Registration No. 2-76581
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------
Form N-3
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 28
and
REGISTRATION STATEMENT UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 30
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THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
(Exact Name of Registrant)
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(Name of Insurance Company)
Prudential Plaza
Newark, New Jersey 07102-3777
(201) 802-8781
(Address and telephone number of Insurance Company's
principal executive offices)
-----------------
C. CHRISTOPHER SPRAGUE
Assistant General Counsel
The Prudential Insurance Company of America
213 Washington Street
2nd Floor
Newark, NJ 07102
(Name and address of agent for service)
Copy to:
Jeffrey C. Martin
Shea & Gardner Christopher E. Palmer
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
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Registrant has registered an indefinite amount of securities pursuant to Rule
24f-2 under the Investment Company Act of 1940. The 24f-2 notice for fiscal year
1996 was filed on February 28, 1997.
For the purpose of Amending the Registration Statement.
Fiscal year ending December 31, 1995
It is proposed that this filing will become effective (Check appropriate space):
___ immediately upon filing pursuant to paragraph (b) of Rule 485
___ on ___________ pursuant to paragraph (b) of Rule 485
(date)
___ 60 days after filing pursuant to paragraph (a)(i) of Rule 485
X on May 1, 1997 pursuant to paragraph (a)(i) of the Rule 485
- --- -----------
(date)
___ 75 days after filing pursuant to paragraph (a)(ii) of Rule 485
___ on ___________ pursuant to paragraph (a)(ii) of Rule 485
(date)
If appropriate, check the following box:
___ this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE>
<TABLE>
CROSS REFERENCE SHEET
Pursuant to Rule 495(a) under the Securities Act of 1933 indicating the location
in the Prospectus and Statement of Additional Information called for by the
Items of Parts A and B of Form N-3.
<CAPTION>
Heading in Prospectus or Statement
Item Number and Caption of Additional Information
----------------------- ----------------------------------
<S> <C>
1. Cover Page............................................... Cover Page
2. Definitions.............................................. Definition of Special Terms Used in this Prospectus
3. Synopsis or Highlights................................... Summary
4. Condensed Financial Information.......................... Condensed Financial Information
5. General Description of Registrant
and Insurance Company.................................... The Prudential; The Accounts; Investment Practices
6. Management............................................... Management
7. Deductions and Expenses.................................. Fee Tables; Charges; The Contracts, Exchange Offer
8. General Description of Variable Annuity Contracts........ Summary; Contacting Prudential; The Contracts, The Accumulation
Period; Changes in the Contracts; Voting Rights
9. Annuity Period........................................... The Contracts, The Annuity Period
10. Death Benefit............................................ The Contracts, Death Benefits
11. Purchases and Contract Value............................. The Prudential; Investment Practices, Determination of Asset
Value; The Contracts, The Accumulation Period
12. Redemptions.............................................. The Contracts, Withdrawal (Redemption) of Contributions,
Systematic Withdrawal Plan, Texas Optional Retirement Program
13. Taxes.................................................... Federal Tax Status
14. Legal Proceedings........................................ Legal Proceedings
15. Table of Contents of the
Statement of Additional Information...................... Table of Contents-Statement of Additional Information
16. Cover Page............................................... Cover Page
17. Table of Contents........................................ Table of Contents
18. General Information and History.......................... Not Applicable
19. Investment Objectives and Policies....................... Investment Management and Administration of VCA-10, VCA-11 and
VCA-24
20. Management............................................... The VCA-10 and VCA-11 Committees
21. Investment Advisory and Other Services................... Investment Management and Administration of VCA-10, VCA-11 and
VCA-24
22. Brokerage Allocation..................................... Investment Management and Administration of the Accounts,
Portfolio Brokerage and Related Practices
23. Purchase and Pricing of Securities Being Offered......... Not Applicable
24. Underwriters............................................. Investment Management and Administration of the Accounts; Sale
of the Contracts
25. Calculation of Performance Data.......................... Performance Information
26. Annuity Payments......................................... Not Applicable
27. Financial Statements..................................... Financial Statements of VCA-10; Financial Statements of VCA-11;
Financial Statements of VCA-24; Financial Statements of
Prudential
</TABLE>
<PAGE>
PROSPECTUS
May 1, 1997
THE MEDLEY(SM) PROGRAM
GROUP VARIABLE ANNUITY CONTRACTS
issued through
THE PRUDENTIAL THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-10 VARIABLE CONTRACT ACCOUNT-11
THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-24
- --------------------------------------------------------------------------------
These Contracts are designed for use in connection with retirement arrangements
that qualify for federal tax benefits under Sections 401, 403(b), 408 or 457 of
the Internal Revenue Code of 1986 and with non-qualified annuity arrangements.
Contributions made on behalf of Participants may be invested in The Prudential
Variable Contract Account-10, The Prudential Variable Contract Account-11 or one
or more of the seven Subaccounts of The Prudential Variable Contract Account-24.
The Prudential Variable Contract Account-10 will invest primarily in equity
securities of major, established corporations that are selected with the
objective of long-term growth of capital.
The Prudential Variable Contract Account-11 will invest in money market
instruments selected with the objective of obtaining as high a level of current
income as is consistent with the preservation of capital and liquidity. An
investment in The Prudential Variable Contract Account-11 is neither insured nor
guaranteed by the U.S. Government, and there can be no assurance that the
Account will be able to maintain a stable net asset value.
Each of the Subaccounts of The Prudential Variable Contract Account-24 will
invest in the corresponding Portfolio of The Prudential Series Fund, Inc. (the
"Fund"). The accompanying Prospectus for the Fund describes the investment
objectives of the seven Portfolios currently available to Participants: the
Diversified Bond Portfolio, the Government Income Portfolio, the Conservative
Balanced Portfolio, the Flexible Managed Portfolio, the Stock Index Portfolio,
the Equity Portfolio and the Global Portfolio.
This Prospectus provides information a prospective investor should know before
investing. Additional information about the Contracts has been filed with the
Securities and Exchange Commission in a Statement of Additional Information,
dated May 1,1997, which information is incorporated herein by reference and is
available without charge upon written or oral request directed to the address or
telephone number shown below. The Table of Contents of the Statement of
Additional Information appears on page 35 of this Prospectus.
PLEASE READ THIS PROSPECTUS CAREFULLY AND RETAIN IT FOR FUTURE REFERENCE.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
The Prudential Insurance Company of America
c/o Prudential Retirement Services
30 Scranton Office Park
Moosic, PA 18507-1789
Telephone 1-800-458-6333
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[LOGO] Prudential
<PAGE>
CONTENTS
PAGE
DEFINITION OF SPECIAL TERMS USED IN THIS PROSPECTUS ....................... 1
FEE TABLES ................................................................ 2
SUMMARY ................................................................... 4
CONDENSED FINANCIAL INFORMATION-VCA-10 .................................... 7
CONDENSED FINANCIAL INFORMATION-VCA-11 .................................... 8
CONDENSED FINANCIAL INFORMATION-VCA-24 .................................... 9
INTRODUCTION .............................................................. 10
THE PRUDENTIAL ............................................................ 10
THE ACCOUNTS .............................................................. 10
THE FUND .................................................................. 10
INVESTMENT PRACTICES ...................................................... 11
VCA-10's investment objective ........................................ 11
VCA-10's investment policy ........................................... 11
Financial Futures Contracts and Options on Futures Contracts ......... 11
Real estate-related securities ....................................... 11
Repurchase agreements ................................................ 12
Reverse repurchase agreements and dollar roll transactions ........... 12
When-Issued and Delayed Delivery Securities .......................... 12
Short Sales Against the Box .......................................... 12
Other investment techniques .......................................... 13
VCA-11's investment objective ........................................ 13
VCA-11's investment policy ........................................... 13
Determination of asset value ......................................... 15
MANAGEMENT ................................................................ 16
CHARGES ................................................................... 16
Deferred Sales Charge ................................................ 16
Limitations on Sales Charges ......................................... 17
Annual Account Charge ................................................ 17
Charge for Administrative Expenses and Investment
Management Services ................................................ 18
Modification of Charges .............................................. 18
THE CONTRACTS ............................................................. 18
The Accumulation Period .............................................. 19
1. Contributions; Crediting Units; Enrollment Forms;
Deduction for Administrative Expenses .................. 19
2. Valuation of a Participant's Account .................... 20
3. The Unit Value .......................................... 20
4. Withdrawal (Redemption) of Contributions ................ 20
5. Systematic Withdrawal Plan .............................. 21
6. Texas Optional Retirement Program ....................... 22
7. Death Benefits .......................................... 22
8. Discontinuance of Contributions ......................... 23
9. Transfer Payments ....................................... 24
10. Telephone Requests ...................................... 25
11. Exchange Offer into MEDLEY from VCA-2 ................... 25
12. Exchange Offer with the PMF Funds ....................... 25
13. Loans ................................................... 26
14. Modified Procedures ..................................... 27
The Annuity Period ................................................... 27
1. Electing the Annuity Date and the Form of Annuity ....... 27
2. Available Forms of Annuity .............................. 28
3. Purchasing the Annuity .................................. 28
Assignment ........................................................... 28
Changes in the Contracts ............................................. 28
Reports .............................................................. 29
Performance Information .............................................. 29
Participation in divisible surplus ................................... 29
FEDERAL TAX STATUS ........................................................ 29
VOTING RIGHTS ............................................................. 31
OTHER CONTRACTS ON A VARIABLE BASIS ....................................... 32
STATE REGULATION .......................................................... 33
LEGAL PROCEEDINGS ......................................................... 33
ADDITIONAL INFORMATION .................................................... 34
TABLE OF CONTENTS--STATEMENT OF ADDITIONAL INFORMATION .................... 34
APPENDIX .................................................................. 35
NOTE: All masculine references in this Prospectus are intended to include the
feminine gender. The singular context also includes the plural and vice
versa where necessary.
<PAGE>
DEFINITION OF SPECIAL TERMS USED IN THIS PROSPECTUS
Accumulation Account--An account established for each Participant to record the
amount credited to the Participant under a Contract. Separate accounts are
maintained for each investment option.
Accumulation Period--The period, prior to the effecting of an annuity, during
which the amount credited to a Participant may vary with the investment
performance of VCA-10, VCA-11, any Subaccount of VCA-24, or the rate credited
under the companion contract, as selected.
Companion Contract--A fixed-dollar group annuity contract issued by Prudential
under which contributions may be made for Participants in the MEDLEY Program.
Contract-holder--The employer, association or trust to which Prudential has
issued a Contract.
Contracts--The group variable annuity contracts described in this Prospectus and
offered for use in connection with retirement arrangements that qualify for
federal tax benefits under Sections 401, 403(b), 408 or 457 of the Internal
Revenue Code and with non-qualified annuity arrangements.
Fund--The Prudential Series Fund, Inc., a mutual fund with separate Portfolios,
seven of which correspond to the seven Subaccounts of VCA-24.
MEDLEY Program--The contracts chosen by a Contract-holder from those described
in this Prospectus and any Companion Contract(s) comprise the Contract-holder's
MEDLEY Program. It is sometimes referred to in this Prospectus as the "Program."
MEDLEY is a registered service mark of The Prudential Insurance Company of
America.
Non-qualified Combination Contract--A group variable annuity contract issued in
connection with non-qualified arrangements that permits Participants within a
single Contract to direct contributions to VCA-10, VCA-11, VCA-24 or a general
account fixed rate option of Prudential. Separate Accumulation Accounts are
maintained for amounts credited to the Participant under each investment option
in this Contract.
Participant--A person for whom contributions have been made and to whom amounts
invested under a Contract or Companion Contract remain credited.
Qualified Combination Contract--A group variable annuity contract issued in
connection with qualified arrangements that permits Participants within a single
Contract to direct contributions to VCA-10, VCA-11, VCA-24 or a general account
fixed rate option of Prudential. Separate Accumulation Accounts are maintained
for amounts credited to the Participant under each investment option in this
Contract.
Subaccount--A division of VCA-24, the assets of which are invested in shares of
the corresponding Portfolio of the Fund. VCA-24 currently has seven Subaccounts:
Diversified Bond Subaccount, Government Income Subaccount, Conservative Balanced
Subaccount, Flexible Managed Subaccount, Stock Index Subaccount, Equity
Subaccount, and Global Subaccount.
Unit and Unit Value--A Participant is credited with Units in each of VCA-10,
VCA-11, and the Subaccounts of VCA-24 in which he invests. The value of these
Units changes each day to reflect the investment results of, and deductions of
charges from, VCA-10, VCA-11 and the Subaccounts of VCA-24, and the expenses of
the Fund Portfolios in which the assets of the Subaccounts are invested. The
number of Units credited to a Participant in VCA-10, VCA-11 or any Subaccount of
VCA-24 is determined by dividing the amount of the contribution made on his
behalf to that Account or Subaccount by the applicable Unit Value for the
business day on which the contribution is received at the address shown on the
cover of this Prospectus.
Variable Contract Account-10--A separate account of Prudential registered under
the Investment Company Act of 1940 as an open-end, diversified management
investment company, invested primarily in equity securities of major,
established corporations that are selected with the objective of long-term
growth of capital.
Variable Contract Account-11--A separate account of Prudential registered under
the Investment Company Act of 1940 as an open-end, diversified, management
investment company, invested in money market instruments selected with the
objective of realizing as high a level of current income as is consistent with
the preservation of capital and liquidity.
Variable Contract Account-24--A separate account of Prudential registered under
the Investment Company Act of 1940 as a unit investment trust, invested through
its Subaccounts in shares of the corresponding Fund Portfolios.
1
<PAGE>
The purpose of the tables on this page and on the following page is to assist
the Participant in understanding the various charges that a Participant in an
Account will bear, whether directly or indirectly. For more complete
descriptions of the various charges, see "Charges" page 17 of this Prospectus.
FEE TABLES--VCA-10 AND VCA-11
Participant Transaction Expenses
Sales Load Imposed on Purchases .......................................... None
Deferred Sales Load (as a percentage of contributions withdrawn):
Maximum Deferred Sales Charge as a
Years of Program Participation Percentage of Contributions Withdrawn*
------------------------------ --------------------------------------
0-1 year .................... 7%
1-2 years ................... 6%
2-3 years ................... 5%
3-4 years ................... 4%
4-5 years ................... 3%
5-6 years ................... 2%
6-7 years ................... 1%
After 7 years ............... 0%
Maximum Annual Contract Fee .............................................. $30**
Annual Account Expenses
(as a percentage of average net assets)
VCA-10 VCA-11
------ ------
Investment Management Fee ....................... .25% .25%
Administrative Fee .............................. .75% .75%
Total Annual Expenses ......................... 1.00% 1.00%
Examples
--------
A. You would pay the following expenses on
each $1000 invested assuming (1) a 5% annual
return and (2) redemption at the end of each
time period: 1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
VCA-10 ............................. $ $ $ $
VCA-11 .............................
B. You would pay the following expenses on
the same investment assuming (1) a 5%
annual return and (2) no redemption or you
annuitize at the end of the period:
VCA-10 ............................. $ $ $ $
VCA-11 .............................
The above examples are based on data for each Account's fiscal year ended
December 31, 1996. The examples should not be considered a representation of
past or future expenses. Actual expenses may be greater or less than those
shown.
- ----------
* The deferred sales charge may be reduced under certain contracts. See
Modification of Charges, page __.
** The annual contract fee is reflected in the above example upon the assumption
that it is deducted from each of the available investment options, including
the Companion Contract and fixed rate option, in the same proportions as the
aggregate annual contract fees are deducted from each option. The actual
expenses paid by each Participant will vary depending upon the total amount
credited to that Participant and how that amount is allocated. For the way in
which this fee is deducted, see Annual Account Charge on page 18.
2
<PAGE>
FEE TABLE--VCA-24
Participant Transaction Expenses
Sales Load Imposed on Purchases .......................................... None
Deferred Sales Load (as a percentage of contributions withdrawn):
Maximum Deferred Sales Charge as a
Years of Program Participation Percentage of Contributions Withdrawn*
------------------------------ --------------------------------------
0-1 year .................... 7%
1-2 years ................... 6%
2-3 years ................... 5%
3-4 years ................... 4%
4-5 years ................... 3%
5-6 years ................... 2%
6-7 years ................... 1%
After 7 years ............... 0%
Maximum Annual Contract Fee ............................................. $30**
Annual Separate Account Expenses
(as a percentage of average account value)
Administrative Fee ...................................................... 0.75%
Annual Prudential Series Fund Portfolio Expenses
(as a percentage of each Portfolio's average net assets)
<TABLE>
<CAPTION>
Diversified Government Conservative Flexible Stock
Bond Income Balanced Managed Index Equity Global
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
--------- ---------- ----------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Management Fee .40% .40% .55% .60% .35% .45% .75%
Other Expenses .04% .05% .03% .03% .03% .03% .31%
---- ---- ---- ---- ---- ---- -----
Total Annual Prudential Series
Fund Portfolio Expenses .44% .45% .58% .63% .38% .48% 1.06%
==== ==== ==== ==== ==== ==== =====
</TABLE>
Examples
<TABLE>
<CAPTION>
A. You would pay the following expenses on each
$1000 invested assuming (1) 5% annual return and
(2) redemption at the end of each time period: 1 Year 3 Years 5 Years 10 Years
------- ------- ------- --------
<S> <C> <C> <C> <C>
Diversified Bond .......................... $ $ $ $
Government Income .........................
Conservative Balanced .....................
Flexible Managed ..........................
Stock Index ...............................
Equity ....................................
Global ....................................
B. You would pay the following expenses on
the same investment, assuming (1) a 5%
annual return and (2) no redemption or you
annuitize at the end of the period:
Diversified Bond ..........................
Government Income .........................
Conservative Balanced .....................
Flexible Managed ..........................
Stock Index ...............................
Equity ....................................
Global ....................................
</TABLE>
The above examples are based on data for the fiscal year ended December 31,
1996. The examples should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.
- ----------
* The deferred sales charge may be reduced under certain Contracts. See
Modification of Charges, page __.
** The annual contract fee is reflected in the above example upon the assumption
that it is deducted from each of the available investment options, including
the Companion Contract and fixed rate option, in the same proportions as the
aggregate annual contract fees are deducted from each option. The actual
expenses paid by each Participant will vary depending upon the total amount
credited to that Participant and how that amount is allocated. For the way in
which this fee is deducted, see Annual Account Charge on page 18.
3
<PAGE>
SUMMARY
Five Group Variable Annuity Contracts (the "Contracts") are described in this
Prospectus. They are offered by The Prudential Insurance Company of America
("Prudential") for use in connection with retirement arrangements that qualify
for federal tax benefits under Sections 401, 403(b), 408 or 457 of the Internal
Revenue Code of 1986 (the "Code" or "Internal Revenue Code") and with
non-qualified annuity arrangements. One of the Contracts provides for the
investment of contributions in The Prudential Variable Contract Account-10 ("VCA
- -10"). Another provides for the investment of contributions in The Prudential
Variable Contract Account-11 ("VCA-11"). The third provides for the investment
of contributions in one or more Subaccounts of The Prudential Variable Contract
Account-24 ("VCA-24"). VCA-10, VCA-11 and VCA-24 (the "Accounts") are separate
accounts of Prudential. VCA-10 and VCA-11 are registered as open-end,
diversified, management investment companies, and VCA-24 is registered as a unit
investment trust, under the Investment Company Act of 1940, as amended. The
fourth is a qualified Contract that provides for investment of contributions in
the Accounts and a fixed rate option provided by Prudential (the "Qualified
Combination Contract"). The fifth is a non-qualified Contract that provides for
investment of contributions in the Accounts and a fixed rate option provided by
Prudential (the "Non-Qualified Combination Contract").
The Contracts generally are issued to employers ("Contract-holders") who make
contributions under them on behalf of their employees. A person for whom
contributions have been made and to whom they remain credited under a Contract
is a "Participant." Contributions also may be made for Participants under a
companion fixed-dollar contract ("Companion Contract"). Those contracts that a
Contract-holder chooses from among the Contracts described in this Prospectus,
along with the Companion Contract, if any, make up the Contract-holder's MEDLEY
Program ("Program").
What follows is a summary of information about the Contracts and about VCA-10,
VCA-11 and VCA-24. More detailed information may be found in the referenced
portions of this Prospectus, as well as in the Statement of Additional
Information.
Interests of Participants
In VCA-10, VCA-11 and the Subaccounts of VCA-24
If the Program made available to a Participant includes all the variable
investment options described in this Prospectus, the Participant may choose to
have contributions made on his behalf invested in any one or more of VCA-10,
VCA-11 and the Subaccounts of VCA-24. The Participant may from time to time
change how those contributions are allocated, usually by notifying Prudential at
the address shown on the cover of this Prospectus. An Accumulation Account will
be established in the name of the Participant in each of VCA-10, VCA-11 and the
Subaccounts of VCA-24 in which the Participant invests. The value of a
Participant's Accumulation Account, expressed in Units of the Account or
Subaccount in which the investment is made, will vary with the investment
results of that Account or Subaccount. See "The Accumulation Period,"
pages 20-28.
Investment Objectives of the Accounts
VCA-10's investment objective is long-term growth of capital. VCA-10 will seek
to achieve this objective by investing primarily in equity securities of major,
established corporations. Current income, if any, is incidental to this
objective. See "VCA-10's investment objective and investment policy," pages
__-__.
VCA-11 will invest in money market instruments payable in U.S. dollars selected
with the objective of realizing as high a level of current income as is
consistent with the preservation of capital and liquidity. See "VCA-11's
investment objective and investment policy," pages 13-15.
Each Subaccount of VCA-24 will invest in the corresponding Portfolio of the
Fund. The Diversified Bond Subaccount invests in the Diversified Bond Portfolio,
the Government Income Subaccount in the Government Income Portfolio, the
Conservative Balanced Subaccount in the Conservative Balanced Portfolio, the
Flexible Managed Subaccount in the Flexible Managed Portfolio, the Stock Index
Subaccount in the Stock Index Portfolio, the Equity Subaccount in the Equity
Portfolio, and the Global Subaccount in the Global Portfolio. Additional
Subaccounts and Fund Portfolios may be available in the future. The investment
objectives of each of these seven Fund Portfolios (see "The Investment
Objectives of the Fund Portfolios," page 16) and other information concerning
the management and operation of the Fund are contained in the accompanying Fund
Prospectus and the Fund's Statement of Additional Information.
There is no assurance that the investment objective of VCA-10, VCA-11 or any
Fund Portfolio will be attained. Nor is there any guarantee that the amount
available to a Participant will equal or exceed the total contributions made on
his behalf. The value of the investments held in VCA-10, VCA-11 and in each Fund
Portfolio may fluctuate daily and is subject to the risks of both changing
economic conditions and the selection of investments necessary to meet the
Account's or Portfolio's investment objective.
