation, or offering to the affected owners the
option of making such a change; and (b) establishing a new registered
management investment company or managed separate account.
10.4 Causes of Conflicts of Interest.
(a) State Insurance Regulators. If a material irreconcilable
conflict arises because a particular state insurance
regulator's decision applicable to the Company conflicts with
the majority of other state regulators, then the Company will
withdraw the affected Account's investment in the applicable
Fund and terminate this Agreement with respect to such Account
within the period of time permitted by such decision, but in
no event later than six months after the Directors inform the
Company in writing that it has determined that such decision
has created an irreconcilable material conflict; provided
however, that such withdrawal and termination shall be limited
to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the
disinterested Directors. Until the end of the foregoing
period, the Distributor and Fund shall continue to accept and
implement orders by the Company for the purchase (and
redemption) of shares of the Fund to the extent such actions
do not violate applicable law.
(b) Disregard of Owner Voting. If a material irreconcilable
conflict arises because of Company's decision to disregard
Owner voting instructions and that decision represents a
minority position or would preclude a majority vote, Company
may be required, at the applicable Fund's election, to
withdraw the Account's investment in said Fund. No charge or
penalty will be imposed against the Account as a result of
such withdrawal.
10. Limitations on Consequences. For purposes of Sections 10.3 through 10.5
of this Agreement, a majority of the disinterested Directors shall
determine whether any proposed action adequately remedies any
irreconcilable material conflict. In no event will the Fund, the
Adviser or the Distributors be required to establish a new funding
medium for any of the Contracts. The Company shall not be required by
Section 10.3 to establish a new funding medium for the Contracts if an
offer to do so has been declined by vote of a majority of Owners
affected by the irreconcilable material conflict. In the event that the
Directors determine that any proposed action does not adequately remedy
any irreconcilable material conflict, then the Company will withdraw
the Account's investment in the applicable Fund and terminate this
Agreement as quickly as may be required to comply with applicable law,
but in no event later than six (6) months after the Directors inform
the Company in writing of the foregoing determination, provided,
however, that such withdrawal and termination shall be limited to the
extent required by any such material irreconcilable conflict.
10.6 Changes in Laws. If and to the extent that Rule 6e-2 and Rule 6e-3(T)
are amended, or Rule 6e-3 is adopted, to provide exemptive relief from
any provision of the Act or the rules promulgated thereunder with
respect to mixed or shared funding, (as defined in the Exemptive Order,
if any) on terms and conditions materially different from those
contained in the Exemptive Order, if any, then (a) the Funds and/or the
Company, as appropriate, shall take such steps as may be necessary to
comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as
adopted, to the extent such rules are applicable; and (b) Sections
10.1, 10.2, 10.3 and 10.4 of this Agreement shall continue in effect
only to the extent that terms and conditions substantially identical to
such Sections are contained in such Rule(s) as so amended or adopted.
11. Maintenance of Records.
(a) Recordkeeping and other administrative services to Owners
shall be the responsibility of the Company and shall not be
the responsibility of the Fund, Adviser or Distributor. None
of the Fund, the Adviser or Distributor shall maintain
separate accounts or records for Owners. Company shall
maintain and preserve all records as required by law to be
maintained and preserved in connection with providing the
Services and in making shares of the Fund available to the
Account.
(b) Upon the request of the Adviser or Distributor, the Company
shall provide copies of all the historical records relating to
transactions between the Fund and the Account, written
communications regarding the Fund to or from the Account and
other materials, in each case (1) as are maintained by the
Company in the ordinary course of its business and in
compliance with applicable law, and (2) as may reasonably be
requested to enable the Adviser and Distributor, or its
representatives, including without limitation its auditors or
legal counsel, to (A) monitor and review the Services, (B)
comply with any request of a governmental body or
self-regulatory organization or the Owners, (C) verify
compliance by the Company with the terms of this Agreement,
(D) make required regulatory reports, or (E) perform general
customer supervision. The Company agrees that it will permit
the Adviser and Distributor or such representatives of either
to have reasonable access to its personnel and records in
order to facilitate the monitoring of the quality of the
Services.