4
<PAGE>
Investment Manager and Principal Underwriter
Prudential is the investment manager of VCA-10, VCA-11, and the Fund, and
Prudential Investment Management Services LLC ("PIMS"), a direct wholly-owned
subsidiary of Prudential, is the principal underwriter of the Contracts pursuant
to agreements between PIMS, Prudential, and each of VCA-10 and VCA-11
(collectively, the "Distribution Agreements"). See "The Prudential," page __,
"Management," page __, "The Fund," pages __-__, and the accompanying Fund
prospectus.
Investment Requirements
Contributions to the Program made on behalf of a Participant may be made through
payroll deduction arrangements or similar agreements with the Contract-holder.
Any other contribution to the Program must be at least $500, except for
contributions to an Individual Retirement Annuity for a non-working spouse under
Section 408 of the Code (or working spouse who elects to be treated as a
non-working spouse), which must be at least $250. All contributions may be
divided among the Contracts and Companion Contract(s) that comprise the
Contract-holder's Program. See "The Accumulation Period," pages 20-28. Checks
should be made payable to Prudential.
Charges
No sales charge is deducted from any contribution when made. However, a deferred
sales charge to cover sales expenses may be assessed when a contribution is
withdrawn from VCA-10, VCA-11 or any Subaccount of VCA-24. The deferred sales
charge is imposed only upon contributions withdrawn by a Participant during the
first 7 years of his participation in a Program. The maximum deferred sales
charge of seven percent (7%) applies to contributions withdrawn during the first
year that a Participant is in a Program. The charge is lower for contributions
withdrawn in subsequent years. Withdrawals are deemed to be made up of
contributions until all of a Participant's contributions to the Account have
been withdrawn. No deferred sales charge is imposed upon contributions withdrawn
to purchase an annuity under a Contract, to provide a death benefit, pursuant to
a systematic withdrawal plan, to provide a minimum distribution payment, or in
cases of financial hardship or disability retirement as determined pursuant to
provisions of the employer's retirement arrangement. Further, for all plans
other than IRAs, no deferred sales charge is imposed upon contributions
withdrawn due to resignation or retirement by the Participant or termination of
the Participant by the Contract-holder. Transfers of contributions among the
Accounts, the Subaccounts, the fixed rate option and the Companion Contract(s)
are treated as withdrawals of contributions from the Account, Subaccount, fixed
rate option or Companion Contract from which the transfer is made, but no
deferred sales charge is imposed upon them. They are, however, treated as
contributions to the Account, Subaccount, fixed rate option or Companion
Contract to which the transfer is made for the purpose of determining the sales
charge, if any, upon subsequent withdrawals from that Account, Subaccount, fixed
rate option or Companion Contract. See "Deferred Sales Charge," pages 17-18, for
further explanation and illustration.
An annual account charge may be made against each Participant's Accumulation
Accounts under a Program. This charge will not exceed $30 for any calendar year
and may be divided among the Participant's Accumulation Accounts. See "Annual
Account Charge," pages 18-19.
Prudential intends to decrease the deferred sales or annual account charges, or
both, applicable to a particular Contract if sales and administrative expenses
associated with that Contract are expected to be lower, or if fewer sales or
administrative services are expected to be required in connection with the
Contract. See "Modification of Charges," page 19.
Prudential makes a daily charge equal to an effective annual rate of 1.00% of
the net value of the assets in VCA-10 and VCA-11. This charge is made up of
0.25% (1/4 of 1%) for investment management and 0.75% (3/4 of 1%) for
administrative expenses. Prudential makes a daily charge for administrative
expenses equal to an effective annual rate of 0.75% of the net asset value of
each Subaccount of VCA-24. See "Charge for Administrative Expenses and
Investment Management Services," page 19.
A daily charge against assets for investment management with respect to each
Fund Portfolio in which a Subaccount invests is made separately at an effective
annual rate of 0.35% (35/100 of 1%) of the net asset value of the Fund's Stock
Index Portfolio, 0.40% (40/100 of 1%) of the net asset value of the Fund's
Diversified Bond Portfolio and Government Income Portfolio, 0.45% (45/100 of 1%)
of the net asset value of the Fund's Equity Portfolio, 0.55% (55/100 of 1%) of
the net asset value of the Conservative Balanced Portfolio, 0.60% (60/100 of 1%)
of the net asset value of the Flexible Managed Portfolio, and 0.75% (75/100 of
1%) of the net asset value of the Global Portfolio. The Fund's Portfolios also
bear the costs of Portfolio transactions, legal and accounting expenses,
shareholder services, and custodial and transfer agency fees. Further detail is
provided in the accompanying prospectus for the Fund and in its Statement of
Additional Information.
The deferred sales charge, the annual account charge, and the charges against
assets for administrative expenses may be changed by Prudential. See "Changes in
the Contracts," page 30.
5
<PAGE>
Withdrawals and Transfers
Unless restricted by the retirement arrangement under which he is covered, or by
the withdrawal restrictions imposed by federal tax law on tax-deferred annuity
contracts subject to Section 403(b) of the Code and on interests in deferred
compensation plans under Section457 of the Code, a Participant may withdraw, at
any time, all or a part of his Accumulation Account in VCA-10, or VCA-11 or any
Subaccount of VCA-24. See "Withdrawal (Redemption) of Contributions," pages
21-22. Withdrawals may be subject to tax under the Internal Revenue Code,
including, under certain circumstances, a 10% penalty tax on premature
withdrawals. See "Federal Tax Status," pages 31-33. In addition, all or a part
of a Participant's Accumulation Account may be transferred among Accounts,
Subaccounts, fixed rate option and Companion Contract without charge or tax
liability. Prudential may limit the frequency of transfers and may under certain
Contracts prohibit or restrict transfers from the Companion Contract or fixed
rate option into non-equity investment options that are defined in the
Contract(s) as "competing" with the Companion Contract or the fixed rate option
with respect to investment characteristics. See "Transfer Payments," pages
25-26.
Contacting Prudential
All written requests, notices, and transfer requests required by the Contracts
(other than withdrawal requests and death benefit claims), should be sent to
Prudential at the address shown on the cover of this Prospectus. Any written
inquiries also should be sent to Prudential at that address. A Participant may
effect the telephone transactions that are permitted by his Program by calling
Prudential at 1-800-458-6333. All written withdrawal requests or death benefit
claims relating to a Participant's interest in VCA-10, VCA-11 and VCA-24 must be
sent to Prudential by one of the following three means: 1)By U.S. mail to:
Prudential Retirement Services, P.O. Box 5410, Scranton, Pennsylvania
18505-5410; 2)Delivery service other than the U.S. mail (e.g., Federal Express,
etc.) sent to our office at the following address: Prudential Retirement
Services, 30 Scranton Office Park, Moosic, Pennsylvania 18507-1789; or 3)Fax to
Prudential Retirement Services, Attention: Client Payments at: (717)340-4328. A
withdrawal request or death benefit claim will be deemed received in good order
by Prudential as of the end of the valuation period within which all the
properly completed forms and other information required by Prudential to pay
such a request or claim (e.g., due proof of death) are received as specified
above. Receipt of a withdrawal request or death benefit claim in good order is
required by Prudential to process the transaction in the manner explained on
pages 21-25 of this prospectus. Under certain Contracts, the Contract-holder or
a third party acting on their behalf provides record-keeping services that would
otherwise be performed by Prudential. See "Modified Procedures," page 28.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE. NO PERSON IS AUTHORIZED TO MAKE ANY
REPRESENTATION IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS.
6
<PAGE>
CONDENSED FINANCIAL INFORMATION
Income and Capital Changes Per VCA-10 Unit
(For a Unit outstanding throughout the year)
(Audited year-end information is covered by the Independent Auditors' Report
in the Statement of Additional Information.)
<TABLE>
<CAPTION>
Year Ended
----------------------------------------------------------------------------------------------------
12/31/96 12/31/95 12/31/94 2/31/93 12/31/92 12/31/91 12/31/90 12/31/89 12/31/88 12/31/87
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Investment Income ............... $ .0609 $ .0563 $ .0855 $ .0551 $0.538 $ .0718 $ .0650 $ .0593 $ .0408
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses
For investment management fee... .0094 .0083 .0077 .0064 .0056 .0048 .0047 .0038 .0043
For administrative expenses not
covered by the annual
account charge ................ .0282 .0251 .0230 .0192 .0169 .0144 .0141 .0115 .0129
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income ........... .0233 .0229 .0548 .0295 .0313 .0526 .0462 .0440 .02369
- ------------------------------------------------------------------------------------------------------------------------------------
Capital Changes
Net realized gain (loss)
on investments ................ .3850 .1947 .2763 .2884 .1096 .0791 .1451 (.3251) .2121
Net unrealized appreciation
(depreciation) of investments.. .4744 (.2148) .2599 (.0823) .4478 (.2054) .2167 .5511 (.3913)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in Unit Value .................. .8827 .0028 .5910 .2356 .5887 (.0737) .4080 .2700 (.1556)
- ------------------------------------------------------------------------------------------------------------------------------------
Unit Value
Beginning of year .............. 3.3604 3.3576 2.7666 2.5310 1.9423 2.0160 1.6080 1.3380 1.4936
End of year .................... $4.2431 $3.3604 $3.3576 $2.7666 $2.5310 $1.9423 $2.0160 $1.6080 $1.3380
- ------------------------------------------------------------------------------------------------------------------------------------
Sum of average ratios for the year
of (a) charge for investment
management fee to net assets*
and (b) charge for administrative
expenses not covered by the annual
account charge to net assets* .. .9901% .9965% .9955% .9936% .9929% .9977% 1.0068% 1.0009% 1.0145%
- ------------------------------------------------------------------------------------------------------------------------------------
Average ratio for the year
of net investment income
to net assets .................. .6133% .6791% 1.7775% 1.1431% 1.3779% 2.7403% 2.4684% 2.8773% 1.3851%
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate ......... 44.77% 31.50% 45.45% 65.20% 71.91% 105.69% 64.11% 97.29% 96.39%
- ------------------------------------------------------------------------------------------------------------------------------------
Number of Units outstanding for
Participants at end of
year (000 omitted) ............. 81,817 79,189 73.569 62.592 58,699 55,621 53,748 52,894 52,350
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* These calculations exclude The Prudential's equity in VCA-10.
The above table does not reflect the annual account charge, which does not
affect the Unit Value of VCA-10. This charge is made by reducing Participants'
accounts by a number of Units equal in value to the charge.
While both income and capital changes are shown above, the distinction between
these sources of change in VCA-10 is not particularly significant to
Participants. There is no distinction between income and realized and unrealized
gains and losses on investments in determining the amount of the Participant's
benefits and the taxes payable by the Participant on them.
7
<PAGE>
CONDENSED FINANCIAL INFORMATION
Income and Capital Changes Per VCA-11 Unit
(For a Unit outstanding throughout the year)
(Audited year-end information is covered by the Independent Auditors' Report in
the Statement of Additional Information.)
<TABLE>
<CAPTION>
Year Ended
----------------------------------------------------------------------------------------------------
12/31/96 12/31/95 12/31/94 2/31/93 12/31/92 12/31/91 12/31/90 12/31/89 12/31/88 12/31/87
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Investment Income ................ $ .1313 $ .0912 $ .0682 $ .0812 $ .1215 $ .1464 $ .1536 $ .1158 $ .0967
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses
For investment management fee .. .0054 .0052 .0050 .0049 .0047 .0044 .0040 .0038 .0035
For administrative expenses
not covered by the annual
account charge ................ .0160 .0154 .0150 .0147 .0142 .0131 .0122 .0113 .0106
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income ............ .1099 .0706 .0482 .0616 .1026 .1289 .1374 .1007 .0826
- ------------------------------------------------------------------------------------------------------------------------------------
Capital Changes
Net realized gain (loss)
on investments ................ -- -- -- -- -- -- -- -- --
Net unrealized appreciation
(depreciation) of
investments ................... -- -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in Unit Value ................... .1099 .0482 .0616 .1026 .1289 .1374 .1007 .0826
- ------------------------------------------------------------------------------------------------------------------------------------
Unit Value
Beginning of period ............ 2.1056 2.0350 1.9868 1.9252 1.8226 1.6937 1.5563 1.4556 1.3730
End of period .................. $2.2155 $2.1056 $2.0350 $1.9868 $1.9252 $1.8226 $1.6937 $1.5563 $1.4556
- ------------------------------------------------------------------------------------------------------------------------------------
Sum of average ratios for
the year of (a) charge for
investment management fee to
net assets* and (b)
charge for administrative
expenses not covered by
the annual account charge
to net assets* ................. .9912% .9966% .9942% .9999% 1.0048% .9972% .9988% .9996% .9970%
- ------------------------------------------------------------------------------------------------------------------------------------
Average ratio for the year of
net investment income to net assets 5.0835% 3.4176% 2.3997% 3.1433% 5.4667% 7.3333% 8.4557% 6.6989% 5.8503%
- ------------------------------------------------------------------------------------------------------------------------------------
Number of Units outstanding for
Participants at end of year
(000 omitted) .................. 34,136 35,448 29,421 27,518 26,400 25,174 23,777 21,278 17,341
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* These calculations exclude The Prudential's equity in VCA-11.
The above table does not reflect the annual account charge, which does not
affect the Unit Value of VCA-11. This charge is made by reducing Participants'
accounts by a number of Units equal in value to the charge.
8
<PAGE>
CONDENSED FINANCIAL INFORMATION
Accumulation Unit Value Information per VCA-24
<TABLE>
<CAPTION>
Subaccounts
- -----------------------------------------------------------------------------------------------------------------------
Equity
------------------------------------------------------------------------------------
01/01/96 01/01/95 01/01/94 01/01/93 01/01/92 01/01/91 01/01/90 01/01/89
to to to to to to to to
12/31/96 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91 12/31/90 12/31/89
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period (rounded).... $ 2.0541 $ 2.0136 $ 1.6646 $ 1.4690 $ 1.1745 $ 1.2484 $ 0.9697
End of period (rounded).......... $ 2.6769 $ 2.0541 $ 2.0136 $ 1.6646 $ 1.4690 $ 1.1745 $ 1.2484
Accumulation Units Outstanding
at end of period (000 omitted).. 118,394 99,323 79,985 51,639 35,657 21,964 17,703
<CAPTION>
Subaccounts
- -----------------------------------------------------------------------------------------------------------------------
Diversified Bond
-------------------------------------------------------------------------------------
01/01/96 01/01/95 01/01/94 01/01/93 01/01/92 01/01/91 01/01/90 01/01/89
to to to to to to to to
12/31/96 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91 12/31/90 12/31/89
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period (rounded).... $ 1.6746 $ 1.7435 $ 1.5950 $ 1.4992 $ 1.2973 $ 1.2075 $ 1.0720
End of period (rounded).......... $ 2.0065 $ 1.6746 $ 1.7435 $ 1.5950 $ 1.4992 $ 1.2973 $ 1.2075
Accumulation Units Outstanding
at end of period (000 omitted).. 16,898 14,575 14,481 10,103 7,928 5,824 4,122
<CAPTION>
Flexible
Managed
------------------------------------------------------------------------------------
01/01/96 01/01/95 01/01/94 01/01/93 01/01/92 01/01/91 01/01/90 01/01/89
to to to to to to to to
12/31/96 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91 12/31/90 12/31/89
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period (rounded) ... $ 1.7886 $ 1.8609 $ 1.6223 $ 1.5189 $ 1.2201 $ 1.2056 $ 0.9976
End of period (rounded) ......... $ 2.2038 $ 1.7886 $ 1.8609 $ 1.6223 $ 1.5189 $ 1.2201 $ 1.2056
Accumulation Units Outstanding
at end of period (000 omitted).. 51,419 44,729 36,035 23,410 16,859 12,229 10,015
<CAPTION>
Conservatiave
Balanced
-------------------------------------------------------------------------------------
01/01/96 01/01/95 01/01/94 01/01/93 01/01/92 01/01/91 01/01/90 01/01/89
to to to to to to to to
12/31/96 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91 12/31/90 12/31/89
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period (rounded) ... $ 1.7175 $ 1.7473 $ 1.5691 $ 1.4781 $ 1.2508 $ 1.1971 $ 1.0310
End of period (rounded) ......... $ 1.9993 $ 1.7175 $ 1.7473 $ 1.5691 $ 1.4781 $ 1.2508 $ 1.1971
Accumulation Units Outstanding
at end of period (000 omitted).. 46,873 43,594 36,932 24,223 16,385 11,857 10,273
<CAPTION>
Stock
Index
------------------------------------------------------------------------------------
01/01/96 01/01/95 01/01/94 01/01/93 01/01/92 01/01/91 01/01/90 01/01/89
to to to to to to to to
12/31/96 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91 12/31/90 12/31/89
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period
(rounded) ...................... $ 2.0123 $ 2.0072 $ 1.8440 $ 1.7342 $ 1.3469 $ 1.4086 $ 1.0843
End of period
(rounded) ...................... $ 2.7378 $ 2.0123 $ 2.0072 $ 1.8440 $ 1.7342 $ 1.3469 $ 1.4086
Accumulation Units
Outstanding at
end of period
(000 omitted) .................. 51,701 40,522 32,178 20,554 10,724 4,232 1,285
<CAPTION>
Government
Global Income
----------------------------------------- -----------------------------------------
01/01/96 01/01/95 01/01/94 01/01/93 01/01/96 01/01/95 01/01/94 01/01/93
to to to to to to to to
12/31/96 12/31/95 12/31/94 12/31/93 12/31/96 12/31/95 12/31/94 12/31/93
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period
(rounded) ...................... $ 1.3020 $ 1.3791 $ 0.9707 $ 1.2421 $ 1.3196 $ 1.1811
End of period
(rounded) ...................... $ 1.4975 $ 1.3020 $ 1.3791 $ 1.4730 $ 1.2421 $ 1.3196
Accumulation Units
Outstanding at
end of period
(000 omitted) .................. 24,439 21,739 12,368 17,289 16,140 15,556
</TABLE>
Additional financial information concerning VCA-24 can be found on pages 36-42
of the Statement of Additional Information.
9
<PAGE>
INTRODUCTION
The Contracts described in this Prospectus are offered for use in connection
with various retirement arrangements entitled to federal income tax benefits.
These are (a) individual retirement annuities ("IRAs") subject to Section 408 of
the Code, (b) tax-deferred annuities subject to Section 403(b) of the Code, for
use by public schools and certain tax-exempt organizations, (c) eligible
deferred compensation plans subject to Section 457 of the Code (d) pension and
profit sharing plans qualified under Section 401 of the Code including those
plans that are established by self-employed individuals for themselves and their
employees, and (e) certain non-qualified annuity arrangements. A summary of the
tax benefits available to persons participating in these arrangements and their
beneficiaries is provided under "Federal Tax Status," pages 31-33.
When the Program made available to a Participant includes all variable
investment options, the Participant may have contributions made on his behalf
invested in one or more of VCA-10, VCA-11, and the Subaccounts of VCA-24. Some
Programs, however, may offer only some of the variable investment options, and
accordingly a Participant in those Programs may only have contributions made on
their behalf to the available Accounts and Subaccounts. An Accumulation Account
will be established for a Participant in each Account or Subaccount in which he
invests. The value of a Participant's Accumulation Account in VCA-10, VCA-11 or
any particular Subaccount of VCA-24 will vary with the investment results in
VCA-10, VCA-11 or any particular Subaccount of VCA-24, respectively. A
Participant may elect to have the value of his Accumulation Accounts distributed
to him in one sum, applied to the purchase of a fixed-dollar annuity, or both.
The Contracts do not provide for annuity payments that vary with the investment
results of VCA-10, VCA-11 or any Subaccount of VCA-24.
THE PRUDENTIAL
Prudential is a mutual life insurance company incorporated in 1873 under the
laws of the State of New Jersey. Its corporate office is located at Prudential
Plaza, Newark, New Jersey. It has been investing for pension funds since 1928.
Prudential serves as the investment manager for VCA-10, VCA-11, and the Fund and
is registered as an investment adviser under the Investment Advisers Act of
1940. PIMS performs certain sales and distribution functions regarding the
Contracts pursuant to agreements between PIMS, Prudential, and each of VCA-10
and VCA-11 (collectively, the "Distribution Agreements") and may be deemed to be
the Contracts' "principal underwriter" under the Investment Company Act of 1940
(the "1940 Act"). PIMS is registered as a broker-dealer under the Securities
Exchange Act of 1934.
Prudential is responsible for the administrative and recordkeeping functions of
VCA-10, VCA-11, VCA-24 and the Fund. Prudential's financial statements appear in
the Statement of Additional Information and should be considered only as bearing
upon Prudential's ability to meet its obligations under the Contracts.
THE ACCOUNTS
Prudential established VCA-10 and VCA-11 on March 1, 1982, and VCA-24 on April
29, 1987, under the insurance laws of the State of New Jersey. Each Account
meets the definition of a "separate account" under the federal securities laws.
The assets in the Accounts are the property of Prudential, but are legally
segregated from all other assets of Prudential and may not be charged with
liabilities arising out of any of Prudential's other business. All income, gains
and losses, whether or not realized, from assets allocated to the Accounts are
credited to or charged against the Accounts without regard to other income,
gains, or losses of Prudential. The assets in the Accounts will always be equal
or greater in value than Prudential's liabilities under the Contracts. The
fixed-dollar annuities available under the Contracts are not funded through the
Accounts. The obligations arising under the Contracts are general corporate
obligations of Prudential.
VCA-10, VCA-11 and the Fund are registered as open-end, diversified, management
investment companies, and VCA-24 as a unit investment trust, with the Securities
and Exchange Commission (the "Commission") under the 1940 Act. This registration
does not involve supervision by the Commission of Prudential or of the
management or investment practices of the Accounts or the Fund.
THE FUND
The Fund is registered under the 1940 Act as an open-end, diversified,
management investment company. Seven of the Portfolios of the Fund are available
for the investment of contributions made under the Contracts funded through
VCA-24. Investments in a Portfolio are made by purchasing shares of the series
of Fund capital stock representing interests in that Portfolio. Shares in the
Fund are currently sold at their net asset value to separate accounts
established by Prudential and certain other insurers that offer variable life
insurance contracts and variable annuity contracts.
As noted, shares of the Fund are sold to both variable life and variable annuity
separate accounts. It is conceivable that in the future it may become
disadvantageous for both variable life and variable annuity contract separate
accounts to invest in the same underlying fund. Although Prudential, Pruco Life,
Pruco Life Insurance Company of New Jersey, and the Fund do not currently
foresee any such disadvantage, the Fund's Board of Directors intends to monitor
events in order to identify any material conflict between variable annuity
10
<PAGE>
contract owners and variable life contract owners and to determine what action,
if any, should be taken in response thereto. Material conflicts could result
from such things as: (1) changes in state insurance law; (2) changes in federal
income tax law; (3) changes in the investment management of any Portfolio of the
Fund; or (4) differences between voting instructions given by variable annuity
contract owners and Participants and those given by variable life insurance
contract owners.
INVESTMENT PRACTICES
A Participant should review the investment objectives and policies described
below for VCA-10, VCA-11 and each Fund Portfolio corresponding to each
Subaccount of VCA-24 before deciding how to have his contributions invested.
VCA-10, VCA-11 and the Fund Portfolios have for the most part different
investment objectives and policies. These differences will affect the return on
a Participant's investment and the market and financial risks to which that
investment will be exposed. There is no guarantee that the objectives of VCA-10,
VCA-11 or any Fund Portfolio will be met.
VCA-10's investment objective
VCA-10's investment objective is long-term growth of capital. VCA-10 will seek
to achieve this objective by investing primarily in equity securities of major,
established corporations. Current income, if any, is incidental to this
objective. This objective is a fundamental investment policy and may not be
changed without the approval of a majority vote (as defined in the 1940 Act) of
VCA-10 Participants. Certain additional investment restrictions applicable to
VCA-10 are set forth in the Statement of Additional information.
VCA-10's investment policy
The investment policies of VCA-10 set forth below are adopted in an effort to
achieve the investment objective and are not fundamental. Therefore, these
investment policies may be changed by the VCA-10 Committee without the approval
of VCA-10 Participants.
In attempting to achieve its objective, VCA-10 will invest in common stocks,
preferred stocks, warrants or convertible bonds which, in the opinion of
VCA-10's investment adviser, are believed to be in sound financial condition and
have prospects for price appreciation greater than broadly based stock indices.
Under normal market conditions, VCA-10 may also invest up to 20% of its assets
in investment grade short-term, intermediate term, or long-term debt
instruments. At times when economic conditions or general levels of common stock
prices are such that the investment adviser deems it prudent to adopt a
defensive position by reducing or curtailing investments in equities, a larger
proportion than usual of VCA-10's assets may be invested in such debt
instruments.
Description of VCA-10's Investment Techniques
VCA-10 may use some of the following investment techniques designed to meet
VCA-10's objective.
Financial futures contracts. To the extent permitted by applicable regulations,
VCA-10 may purchase and sell financial futures contracts, including stock index
futures contracts, futures contracts on interest-bearing securities (such as
U.S. Treasury bonds and notes) or rate indices, and futures contracts on foreign
currencies or groups of foreign currencies. VCA-10 will use futures contracts
solely for the purpose of hedging the Account's positions with respect to
securities, interest rates, and foreign securities.
A financial futures contract generally provides for the future sale by one party
and purchase by the other party of a specified amount of a particular financial
instrument or currency at a specified price on a designated date. A stock index
futures contract is an agreement in which the seller of the contract agrees to
deliver to the buyer an amount of cash equal to a specific dollar amount times
the difference between the value of a specific stock index at the close of the
last trading day of the contract and the price at which the agreement is made.
No physical delivery of the underlying stocks in the index is made.
Further information about futures contracts, including risks and investment
techniques, is provided in the Statement of Additional Information.
Options. VCA-10 may purchase and sell (i.e., write) put and call options on
equity securities, debt securities, securities indices, foreign currencies, and
financial futures contracts. An option gives the owner the right to buy or sell
securities at a predetermined exercise price for a given period of time.
Currently, the 1940 Act is interpreted to require that any options written by
investment companies, such as VCA-10, be "covered," which can be done in a
variety of ways, such as placing in a segregated account certain securities or
cash designed to "cover" VCA-10's obligation under the written option.
Additional explanation about techniques VCA-10 will use in connection with
options is provided in the Statement of Additional Information.
Although options will be primarily used to reduce fluctuations in the value of
VCA-10's investments (i.e., hedge) or to generate additional premium income,
they do involve certain risks. The investment adviser may not correctly
anticipate movements in the relevant markets, thus causing losses on VCA-10's
options positions. VCA-10's use of options is subject to other special risks,
information about which is provided in the Statement of Additional Information.
Real estate-related securities. VCA-10 may invest in securities secured by real
estate or shares of real estate investment trusts that are listed on a stock
exchange or reported on the National Association of Securities Dealers, Inc.
automated quotation system ("NASDAQ"). Such securities may be sensitive to
factors such as real
11
<PAGE>
estate values and property taxes, interest rates, cash flow of underlying real
estate assets, overbuilding, and the management skill and creditworthiness of
the issuer. They may also be affected by tax and regulatory requirements, such
as those relating to the environment.
Repurchase agreements. When VCA-10 purchases certain money market securities, it
may on occasion enter into a repurchase agreement with the seller wherein the
seller and VCA-10 agree at the time of sale to a repurchase of the security at a
mutually agreed upon time and price. The period of maturity is usually quite
short, possibly overnight or a few days, although it may extend over a number of
months. The resale price is in excess of the purchase price, reflecting an
agreed-upon market rate of interest effective for the period of time the
Account's money is invested in the security, and is not related to the coupon
rate of the purchased security. Repurchase agreements may be considered loans of
money to the seller of the underlying security, which are collateralized by the
securities underlying the repurchase agreement. VCA-10 will not enter into
repurchase agreements unless the agreement is "fully collateralized," i.e., the
value of the securities is, and during the entire term of the agreement remains,
at least equal to the amount of the "loan" including accrued interest. VCA-10
will take possession of the securities underlying the agreement and will value
them daily to assure that this condition is met. The VCA-10 Committee has
adopted standards for the parties with whom it will enter into repurchase
agreements which it believes are reasonably designed to assure that such a party
presents no serious risk of becoming involved in bankruptcy or insolvency
proceedings within the time frame contemplated by the repurchase agreement. In
the event that a seller defaults on a repurchase agreement, VCA-10 may incur a
loss in the market value of the collateral as well as disposition costs; and, if
a party with whom VCA-10 had entered into a repurchase agreement becomes
insolvent, VCA-10's ability to realize on the collateral may be limited or
delayed and a loss may be incurred if the collateral securing the repurchase
agreement declines in value during the insolvency proceedings.
VCA-10 will not enter into repurchase agreements with Prudential or its
affiliates, including Prudential Securities Incorporated. This will not affect
VCA-10's ability to maximize its opportunities to engage in repurchase
agreements.
Reverse repurchase agreements and dollar roll transactions. VCA-10 may enter
into reverse repurchase agreements and dollar roll transactions. Reverse
repurchase agreements involve the sale of securities held by VCA-10 with an
agreement by the Account to repurchase the same securities at an agreed upon
price and date. During the reverse repurchase period, VCA-10 often continues to
receive principal and interest payments on the sold securities. The terms of
each agreement reflect a rate of interest for use of the funds for the period,
and thus these agreements have some of the characteristics of borrowing by
VCA-10.
Dollar rolls involve sales by VCA-10 of securities for delivery in the current
month with a simultaneous contract to repurchase substantially similar
securities (same type and coupon) from the same party at an agreed upon price
and date. During the roll period, VCA-10 forgoes principal and interest paid on
the securities. VCA-10 is compensated by the difference between the current
sales price and the forward price for the future purchase (often referred to as
the "drop") as well as by the interest earned on the cash proceeds of the
initial sale. A "covered roll" is a specific type of dollar roll for which there
is an offsetting cash position or a cash equivalent security position which
matures on or before the forward settlement date of the dollar roll transaction.
VCA-10 will establish a segregated account with its custodian in which it will
maintain cash, U.S. Government securities or other liquid high-grade debt
obligations equal in value to its obligations in respect of reverse repurchase
agreements and dollar rolls.
Reverse repurchase agreements and dollar rolls involve the risk that the market
value of the securities retained by VCA-10 may decline below the price of the
securities VCA-10 has sold but is obligated to repurchase under the agreement.
In the event the buyer of securities under a reverse repurchase agreement or
dollar roll files for bankruptcy or becomes insolvent, VCA-10's use of the
proceeds of the agreement may be restricted pending a determination by the other
party, or its trustee or receiver, whether to enforce VCA-10's obligation to
repurchase the securities.
When-issued or delayed delivery securities. VCA-10 may, from time to time and in
the ordinary course of business, purchase or sell securities on a when-issued or
delayed delivery basis, that is, delivery and payment can take place a month or
more after the date of the transaction. VCA-10 will make commitments for such
when-issued or delayed delivery transactions only with the intention of
acquiring the securities. The Account's custodian will maintain in a separate
account portfolio securities having a value equal to or greater than any such
commitments. If VCA-10 were to dispose of the right to acquire a security it
could, as with the disposition of any security, incur a gain or loss due to
market fluctuations.
Short sales against the box. VCA-10 may make short sales of securities or
maintain a short position, provided that at all times when a short position is
open, VCA-10 owns an equal amount of the securities sold short or securities
convertible into or exchangeable, with or without payment of any further
consideration, for securities of the same issue as, and equal in amount to, the
securities sold short (a "short sale against the box"); provided, that if
further consideration is required in connection with the conversion or exchange,
cash or U.S. Government securities in an amount equal to such consideration must
be put in a segregated account.
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Other investment techniques. To the extent permitted by applicable regulations,
VCA-10 may also use forward foreign currency exchange contracts and interest
rate swaps. VCA-10 may also lend its portfolio securities from time to time.
Information about these investment techniques, including certain risks
associated with their use, is provided in the Statement of Additional
Information.
VCA-11's investment objective
The investment objective of VCA-11 is to seek as high a level of current income
as is consistent with the preservation of capital and liquidity. This objective
is a fundamental investment policy and may not be changed without the approval
of a majority vote of persons having voting rights in respect of the Account.
Certain investment restrictions are applicable; they are set forth in the
Statement of Additional Information.
VCA-11's investment policy
The investment policies of VCA-11 set forth below are adopted in an effort to
achieve the investment objectives and are not fundamental. Therefore, the
investment policies of VCA-11 may be changed by the Account's Committee without
participant approval.
The Account seeks to achieve its objective by investing in the following money
market instruments payable in U.S. dollars:
1. U.S. Treasury Bills and other obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. See "Appendix."
2. Obligations (including certificates of deposit and bankers' acceptances) of
any commercial bank, savings bank and savings and loan association organized
under the laws of the United States or any state thereof and any commercial
bank organized under the laws of any foreign nation, provided that such bank
or association has, at the time of the Account's investment, total assets of
at least $1 billion or the equivalent. The term "certificates of deposit"
includes both Eurodollar certificates of deposit, for which there is
generally a market, and Eurodollar time deposits, for which there is
generally not a market. "Eurodollars" are dollars deposited in foreign banks
and foreign branches of United States banks outside the United States.
An investment in Eurodollar instruments and in instruments of foreign
issuers generally involves risks that are different in some respects from an
investment in debt obligations of domestic issuers, including future
political and economic developments that might adversely affect the payment
of principal and interest on such instruments. In addition, there may be
less publicly available information about a foreign issuer than about a
domestic issuer, and such foreign issuers may not be subject to the same
accounting, auditing and financial standards and requirements as domestic
issuers. Finally, in the event of default, judgments against a foreign
issuer might be difficult to obtain or enforce. See "Appendix."
3. Commercial paper, variable amount demand master notes, bills, notes and
other obligations issued by a U.S. or foreign company, a foreign government,
its political subdivisions, agencies or instrumentalities, maturing in 397
days or less, denominated in U.S. dollars, and, at the date of investment,
present minimal credit risk and are of "eligible quality ", as determined by
VCA-11's investment manager under the supervision of the Committee members.
"Eligible quality," means (i) a security (or issuer) rated in one of the two
highest rating categories by at least two nationally recognized statistical
rating organizations assigning a rating to the security or issuer (or, if
only one such rating organization assigned a rating, that rating
organization) or (ii) an unrated security deemed of comparable quality by
VCA-11's investment manager under the supervision of the Committee members.
See "Appendix."
VCA-11 also may purchase instruments of the types described above together
with the right to resell the instruments at an agreed-upon price or yield
within a specified period prior to the maturity date of the instruments.
Such a right to resell is commonly known as a "put" and the aggregate price
that VCA-11 pays for instruments with a put may be higher than the price
that otherwise would be paid for the instruments.
4. Commercial paper, variable amount demand master notes or other obligations
which are guaranteed or supported by a letter of credit issued by a bank,
provided such bank (including a foreign bank) meets the requirements set
forth in paragraph (2) above. Commercial paper, variable amount demand
master notes or other fixed income obligations which are guaranteed or
insured by an insurance company or other non-bank entity, provided such
insurance company or other non-bank entity represents a credit of high
quality, as determined by the Account's Portfolio Manager under the
supervision of the VCA-11 Committee.
5. "Floating rate" and "variable rate" obligations, the interest rates on which
fluctuate generally with changes in market interest rates. Investments in
floating rate or variable rate securities normally will involve securities
which provide that the rate of interest is set as a spread to a designated
base rate, such as rates on Treasury bills, and, in some cases, that the
purchaser can demand payment of the obligation at specified intervals or
after a specified notice period (in each case of less than one year) at par
plus accrued interest, which
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amount may be more or less than the amount paid for them. Variable rate
securities provide for a specified periodic adjustment in the interest rate,
while floating rate securities have an interest rate which changes whenever
there is a change in the designated base interest rate.
Description of VCA-11's Investment Techniques
Repurchase Agreements. When VCA-11 purchases money market securities of the
types described above, it may on occasion enter into a repurchase agreement with
the seller wherein the seller and VCA-11 agree at the time of sale to a
repurchase of the security at a mutually agreed upon time and price. Repurchase
agreements are described in more detail under "Description of VCA-10's
Investment Techniques," page __. VCA-11's use of repurchase agreements is
subject to the same standards as those described for VCA-10.
Illiquid securities. VCA-11 will not invest more than 10% of its net assets in
illiquid securities (including repurchase agreements and non-negotiable time
deposits maturing in more than seven days). Securities that have legal or
contractual restrictions on resale but have a readily available market are not
deemed illiquid for purposes of this limitation. The investment adviser will
monitor the liquidity of such restricted securities subject to the supervision
of the VCA-11 Committee. In reaching liquidity decisions, the investment adviser
will consider, among other things, the following factors: (1) the frequency of
trades and quotes for the security; (2) the number of dealers wishing to
purchase or sell the security and the number of other potential purchasers; (3)
dealer undertakings to make a market in the security and (4) the nature of the
security and the nature of the market place trades (e.g., the time needed to
dispose of the security, the method of soliciting offers and the mechanics of
the transfers). Repurchase agreements subject to demand are deemed to have a
maturity equal to the notice period.
Other investment techniques. VCA-11 may purchase or sell securities on a
when-issued or delayed delivery basis. This technique is described under
"Description of VCA-10's Investment Techniques," page __. In addition, as
explained in greater detail in the Statement of Additional Information, VCA-11
may lend its portfolio securities.
SEC standards. The VCA-11 Committee has adopted the following additional
policies for the Account to conform to the SEC's standards applicable to all
money market funds, including VCA-11: (1) VCA-11 will only purchase securities
that are United States dollar-denominated "eligible securities" (see "Appendix")
that the VCA-11 Committee has determined present minimal credit risks; (2) VCA
- -11 will not invest more than 5% of its assets in the securities of any one
issuer (except U.S. Government obligations); however, the Account may exceed the
5% limit with respect to the "first tier" securities (see "Appendix"), of one
issuer at a time, for up to three business days after the purchase is made; (3)
VCA-11 will not invest more than 5% of its total assets in "second tier"
securities (see "Appendix") nor more than the greater of one million dollars and
1% of its assets in the "second tier" securities of any one issuer; (4) If a
"first tier" security held by VCA-11 ceases to be so classified, or if
Prudential becomes aware that any "NRSRO" (see "Appendix") has rated any
security in the Account below the NRSRO's second highest rating, the Committee
will reassess promptly whether the security presents minimal credit risks and
shall cause the Account to take such action as the Committee determines is in
the best interests of VCA-11 and its Participants; (5) In the event of a default
with respect to a security held by VCA-11, or if a security held in the Account
ceases to be an "eligible security," or if it has been determined that a
security owned by VCA-11 no longer presents minimal credit risks, VCA-11 will
sell the security as soon as practicable unless the Committee makes a specific
finding that such action would not be in the best interest of the Account; and
(6) VCA-11's dollar-weighted average portfolio maturity will be no more than 90
days, and the Account will not acquire any instrument with a remaining maturity
greater than 397 calendar days. The VCA-11 Committee has adopted written
procedures delegating to the investment manager under certain guidelines the
responsibility to make the above-described determinations, including certain
credit quality determinations.
The investment objectives of the Fund Portfolios
The investment objectives of the seven Fund Portfolios currently available for
investment through VCA-24 under the Contracts are:
Diversified Bond Portfolio. A high level of income over the longer term while
providing reasonable safety of capital through investment primarily in readily
marketable intermediate and long-term fixed income securities that provide
attractive yields but do not involve substantial risk of loss of capital through
default.
Government Income Portfolio. A high level of income over the longer term
consistent with the preservation of capital through investment primarily in U.S.
Government securities, including intermediate and long-term U.S. Treasury
securities and debt obligations issued by agencies of or instrumentalities
established, sponsored or guaranteed by the U.S. Government. At least 65% of the
total assets of the portfolio will be invested in U.S. Government securities.
Conservative Balanced Portfolio. Achievement of a favorable total investment
return consistent with a portfolio having a conservatively managed mix of money
market instruments, fixed income securities, and common stocks of established
companies, in proportions believed by the investment manager to be appropriate
for an investor desiring diversification of investment who prefers a relatively
lower risk of loss than that associated with the Flexible Managed Portfolio
while recognizing that this reduces the chances of greater appreciation.
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Flexible Managed Portfolio. Achievement of a high total return consistent with a
portfolio having an aggressively managed mix of money market instruments, fixed
income securities, and common stocks, in proportions believed by the investment
manager to be appropriate for an investor desiring diversification of investment
who is willing to accept a relatively high risk of loss in an effort to achieve
greater appreciation.
Stock Index Portfolio. Achievement of investment results that correspond to the
price and yield performance of publicly traded common stocks in the aggregate by
following a policy of attempting to duplicate the price and yield performance of
the Standard & Poor's 500 Composite Stock Price Index.
Equity Portfolio. Capital appreciation through investment primarily in common
stocks of companies, including major established corporations as well as smaller
capitalization companies, that appear to offer attractive prospects of price
appreciation that is superior to broadly-based stock indices. Current income, if
any, is incidental.
Global Portfolio. Long-term growth of capital through investment primarily in
common stock and common stock equivalents of foreign and domestic issuers.
Current income, if any, is incidental.
The investment policies, restrictions and risks associated with each of these
seven Fund Portfolios are described in the accompanying Prospectus for the Fund.
Certain restrictions are set forth in the Fund's Statement of Additional
Information.
Determination of asset value
The Unit Value for VCA-10 will be determined once daily as of 4:15 p.m. Eastern
time on each day that the New York Stock Exchange ("NYSE") is open for trading.
The NYSE is normally open for trading Monday through Friday except for the days
on which the following holidays are observed: New Year's Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and
Christmas Day. Any security for which the primary market is on an exchange is
generally valued at the last sale price on such exchange as of the close of the
NYSE (which is currently 4:00 p.m. Eastern time) or, in the absence of recorded
sales, at the mean between the most recently quoted bid and asked prices. NASDAQ
National Market System equity securities are valued at the last sale price or,
if there was no sale on such day, at the mean between the most recently quoted
bid and asked prices. Other over-the-counter equity securities are valued at the
mean between the most recently quoted bid and asked prices.
Fixed income securities will be valued utilizing an independent pricing service
to determine valuations for normal institutional size trading units of
securities. The pricing service considers such factors as security prices,
yields, maturities, call features, ratings and developments relating to specific
securities in arriving at securities valuations. Convertible debt securities
that are actively traded in the over-the-counter market, including listed
securities for which the primary market is believed to be over-the-counter, are
valued at the mean between the most recently quoted bid and asked prices
provided by an independent pricing service.
Short-term investments having maturities of sixty days or less are valued at
amortized cost which, with accrued interest, approximates market value.
Amortized cost is computed using the cost on the date of purchase, adjusted for
constant accrual of discount or amortization of premium to maturity.
Options on stock and stock indices traded on national securities exchanges are
valued at the mean of the bid and asked prices as of the close of the respective
exchange (which is currently 4:10 p.m. Eastern time). Futures contracts and
options thereon are valued at the last sale price at the close of the applicable
commodities exchange or board of trade (which is currently 4:15 p.m. Eastern
time) or, if there was no sale on the applicable commodities exchange or board
of trade on such day, at the mean between the most recently quoted bid and asked
prices on such exchange or board of trade.
Portfolio securities for which market quotations are not readily available will
be valued at fair value as determined in good faith under the direction of the
Committee.
The Unit Value for VCA-11 will be determined once daily as of 4:15 p.m. Eastern
time on each day that the NYSE is open for trading. With the exception of U.S.
Government securities held subject to repurchase agreements that may have
maturity dates in excess of one year from the date of delivery of the repurchase
agreement, securities held in VCA-11 consist primarily of debt obligations with
a remaining maturity of less than thirteen months. These securities will be
valued at amortized cost. If the net asset value of VCA-11 fluctuates by as much
as three-tenths of one percent because of the use of the amortized cost method
as opposed to the mark-to-market valuation, then the Committee will be promptly
notified so that corrective action may be taken to avoid the dilution of the
interests of Participants in investment companies. This corrective action may
entail selling portfolio instruments prior to maturity, redeeming shares in kind
or using market value. In determining the market value for securities held in
VCA-11, where the primary market for a security is an exchange, the market
quotations are obtained from that exchange. Securities which are not listed on
an exchange and for which market quotations are readily available are valued at
the market price as obtained from one or more of the major market makers. Other
investments and assets are valued at fair value as determined by appraisal.
Prudential supervises and retains responsibility for such appraisals under the
direction of the VCA-11 Committee.
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The proceeds from sales of VCA-11's assets generally will vary inversely to
changes in interest rates. If interest rates increase after a security is
purchased, the security, if sold, may return less than its cost.
The procedures for computing the net asset value of Fund shares are described in
the accompanying Fund Prospectus.
MANAGEMENT
The operations of VCA-10 and VCA-11 are conducted under the general supervision
of each Account's Committee and in accordance with each Account's Rules and
Regulations. The members of each Account's Committee are elected for indefinite
terms by the Participants in that Account and by any other persons who may have
voting rights in respect of the Account. See "Voting Rights," pages 33-34. A
majority of the Committee members are not "interested persons" of Prudential or
of the Accounts, as defined in the 1940 Act. Information about the Fund's Board
of Directors is provided in the accompanying Prospectus of the Fund and its
Statement of Additional Information.