(c) Upon the request of the Company, the Adviser and Distributor
shall provide copies of all the historical records relating to
transactions between the Fund and the Account, written
communications regarding the Fund to or from the Account and
other materials, in each case (1) as are maintained by the
Adviser and Distributor, as the case may be, in the ordinary
course of its business and in compliance with applicable law,
and (2) as may reasonably be requested to enable the Company,
or its representatives, including without limitation its
auditors or legal counsel, to (A) comply with any request of a
governmental body or self-regulatory organization or the
Owners, (B) verify compliance by the Adviser and Distributor
with the terms of this Agreement, (C) make required regulatory
reports, or (D) perform general customer supervision.
(d) The Parties agree to cooperate in good faith in providing
records to one another pursuant to this Section 11.
12. Term and Termination.
12.1 Term and Termination without Cause. The initial term of this Agreement
shall be for a period of one year from the date hereof. Unless
terminated by any Party upon not less than thirty (30) days prior
written notice to the other Parties, this Agreement shall thereafter
automatically renew from year to year, subject to termination at the
next applicable renewal date upon not less than 30 days prior written
notice. Any Party may terminate this Agreement following the initial
term upon six (6) months advance written notice to the other Parties.
12.2 Termination by Fund, Distributor or Adviser for Cause. Adviser, Fund or
Distributor may terminate this Agreement immediately by written notice
to the Company, if any of them shall determine, in its sole judgment
exercised in good faith, that (a) the Company has suffered a material
adverse change in its business, operations, financial condition or
prospectus since the date of this Agreement or is the subject of
material adverse publicity; or (b) any of the Contracts are not
registered, issued or sold in accordance with applicable state and
federal law or such law precludes the use of Fund shares as the
underlying investment media of the Contracts issued or to be issued by
the Company.
12.3 Termination by Company for Cause. Company may terminate this Agreement
by written notice to the Adviser, Fund and Distributor in the event
that (a) the Fund shares are not registered, issued or sold in
accordance with applicable state or federal law or such law precludes
the use of such shares as the underlying investment media of the
Contracts issued or to be issued by the Company; (b) the Fund ceases to
qualify as a Regulated Investment Company under Subchapter M of the
Code or under any successor or similar provision, or if the Company
reasonably believes that the Fund may fail to so qualify; or (c) the
Fund fails to meet the diversification requirements specified in
Section 6.4(a).
12.4 Termination by any Party. This Agreement may be terminated by any Party
at any time (A) by giving 30 days' written notice to the other Parties
in the event of an material breach of this Agreement by the other Party
or Parties that is not cured during such 30-day period, and (B) (i)
upon institution of formal proceedings relating to the legality of the
terms and conditions of this Agreement against the Account, Company,
Fund, Adviser or Distributor by the NASD, the SEC or any other
regulatory body provided that the terminating Patty has a reasonable
belief that the institution of formal proceedings is not without
foundation and will have a material adverse impact on the terminating
Party, (ii) by the non-assigning Party upon the assignment of this
Agreement in contravention of the terms hereof, or (iii) as is required
by law, order or instruction by a court of competent jurisdiction or a
regulatory body or self-regulatory organization with jurisdiction over
the terminating Party.
12.5 Limiton Termination. Notwithstanding the termination of this Agreement
with respect to the Fund, for so long as any Contracts remain
outstanding and Invested in the Fund each Party hereto shall continue
to perform such of its duties hereunder as are necessary to ensure the
continued tax deferred status thereof and the payment of benefits
thereunder, except to the extent proscribed by law, the SEC or other
regulatory body. Notwithstanding the foregoing, nothing in this Section
12.5 obligates the Fund to continue in existence. In the event that the
Fund elects to terminate its operations, the Company shall, as soon as
practicable, obtain an exemptive order or order of substitution from
the SEC to remove all Owners from the Fund.
13. Notices.
All notices hereunder shall be given in writing (and shall be deemed to
have been duly given upon receipt) by delivery in person, by facsimile, by
registered or certified mail or by overnight delivery (postage prepaid,
return receipt requested) to the respective Parties as follows:
If to Timothy Variable:
The Timothy Plan
1304 West Fairbanks Avenue
Winter Park, FL 32789
Facsimile: (407) 644-4574
e-mail: [email protected]
If to Adviser:
Timothy Partners, Ltd.
1304 West Fairbanks Avenue
Winter Park, FL 32789
Facsimile: (407) 644-4574
e-mail: [email protected]
If to Distributor:
Timothy Partners, Ltd.