Prudential serves as the investment manager of the Accounts and the Fund under
separate investment management agreements with each of them. Subject to
Prudential's supervision, all of the investment management services provided by
Prudential are furnished by its wholly-owned subsidiary, The Prudential
Investment Corporation ("PIC"). Prudential continues to have responsibility for
all investment advisory services under its investment management agreements with
the Accounts and the Fund. Pursuant to a service agreement between Prudential
and PIC, Prudential reimburses PIC for its costs and expenses. PIC is registered
as an investment adviser under the Investment Advisers Act of 1940.
An affiliated broker may be employed to execute brokerage transactions on behalf
of the Accounts and the Fund, as long as the commissions are reasonable and fair
compared to the commissions received by other brokers in connection with
comparable transactions involving similar securities being purchased or sold on
a securities exchange during a comparable period of time. The Accounts and the
Fund may not engage in any transactions in which Prudential or its affiliates,
including Prudential Securities Incorporated, act as principal, including
over-the-counter purchases and negotiated trades in which such a party acts as a
principal.
Prudential is also responsible for the Accounts' administrative and
recordkeeping functions and pays the expenses associated with them. Information
about the administrative, recordkeeping and other expenses of the Fund appears
in the accompanying Fund prospectus, and in the Fund's Statement of Additional
Information.
CHARGES
No deduction is made from contributions to VCA-10, VCA-11 or any Subaccount of
VCA-24 at the time they are made. Accordingly, one hundred percent (100%) of
those contributions is invested in the program. Certain charges, described
below, are imposed upon withdrawal of all or part of the contributions made on
behalf of Participants, or upon each Participant's Accumulation Account in the
Program.
Deferred Sales Charge
PIMS performs certain sales and distribution functions regarding the Contracts.
In consideration for these services, a deferred sales charge which is designed
to cover expenses relating to sales of the Contracts, including commissions, may
be imposed upon contributions withdrawn by a Participant. To the extent the
deferred sales charge does not repay these expenses, the difference will be made
up from Prudential's surplus held in its general account. The amount of the
deferred sales charge imposed upon any withdrawal depends upon the number of
years of a Participant's participation in a MEDLEY Program, the year in which
the withdrawal is made, and the kind of retirement arrangement that covers the
Participant.
Participation in a Program begins upon the date when the first contribution on
behalf of the Participant under a Contract described in this Prospectus, a
Companion Contract, the fixed rate option, mutual fund, or other investment
options made available by Prudential along with enrollment information in a form
satisfactory to Prudential, is received by Prudential. Such participation ends
on the date when all of the Participant's Accumulation Accounts under the
Program are cancelled. In the event of such cancellation, Prudential reserves
the right to consider the Participant to be participating in the Program for a
limited time (currently about one year) for the purposes of calculating any
deferred sales charge on the withdrawal of any future contributions.
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The chart below describes the maximum amount of the deferred sales charge.
Deferred Sales
Charge, as a
Years of Percentage of
Program Contributions
Participation Withdrawn
------------- --------------
0-1 year ............................... 7%
1-2 years .............................. 6%
2-3 years .............................. 5%
3-4 years .............................. 4%
4-5 years .............................. 3%
5-6 years .............................. 2%
6-7 years .............................. 1%
After 7 years .......................... 0%
Although some Contracts may provide for higher sales charges, Prudential has
determined to limit sales charges on all Contracts to the above schedule. If a
Participant makes a withdrawal on an anniversary date of his Program
participation, any applicable deferred sales charge will be based on the longer
period of Program participation.
The proceeds received by a Participant upon any partial or full withdrawal will
be reduced by the amount of any deferred sales charge.
Lower deferred sales charges may be imposed under certain Contracts. See
"Modification of Charges," page 19.
Limitations on Sales Charges
No deferred sales charge is imposed upon contributions withdrawn to purchase an
annuity under a Contract, to provide a death benefit, pursuant to a systematic
withdrawal plan, to provide a minimum distribution payment, or in cases of
financial hardship or disability retirement as determined pursuant to provisions
of the employer's retirement arrangement. Further, for all plans other than
IRAs, no deferred sales charge is imposed upon contributions withdrawn due to
resignation or retirement by the Participant or termination of the Participant
by the Contract-holder. In addition, no deferred sales charge is imposed upon
contributions withdrawn for any reason after seven years of participation in a
Program.
Contributions transferred among VCA-10, VCA-11, the Subaccounts of VCA-24, a
Companion Contract, and the fixed rate option of a Combination Contract are
considered to be withdrawals from the Account or Subaccount from which the
transfer is made, but no deferred sales charge is imposed upon them. They will,
however, be considered as contributions to the receiving Account or Subaccount
for purposes of calculating any deferred sales charge imposed upon their
subsequent withdrawal from it.
Loans are considered to be withdrawals from the Account or Subaccount from which
the loan amount was deducted but are not considered a withdrawal from the
Program. Therefore, no deferred sales charge is imposed upon them. The principal
portion of any loan repayment, however, will be treated as a contribution to the
receiving Account or Subaccount for purposes of calculating any deferred sales
charge imposed upon any subsequent withdrawal. If the Participant defaults on
the loan by, for example, failing to make required payments, the outstanding
balance of the loan will be treated as a withdrawal for purposes of the deferred
sales charge. The deferred sales charge will be withdrawn from the same
Accumulation Accounts, and in the same proportions, as the loan amount was
withdrawn. If sufficient funds do not remain in those Accumulation Accounts, the
deferred sales charge will be withdrawn from the Participant's other
Accumulation Accounts as well.
Withdrawals, transfers and loans from VCA-10, VCA-11 and each Subaccount of
VCA-24 are considered to be withdrawals of contributions until all of the
Participant's contributions to the Account or Subaccount have been withdrawn,
transferred or borrowed. No deferred sales charge is imposed upon withdrawals of
any amount in excess of contributions.
Annual Account Charge
An annual account charge for recordkeeping and other administrative services is
deducted from each Participant's Accumulation Account in the Program. This
annual account charge is payable to Prudential and is made on the last business
day of each calendar year as long as the Participant still has an Accumulation
Account under the Program. The annual account charge will be pro rated for new
Participants for the first year of their participation, based on the number of
full months remaining in the calendar year after the first contribution is
received. If all of the Participant's Accumulation Accounts are cancelled before
the end of the year, the charge will be made on the date the last Accumulation
Account is cancelled (and the charge will not be pro rated if this occurs during
the year in which the first contribution is made to such Account). The annual
account charge will not be made, however, upon the cancellation of a
Participant's Accumulation Account to purchase an annuity under a Contract if
the annuity becomes effective on January 1 of any year. After a cancellation,
the Participant may again participate in the Program only as a new Participant
and will be subject to a new annual account charge. Also, the annual account
charge will not be made if the Participant's employer has chosen to pay the
charge.
The aggregate annual account charge with respect to a Participant's Accumulation
Accounts will not be greater than $30. The charge will first be made against a
Participant's Accumulation Account under a fixed-dollar Companion Contract or
fixed rate option of a Combination Contract. If the Participant has no
Accumulation Account under a Companion Contract or the fixed rate option, or if
that Accumulation Account is too small to pay the charge, the charge will be
made against the Participant's Accumulation Account in VCA-11. If the
Participant has no VCA-11 Accumulation Account, or if
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that Account is too small to pay the charge, the charge will then be made
against the Participant's VCA-10 Accumulation Account. If the Participant has no
VCA-10 Accumulation Account, or if it is too small to pay the charge, the charge
will then be made against any one or more of the Participant's Accumulation
Accounts in VCA-24.
The cash positions of VCA-10, VCA-11 and the Subaccounts of VCA-24 are expected
to be sufficient to cover such part of the charge that is collected from them.
Accordingly, that collection should have no adverse financial effect on any
Account or Subaccount.
Charge for Administrative Expenses and
Investment Management Services
A daily charge is made which is equal to an effective annual rate of 1.00% of
the net value of the assets in VCA-10 and VCA-11. Three quarters of this charge
(0.75%) is for administrative expenses not covered by the annual account charge,
and one quarter (0.25%) is for investment management. A daily charge is also
made which is equal to an effective annual rate of 0.75% of the net value of the
assets in each Subaccount of VCA-24. All of this charge is for administrative
expenses not covered by the annual account charge. These charges are payable to
Prudential and are reflected in the computation of the value of the Units in
each Account and Subaccount. See "The Unit Value," page 21 and "The Unit Change
Factor for Any Business Day," page 21. It should be noted that because the
administrative charge of 0.75% is a charge based on a percentage of assets in an
Account, there is no necessary relationship between this administrative charge
and the amount of expenses attributable to a particular Contract or Participant.
Prudential makes daily charges for providing investment management of the Fund
Portfolios at the following effective annual rates: 0.35% of the average daily
net assets of the Stock Index Portfolio, 0.40% of the average daily net assets
of the Diversified Bond Portfolio and Government Income Portfolio, 0.45% of the
average daily net assets of the Equity Portfolio, 0.55% of the average daily net
assets of the Conservative Balanced Portfolio, 0.60% of the average daily net
assets of the Flexible Managed Portfolio and 0.75% of the average daily net
assets of the Global Portfolio. Other expenses incurred by the Fund include
costs of Portfolio transactions, legal and accounting expenses, and the fees of
the Fund's custodian and transfer agent. Further detail is provided in the
accompanying Prospectus for the Fund and its Statement of Additional
Information.
Modification of Charges
Prudential may impose deferred sales charges and annual account charges lower
than those described above with respect to Participants under certain Contracts.
These lower charges will reflect Prudential's anticipation that lower sales or
administrative costs will be incurred, or less sales or administrative services
will be performed, with respect to such Contracts due to economies arising from
(1) the utilization of mass enrollment procedures or (2) the performance of
recordkeeping or sales functions, which Prudential would otherwise be required
to perform, by the Contract-holder, an employee organization, or by a third
party on their behalf or (3) an accumulated surplus of charges over expenses
under a particular Contract. Generally, the deferred sales charge is lowered or
waived depending on the amount of local service the Contract-holder requires. In
addition, the deferred sales charge may be lowered if required by state law. The
exact amount of the deferred sales charge and annual account charge applicable
to Participants under any given Contract will be stated in the Contract.
Prudential may change the deferred sales charge, the annual account charge and
the charge of 0.75% for administrative expenses. See "Changes in the Contracts,"
page 30.
THE CONTRACTS
Prudential generally issues the Contracts to employers whose employees may
become Participants. Under an IRA, a Participant's spouse may also become a
Participant. Sometimes a Contract is issued to an association that represents
employers of employees who become Participants, sometimes to an association
whose members become Participants and sometimes to a trustee of a trust with
participating employers whose employees become Participants. Even though an
employer, an association or a trustee is the Contract-holder, the Contract
normally provides that Participants shall have the rights and interests under
them that are described in this Prospectus. But this is not always true. For
example, prior to 1996, Section 457 of the Internal Revenue Code required that a
Contract issued in connection with a plan under that section provide that all
rights under the Contract are owned by the employer to whom, or on whose behalf,
the Contract is issued. The Section also required that the Contract provide that
all amounts are payable to the employer and that the employee has no rights or
interests under the Contract, including any right or interest in the
Accumulation Account established in his name except as provided in the plan. In
1996, however, Congress amended Section 457 to require that all plan assets be
held for the exclusive benefit of Participants and their beneficiaries. For
plans existing on the date of enactment in 1996, that new requirement need not
be implemented until January 1, 1999. Thus, Participants under 457 Contracts
should consult their employer's plan to determine what rights they have under
their particular plan. Certain Contracts issued in connection with non-qualified
arrangements may place all rights and interests in the employer, not the
employee.
Also, a particular plan, even if it is not a deferred compensation plan, may
limit a Participant's exercise of
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certain rights under a Contract. Participants should check the provisions of
their employer's plan or any agreements with the employer to see if there are
any such limitations and, if so, what they are. Prudential may issue the
Non-Qualified Combination Contract to cover individuals who are not associated
with a single employer or other organization.
The Accumulation Period
1. Contributions; Crediting Units; Enrollment Forms; Deduction for
Administrative Expenses.
Contributions to a Program ordinarily will be made periodically pursuant
to a payroll deduction or similar agreement between the Participant and
his employer. Any contributions to an IRA must be in an amount of no
less than $500, except for contributions to an IRA for a non-working
spouse (or working spouse who elects to be treated as a non-working
spouse), which are limited to $250 per year.
A Participant designates what portion of the contributions made on his
behalf should be invested in VCA-10, VCA-11 and in any Subaccount of
VCA-24 (if all three Accounts are part of his employer's Program) or
under a fixed rate option or Companion Contract, if any. The Participant
may change this designation usually by notifying Prudential at the
address shown on the cover page of this Prospectus. Under certain
Contracts, an entity other than Prudential keeps certain records, and
Participants under those Contracts must contact the record-keeper. See
"Modified Procedures," page 28.
The full amount (100%) of each contribution designated for investment in
VCA-10, VCA-11 or any Subaccount of VCA-24 is credited to an
Accumulation Account maintained for the Participant in that Account or
Subaccount. An Accumulation Account in VCA-10 consists of VCA-10 Units;
an Accumulation Account in VCA-11 consists of VCA-11 Units; an
Accumulation Account in a Subaccount of VCA-24 consists of Units of that
Subaccount. The number of Units credited to a Participant in an Account
or Subaccount is determined by dividing the amount of the contribution
made on his behalf to that Account or Subaccount by the Account's or
Subaccount's Unit Value for the business day on which the contribution
is received at the address shown on the cover page of this Prospectus. A
business day is a day on which the New York Stock Exchange is open for
trading.
The initial contribution made for a Participant will be invested in VCA
-10, VCA-11, or a Subaccount of VCA-24 no later than two business days
after it is received by Prudential and identified as being for
investment in VCA-10, VCA-11, or a Subaccount of VCA-24, if it is
preceded or accompanied by satisfactory enrollment information. If the
Contract-holder submits an initial contribution on behalf of one or more
new Participants that is not preceded or accompanied by satisfactory
enrollment information, then Prudential will allocate such contribution
to a money market option upon receipt, and also will send a notice to
the Contract-holder that requests allocation information for each such
Participant. If the Contract-holder purchases only contracts that are
within the MEDLEY Program, or purchases such contracts together with
either a group variable annuity contract issued through The Prudential
Variable Contract Account-2 or unaffiliated mutual funds, then
contributions that are not preceded or accompanied by satisfactory
enrollment information will be invested in the VCA-11 money market
option. If the Contract-holder purchases contracts that are within the
MEDLEY Program as well as shares of a money market fund, then
contributions that are not preceded or accompanied by satisfactory
enrollment information will be invested in the money market fund. If the
necessary enrollment information is not received in response to its
initial notice to the Contract-holder, Prudential will deliver up to
three additional notices to the Contract-holder at monthly intervals
that request such allocation information. After 105 days have passed
from the time that Units of VCA-11 (or, as the case may be, shares of
the money market fund) were purchased on behalf of Participants who
failed to provide the necessary enrollment information, Prudential will
redeem the relevant VCA-11 Units (or shares of the money market fund)
and pay the proceeds (including earnings thereon) to the
Contract-holder. Any proceeds paid to the Contract-holder under this
procedure may be considered a prohibited and taxable reversion to the
Contract-holder under current provisions of the Internal Revenue Code of
1986, as amended. Similarly, returning proceeds may cause the
Contract-holder to violate a requirement under the Employee Retirement
Income Security Act of 1974, as amended, to hold all plan assets in
trust. Both problems may be avoided if the Contract-holder arranges to
have the proceeds paid into a qualified trust or annuity contract.
The number of VCA-10 Units, VCA-11 Units or Units of a particular
Subaccount of VCA-24 credited to a Participant will not be affected by
any subsequent change in the value of those Units, but the dollar value
of a Unit will vary from business day to business day depending upon the
investment experience of the Account or Subaccount. The number of Units
credited to a Participant in an Account or Subaccount will be reduced as
the
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result of the annual account charge. That charge will be made by
cancelling the number of Units that is equal to the amount of the charge
(see "Annual Account Charge," pages 18-19) divided by the Unit Value for
the business day on which the charge is made.
2. Valuation of a Participant's Account
The value of a Participant's Accumulation Account in VCA-10, VCA-11 or
in a Subaccount of VCA-24 on any particular day is determined by
multiplying the total number of Units then to the Participant's credit
in the Account or Subaccount by the Account's or Subaccount's Unit Value
on that day.
3. The Unit Value
On November 4, 1982, the date of the first Participant contribution to
VCA-10, the Unit Value for VCA-10 was set at $1.00. On November 8, 1982,
the date of the first Participant contribution to VCA-11, the Unit Value
for VCA-11 was set at $1.00. The Unit Value for each Subaccount of
VCA-24 was set at $1.00 on the date of commencement of operations of
that Subaccount. The Unit Value for each Account and Subaccount will be
determined each business day and represents the value of the Account's
or Subaccount's assets minus its outstanding liabilities (including
accrued fees and expenses) divided by the number of outstanding units.
Unit Values are determined before giving effect to the day's allocations
and withdrawals from the Account or Subaccount.
4. Withdrawal (Redemption) of Contributions.
The Internal Revenue Code imposes restrictions on withdrawals from
tax-deferred annuities subject to Section 403(b) of the Code. Pursuant
to Section 403(b)(11) of the Code, amounts attributable to a
Participant's salary reduction contributions (including the earnings
thereon) that are made under a tax-deferred annuity after December 31,
1988 can only be withdrawn (redeemed) when the Participant attains age
59 1/2, separates from service with his employer, dies or becomes
disabled (within the meaning of Section 72(m)(7) of the Code). However,
the Code permits the withdrawal at any time of amounts attributable to
tax-deferred annuity salary reduction contributions (excluding the
earnings thereon) that are made after December 31, 1988, in the case of
a hardship. If the retirement arrangement under which a Participant is
covered contains a financial hardship provision, withdrawals can be made
in the event of the hardship.
Furthermore, subject to any restrictions upon withdrawals contained in
the tax-deferred annuity arrangement under which a Participant is
covered, a Participant can withdraw at any time all or part of his
interest in his Accumulation Account(s) as of December 31, 1988. Amounts
earned after December 31, 1988 on the December 31, 1988 balance in a
Participant's Accumulation Account(s) attributable to salary reduction
contributions are, however, subject to the Section 403(b)(11) withdrawal
restrictions discussed above.
Subject to any conditions or limitations regarding transfers contained
in the tax-deferred annuity arrangement under which a Participant is
covered, a Participant can continue to make transfers of all or part of
his interest in his Accumulation Account(s) among the available
investment options offered by the Prudential and can transfer directly
all or part of his interest in his Accumulation Account(s) to a Section
403(b) tax-deferred annuity contract of another insurance company or to
a mutual fund custodial account under Section 403(b)(7). See "Transfer
Payments", pages 25-26.
Unless restricted by the tax-deferred annuity arrangement under which he
is covered, a Participant may withdraw at any time all or part of his
interest in his Accumulation Account(s) that is attributable to employer
contributions or after-tax Participant contributions, if any.
With respect to retirement arrangements other than tax-deferred
annuities subject to Section403(b) of the Code (e.g., Code Section457
plans) a Participant's right to withdraw at any time all or part of his
interest in VCA-10, VCA-11 or any Subaccount of VCA-24 may be restricted
by the retirement arrangement under which he is covered. For example,
Code Section457 plans typically permit withdrawals only upon attainment
of age 70 1/2, separation from service, or for unforeseeable
emergencies.
Withdrawal requests should be submitted to Prudential in the manner set
out in the Summary section of this prospectus or, if required by the
Contract, another entity providing record-keeping services. See
"Modified Procedures," page 28. Under certain Contracts, the amount
withdrawn from an Account or Subaccount as a minimum distribution
payment must be at least $250 or, if less, then equal to the full value
of the Participant's interest in the Account or Subaccount. The amount
withdrawn will be reduced by any deferred sales charge that may apply.
See "Deferred Sales Charge," pages 17-18. If a Participant withdraws the
value of all of his Accumulation Accounts under a Program, the full
annual account charge will be deducted at that time that would otherwise
have been deducted at the end of the calendar year and those
Accumulation Accounts will be cancelled. The resulting amount will be
paid within seven days after the request for the withdrawal
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has been received in a manner prescribed by Prudential, except as
deferment of such payment may be permitted under the provisions of the
1940 Act in effect from time to time. Currently, deferment is
permissible only when the New York Stock Exchange is closed or trading
is restricted, when an emergency exists as a result of which disposal of
the securities held in the Account or Subaccount involved is not
reasonably practicable or it is not reasonably practicable to determine
fairly the value of the Account's or Subaccount's assets, or when the
Securities and Exchange Commission has provided for such deferment for
the protection of Participants. As of the day a withdrawal request is
received by Prudential, the Participant's Accumulation Account in
VCA-10, VCA-11 or any Subaccount of VCA-24, as the case may be, will be
reduced by the lesser of the number of Units obtained by dividing the
amount of the Participant's withdrawal request by the Unit Value for
that day, or the number of Units remaining in the Accumulation Account.
Under certain types of retirement arrangements, the Retirement Equity
Act of 1984 requires that in the case of a married Participant, certain
withdrawal requests include the consent of the Participant's spouse.
This consent must contain the signatures of the Participant and spouse
and must be notarized or witnessed by an authorized plan representative.
Under certain Contracts, withdrawals may be made to pay expenses of the
plan.
Prudential may process a withdrawal from a Participant's Accumulation
Account if Prudential determines that the Participant's contributions
exceed the amount permitted by the Internal Revenue Code.
A withdrawal will generally have federal income tax consequences, which
can include tax penalties. See "Federal Tax Status," pages 31-33.
5. Systematic Withdrawal Plan
If permitted by Internal Revenue Code and the retirement arrangement
under which a Participant is covered, and subject to the restrictions
and limitations set forth below, a Participant may arrange for
systematic withdrawals to be made from his Accumulation Account(s). A
Participant may arrange for systematic withdrawals only if, at the time
he elects to have such an arrangement, the sum of the balance(s) in his
Accumulation Account(s) is at least $5,000. A Participant who has not
reached age 59 1/2, however, may not elect a systematic withdrawal
arrangement unless he has first separated from service with his
employer. In addition, the $5,000 minimum balance does not apply to
systematic withdrawals made for the purpose of satisfying minimum
distribution rules.
Federal income tax provisions applicable to the retirement arrangement
under which a Participant is covered may significantly affect the
availability of systematic withdrawals, how they may be made, and the
consequences of making them. Withdrawals by Participants are generally
taxable and Participants who have not reached age 59 1/2 may incur
substantial tax penalties. Withdrawals made after a Participant has
attained age 70 1/2 (or, in the case of Participants in Section 403(b)
annuity plans and certain governmental or church plans who retire after
age 70 1/2, after the Participant has retired) and by beneficiaries must
satisfy certain minimum distribution rules. See "Federal Tax Status,"
pages __-__.
Systematic withdrawals may be arranged only pursuant to an election on a
form approved by Prudential. Under certain types of retirement
arrangements, an election to arrange for systematic withdrawals by a
married Participant must be consented to in writing by the Participant's
spouse, with signatures notarized or witnessed by an authorized plan
representative. The election must specify that the systematic
withdrawals shall be made on a monthly, quarterly, semi-annual, or
annual basis.
All systematic withdrawals shall be effected as of the day of the month
specified by the Contract-holder, or, if such day is not a business day,
then on the next succeeding business day. Systematic withdrawals shall
continue until the Participant has withdrawn all of the balances in his
Accumulation Account(s) or has instructed Prudential in writing to
terminate his systematic withdrawal arrangement. The Participant may
elect to make systematic withdrawals in equal dollar amounts (in which
case each withdrawal must be at least $250), unless it is made to
satisfy minimum distribution rules, or over a specified period of time
(at least three years). Where the Participant elects to make systematic
withdrawals over a specified period of time, the amount of each
withdrawal--which will vary, reflecting investment experience during the
withdrawal period--will be equal to the sum of the balances then in the
Participant's Accumulation Account(s) divided by the number of
systematic withdrawals remaining to be made during the withdrawal
period.
Systematic withdrawals shall be taken first out of the Participant's
Accumulation Account, if any, in the Companion Contract or the fixed
rate option until that Accumulation Account is exhausted. Thereafter,
systematic withdrawals will be taken in order from the Participant's
Accumulation Account(s) (until each is exhausted), in VCA-11, VCA-10,
the VCA-24 Equity Subaccount, the VCA-24 Diversified Bond Subaccount,
the VCA-24 Conservative Balanced Subaccount, the
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VCA-24 Flexible Managed Subaccount, the VCA-24 Stock Index Subaccount,
the VCA-24 Government Income Subaccount, and the VCA-24 Global
Subaccount.
A Participant may change the frequency, amount or duration of his
systematic withdrawals by submitting a form to Prudential that
Prudential will provide to him upon request. A Participant may make such
a change only once during each calendar year.
A Participant may at any time instruct Prudential to terminate the
Participant's systematic withdrawal arrangement, and no systematic
withdrawals will be made for him after Prudential has received his
instruction. A Participant who chooses to stop making systematic
withdrawals may not again make them until the next calendar year and may
be subject to federal tax consequences as a result thereof.
An arrangement to make systematic withdrawals will not affect any of the
Participant's other rights under the Contracts, including the right
to make withdrawals (redemptions) described on page 21-22 of this
Prospectus, the right to make transfers described on pages 25-26, and
the right to purchase a fixed dollar annuity described on pages 28-29.
No deferred sales charge is imposed upon systematic withdrawals made
pursuant to an arrangement elected as described above; provided,
however, that Prudential reserves the right to apply a deferred sales
charge on systematic withdrawals where payments are made for less than
three years. Furthermore, a Participant who is receiving systematic
withdrawals and is over the age of 59 1/2 may make one additional,
non-systematic, withdrawal during each calendar year in an amount that
does not exceed 10% of the sum of the balances in his Accumulation
Account(s) and no deferred sales charge shall be imposed upon such
withdrawal. This additional withdrawal may be made from any of the
Participant's Accumulation Account(s), as the Participant may elect.
Different procedures may apply for Contracts under which an entity other
than Prudential provides record-keeping services. See "Modified
Procedures," page 28.
6. Texas Optional Retirement Program
Special rules apply with respect to Contracts covering persons
participating in the Texas Optional Retirement Program ("Texas Program")
in order to comply with the provisions of Texas law relating to the
Texas Program.
Under the terms of the Texas Program, Texas will contribute an amount
somewhat larger than a Participant's contribution. Texas' contributions
will be credited to the Participant's individual Accumulation Accounts.
Until the Participant begins his second year of participation in the
Texas Program as a "faculty member" as defined in Section 31.001(8) of
Title 110B of the Texas Revised Civil Statutes, Prudential will have the
right to withdraw the value of the Units purchased for his account with
Texas' contributions. If the Participant does not commence his second
year of Texas Program participation, the value of those Units
representing Texas' contribution will be withdrawn and returned to the
State.
Pursuant to Section 36.105 of Title 110B of the Texas Revised Civil
Statutes and a ruling of the State Attorney General, withdrawal benefits
of Contracts issued under the Texas Program are available only in the
event of a Participant's death, retirement or termination of employment
in all institutions of higher education as defined in Section 61.003 of
the Texas Education Code. Participants will not, therefore, be entitled
to exercise the right of withdrawal in order to receive in cash the
values credited to them under the Contract unless one of the foregoing
conditions has been satisfied. The value of a Participant's interests
under the Contract may, however, be transferred to another Prudential
contract or contracts of other carriers approved under the Texas Program
during the period of the Participant's Texas Program participation.
7. Death Benefits
Upon receipt by Prudential of due proof of a Participant's death and a
claim and payment election submitted on a form approved by Prudential, a
death benefit made up of the balance in the Participant's Accumulation
Accounts (after deduction of the annual account charge and calculated,
insofar as Accumulation Accounts in VCA-10, VCA-11 and the Subaccounts
of VCA-24 are concerned, as the product of the Unit Value for the
business day on which Prudential receives due proof of the Participant's
death and other necessary forms multiplied by the number of Units then
credited to the Participant's Accumulation Account) will be payable to
his designated beneficiary. The appropriate address to which a death
benefit claim should be sent is set out in the Summary section of this
Prospectus. For certain Contracts a death benefit claim should be sent
to a designated record-keeper rather than Prudential. See "Modified
Procedures," page 28.
The death benefit will be paid in one sum as if it were a single
withdrawal, as systematic withdrawals, as an annuity, or a combination
of the three, as the Participant may have directed subject to the
minimum distribution rules of Code Section 401(a)(9) as described below
under "Federal Tax
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Status." If the Participant has not so directed, the beneficiary may,
within any time limit prescribed by or for the retirement arrangement
that covered the Participant, elect:
a. to receive a one-sum cash payment;
b. to have a fixed-dollar annuity purchased under the Contract on a
specified date, using the same annuity purchase rate basis that
would have applied if the Participant's account were being used to
purchase an annuity for the Participant.
c. to receive regular payments in accordance with the systematic
withdrawal plan; or
d. a combination of all or any two of (a), (b), and (c)
Unless restricted by the retirement arrangement under which the
Participant is covered, or unless the Participant has elected otherwise,
if within one year after the Participant's death the beneficiary elects
to use at one time the entire balance in any one or more of the
Participant's Accumulation Accounts to receive a one-sum cash payment,
Prudential will add to the death benefit, if necessary, so that with
respect to each Accumulation Account from which such cash payment is
made, the total made available to the beneficiary will not be less than
the contributions to such Accumulation Account minus any withdrawals or
transfers affecting such Accumulation Account and minus the annual
account charge, if any. Certain Contracts may provide a higher amount.
Under certain types of retirement arrangements, the Retirement Equity
Act of 1984 requires that in the case of a married Participant, a death
benefit be payable to the Participant's spouse in the form of a
"qualified pre-retirement survivor annuity." A "qualified pre-retirement
survivor annuity" is an annuity for the lifetime of the Participant's
spouse in an amount which can be purchased with no less than 50% of the
balance in the Participant's account as of his date of death. Under the
Retirement Equity Act, the spouse of a Participant in a retirement
arrangement which is subject to these rules may consent to waive the
pre-retirement survivor annuity benefit. Such consent must acknowledge
the effect of waiving the coverage, contain the signatures of the
Participant and spouse and must be notarized or witnessed by an
authorized plan representative. Unless the spouse of a Participant in a
Plan which is subject to these requirements properly consents to the
waiver of the benefit, 50% of the balance in all of the Participant's
Accumulation Accounts will be paid to such spouse even if the designated
beneficiary is someone other than the spouse. Under these circumstances,
the remaining50% would be paid to Participant's designated beneficiary.
Unless the retirement arrangement that covered the Participant provides
otherwise, a beneficiary who elects to have a fixed-dollar annuity
purchased for himself may choose from among the available forms of
annuity. See "Available Forms of Annuity," page 29. The beneficiary may
elect to purchase an annuity immediately or at a future date. If an
election includes systematic withdrawals, the beneficiary will have the
right to terminate such withdrawals and receive the remaining balance
in the Participant's Accumulation Accounts in cash (or effect an annuity
with it), or to change the frequency, size or duration of such
withdrawals, subject to the minimum distribution rules. (See "Federal
Tax Status" on pages 31-33). If the beneficiary fails to make any
election within any time limit prescribed by or for the retirement
arrangement that covered the Participant, within seven days after the
expiration of that time limit, a one-sum cash payment will be made to
the beneficiary, after deduction of the annual account charge. A
specific contract may provide that an annuity is payable to the
beneficiary if the beneficiary fails to make an election.
Until a death benefit is paid that results in reducing to zero the
balance in all of the Participant's Accumulation Accounts under a
Program, those Accounts will be maintained for the beneficiary in the
same manner as they had been for the Participant, except (i) the
beneficiary may make no contributions (ii) no loans may be taken
and (iii) no deferred sales charge will be imposed upon withdrawals.
8. Discontinuance of Contributions
Contributions on behalf of all Participants under a Contract or for all
Participants of an employer covered under a Contract may be discontinued
upon notice by the Contract-holder to Prudential. Contributions under
the Contract will also be discontinued for all Participants covered by a
retirement arrangement that is terminated.
On at least 60 days' advance notice to the Contract-holder, Prudential
may elect not to accept any new Participant, or not to accept further
contributions for existing Participants, under a Contract. (Some
Contracts require 90 days' advance notice.)
The discontinuance of contributions on a Participant's behalf does not
otherwise affect his rights under the Contracts. He may make withdrawals
from his Accumulation Account--for transfer, for the purchase of an
annuity or for any other purpose--just as if contributions were still
being made for him. However, if contributions under a Program are not
made for a Participant for a
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specified period of time (24 months in certain states, 36 months in
others) and the total value of his Accumulation Accounts is at or below
a specified amount ($1,000 in certain states, $2,000 in others),
Prudential may elect to cancel those Accumulation Accounts unless
prohibited by the retirement arrangement, and pay the Participant their
value (less the annual account charge) as of the date of cancellation.
9. Transfer Payments
a. Unless restricted by the retirement arrangement under which a
Participant is covered, upon the receipt by Prudential of a duly
completed written transfer request form or properly authorized
telephone transfer request, all or a portion of the Participant's
Accumulation Account in VCA-10, VCA-11, or in any Subaccount of
VCA-24 will be transferred to another Account or Subaccount, fixed
rate option or to a Companion Contract that covers him. There is no
minimum transfer amount. As of the day the transfer request is
received, the Participant's Accumulation Account in the Account or
Subaccount from which the transfer is made will be reduced by the
number of Units obtained by dividing the amount to be transferred by
the Unit Value for that day. If the transfer is made to another
Account or Subaccount as of the same day, the number of Units
credited to the Participant in that Account or Subaccount will be
increased by means of a similar calculation. Prudential reserves the
right to limit the frequency of these transfers. All transfers are
subject to the terms and conditions set forth in this Prospectus and
in the Contract(s) covering a Participant. For example, many
Contracts may preclude transfers from the Companion Contract or
fixed rate option into non-equity investment options that are
defined in the Contract as "competing" with the general account
options in investment characteristics. If such transfers are
precluded, the Contract will further require that amounts
transferred from the Companion Contract or fixed rate option into
non-competing investment options such as a stock fund may not for 90
days thereafter be transferred into a "competing" option.
Different procedures may apply for Contracts under which an entity
other than Prudential provides record-keeping services. See
"Modified Procedures," page 28. Although there is presently no
charge for transfers, Prudential reserves the right to impose such
charges in the future.
b. A Contract may include a provision that, upon discontinuance of
contributions for all Participants under the Contract or for all
Participants of an employer covered under a Contract (see
"Discontinuance of Contributions," above), the Contract-holder may
request Prudential to make transfer payments from VCA-10, VCA-11 or
any Subaccount of VCA-24 to a designated alternate funding agency.
If the Contract is used in connection with certain non-qualified
annuity arrangements, certain tax-deferred annuities subject to
Section 403(b) of the Code, or with IRAs, Prudential will promptly
notify each Participant and each beneficiary of a deceased
Participant for whom an Accumulation Account remains in force under
the Contract-holder's Program that such a request has been received.
Within thirty days of receipt of such notice, each recipient may
elect in writing on a form approved by Prudential to have his
Account in VCA-10, VCA-11 or any Subaccount of VCA-24, transferred
to the alternate funding agency. If he does not so elect, his
Accounts will continue in force under the Contract. The Accumulation
Account of any Participant or beneficiary who does so elect will be
cancelled as of a "transfer date," which is the business day
specified in the Contract-holder's request or 90 days after
Prudential receives the request, whichever is later. The product
of the Units in the Participant's Accumulation Accounts immediately
prior to cancellation and the appropriate Unit Value on the transfer
date, less the applicable deferred sales and annual account charges,
will be transferred to the designated funding agency in cash,
securities held in VCA-10 and VCA-11, or both.
c. Contributions may be discontinued for all Participants under a
Contract or for all Participants of an employer covered under the
Contract used in connection with a deferred compensation plan
subject to Section 457 of the Code due to certain circumstances,
such as a change in any law or regulation, which would have an
adverse effect on Prudential in fulfilling the terms of the
Contract. If contributions are so discontinued, Prudential may
initiate transfer payments from VCA-10, VCA-11 or any Subaccount of
VCA-24 to an alternate funding agency. The transfer would be made as
described in paragraph b. above.
Under certain types of retirement arrangements, the Retirement
Equity Act of 1984 requires that in the case of a married
Participant, certain requests for transfer payments (other than
those described in paragraph a. above) must include the consent of
the Participant and spouse and must be notarized or witnessed by an
authorized plan representative.
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10. Telephone Requests
Certain Programs may allow Participants to effect transfers and other
Account transactions by telephone and telecopy. If the Program offers
telephone privileges, each Program Participant will automatically
receive such privileges unless he declines those privileges on a form
that will be supplied by the Contract-holder or Prudential. For the
Participant's protection and to prevent unauthorized exchanges,
telephone calls will be recorded and the Participant will be asked to
provide his personal identification number or other identifying
information. A written confirmation of a transfer will be sent to the
Participant. Neither the Accounts nor their agents will be liable for
any loss, liability or cost which results from acting upon instructions
reasonably believed to be genuine under the foregoing procedures.
Telephone privileges are available only if the Contract-holder has so
elected and only in states where these privileges may legally be
offered. The safeguards discussed above that are employed by the
Accounts are designed to minimize unauthorized exercise of these
privileges. During times of extraordinary economic or market changes,
telephone privileges or telecopied instructions may be difficult to
implement.
11. Exchange Offer Into MEDLEY from VCA-2
Certain Contract-holders in The Prudential Variable Contract Account-2
("VCA-2") may be offered an opportunity to exchange their retirement
program's investment in VCA-2 for Units of VCA-10, VCA-11 or the
Subaccounts of VCA-24.
Participants in plans of VCA-2 Contract-holders that accept this
exchange offer have the option of exchanging their interests in VCA-2
for interests in VCA-10 and VCA-11 or any of the Subaccounts of VCA-24.
In such an exchange, any years of participation credited to those VCA-2
Participants under VCA-2 contracts will be counted as years of MEDLEY
Program participation. In addition, no deferred sales charge will be
applied to withdrawals from VCA-10, VCA-11 or the Subaccounts of VCA-24
until a Participant has withdrawn an amount of contributions equal to
the amount transferred from VCA-2.
12. Exchange Offer with the PMF Funds
Prudential may offer certain open-end management investment companies --
generally referred to as mutual funds -- as an alternative investment
vehicle for existing MEDLEY Contract-holders. These funds are managed by
Prudential Mutual Fund Management, LLC, an indirect wholly-owned
subsidiary of Prudential (collectively, the "PMF Funds"). If the
Contract-holder elects to make one or more of the PMF Funds available to
its Participants, Participants will be given the opportunity to direct
new contributions to those PMF Funds.
Prudential may permit Participants to exchange any or all amounts in
their current variable investment accounts (under VCA-10, VCA-11 or
VCA-24) for shares of the PMF Funds without the imposition of the
deferred sales charge that may otherwise be applicable to withdrawals
from those accounts under the MEDLEY Program (a "MEDLEY-to-PMF
Exchange"). In addition, Prudential may permit Participants to exchange
any or all amounts in their PMF Fund accounts to VCA-10, VCA-11 or
VCA-24 (a "PMF-to-MEDLEY Exchange"). No sales charge or other
transaction charge is imposed at the time of a MEDLEY-to-PMF Exchange or
a PMF-to-MEDLEY Exchange. No deferred sales load will be imposed on the
subsequent withdrawal of interests in VCA-10, VCA-11 or VCA-24 acquired
in a PMF-to-MEDLEY Exchange.
Prudential will determine the time periods for which any exchange offer
will be available. Prudential may, for example, establish fixed periods
of time for exchanges under a particular Contract (an "open window").
Prudential will advise each Contract-holder of the timing of their
particular open window, but all such open windows will be for at least
60 days. Furthermore, any open-ended exchange offer will not be
terminated without 60 days prior notice to the Contract-holder. If a
Participant does not elect to exchange Units of an Account for PMF Funds
shares during an open window, the Participant may subsequently transfer
from an Account to PMF Funds only amounts that are not subject to the
deferred sales charge. This exchange offer is subject to termination and
its terms are subject to change.
If a Participant exchanges all the MEDLEY Program accounts for shares of
PMF Funds, the annual account charge, which is assessed at the end of
each calendar year, may be deducted from the Participant's PMF Fund
account(s).
Before deciding whether to exchange any or all of their existing MEDLEY
accounts for shares of any PMF Fund, Participants should carefully read
the relevant PMF Fund prospectus. Participants should understand that
the PMF Funds are registered management investment companies (i.e.,
mutual funds) offered directly to qualified plans, certain institutional
investors and others. They are not funding vehicles for variable annuity
contracts. Thus, Participants investing in the PMF Funds will not have
the features of an annuity contract, such as a minimum death benefit or
certain annuity-related provisions, as they do under the MEDLEY Program.
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In Prudential's opinion, there should be no adverse tax consequences if
a Participant in a qualified retirement arrangement, in a deferred
compensation plan under Section 457 or in an individual retirement
annuity under Section 408 of the Internal Revenue Code of 1986, as
amended, elects to exchange amounts in the Participants' current MEDLEY
account(s) for shares of PMF Funds or vice versa.
Furthermore, for 403(b) plans, MEDLEY-to-PMF exchanges will be effected
from a 403(b) annuity contract (Tax Deferred Annuity funds under the
MEDLEY Program) to a Section 403(b)(7) custodial account (Tax Deferred
Annuity funds under the PMF Funds) so that such transactions will not
constitute taxable distributions. Conversely, PMF-to-MEDLEY Exchanges
will be effected from a 403(b)(7) custodial account to a 403(b) annuity
contract so that such transactions will not constitute taxable
distributions. However, 403(b) Participants should be aware that there
may be more restrictive rules on early withdrawals from Section
403(b)(7) custodial accounts under the PMF Funds than under the MEDLEY
Program.
Prudential does not intend to extend this exchange offer out of MEDLEY
to Participants under any Non-Qualified Combination Contract issued to a
plan covering employees that share a common employer or are otherwise
associated. Any MEDLEY Contract that is held under a non-qualified
arrangement is subject to taxation as an annuity Contract. Any permitted
exchange of amounts under such MEDLEY Contract to shares of PMF Funds
may be treated for tax purposes as a taxable withdrawal up to the amount
of the investment income earned in the MEDLEY Contract. In addition, the
exchange may constitute a premature withdrawal that is subject to a 10
percent tax penalty of the amount exchanged with is includable in income
(i.e., the investment earnings exchanged). However, if the owner of the
MEDLEY Contract is not a natural person and the investment income on the
Contract is currently taxable each year to such owner, there will be no
added tax incurred if such an owner decides to exchange funds from the
MEDLEY Contract to shares of PMF Funds.
Contract-holders and Participants are encouraged to consult a qualified
tax advisor for complete tax information and advice.
13. Loans
The loans described in this Section are generally available to
Participants in 401(a) plans and 403(b) programs. Loans may also be
available to Participants in 457 plans. The interest rate and other
terms and conditions of the loan may vary from program to program. For
plans that are subject to ERISA it is the responsibility of the program
trustee or fiduciary to ensure that the interest rate and other terms
and conditions of the loan comply with all program qualification
requirements including the ERISA regulations. In addition to the loans
described in this section, Participants in 403(b) programs may also be
able to obtain loans under their Companion Contract and should consult
their employer or Prudential.
The loans described in this section, which involve the variable
investment options, work as follows. The minimum loan amount is as
specified in the Participant's Program, or if not specified, as
determined by Prudential. The maximum loan amount is the lesser of (a)
$50,000, reduced by the highest outstanding balance of loans during the
one-year period immediately preceding the date of the loan or (b) 50% of
the value of the Participant's vested interest in his or her
Accumulation Accounts. In the loan application, the Contract-holder (or
in certain cases, the Participant) designates the Accumulation
Account(s) from which the loan amount is deducted. Borrowing, therefore,
reduces a Participant's Accumulation Accounts. To repay the loan, the
Participant makes periodic payments of interest plus a portion of
principal. Those payments are invested in the Accounts or Subaccounts
chosen by the Participant. The Participant's Program may specify the
Accumulation Accounts from which he may borrow and into which repayments
may be invested.
The maximum loan amount referred to above is imposed by federal tax law.
That limit, however, applies to all loans from any qualified retirement
plan of the employer. Since Prudential cannot monitor a Participant's
loan activity relating to other plans offered to Participants, it is the
Participant's responsibility to do so. Provided that a Participant
adheres to these limitations, the loan will not be treated as a taxable
distribution. If, however, the Participant defaults on the loan by, for
example, failing to make required payments, the defaulted loan amount
(as described in loan disclosure information provided to a borrowing
Participant) will be treated as a taxable distribution and Prudential
will send the appropriate tax information to the Participant and the
Internal Revenue Service. For information as to how the deferred sales
charge applies to loans, see "Deferred Sales Charge." pages 17-18.