1304 West Fairbanks Avenue
Winter Park, FL 32789
Facsimile: (407) 644-4574
e-mail: [email protected]
If to Company:
Great American Life Insurance Company of New York
250 East Fifth Street
Cincinnati, OH 45202
Attention: Mark F. Muething
Facsimile No.: (513) 357-3397
<PAGE>
14. Miscellaneous.
14.1 Captions. The captions in this Agreement are included for convenience
of reference only and in no way affect the construction or effect of
any provisions hereof.
14.2 Enforceability. If any portion of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder
of the Agreement shall not be affected thereby.
14.3 Counterparts. This Agreement may be executed simultaneously in two or
more counterparts, each of which taken together shall constitute one
and the same instrument.
14.4 Remedies not Exclusive. The rights, remedies and obligations contained
in this Agreement are cumulative and are in addition to any and all
rights, remedies and obligations, at law or in equity, which the
Parties hereto are entitled to under state and federal laws.
14.5 Confidentiality. Subject to the requirements of legal process and
regulatory authority, the Fund and Distributor shall treat as
confidential the names and addresses of the owners of the Contracts and
all information reasonably identified as confidential in writing by the
Company hereto and, except as permitted by this Agreement, shall not
disclose, disseminate or utilize such names and addresses and other
confidential information without the express written consent of the
Company until such time as it may come into the public domain.
14.6 Governing Law. This Agreement shall be governed by and interpreted in
accordance with the internal laws of the State of Ohio applicable to
agreements fully executed and to he performed therein, exclusive of
conflicts of laws.
14.7 Survivability. Sections 6, 7.2, 7.3, 7.4, 9, 11 and 12.5 hereof shall
survive termination of this Agreement. In addition, all provisions of
this Agreement shall survive termination of this Agreement in the event
that any Contracts are invested in the Fund at the time the termination
becomes effective and shall survive for so long as such Contracts
remain so invested.
14.8 Amendment and Waiver. No modification of any provision of this
Agreement will be binding unless in writing and executed by the Party
to be bound thereby. No waiver of any provision of this Agreement will
be binding unless in writing and executed by the Party granting such
waiver. Notwithstanding anything in this Agreement to the contrary, the
Company may unilaterally amend Exhibit A hereto to add additional
series of The Timothy Plan ("New Funds") as Funds by sending to the
Company a written notice of the New Funds. Any valid waiver of a
provision set forth herein shall not constitute a waiver of any other
provision of this Agreement. In addition, any such waiver shall
constitute a present waiver of such provision and shall not constitute
a permanent fixture waiver of such provision.
14.9 Assignment. This Agreement shall be binding upon and shall inure to the
benefit of the Parties and their respective successors and assigns;
provided however that neither this Agreement nor any rights,
privileges, duties or obligations of the Parties may be assigned by any
Party without the written consent of the other Parties or as expressly
contemplated by this Agreement.
14.10 Entire Agreement. This Agreement contains the full and complete
understanding between the Parties with respect to the transactions
covered and contemplated hereunder, and supersedes all prior agreements
and understandings between the Parties relating to the subject matter
hereof, whether oral or written, express or implied.
14.11 Relationship of Parties: No Joint Venture, Etc. Except for the limited
purpose provided in Section 3.8, it is understood and agreed that the
Company shall be acting as an independent contractor and not as an
employee or agent of the Adviser, Distributor or the Fund, and none of
the Parties shall hold itself out as an agent of any other Party with
the authority to bind such Party. Neither the execution nor performance
of this Agreement shall be deemed to create a partnership or joint
venture by and among any of the Company, Fund, Adviser, or Distributor.
14.12 Expenses. All expenses incident to the performance by each Party of its
respective duties under this Agreement shall be paid by that Party.
14.13 Time of Essence. Time shall be of the essence in this Agreement.
14.14 Non-Exclusivity. Each of the Parties acknowledges and agrees that this
Agreement and the arrangements described herein are intended to be
non-exclusive and that each of the Parties is free to enter into
similar agreements and arrangements with other entities.
14.15 Operations of Funds. In no way shall the provisions of this Agreement
limit the authority of the Fund, the Company or Distributor to take
such action as it may deem appropriate or advisable in connection with
all matters relating to the operation of such Fund and the sale of its
shares. In no way shall the provisions of this Agreement limit the
authority of the Company to take such action as it may deem appropriate
or advisable in connection with all matters relating to the provision
of Services or the shares of fund other than the Fund offered to the
Account.
IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be
duly executed as of the date first above written.