Prudential charges a loan application fee of up to $75, which is
deducted from a Participant's Accumulation Accounts at the time the loan
is initiated. Prudential will not accept a personal check as payment of
the loan application fee. Prudential also charges up to $25 per year as
a
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loan maintenance fee for recordkeeping and other administrative services
provided in connection with the loan. This charge is guaranteed not to
increase during the term of any loan. This annualized loan maintenance
charge will be prorated based on the number of full months that the loan
is outstanding and is generally deducted quarterly. The Accumulation
Account from which this charge is deducted is determined in the same
manner as with the annual account charge. See "Annual Account Charge,"
pages 18-19.
14. Modified Procedures
Under certain Contracts, the Contract-holder or a third party acting on
their behalf provides record-keeping services that would otherwise be
performed by Prudential. Such Contracts may require procedures somewhat
different than those set forth in this Prospectus. For example, such
Contracts may require that contribution allocation requests, withdrawal
requests, and/or transfer requests be directed to the Contract's
record-keeper rather than Prudential. The record-keeper is the
Contract-holder's agent, not Prudential's agent. Accordingly,
transactions will be processed and priced as of the end of the valuation
period in which Prudential receives appropriate instructions and/or
funds from the record-keeper. Any such different procedures will be set
forth in the Contract.
These contracts may have modified deferred sales charges and annual
account charges. See "Modification of Charges," page 19.
The Annuity Period
1. Electing the Annuity Date and the Form of Annuity
Subject to the restrictions on withdrawals from tax-deferred annuities
subject to Section 403(b) of the Code, (see "Withdrawal (Redemption) of
Contributions," pages 21-22), and subject to the provisions of the
retirement arrangement that covers him, a Participant may elect at any
time to have all or a part of his interest in VCA-10, VCA-11 or any
Subaccount of VCA-24 used to purchase a fixed-dollar annuity under the
Contracts. The Contracts do not provide for annuities that vary with the
investment results of VCA-10, VCA-11 or any Subaccount of VCA-24.
Withdrawals from VCA-10, VCA-11 or any Subaccount of VCA-24 that are
used to purchase a fixed-dollar annuity under the Contracts become part
of Prudential's general account, which supports insurance and annuity
obligations. Similarly, amounts allocated to the Companion Contract or
the fixed rate option under a Combination Contract become part of
Prudential's general account. Because of exemptive and exclusionary
provisions, interests in the general account have not been registered
under the Securities Act of 1933 ("1933 Act") nor is the general account
registered as an investment company under the 1940 Act. Accordingly,
neither the general account nor any interests therein are generally
subject to the provisions of the 1933 or 1940 Acts and we have been
advised that the staff of the Securities and Exchange Commission has not
reviewed the disclosures in this Prospectus which relate to the
fixed-dollar annuity that may be purchased under the Contracts.
Disclosures regarding the fixed-dollar annuity and the general account,
however, may be subject to certain generally applicable provisions of
the federal securities laws relating to the accuracy and completeness of
statements made in prospectuses.
In electing to have an annuity purchased, the Participant may select
from the forms of annuity described below, unless the retirement
arrangement covering him provides otherwise. The annuity is purchased on
the first day of the month following receipt by Prudential of proper
written notice on a form approved by Prudential that the Participant has
elected to have an annuity purchased, or on the first day of any
subsequent month that the Participant designates. The first monthly
annuity payment generally will be made within one month of the date on
which the annuity is purchased.
Under certain types of retirement arrangements, the Retirement Equity
Act of 1984 requires that in the case of a married Participant, certain
elections of payouts which are not qualified joint and survivor
annuities must include the consent and signatures of the Participant and
spouse and must be notarized or witnessed by an authorized plan
representative. A "qualified joint and survivor annuity" is an annuity
for the Participant's lifetime with at least 50% of the amount payable
to the Participant continued after his death to his spouse, if then
living.
If the dollar amount of the first monthly annuity payment is less than
the minimum amount specified in the Contract, Prudential may, at its
option and in lieu of making any annuity payment whatsoever, pay the
person who would receive the annuity a one-sum cash payment in the
amount that would otherwise have been applied to purchase the annuity.
Once annuity payments begin, the annuitant cannot surrender his annuity
benefit and receive a one-sum payment in lieu thereof.
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2. Available Forms of Annuity
Option 1--Life annuity with payments certain. This is an immediate
annuity payable monthly during the lifetime of the annuitant with the
guarantee that if, at the death of the annuitant, payments have been
made for less than the period-certain (which may be 60, 120, 180 or 240
months, as selected by the annuitant), they will be continued during the
remainder of the selected period to his beneficiary.
Option 2--Annuity-certain. This is an immediate annuity payable monthly
for a period-certain which may be 60, 120, 180 or 240 months, as
selected by the annuitant. If the annuitant dies during the
period-certain, payments in the same amount the annuitant was receiving
will be continued to his beneficiary, but no further payments are
payable after the end of the period-certain.
Option 3--Joint and survivor annuity with payments certain. This is an
immediate annuity payable monthly during the lifetime of the annuitant
with payments continued after his death to his contingent annuitant, if
surviving, for the latter's lifetime. Until the selected number of
payments certain have been paid, payments made to the contingent
annuitant after the annuitant's death are the same as those the
annuitant was receiving. Thereafter, the payments continued to the
contingent annuitant will be a percentage of the monthly amount paid to
the annuitant such as 33%, 50%, 66% or 100% as selected by the annuitant
(the amounts of each payment made to the annuitant will be lower as the
percentage he selects to be paid to the contingent annuitant is higher).
If both the annuitant and the contingent annuitant die during the
period-certain (which may be 60, 120, 180 or 240 months, as selected by
the annuitant), payments will be continued during the remainder of the
period-certain to the properly designated beneficiary.
Other forms of annuity may be available under the Contracts. The
retirement arrangement under which the Participant is covered may
restrict the forms of annuity that a Participant may elect.
If the dollar amount of the first monthly payment to a beneficiary is
less than the minimum amount specified in the Contract, or if the
beneficiary is other than a natural person receiving payments in his own
right, Prudential may elect to pay the commuted value of the unpaid
payments-certain in one sum.
3. Purchasing the Annuity
No deferred sales charge is deducted from contributions withdrawn to
purchase an annuity. If, as a result of a withdrawal to purchase an
annuity, all of the Participant's Accumulation Accounts under the
Program are reduced to zero, the full annual account charge is deducted,
unless the annuity becomes effective on January 1 of any year. The
resulting amount, less any applicable taxes on annuity considerations,
is applied to the appropriate annuity purchase rate determined in
accordance with the schedule in the Contract at the time the annuity is
purchased. However, Prudential may determine monthly payments from
schedules of annuity purchase rates providing for larger payments than
the rates shown in the Contract.
The schedule of annuity purchase rates in a Contract is guaranteed by
Prudential for ten years from the date the Contract is issued. If at any
time after a Contract has been in effect for ten years, the schedule of
annuity purchase rates is modified, the modification is also guaranteed
for ten years. A change in the schedule of annuity purchase rates used
for an annuity-certain with 180 payments or less, as described in Option
2, will apply only to amounts added to a Participant's Accumulation
Account after the date of change. A change in any other schedule will
apply to all amounts in a Participant's Accumulation Account.
Assignment
Unless contrary to applicable law, the right to any payment under the Contract
is neither assignable nor subject to the claim of any creditor.
Changes in the Contracts
Some contracts provide that after it has been in effect for two years Prudential
may change the annual account charge and the table of deferred sales charges.
Any change in the table of deferred sales charges generally will apply only to
the withdrawal of those contributions made on or after the date the change takes
effect. For this purpose, contributions shall be deemed to be withdrawn on a
first-in, first-out basis.
Some Contracts also provide that after it has been in effect for five years
Prudential may change the deduction from assets of VCA-10, VCA-11 or any
Subaccount of VCA-24 for administrative expenses, the terms and conditions under
which a deferred sales charge is made, the minimum amount of any contribution to
VCA-10, VCA-11 or any Subaccount of VCA-24 that is made other than on a regular,
periodic basis and the terms and amount of any transfer or withdrawal, provided,
however, that any such change must be permissible under the provisions of the
1940 Act. The changes described in this paragraph will apply to all amounts in
Participants' Accumulation Accounts, whether credited before or after the change
is made.
The changes discussed in the preceding two paragraphs may not become effective
earlier than 90 days after
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notice of them has been sent to the Contract-holder and to each person to whom
the change applies who has an Accumulation Account under the Contract, other
than persons covered by a Contract used in connection with deferred compensation
plans under Section 457 of the Code and persons covered by a Contract used in
connection with non-qualified annuity arrangements.
Some Contracts permit the periodic revision of annuity purchase rates. The
Contracts permit Prudential to change the Contract if Prudential deems it
appropriate to conform to the requirements of any law or regulation.
A Contract may be changed at any time by agreement between Prudential and the
Contract-holder; however, no change may be made that adversely affects rights
with respect to annuities purchased before the effective date of the change,
unless the consent of each affected annuitant is obtained.
Prudential reserves the right to substitute the shares of any other registered
investment company for the shares of the Fund held in any of the Subaccounts of
VCA-24. Current law requires approval by the Securities and Exchange Commission
and notification to the holders of the Contracts of any such substitution.
Prudential also reserves the right to operate VCA-24 as a different form of
registered investment company or as an unregistered entity, to transfer the
Contracts to a different separate account, or to discontinue any of the
Subaccounts of the Account, all to the extent permitted by applicable law.
Prudential may also amend any Contract to the extent necessary to comply with
any applicable law or regulation.
Reports
Participants will be sent, at least annually, reports showing as of a specified
date the number of Units credited to them in VCA-10, VCA-11 and in the
Subaccounts of VCA-24. Each Participant will also be sent semi-annual reports
showing the financial condition of the Accounts and the Subaccounts with their
corresponding Fund Portfolios, and the investments held in each.
Performance Information
Performance information for VCA-10, VCA-11, and the Subaccounts of VCA-24 may
appear in advertising and reports to current and prospective Contract-holders
and Participants. Performance information is based on historical investment
experience of those investment options and does not indicate or represent future
performance.
Total returns are based on the overall dollar or percentage change in value of a
hypothetical investment. Total return quotations reflect changes in unit values
and the deduction of applicable charges.
A cumulative total return reflects performance over a stated period of time. An
average annual total return reflects the hypothetical annually compounded return
that would have produced the same cumulative total return if the performance had
been constant over the entire period.
VCA-11 may also advertise its current and effective yield. Current yield
reflects the income generated by an investment in VCA-11 over a specified
seven-day period. Effective yield is calculated in a similar manner except that
income earned is assumed to be reinvested.
Comparative performance information may from time to time be included in reports
or advertising, including, but not limited to, data from Morningstar, Inc.,
Lipper Analytical Services, Inc., the Standard & Poor's 500 Composite Price
Index, Lehman Brothers indices and other commonly used indices or industry
publications.
See "Performance Information" in the Statement of Additional Information for
recent performance information.
Participation in divisible surplus
A mutual life insurance company differs from a stock life insurance company in
that it has no stockholders who are the owners of the enterprise. Accordingly, a
Contract-holder of Prudential participates in the divisible surplus of
Prudential, according to the annual determination of Prudential's Board of
Directors as to the portion, if any, of the divisible surplus which has accrued
on the Contract. In the case of the Contracts described in this Prospectus, any
surplus determined to be payable as a dividend is credited to Participants. No
assurance can be given as to the amount of divisible surplus, if any, that will
be available for distribution under these Contracts in the future. There were no
payments of divisible surplus made under the Contracts in 1996, 1995 or 1994.
FEDERAL TAX STATUS
The following discussion is general in nature. It is not intended as tax advice.
Nor does it consider any applicable state or other tax laws. A qualified tax
adviser should be consulted for complete information and advice.
Taxes on Prudential. The Accounts are not considered separate taxpayers for
purposes of the Internal Revenue Code. As distinguished from most other
registered investment companies--which are separate taxpayers--the earnings of
the Accounts (and Subaccounts) are taxed as part of the income of Prudential. No
charge is being made currently to the Accounts or the Subaccounts for company
federal income taxes. Prudential will review periodically the question of a
charge to the Account or Subaccounts for company federal income taxes
attributable to the Contracts. Such a charge may be made in future years for any
federal income taxes attributable to the Contracts.
Qualified Retirement Arrangements Using the Contracts. The Contracts may be used
in connection with qualified pension and profit sharing plans, plans established
by self-employed persons ("Keogh plans"), simplified employee pension plans
("SEPS"), individual retirement
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plan accounts ("IRAs"), and retirement programs for certain persons known as
Section 403(b) annuity plans.
The provisions of the Code that apply to the retirement arrangements that may be
funded by the Contracts are complex and Participants are advised to consult a
qualified tax adviser. In general, however, assuming that the requirements and
limitations of the provisions of the Code applicable to the particular type of
plan are adhered to by Participants and employers, contributions made under a
retirement arrangement funded by a Contract are deductible (or not includible in
income) up to certain amounts each year. Further, under the retirement programs
with which the Contracts may be used, Federal income tax currently is not
imposed upon the investment income and realized gains earned by the Accounts and
Subaccounts in which the contributions have been invested until a distribution
or withdrawal is received. When a distribution or withdrawal is received, either
as a lump sum, an annuity or as regular payments in accordance with a systematic
withdrawal arrangement, all or a portion of the distribution or withdrawal is
normally taxable as ordinary income. In some cases, the tax on lump sum
distributions may be limited by a special income-averaging rule. The effect of
Federal income taxation depends largely upon the type of retirement plan and a
generalized description, beyond that given here, is not particularly useful.
Careful review of the provisions of the Code applicable to the particular type
of plan is necessary.
As noted above, withdrawals or distributions are taxable. Furthermore, premature
distributions or withdrawals may be subject to a penalty tax. Participants
contemplating a withdrawal should consult a qualified tax adviser. In addition,
Federal tax laws impose restrictions on withdrawals from Section 403(b)
annuities. See "Withdrawal (Redemption) of Contributions," pages 21-22.
Distributions are subject to certain minimum distribution requirements.
The Contracts may be used in connection with deferred compensation plans that
meet the requirements of Section 457 of the Code. The tax rules for such plans
involve, among other things, limitations on contributions and minimum
distribution requirements. Tax-exempt organizations or governmental employers
considering the use of the Contracts to fund or otherwise provide deferred
compensation to their employees should consult with a qualified tax adviser
concerning the applicability of Section 457 to their plans as well as the
specific requirements. Reference is also made to the discussion below of Section
72(u) of the Code which may be applicable in certain circumstances.
Subject to the exceptions discussed below with respect to Section 403(b) annuity
plans and certain governmental or church plans, distributions from IRAs,
qualified retirement arrangements and deferred compensation plans that meet the
requirements of Section 457 of the Code must begin by April 1 of the calendar
year following the year in which the Participant attains age 70 1/2.
Distributions from a Section 403(b) annuity plan attributable to benefits
accruing after December 31, 1986 and distributions from certain governmental or
church plans and qualified retirement arrangements must begin by April 1 of the
calendar year following the later of (i) the calendar year in which the
Participant attains age 70 1/2 or (ii) the calendar year in which the
Participant retires. In any case, distributions that are made after this
required beginning date generally must be made in the form of an annuity for the
life of the Participant or the lives of the Participant and his designated
beneficiary, or over a period that is not longer than the life expectancy of the
Participant or the life expectancies of the Participant and his designated
beneficiary.
Distributions to beneficiaries are also subject to minimum distribution rules.
If a Participant dies before his entire interest in his Accumulation Account(s)
has been distributed, his remaining interest must be distributed at least as
rapidly as under the method of distribution being used as of the date of death.
If the Participant dies before distributions have begun (or are treated as
having begun) the entire interest in his Accumulation Accounts must be
distributed by December 31 of the calendar year containing the fifth anniversary
of the Participant's death. Alternatively, if there is a designated beneficiary,
the designated beneficiary may elect to receive payments beginning no later than
December 31 of the calendar year immediately following the year in which the
Participant dies and continuing for the beneficiary's life or a period not
exceeding the beneficiary's life expectancy (except that with respect to
distributions from a deferred compensation plan subject to Section 457 of the
Code, such period cannot exceed 15 years). Special rules apply to the spouse of
a deceased Participant.
In addition to the above rules, with respect to a deferred compensation plan
subject to Section 457 of the Code, any distribution that is payable over a
period of more than one year can only be made in substantially non-increasing
amounts no less frequently than annually.
An excise tax applies to Participants or beneficiaries who fail to take the
minimum distribution in any calendar year.
Non-qualified Arrangements Using the Contracts. The Contracts constitute
variable annuity contracts. Accordingly, no tax should be payable by a
Participant as a result of any increase in the value of his share of the
investment income and realized gain earned by the Account or Subaccount in which
his accumulated premium payments are held. Generally, amounts are taxed when
received, either as an annuity or as a withdrawal before the annuity starting
date. For these purposes, loans against the Contracts or the pledging of the
Contracts are treated as withdrawals.
Amounts withdrawn before the annuity starting date are treated for tax purposes
first as being withdrawals of investment income, rather than withdrawals of
premium payments, until all investment income earned by a Participant's Account
or Subaccount has been withdrawn. Thus, a Participant will be taxed on the
amount he
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withdraws before he starts receiving annuity payments to the extent that the
cash value of his Contract, unreduced by the withdrawal charge, exceeds his
premium payments.
In addition to the ordinary income tax, the Code further provides that premature
withdrawals that are includible in income will be subject to a penalty tax. The
amount of the penalty is 10 percent of the amount withdrawn that is includable
in income. Some withdrawals will be exempt from the penalty. These include
withdrawals (1) made on or after the date on which the Participant reaches age
59 1/2, (2) made on or after the death of the Participant, (3) attributable to
the Participant becoming disabled (as defined in Code Section72(m)), (4) in the
form of level annuity payments under a lifetime annuity, or (5) in the form of
substantially equal periodic payments (made at least annually) for the life
expectancy of the Participant or the joint life expectancies of the Participant
and his designated beneficiary.
Different tax rules apply to the receipt of annuity payments or regular payments
in accordance with a systematic withdrawal arrangement by a Participant after
the annuity starting date. A portion of each payment he receives under a
Contract will be treated as a partial return of his post-tax premium payments,
if any, and will not be taxable. The remaining portion of the payment will be
taxed as ordinary income. Exactly how each payment is divided into taxable and
nontaxable portions depends upon (i) the period over which annuity payments are
expected to be received, which in turn is governed by the form of annuity
selected and, where a lifetime annuity is chosen, by the life expectancy of the
annuitant, payee or, in the case of a joint and survivor life annuity, payees,
or (ii) whether you elect to have regular payments made in accordance with a
systematic withdrawal plan over a fixed period of time or in fixed dollar
amounts. Once a Participant has recovered all his premium payments, the balance
of the annuity payments will be fully taxable.
Certain minimum distribution requirements apply in the case where the
Participant dies before the entire interest in his annuity has been distributed.
Further, certain transfers of an annuity for less than full compensation, e.g.,
certain gifts, will trigger tax on the gain in the Contract.
Special rules under section 72(u) of the Code apply to the Contracts if held by
a person who is not a natural person and if not covered by one of several
exceptions. Under these rules, if a Contract is held by a corporation,
partnership, trust or similar nonnatural person, the income on the Contract each
year is treated as ordinary income received or accrued that year by the owner of
the Contract. Income on the contract is the excess of the sum of the net
surrender value of the Contract at the end of the taxable year plus any amounts
distributed for all years over the aggregate amount of premiums paid under the
Contract minus premiums paid and amounts received under the Contract that have
been included in income. Exceptions to these rules include contracts held by a
nonnatural person as an agent for a natural person, contracts acquired by an
estate by reason of the death of the decedent, contracts held under a qualified
pension or profit sharing plan, a Section 403(b) annuity plan or individual
retirement plan (see discussion above) or contracts which provide for immediate
annuities.
Withholding. Generally, under a nonqualified annuity arrangement, or individual
retirement account or individual retirement annuity, unless a Participant elects
to the contrary, any amounts that are received under his Contract that
Prudential reasonably believes are includable in gross income tax for tax
purposes will be subject to withholding to meet Federal income tax obligations.
In the absence of an election by a Participant that Prudential should not do so,
it will withhold from every withdrawal or annuity payment the appropriate
percentage of the amount of the payment that Prudential reasonably believes is
subject to withholding. In addition, certain distributions from qualified plans
under Section401 or Section 403(b) of the Code, which are not directly rolled
over or transferred to another eligible qualified plan, are subject to a
mandatory 20% withholding for federal income tax. The 20% withholding
requirement does not apply to: (a) distributions for the life or life expectancy
of the participant, or joint and last survivor expectancy of the participant and
a designated beneficiary; or (b) distributions for a specified period of ten
years or more; or (c) distributions which are required as minimum distributions.
Accordingly, a Participant would be well-advised to check the Contract-holder's
retirement arrangement and consult with appropriate tax advisers regarding the
current state of the law before making a withdrawal. Prudential will provide
forms and instructions concerning withholding. However, amounts that are
received under a Contract used in connection with a plan that is subject to
Section 457 of the Code are treated as wages for Federal income tax purposes and
are, thus, subject to general withholding requirements.
VOTING RIGHTS
Except for Participants and beneficiaries under certain Contracts used in
connection with certain non-qualified annuity arrangements and deferred
compensation plans established under Section 457 of the Internal Revenue Code,
each person who has an Accumulation Account in VCA-10 or VCA-11, as the case may
be, has the right to vote at meetings of Participants in that Account, and
Prudential will vote the shares of the Fund that it holds in any Subaccount of
VCA-24 in the manner directed by persons who have Accumulation Accounts in that
Subaccount. If the Participants under a contract issued in connection with a 457
plan do not have voting rights, then the Contract-holder will have the voting
rights.
Persons having voting rights with respect to VCA-10 and VCA-11 are entitled to
vote in connection with the election of the members of an Account's Committee.
Committee members are not elected annually. All Committee members elected by
persons having voting rights are elected
31
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for indefinite terms. Vacancies may be filled by a majority vote of all the
remaining Committee members, provided that immediately after filling any such
vacancy, at least two-thirds of the members then holding office shall have been
elected by persons having voting rights. Members elected by a Committee, rather
than by persons having voting rights, only hold their positions until the next
meeting of persons having voting rights in respect to such Account. At that next
meeting, persons with voting rights fill the vacancy by electing a member for an
indefinite term.
In addition, persons having VCA-10 and VCA-11 voting rights are entitled to vote
in connection with:
a. any amendments of the investment management agreement between Prudential
and the Account and any such new agreements negotiated by the Committee;
b. any changes in the fundamental investment policies of the Account; and
c. any other matter requiring a vote of VCA-10 and VCA-11 Participants.