Great American Life Insurance Company of New York
By: _________________________________
Name: Mark F. Muething
Title: Senior Vice President
Timothy Partners, Ltd. - Adviser
By: _________________________________
Name: Arthur D. Ally
Title: General Partner
Timothy Partners, Ltd. - Distributor
By: _________________________________
Name: Arthur D. Ally
Title: General Partner
The Timothy Plan - Fund
By: _________________________________
Name: Arthur D. Ally
Title: President
<PAGE>
Exhibit A
Portfolios:
The Timothy Plan Small-Cap Variable Series
<PAGE>
Exhibit A-1
Separate Accounts:
GALIC of New York Separate Account I
<PAGE>
Exhibit B
The Services
Company shall perform the following services. Such services shall be the
responsibility of the Company and shall not be the responsibility of the Fund,
Adviser or Distributor.
1. Maintain separate records for the Account, which records shall reflect Fund
shares ("Shares") purchased and redeemed, including the date and price for
all transactions, Share balances, and the name and address of each Owner,
including zip codes and tax identification numbers.
2. Credit contributions to individual Owner accounts and invest such
contributions in shares of the Funds to the extent so designated by the
Owner.
3. Disburse or credit to the Owners, and maintain records of, all proceeds of
redemptions of Fund shares and all other distributions not reinvested in
shares.
4. Prepare and transmit to the Owners, periodic account statements showing,
among other things, the total number of Fund shares owned as of the
statement closing date, purchases and redemptions of shares during the
period covered by the statement, the net asset value of the Funds as of a
recent date, and the dividends and other distributions paid during the
Statement period (whether paid in cash or reinvested in shares).
5. Transmit to the Owners, as required by applicable law, prospectuses, proxy
materials, shareholder reports, and other information provided by the
Adviser, Distributor or Fund and required to be sent to shareholders under
the Federal securities laws.
6. Transmit to Distributor purchase orders and redemption requests placed by
the Account and arrange for the transmission of funds to and from the Fund.
7. Transmit to Distributor such periodic reports as Distributor shall
reasonably conclude is necessary to enable the Fund to comply with
applicable Federal securities and state Blue-Sky requirements.
8. Transmit to the Account confirmations of purchase orders and redemption
requests placed by the Account.
9. Maintain all account balance information for the Account and daily and
monthly purchase summaries expressed in shares and dollar amounts.
10. Prepare, transmit and file any Federal, state and local government reports
and returns as required by law with respect to the account maintained on
behalf of the Account.
11. Respond to Owners' inquiries regarding, among other things, share prices,
account balances, dividend options, dividend amounts, and dividend payment
dates.
<PAGE>
Exhibit C
Account Information
1. Entity in whose name each Account will be opened:
Great American Life Insurance Company of New York
250 E. Fifth Street
Cincinnati, OH 45202
2. Employer ID number (For internal use only): 13-1996152
3. Authorized contact persons: The following persons are authorized on behalf
of the Company to effect transactions in each Account:
Brian Sponaugle 513-412-2931
Todd Gayhart 513-412-2932
John Burress 513-412-3194
Scott Soudrette 513-412-2938
4. Will the Accounts have telephone exchange? [ ] Yes [ X ] No (This option
lets Company redeem shares by telephone and apply the proceeds for purchase
in another identically registered Timothy Funds account.)
5. Will the Accounts have telephone redemption? [ ] Yes [ X ] No (This option
lets Company sell shares by telephone. The proceeds will be wired to the
bank account specified below.)
6. All dividends and capital gains will be reinvested automatically.
7. Instructions for all outgoing wire transfers:
The Provident Bank
Cincinnati, OH 45202
ABA # 042000424
For the Account of Great American
Life Insurance Company of New York
Account # 0011-924 Amount:
Attn.: Wire Transfer Department
8. If this Account information Form contains changed information, the
undersigned authorized officer has executed this amended Account
Information Form as of the date set forth below and acknowledges the
agreements and representations set forth in the Participation Agreement
between the Company, the Fund, Adviser and Distributor:
---------------------------------- -----------------------
(Signature of Authorized Officer) (Date)
9. Company represents under penalty of perjury that:
(i) The employer ID number on this form is correct; and
(ii) Company is not subject to backup withholding because (a) Company
is exempt from backup withholding, (b) Company has not been
notified by the IRS that it is subject to backup withholding as a
result of failure to report all interest or dividends, or (c) the
IRS has notified the Company that it is no longer subject to
backup withholding. (Cross out (ii) if Company has been notified
by the IRS that it is subject to backup withholding because of
underreporting interest or dividends on its tax return.)