Instructions to Prudential for the voting of Fund shares will involve the
following matters: (1) election of the Board of Directors of the Fund; (2)
ratification of the independent accountant for the Fund; (3) approval of the
investment advisory agreement for the Fund; (4) any change in the fundamental
investment policy of a Portfolio in which assets of a Subaccount of VCA-24 are
invested; and (5) any other matter requiring a vote of the shareholders of the
Fund. With respect to approval of the investment advisory agreement or any
change in a Portfolio's fundamental investment policy, Participants with
Accumulation Accounts in a Subaccount the assets of which are invested in such
Portfolio will vote with other holders of shares in such Portfolio on the
matter, pursuant to the requirements of Rule 18f-2 under the 1940 Act.
The number of votes which a person may cast at meetings of Participants in
VCA-10 or VCA-11 is equal to the number of dollars in the Account and fractions
thereof credited to him, or, in the case of holders of Contracts used in
connection with deferred compensation plans under Section 457 of the Code where
the Contract-holder has the voting rights, the number of dollars and fractions
thereof that are credited to the Participants under that Contract, as of the
record date.
Prudential is entitled to vote the number of votes and fractions thereof equal
to the number of dollars and fractions thereof of its own funds invested in
either VCA-10 or VCA-11 as of the record date. Prudential will cast its votes in
the same proportions as all other votes represented at the meeting, in person or
by proxy.
Meetings of Participants are not required to be held annually. The Rules and
Regulations of both VCA-10 and VCA-11 provide that meetings of persons having
voting rights may be called by a majority of the Committee. An Account's
Committee is required to call a meeting of persons having voting rights in the
event that at any time less than a majority of the members of such Committee
holding office at that time were elected by persons having voting rights. Such
meeting must be held within 60 days unless the Securities and Exchange
Commission by order extends such period. In addition, the Committee is required
to call meetings of persons with voting rights in order to submit for a vote
matters on which such persons are entitled to vote (as listed above).
For the purpose of determining the persons having voting rights in respect of an
Account who are entitled to notice of and to vote at such meetings, the
Committee may fix, in advance, a record date which shall not be more than 70 nor
less than 10 days before the date of the meeting.
Votes may be cast either in person or by proxy. Persons entitled to vote will
receive all proxy materials.
Each person having an Accumulation Account in a Subaccount of VCA-24 may give
voting instructions to Prudential equal to the number of Fund shares represented
by the Subaccount Units in his Accumulation Account. Prudential will vote the
shares of the Fund that are attributable to assets of its own that it maintains
in the Subaccount, or to any shares as to which it has not received
instructions, in the same manner and proportion as the shares for which it has
received instructions.
The number of votes for which each person may give Prudential instructions will
be determined as of the record date for Fund shareholders chosen by the Board of
Directors of the Fund. Prudential will furnish Participants with proper forms
and proxies to enable them to give it these instructions.
As defined by the 1940 Act and as referred to elsewhere in this Prospectus, a
majority vote of persons having voting rights in respect of VCA-10, VCA-11 or
the Fund means (a) 67% or more of the votes of such persons present at a meeting
if more than 50% of all votes entitled to be cast are held by persons present in
person or represented by proxy at such meeting, or (b) more than 50% of all
votes entitled to be cast, whichever is less.
OTHER CONTRACTS ON A
VARIABLE BASIS
In addition to the Contracts, Prudential currently issues other forms of
contracts on a variable basis. At present, contributions under such other
contracts are not held in VCA-10, VCA-11 or any Subaccount of VCA-24 but are
held in other separate accounts.
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STATE REGULATION
Prudential is subject to regulation by the Department of Insurance of the State
of New Jersey as well as by the insurance departments of all the other states
and jurisdictions in which it does business. Prudential must file an annual
statement in a form promulgated by the National Association of Insurance
Commissioners. This annual statement is reviewed and analyzed by the New Jersey
Department, which makes an independent computation of Prudential's legal reserve
liabilities and statutory apportionments under its outstanding contracts. New
Jersey law requires a quinquennial examination of Prudential to be made.
Examination involves extensive audit including, but not limited to, an inventory
check of assets, sampling techniques to check the performance by Prudential of
its contracts and an examination of the manner in which divisible surplus has
been apportioned and distributed to policyholders and contract-holders. This
regulation does not involve any supervision or control over the investment
policies of either Account or over the selection of investments for them, except
for verification of the compliance of Prudential's investment portfolio with New
Jersey law. See "Investment restrictions imposed by state law," in the Statement
of Additional Information.
The laws of New Jersey also contain special provisions which relate to the
issuance and regulation of contracts on a variable basis. These laws set forth a
number of mandatory provisions which must be included in contracts on a variable
basis and prohibit such contracts from containing other specified provisions. No
variable contract may be issued for delivery in New Jersey prior to the written
acknowledgement by the Department of Insurance of its filing. The Department may
initially disapprove or subsequently withdraw approval of any contract if it
contains provisions which are "unjust, unfair, inequitable, ambiguous,
misleading, likely to result in misrepresentation or contrary to law." Approval
can also be withheld or withdrawn if sales are solicited by communications which
involve misleading or inadequate descriptions of the provisions of the contract.
In addition to the annual statement referred to above, Prudential is required to
file with New Jersey and other states a separate statement with respect to the
operations of all its variable contracts accounts, in a form promulgated by the
National Association of Insurance Commissioners.
LEGAL PROCEEDINGS
Several actions have been brought against Prudential on behalf of those persons
who purchased life insurance policies based on complaints about sales practices
engaged in by Prudential, certain insurance companies affiliated with Prudential
and agents appointed by Prudential and such companies.
Prudential is engaged in routine litigation of various kinds which in its
judgment is not of material importance in relation to its total assets.
There is no litigation pending the outcome of which might have a material effect
on the operations of VCA-10, VCA-11, VCA-24 or the Fund.
33
<PAGE>
ADDITIONAL INFORMATION
Registration statements under the Securities Act of 1933 have been filed with
the Securities and Exchange Commission with respect to the Contracts. This
Prospectus does not contain all the information set forth in the registration
statements, certain portions of which have been omitted pursuant to the rules
and regulations of the Commission. The omitted information may be obtained from
the Commission's principal office in Washington, D.C. upon payment of the fees
prescribed by the Commission.
For further information, you may also contact Prudential's office, the address
and telephone number of which are set forth on the cover of this Prospectus.
A copy of the Statement of Additional Information prepared by Prudential, which
provides more detailed information about the Contracts, may be obtained without
charge by calling Prudential at the number set forth on the cover of this
Prospectus. The Statement includes:
TABLE OF CONTENTS--STATEMENT OF ADDITIONAL INFORMATION
Page
INVESTMENT MANAGEMENT AND ADMINISTRATION OF VCA-10, VCA-11 AND VCA-24 ..... 2
Investment restrictions adopted by VCA-10 and VCA-11 ..................... 3
Investment restrictions imposed by state law ............................. 4
Loans of portfolio securities ............................................ 4
Portfolio turnover rate .................................................. 5
Portfolio brokerage and related practices ................................ 5
Custody of securities .................................................... 6
Options and Futures ...................................................... 6
Performance Information .................................................. 10
THE VCA-10 AND VCA-11 COMMITTEES .......................................... 12
VCA-10 Committee ......................................................... 12
VCA-11 Committee ......................................................... 12
Remuneration of Members of the Committees and
Certain Affiliated Persons ............................................. 13
DIRECTORS AND OFFICERS OF PRUDENTIAL ...................................... 14
SALE OF THE CONTRACTS ..................................................... 17
EXPERTS ................................................................... 17
FINANCIAL STATEMENTS OF VCA-10 ............................................ 18
FINANCIAL STATEMENTS OF VCA-11 ............................................ 27
FINANCIAL STATEMENTS OF VCA-24 ............................................ 35
FINANCIAL STATEMENTS OF THE PRUDENTIAL .................................... 42
34
<PAGE>
APPENDIX
Some of the terms used in this Prospectus to describe the investment objective
and policies of VCA-11 are further explained below.
The term "money market" refers to the marketplace composed of the financial
institutions which handle the purchase and sale of liquid, short-term,
high-grade debt instruments. The money market is not a single entity, but
consists of numerous separate markets, each of which deals in a different type
of short-term debt instrument. These include U.S. government obligations,
commercial paper, certificates of deposit and bankers' acceptances, which are
generally referred to as money market instruments.
"U.S. Government obligations" are debt securities (including bills, certificates
of indebtedness, notes, and bonds) issued by the U.S. Treasury or issued by an
agency or instrumentality of the U.S. government which is established under the
authority of an act of Congress. Such agencies or instrumentalities include, but
are not limited to, the Federal National Mortgage Association, the Federal Farm
Credit Bank, and the Federal Home Loan Bank. Although all obligations of
agencies and instrumentalities are not direct obligations of the U.S. Treasury,
payment of the interest and principal on these obligations is generally backed
directly or indirectly by the U.S. government. This support can range from the
backing of the full faith and credit of the United States, to U.S. Treasury
guarantees, or to the backing solely of the issuing instrumentality itself.
"Bank obligations" include (1) "Certificates of deposit" which are certificates
evidencing the indebtedness of a commercial bank to repay funds deposited with
it for a definite period of time (usually from 14 days to one year);(2)
"Bankers' acceptances" which are credit instruments evidencing the obligation of
a bank to pay a draft which has been drawn on it by a customer. These
instruments reflect the obligation both of the bank and of the drawer to pay the
face amount of the instrument upon maturity; and (3) "Time deposits" which are
non-negotiable deposits in a bank for a fixed period of time.
"Commercial paper" consists of short-term (usually from 1 to 270 days) unsecured
promissory notes issued to finance current operations. Commercial paper ratings
are as follows:
A Prime rating is the highest commercial paper rating assigned by Moody's
Investors Service, Inc. ("Moody's"). Issuers rated Prime are further referred to
by use of numbers 1, 2 and 3 to denote relative strength within this highest
classification. Among the factors considered by Moody's in assigning ratings are
the following: (1) evaluation of the management of the issuer; (2) economic
evaluation of the issuer's industry or industries and an appraisal of
speculative type risks which may be inherent in certain areas; (3) evaluation of
the issuer's products in relation to competition and customer acceptance; (4)
liquidity; (5) amount and quality of long-term debt; (6) trend of earnings over
a period of ten years; (7) financial strength of a parent company and the
relationships which exist with the issuer; and (8) recognition by management of
obligations which may be present or may arise as a result of public interest
questions and preparations to meet such obligations.
Commercial paper rated A by Standard & Poor's Corporation ("S&P") has the
following characteristics as determined by S&P: Liquidity ratios are better than
the industry average; long-term senior debt rating is A or better (in some
cases, BBB credits may be acceptable); the issuer has access to at least two
additional channels of borrowing and basic earnings and cash flow have an upward
trend with allowances made for unusual circumstances. Typically, the issuer's
industry is well established, the issuer has a strong position within its
industry and the reliability and quality of management is unquestioned. Issuers
rated A are further referred to by use of numbers 1, 2 and 3 to denote relative
strength within this highest classification.
"Other corporate obligations" are bonds and notes, loan participations and other
debt obligations created by corporations, banks and other business
organizations, including business trusts. Corporate bond ratings are as follows:
Bonds rated Aa by Moody's are judged by Moody's to be of high quality by all
standards. Together with bonds rated Aaa (Moody's highest rating), they comprise
what are generally known as high-grade bonds. They are rated lower than the best
bond because margins of protection may not be as large as Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may be
other elements present which make the long-term risks appear somewhat larger
than in Aaa securities.
Bonds rated AA by S&P are judged by S&P to be high-grade obligations and, in the
majority of instances, to differ only in small degree from issues rated AAA.
Bonds rated AAA are considered by S&P to be highest grade obligations and
possess the ultimate degree of protection as to principal and interest. As with
AAA bonds, prices of AA bonds move with the long-term money market.
An "NRSRO" is any nationally recognized statistical rating organization
designated by the SEC staff, including Moody's and S&P.
An "eligible security" is either (i) a short-term security that is rated, or has
been issued by an issuer that is rated with respect to comparable securities, in
one of the two highest rating categories for such securities or issuers by two
35
<PAGE>
NRSROs (or by only one NRSRO if it is the only NRSRO that has rated such
security or issuer), or (ii) an unrated short-term security of comparable
quality as determined by the VCA-11 Committee.
A "first tier" security is either (i) an "eligible security" that is rated, or
has been issued by an issuer that is rated with respect to comparable
securities, in the highest rating category for such securities or issuers by two
NRSROs (or by only one NRSRO if it is the only NRSRO that has rated such
security or issuer), or (ii) is an unrated short-term security of comparable
quality as determined by the VCA-11 Committee.
A "second tier" security is any "eligible security" other than a "first tier"
security.
36
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1997
THE MEDLEY(SM) PROGRAM
GROUP VARIABLE CONTRACTS
issued through
THE PRUDENTIAL THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-10 VARIABLE CONTRACT ACCOUNT-11
THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-24
These Contracts are designed for use in connection with retirement arrangements
that qualify for federal tax benefits under Sections 401, 403(b), 408 or 457 of
the Internal Revenue Code of 1986 and with non-qualified annuity arrangements.
Contributions made on behalf of Participants may be invested in The Prudential
Variable Contract Account-10, a separate account primarily invested in common
stocks, in The Prudential Variable Contract Account-11, a separate account
invested in money market instruments, or in one or more of the seven Subaccounts
of The Prudential Variable Contract Account-24. Each Subaccount is invested in a
corresponding Portfolio of The Prudential Series Fund, Inc.
---------------------
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectus, dated May 1, 1997, which is available
without charge upon written request to The Prudential Insurance Company of
America, c/o Prudential Retirement Services, 30 Scranton Office Park, Moosic, PA
18507-1789, or by telephoning 1-800-458-6333.
TABLE OF CONTENTS
Page
INVESTMENT MANAGEMENT AND ADMINISTRATION OF VCA-10, VCA-11 AND VCA-24 .....
Investment restrictions adopted by VCA-10 and VCA-11 .....................
Investment restrictions imposed by state law .............................
Loans of portfolio securities ............................................
Portfolio turnover rate ..................................................
Portfolio brokerage and related practices ................................
Custody of securities ....................................................
Options and Futures ......................................................
PERFORMANCE INFORMATION ...................................................
THE VCA-10 AND VCA-11 COMMITTEES ..........................................
VCA-10 Committee .........................................................
VCA-11 Committee .........................................................
Remuneration of Members of the Committees and
Certain Affiliated Persons .............................................
DIRECTORS AND OFFICERS OF PRUDENTIAL ......................................
SALE OF THE CONTRACTS .....................................................
EXPERTS ...................................................................
FINANCIAL STATEMENTS OF VCA-10 ............................................
FINANCIAL STATEMENTS OF VCA-11 ............................................
FINANCIAL STATEMENTS OF VCA-24 ............................................
FINANCIAL STATEMENTS OF THE PRUDENTIAL ....................................
The Prudential Insurance Company of America
c/o Prudential Retirement Services
30 Scranton Office Park
Moosic, PA 18507-1789
Telephone 1-800-458-6333
================================================================================
[LOGO] Prudential
<PAGE>
INVESTMENT MANAGEMENT
AND ADMINISTRATION OF
VCA-10, VCA-11 and VCA-24
Prudential acts as investment manager for The Prudential Variable Contract
Account-10 ("VCA-10") and The Prudential Variable Contract Account-11 ("VCA-11")
under separate investment management agreements with each of them. Each
Account's assets are invested and reinvested in accordance with its investment
objective and policies, subject to the general supervision and authorization of
the Account's Committee.
The assets of each Subaccount of VCA-24 are invested in a corresponding
portfolio of The Prudential Series Fund, Inc. (the "Fund"). The Prospectus and
the Statement of Additional Information of the Fund describe the investment
management and administration of the Fund and its various portfolios.
Subject to Prudential's supervision, all of the investment management services
provided by Prudential are furnished by its wholly-owned subsidiary, The
Prudential Investment Corporation ("PIC"), pursuant to the service agreement
between Prudential and PIC (the "Service Agreement") which provides that
Prudential will reimburse PIC for its costs and expenses.
PIC is registered as an investment adviser under the Investment Advisers Act of
1940.
Prudential continues to have responsibility for all investment advisory services
under its advisory or subadvisory agreements with respect to its clients.
Prudential's investment management agreement with each of VCA-10 and VCA-11 was
most recently renewed by unanimous vote of the Committees on November 22, 1996
and by the Participants in each Account on September 8, 1983. The Service
Agreement was submitted to and approved by Participants in VCA-10 and VCA-11 on
November 4, 1985 and its annual continuation was most recently approved by
unanimous vote of the VCA-10 and VCA-11 Committees on November 22, 1996. Each
Account's investment management agreement and the Service Agreement will
continue in effect as long as approved at least once a year by a majority of the
non-interested members of the Account's Committee and either by a majority of
each entire Committee or by a majority vote of persons entitled to vote in
respect of the Account. An Account's investment management agreement will
terminate automatically in the event of assignment, and may be terminated
without penalty on 60 days' notice by the Account's Committee or by the majority
vote of persons having voting rights in respect of the Account, or on 90 days'
notice by Prudential.
The Service Agreement will continue in effect as to each Account for a period of
more than two years from its execution only so long as such continuance is
specifically approved at least annually in the same manner as the Agreements for
Investment Management Services between Prudential and the Accounts. The Service
Agreement may be terminated by either party upon not less than thirty days'
prior written notice to the other party, will terminate automatically in the
event of its assignment and will terminate automatically as to an Account in the
event of the assignment or termination of the Agreement for Investment
Management Services between Prudential and the Account. Prudential is not
relieved of its responsibility for all investment advisory services under the
Agreement for Investment Management Services between Prudential and the
Accounts. The Service Agreement provides for Prudential to reimburse PIC for its
costs and expenses incurred in furnishing investment advisory services. For the
meaning of a majority vote of persons having voting rights with respect to an
Account, see "Voting Rights," page 33 of the Prospectus.
Prudential is responsible for the administrative and recordkeeping functions of
VCA-10, VCA-11 and VCA-24 and pays the expenses associated with them. These
functions include enrolling Participants, receiving and allocating
contributions, maintaining Participants' Accumulation Accounts, preparing and
distributing confirmations, statements, and reports. The administrative and
recordkeeping expenses borne by Prudential include salaries, rent, postage,
telephone, travel, legal, actuarial and accounting fees, office equipment,
stationery and maintenance of computer and other systems.
A daily charge is made which is equal to an effective annual rate of 1.00% of
the net value of the assets in VCA-10 and VCA-11. Three quarters of this charge
(0.75%) is for administrative expenses not covered by the annual account charge,
and one quarter (0.25%) is for investment management. During 1996, 1995, and
1994, Prudential received $______, $3,023,169, and $2,608,950, respectively,
from VCA-10 and $_______, $746,306, and $659,492, respectively, from VCA-11 for
administrative expenses and for providing management services.
A daily charge is made which is equal to an effective annual rate of 0.75% of
the net value of the assets in each Subaccount of VCA-24. All of this charge is
for administrative expenses not covered by the annual account charge. During
1996, 1995, and 1994, Prudential received $_______, $4,741,003, and $3,535,163,
respectively, in daily charges for VCA-24.
There is also an annual account charge for administrative expenses of not
greater than $30 assessed against a Participant's Accumulation Account. During
1996, 1995, and 1994, Prudential collected $________, $78,996, and $69,867,
respectively, from VCA-10 and $________, $40,200, and $34,832, respectively,
from VCA-11 in annual account charges. During 1996, 1995, and 1994, Prudential
collected $__________, $147,713, and $139,359, respectively in annual account
charges from VCA-24.
A deferred sales charge is also imposed on certain withdrawals from the Accounts
and Subaccounts. The deferred sales charges imposed on withdrawals from
2
<PAGE>
VCA-10 during 1996, 1995, and 1994, were $________, $146,870, and $24,016,
respectively. The deferred sales charges imposed on VCA-11 withdrawals during
1996, 1995, and 1994, were $_________, $17,399, and $16,777, respectively.
During 1996, 1995, and 1994 the deferred sales charges imposed on withdrawals
from VCA-24 were $___________, $151,147, and $62,145, respectively.
Fundamental investment restrictions adopted by VCA-10
In addition to the investment objective described in the prospectus, the
following investment restrictions are fundamental investment policies of VCA-10
and may not be changed without the approval of a majority vote of persons having
voting rights in respect of the Account.
Concentration in Particular Industries. VCA-10 will not purchase any security
(other than obligations of the U.S. Government, its agencies or
instrumentalities) if as a result: (i) with respect to 75% of VCA-10's total
assets, more than 5% of VCA-10's total assets (determined at the time of
investment) would then be invested in securities of a single issuer, or (ii) 25%
or more of VCA-10's total assets (determined at the time of the investment)
would be invested in a single industry.
Investments in Real Estate-Related Securities. No purchase of or investment in
real estate will be made for the account of VCA-10 except that VCA-10 may buy
and sell securities that are secured by real estate or shares of real estate
investment trusts listed on stock exchanges or reported on the National
Association of Securities Dealers, Inc. automated quotation system ("NASDAQ").
Investments in Financial Futures. No commodities or commodity contracts will be
purchased or sold for the account of VCA-10 except that VCA-10 may purchase and
sell financial futures contracts and related options.
Loans. VCA-10 will not lend money, except that loans of up to 10% of the value
of VCA-10's total assets may be made through the purchase of privately placed
bonds, debentures, notes, and other evidences of indebtedness of a character
customarily acquired by institutional investors that may or may not be
convertible into stock or accompanied by warrants or rights to acquire stock.
Repurchase agreements and the purchase of publicly traded debt obligations are
not considered to be "loans" for this purpose and may be entered into or
purchased by VCA-10 in accordance with its investment objectives and policies.
Borrowing. VCA-10 will not issue senior securities, borrow money or pledge its
assets, except that VCA-10 may borrow from banks up to 33 1/3 percent of the
value of its total assets (calculated when the loan is made) for temporary,
extraordinary or emergency purposes, for the clearance of transactions or for
investment purposes. VCA-10 may pledge up to 33 1/3 percent of the value of its
total assets to secure such borrowing. For purposes of this restriction, the
purchase or sale of securities on a when-issued or delayed delivery basis,
forward foreign currency exchange contracts and collateral arrangements relating
thereto, and collateral arrangements with respect to interest rate swap
transactions, reverse repurchase agreements, dollar roll transactions, options,
futures contracts, and options thereon are not deemed to be a pledge of assets
or the issuance of a senior security.