Please Note Distributor employs reasonable procedures to confirm that
instructions communicated by telephone are genuine and may not be
liable for losses due to unauthorized or fraudulent instructions.
Please see the prospectus for the applicable Fund' for more
information on the telephone exchange and redemption privileges.
<PAGE>
July 9, 1999
Great American Life Insurance Company of New York
250 East Fifth Street
Cincinnati, OH 45202
Attention: Mark F. Muething
Dear Mark:
Re: Fee letter relating to the Great American Life Insurance Company of
New York Participation Agreement.
Pursuant to the Participation Agreement by and among The Timothy Plan (the
"Fund"), and Great American Life Insurance Company of New York (the "Company")
dated July 9, 1999 (the "Participation Agreement"), the Company will provide
certain administrative services on behalf of the registered investment companies
or series thereof specified in Exhibit A.
In recognition of the reduction in administrative expenses that derives from the
performance of said administrative services, The Timothy Plan agrees to pay the
Company the fee specified below.
(a) For average aggregate amounts (as calculated in paragraph (b), below)
invested through variable insurance products issued by the Company with
the Fund, the monthly fee shall equal the percentage (calculated
paragraph (b), below) of the applicable annual fee for each Fund
specified in Exhibit A.
(b) For purposes of computing the fee contemplated in paragraph (a) above,
the Fund shall calculate and pay to the Company an amount equal to the
product of: (a) the product of (i) the number of calendar days in the
applicable month divided by the number of calendar days in that year
(365 or 366 as applicable) and (ii) the applicable percentage specified
in Exhibit A, hereto, multiplied by (b) the average daily market value
of the investments held in such Fund pursuant to the Participation
Agreement computed by totaling the aggregate investment (share net
asset value multiplied by the total number of shares held) on each day
during the calendar month and dividing by the total number of days
during such month.
(c) The Fund shall calculate the amount of the payment to be made pursuant
to this Letter Agreement at the end of each calendar month and will
make such payment to the Company within 30 days after receiving the
report referenced in paragraph (e), below. Fees will be paid by wire
transfer or by check. All payments hereunder shall be considered final
unless disputed by the Company in writing within 60 days of receipt.
(d) The parties agree that the fees contemplated herein are solely for
shareholder servicing and other administrative services provided by the
Company and do not constitute payment in any manner for investment
advisory, distribution, trustee, or custodial services.
(e) The Company agrees to provide the Fund by the 15th day of each month
with a report, which indicates the number of Owners that hold Contract
interests in each Account as of the last day of the prior month.
(f) If requested in writing by the Fund, and at the Fund's expense, the
Company shall provide to the Fund, by February 14th of each year a
"Special Report" from a nationally recognized accounting firm
reasonably acceptable to the Fund which substantiates for each month of
the prior calendar year: (a) the number of Owners that hold, through an
Account, interests in each Account maintained by the Company on the
last day of each month which held shares for which the fee provided or
in this Letter Agreement was received by the Company, (b) that any fees
billed to the Fund for such month were accurately determined in
accordance with this Letter Agreement, and (c) such other information
in connection with this Agreement and the Participation Agreement as
may be reasonably requested by the Fund.
(g) The parties hereto agree that the Fund may unilaterally amend Schedule
A hereto to add additional investment companies or series thereof ("New
Funds") as Funds subject to the provisions of this Letter Agreement by
sending to the Company a written notice of the New Funds and indicating
therein the fees to be paid to the Company with respect to the
administrative services provided pursuant to the Participation
Agreement in connection with such New Funds.
(h) This Letter Agreement shall terminate upon termination of the
Participation Agreement. Accordingly, all payments pursuant to this
Letter Agreement shall cease upon termination of the Participation
Agreement.
(i) Capitalized terns not otherwise defined herein shall have the meaning
assigned to herein in the Participation Agreement.
If you are in agreement with the foregoing, please sign and date below where
indicated and return one copy of this signed letter agreement to me.
Very truly yours,
Arthur D. Ally
President
The Timothy Plan
Accepted and agreed as of July 9, 1999 by
Great American Life Insurance Company of New York
By: _______________________________
Name: Mark F. Muething
Title: Senior Vice President
<PAGE>
Exhibit A to Letter dated July 9, 1999
The Funds subject to this Agreement and applicable annual fees are as follows:
Fund Annual Fee
The Timothy Plan Small-Cap Variable Series .20%