Margin. VCA-10 will not purchase securities on margin (but VCA-10 may obtain
such short-term credits as may be necessary for the clearance of transactions);
provided that the deposit or payment by VCA-10 of initial or maintenance margin
in connection with futures or options is not considered the purchase of a
security on margin.
Underwriting of Securities. VCA-10 will not underwrite the securities of other
issuers, except where VCA-10 may be deemed to be an underwriter for purposes of
certain federal securities laws in connection with the disposition of portfolio
securities and with loans that VCA-10 is permitted to make.
Control or Management of Other Companies. No securities of any company will be
acquired for VCA-10 for the purpose of exercising control or management thereof.
Non-fundamental investment restrictions adopted by VCA-10
The VCA-10 Committee has also adopted the following additional investment
restrictions as non-fundamental operating policies. The Committee can change
these restrictions without the approval of the persons having voting rights in
respect of VCA-10.
Investments in Other Investment Companies. Except as part of a merger,
consolidation, acquisition or reorganization, VCA-10 will not invest in the
securities of other investment companies in excess of the limits stipulated by
the Investment Company Act of 1940 as amended, and the rules and regulations
thereunder.
Short Sales. VCA-10 will not make short sales of securities or maintain a short
position, except that VCA-10 may make short sales against the box. Collateral
arrangements entered into with respect to options, futures contracts and forward
contracts are not deemed to be short sales. Collateral arrangements entered into
with respect to interest rate swap agreements are not deemed to be short sales.
Restricted Securities. No more than 15% of the value of the net assets held in
VCA-10 will be invested in securities (including repurchase agreements and
non-negotiable time deposits maturing in more than seven days) that are subject
to legal or contractual restrictions on resale or for which no readily available
market exists.
3
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Fundamental investment restrictions adopted by VCA-11
In addition to the investment objective described in the prospectus, the
following investment restrictions are fundamental investment policies of VCA-11
and may not be changed without the approval of a majority vote of persons having
voting rights in respect of the Account.
Concentration in Particular Industries. VCA-11 will not purchase any security
(other than obligations of the U.S. Government, its agencies or
instrumentalities) if as a result: (i) with respect to 75% of VCA-11's total
assets, more than 5% of VCA-11's total assets (determined at the time of
investment) would then be invested in securities of a single issuer, or (ii) 25%
or more of VCA-11's total assets (determined at the time of the investment)
would be invested in a single industry. Notwithstanding this restriction, there
is no limitation with respect to money market instruments of domestic banks,
U.S. branches of foreign banks that are subject to the same regulations as U.S.
banks, and foreign branches of domestic banks (provided that the domestic bank
is unconditionally liable in the event of the failure of the foreign branch to
make payment on its instruments for any reason).
Investments in Real Estate-Related Securities. No purchase of or investment in
real estate will be made for the account of VCA-11.
Investments in Financial Futures. No commodities or commodity contracts will be
purchased or sold for the account of VCA-11.
Loans. VCA-11 will not lend money, except that it may purchase debt obligations
in accordance with its investment objective and policies and may engage in
repurchase agreements.
Borrowing. VCA-11 will not issue senior securities, borrow money or pledge its
assets, except that VCA-11 may borrow from banks up to 33 1/3 percent of the
value of its total assets (calculated when the loan is made) for temporary,
extraordinary or emergency purposes, for the clearance of transactions or for
investment purposes. VCA-11 may pledge up to 33 1/3 percent of the value of its
total assets to secure such borrowing. For purposes of this restriction, the
purchase or sale of securities on a when-issued or delayed delivery basis is not
deemed to be a pledge of assets or the issuance of a senior security.
Margin. VCA-11 will not purchase securities on margin (but VCA-11 may obtain
such short-term credits as may be necessary for the clearance of transactions).
Underwriting of Securities. VCA-11 will not underwrite the securities of other
issuers, except where VCA-11 may be deemed to be an underwriter for purposes of
certain federal securities laws in connection with the disposition of portfolio
securities and with loans that VCA-11 is permitted to make.
Control or Management of Other Companies. No securities of any company will be
acquired for VCA-11 for the purpose of exercising control or management thereof.
Non-fundamental investment restrictions adopted by VCA-11
The VCA-11 Committee has also adopted the following additional investment
restrictions as non-fundamental operating policies. The Committee can change
these restrictions without the approval of the persons having voting rights in
respect of VCA-11.
Investments in Other Investment Companies. Except as part of a merger,
consolidation, acquisition or reorganization, VCA-11 will not invest in the
securities of other investment companies in excess of the limits stipulated by
the Investment Company Act of 1940 as amended, and the rules and regulations
thereunder.
Short Sales. VCA-11 will not make short sales of securities or maintain a short
position.
Restricted Securities. No more than 10% of the value of the net assets held in
VCA-11 will be invested in illiquid securities (including repurchase agreements
and non-negotiable time deposits maturing in more than seven days). Securities
that have legal or contractual restrictions on resale but have a readily
available market are not deemed illiquid for purposes of this limitation.
Investment restrictions imposed by state law
In addition to the investment objectives, policies and restrictions that they
have adopted, VCA-10 and VCA-11 must limit their investments to those authorized
for variable contract accounts of life insurance companies by the laws of the
State of New Jersey. In the event of future amendments of the applicable New
Jersey statutes, each Account will comply, without the approval of Participants
or others having voting rights in respect of the Account, with the statutory
requirements as so modified. The pertinent provisions of New Jersey law as they
currently read are, in summary form, as follows:
1. An account may not purchase any evidence of indebtedness issued, assumed
or guaranteed by any institution created or existing under the laws of
the U.S., any U.S. state or territory, District of Columbia, Puerto
Rico, Canada or any Canadian province, if such evidence of indebtedness
is in default as to interest. "Institution" includes any corporation,
joint stock association, business trust, business joint venture,
business partnership, savings and loan association, credit union or
other mutual savings institution.
2. The stock of a corporation may not be purchased unless (i) the
corporation has paid a cash dividend on the class of stock during each
of the past five years preceding the time of purchase, or (ii) during
the five-year period the corporation had aggregate
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earnings available for dividends on such class of stock sufficient to
pay average dividends of 4% per annum computed upon the par value of
such stock, or upon stated value if the stock has no par value. This
limitation does not apply to any class of stock which is preferred as to
dividends over a class of stock whose purchase is not prohibited.
3. Any common stock purchased must be (i) listed or admitted to trading on
a securities exchange in the United States or Canada; or (ii) included
in the National Association of Securities Dealers' national price
listings of "over-the-counter" securities; or (iii) determined by the
Commissioner of Insurance of New Jersey to be publicly held and traded
and as to which market quotations are available. As of the date of this
Prospectus no such determination has been made.
4. Any security of a corporation may not be purchased if after the purchase
more than 10% of the market value of the assets of an Account would be
invested in the securities of such corporation.
The currently applicable requirements of New Jersey law impose substantial
limitations on the ability of VCA-10 to invest in the stock of companies whose
securities are not publicly traded or who have not recorded a five-year history
of dividend payments or earnings sufficient to support such payments. This means
that the Account will not generally invest in the stock of newly organized
corporations. Nonetheless, an investment not otherwise eligible under paragraph
1 or 2 above may be made if, after giving effect to the investment, the total
cost of all such non-eligible investments does not exceed 5% of the aggregate
market value of the assets of the Account.
Investment limitations may also arise under the insurance laws and regulations
of other states where the Contracts are sold. Although compliance with the
requirements of New Jersey law set forth above will ordinarily result in
compliance with any applicable laws of other states, under some circumstances
the laws of other states could impose additional restrictions on the portfolios
of the Accounts.
Additional information about financial futures contracts
As described in the prospectus, VCA-10 may engage in certain transactions
involving financial futures contracts. This additional information on those
instruments should be read in conjunction with the prospectus.
VCA-10 will only enter into futures contracts that are standardized and traded
on a U.S. exchange or board of trade. When a financial futures contract is
entered into, each party deposits with a broker or in a segregated custodial
account approximately 5% of the contract amount, called the "initial margin."
Subsequent payments to and from the broker, called the "variation margin," are
made on a daily basis as the underlying security, index, or rate fluctuates,
making the long and short positions in the futures contracts more or less
valuable, a process known as "marking to the market."
There are several risks associated with the use of futures contracts for hedging
purposes. While VCA-10's hedging transactions may protect it against adverse
movements in the general level of interest rates or other economic conditions,
such transactions could also preclude VCA-10 from the opportunity to benefit
from favorable movements in the level of interest rates or other economic
conditions. There can be no guarantee that there will be correlation between
price movements in the hedging vehicle and in the securities or other assets
being hedged. An incorrect correlation could result in a loss on both the hedged
assets and the hedging vehicle so that VCA-10's return might have been better if
hedging had not been attempted. The degree of imperfection of correlation
depends on circumstances such as variations in speculative market demand for
futures and futures options, including technical influences in futures trading
and futures options, and differences between the financial instruments being
hedged and the instruments underlying the standard contracts available for
trading in such respects as interest rate levels, maturities, and
creditworthiness of issuers. A decision as to whether, when, and how to hedge
involves the exercise of skill and judgment and even a well-conceived hedge may
be unsuccessful to some degree because of market behavior or unexpected market
trends.
There can be no assurance that a liquid market will exist at a time when VCA-10
seeks to close out a futures contract or a futures option position. Most futures
exchanges and boards of trade limit the amount of fluctuation permitted in
futures contract prices during a single day; once the daily limit has been
reached on a particular contract, no trades may be made that day at a price
beyond that limit. In addition, certain of these instruments are relatively new
and without a significant trading history. As a result, there is no assurance
that an active secondary market will develop or continue to exist. The daily
limit governs only price movements during a particular trading day and therefore
does not limit potential losses because the limit may work to prevent the
liquidation of unfavorable positions. For example, futures prices have
occasionally moved to the daily limit for several consecutive trading days with
little or no trading, thereby preventing prompt liquidation of positions and
subjecting some holders of futures contracts to substantial losses. Lack of a
liquid market for any reason may prevent VCA-10 from liquidating an unfavorable
position and VCA-10 would remain obligated to meet margin requirements and
continue to incur losses until the position is closed.
Additional information about options
As described in the prospectus, VCA-10 may engage in certain transactions
involving options. This additional
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information on those instruments should be read in conjunction with the
prospectus.
In addition to those described in the prospectus, options have other risks,
primarily related to liquidity. A position in an exchange-traded option may be
closed out only on an exchange, board of trade or other trading facility which
provides a secondary market for an option of the same series. Although VCA-10
will generally purchase or write only those exchange-traded options for which
there appears to be an active secondary market, there is no assurance that a
liquid secondary market on an exchange will exist for any particular option, or
at any particular time, and for some options no secondary market on an exchange
or otherwise may exist. In such event it might not be possible to effect closing
transactions in particular options, with the result that VCA-10 would have to
exercise its options in order to realize any profit and would incur brokerage
commissions upon the exercise of such options and upon the subsequent
disposition of underlying securities acquired through the exercise of call
options or upon the purchase of underlying securities for the exercise of put
options. If VCA-10 as a covered call option writer is unable to effect a closing
purchase transaction in a secondary market, it will not be able to sell the
underlying security until the option expires or it delivers the underlying
security upon exercise.
Reasons for the absence of a liquid secondary market on an exchange include the
following: (i) there may be insufficient trading interest in certain options;
(ii) restrictions imposed by an exchange on opening transactions or closing
transactions or both; (iii) trading halts, suspensions or other restrictions may
be imposed with respect to particular classes or series of options or underlying
securities; (iv) unusual or unforeseen circumstances may interrupt normal
operations on an exchange; (v) the facilities of an exchange or a clearing
corporation may not at all times be adequate to handle current trading volume;
or (vi) one or more exchanges could, for economic or other reasons, decide or be
compelled at some future date to discontinue the trading of options (or a
particular class or series of options), in which event the secondary market on
that exchange (or in the class or series of options) would cease to exist,
although outstanding options on that exchange that had been issued by a clearing
corporation as a result of trades on that exchange would continue to be
exercisable in accordance with their terms. There is no assurance that higher
than anticipated trading activity or other unforeseen events might not, at
times, render certain of the facilities of any of the clearing corporations
inadequate, and thereby result in the institution by an exchange of special
procedures which may interfere with the timely execution of customers' orders.
The purchase and sale of over-the-counter ("OTC") options will also be subject
to certain risks. Unlike exchange-traded options, OTC options generally do not
have a continuous liquid market. Consequently, VCA-10 will generally be able to
realize the value of an OTC option it has purchased only by exercising it or
reselling it to the dealer who issued it. Similarly, when VCA-10 writes an OTC
option, it generally will be able to close out the OTC option prior to its
expiration only by entering into a closing purchase transaction with the dealer
to which VCA-10 originally wrote the OTC option. There can be no assurance that
VCA-10 will be able to liquidate an OTC option at a favorable price at any time
prior to expiration. In the event of insolvency of the other party, VCA-10 may
be unable to liquidate an OTC option.
Options on Equity Securities. VCA-10 may purchase and write (i.e., sell) put and
call options on equity securities that are traded on U.S. securities exchanges,
are listed on the National Association of Securities Dealers Automated Quotation
System ("NASDAQ"), or that result from privately negotiated transactions with
broker-dealers ("OTC options"). A call option is a short-term contract pursuant
to which the purchaser or holder, in return for a premium paid, has the right to
buy the security underlying the option at a specified exercise price at any time
during the term of the option. The writer of the call option, who receives the
premium, has the obligation, upon exercise of the option, to deliver the
underlying security against payment of the exercise price. A put option is a
similar contract which gives the purchaser or holder, in return for a premium,
the right to sell the underlying security at a specified price during the term
of the option. The writer of the put, who receives the premium, has the
obligation to buy the underlying security at the exercise price upon exercise by
the holder of the put.
VCA-10 will write only "covered" options on stocks. A call option is covered if:
(1) VCA-10 owns the security underlying the option; or (2) VCA-10 has an
absolute and immediate right to acquire that security without additional cash
consideration (or for additional cash consideration held in a segregated account
by its custodian) upon conversion or exchange of other securities it holds; or
(3) VCA-10 holds on a share-for-share basis a call on the same security as the
call written where the exercise price of the call held is equal to or less than
the exercise price of the call written or greater than the exercise price of the
call written if the difference is maintained by VCA-10 in cash, Treasury bills
or other high grade short-term debt obligations in a segregated account with its
custodian. A put option is covered if: (1) VCA-10 deposits and maintains with
its custodian in a segregated account cash, U.S. Government securities or other
liquid high-grade debt obligations having a value equal to or greater than the
exercise price of the option; or (2) VCA-10 holds on a share-for-share basis a
put on the same security as the put written where the exercise price of the put
held is equal to or greater than the exercise price of the put written or less
than the exercise price if the difference is
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maintained by VCA-10 in cash, Treasury bills or other high grade short-term debt
obligations in a segregated account with its custodian.
VCA-10 may also purchase "protective puts" (i.e., put options acquired for the
purpose of protecting VCA-10 security from a decline in market value). The loss
to VCA-10 is limited to the premium paid for, and transaction costs in
connection with, the put plus the initial excess, if any, of the market price of
the underlying security over the exercise price. However, if the market price of
the security underlying the put rises, the profit VCA-10 realizes on the sale of
the security will be reduced by the premium paid for the put option less any
amount (net of transaction costs) for which the put may be sold.
VCA-10 may also purchase putable and callable equity securities, which are
securities coupled with a put or call option provided by the issuer.
VCA-10 may purchase call options for hedging or investment purposes. VCA-10 does
not intend to invest more than 5% of its net assets at any one time in the
purchase of call options on stocks.
If the writer of an exchange-traded option wishes to terminate the obligation,
he or she may effect a "closing purchase transaction" by buying an option of the
same series as the option previously written. Similarly, the holder of an option
may liquidate his or her position by exercise of the option or by effecting a
"closing sale transaction" by selling an option of the same series as the option
previously purchased. There is no guarantee that closing purchase or closing
sale transactions can be effected.
Options on Debt Securities. VCA-10 may purchase and write exchange-traded and
OTC put and call options on debt securities. Options on debt securities are
similar to options on stock, except that the option holder has the right to take
or make delivery of a debt security, rather than stock.
VCA-10 will write only "covered" options. Options on debt securities are covered
in the same manner as options on stocks, discussed above, except that, in the
case of call options on U.S. Treasury Bills, VCA-10 might own U.S. Treasury
Bills of a different series from those underlying the call option, but with a
principal amount and value corresponding to the option contract amount and a
maturity date no later than that of the securities deliverable under the call
option.
VCA-10 may also write straddles (i.e., a combination of a call and a put written
on the same security at the same strike price where the same issue of the
security is considered as the cover for both the put and the call). In such
cases, VCA-10 will also segregate or deposit for the benefit of VCA-10's broker
cash or liquid high-grade debt obligations equivalent to the amount, if any, by
which the put is "in the money." It is contemplated that VCA-10's use of
straddles will be limited to 5% of VCA-10's net assets (meaning that the
securities used for cover or segregated as described above will not exceed 5% of
VCA-10's net assets at the time the straddle is written).
VCA-10 may purchase "protective puts" in an effort to protect the value of a
security that it owns against a substantial decline in market value. Protective
puts on debt securities operate in the same manner as protective puts on equity
securities, described above. VCA-10 may wish to protect certain securities
against a decline in market value at a time when put options on those particular
securities are not available for purchase. VCA-10 may therefore purchase a put
option on securities it does not hold. While changes in the value of the put
should generally offset changes in the value of the securities being hedged, the
correlation between the two values may not be as close in these transactions as
in transactions in which VCA-10 purchases a put option on an underlying security
it owns.
VCA-10 may also purchase call options on debt securities for hedging or
investment purposes. VCA-10 does not intend to invest more than 5% of its net
assets at any one time in the purchase of call options on debt securities.
VCA-10 may also purchase putable and callable debt securities, which are
securities coupled with a put or call option provided by the issuer.
VCA-10 may enter into closing purchase or sale transactions in a manner similar
to that discussed above in connection with options on equity securities.
Options on Stock Indices. VCA-10 may purchase and sell put and call options on
stock indices traded on national securities exchanges, listed on NASDAQ or that
result from privately negotiated transactions with broker-dealers ("OTC
options"). Options on stock indices are similar to options on stock except that,
rather than the right to take or make delivery of stock at a specified price, an
option on a stock index gives the holder the right to receive, upon exercise of
the option, an amount of cash if the closing level of the stock index upon which
the option is based is greater than in the case of a call, or less than, in the
case of a put, the strike price of the option. This amount of cash is equal to
such difference between the closing price of the index and the strike price of
the option times a specified multiple (the "multiplier"). If the option is
exercised, the writer is obligated, in return for the premium received, to make
delivery of this amount. Unlike stock options, all settlements are in cash, and
gain or loss depends on price movements in the stock market generally (or in a
particular industry or segment of the market) rather than price movements in
individual stocks.
VCA-10 will write only "covered" options on stock indices. A call option is
covered if VCA-10 follows the segregation requirements set forth in this
paragraph. When VCA-10 writes a call option on a broadly based stock market
index, it will segregate or put into escrow with its custodian or pledge to a
broker as collateral for the
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option, cash, Treasury bills or other liquid high-grade short-term debt
obligations, or "qualified securities" (defined below) with a market value at
the time the option is written of not less than 100% of the current index value
times the multiplier times the number of contracts. A "qualified security" is an
equity security which is listed on a national securities exchange or listed on
NASDAQ against which VCA-10 has not written a stock call option and which has
not been hedged by VCA-10 by the sale of stock index futures. When VCA-10 writes
a call option on an industry or market segment index, it will segregate or put
into escrow with its custodian or pledge to a broker as collateral for the
option, cash, Treasury bills or other liquid high-grade short-term debt
obligations, or at least five qualified securities, all of which are stocks of
issuers in such industry or market segment, with a market value at the time the
option is written of not less than 100% of the current index value times the
multiplier times the number of contracts. Such stocks will include stocks which
represent at least 50% of the weighting of the industry or market segment index
and will represent at least 50% of VCA-10's holdings in that industry or market
segment. No individual security will represent more than 15% of the amount so
segregated, pledged or escrowed in the case of broadly based stock market stock
options or 25% of such amount in the case of industry or market segment index
options. If at the close of business on any day the market value of such
qualified securities so segregated, escrowed, or pledged falls below 100% of the
current index value times the multiplier times the number of contracts, VCA-10
will so segregate, escrow, or pledge an amount in cash, Treasury bills, or other
liquid high-grade short-term debt obligations equal in value to the difference.
In addition, when VCA-10 writes a call on an index which is in-the-money at the
time the call is written, it will segregate with its custodian or pledge to the
broker as collateral, cash or U.S. government or other liquid high-grade
short-term obligations equal in value to the amount by which the call is
in-the-money times the multiplier times the number of contracts. Any amount
segregated pursuant to the foregoing sentence may be applied to VCA-10's
obligation to segregate additional amounts in the event that the market value of
the qualified securities falls below 100% of the current index value times the
multiplier times the number of contracts.
A call option is also covered if VCA-10 holds a call on the same index as the
call written where the strike price of the call held is equal to or less than
the strike price of the call written or greater than the strike price of the
call written if the difference is maintained by VCA-10 in cash, Treasury bills
or other high-grade short-term obligations in a segregated account with its
custodian.
A put option is covered if: (1) VCA-10 holds in a segregated account cash,
Treasury bills or other high-grade short-term debt obligations of a value equal
to the strike price times the multiplier times the number of contracts; or (2)
VCA-10 holds a put on the same index as the put written where the strike price
of the put held is equal to or greater than the strike price of the put written
or less than the strike price of the put written if the difference is maintained
by VCA-10 in cash, Treasury bills or other high-grade short-term debt
obligations in a segregated account with its custodian.
VCA-10 may purchase put and call options on stock indices for hedging or
investment purposes. VCA-10 does not intend to invest more than 5% of its net
assets at any one time in the purchase of puts and calls on stock indices.
VCA-10 may effect closing sale and purchase transactions involving options on
stock indices, as described above in connection with stock options.
The distinctive characteristics of options on stock indices create certain risks
that are not present with stock options. Index prices may be distorted if
trading of certain stocks included in the index is interrupted. Trading in the
index options also may be interrupted in certain circumstances, such as if
trading were halted in a substantial number of stocks included in the index. If
this occurred, VCA-10 would not be able to close out options which it had
purchased or written and, if restrictions on exercise were imposed, might be
unable to exercise an option it holds, which could result in substantial losses
to VCA-10. Price movements in VCA-10's equity security holdings probably will
not correlate precisely with movements in the level of the index and, therefore,
in writing a call on a stock index VCA-10 bears the risk that the price of the
securities held by VCA-10 may not increase as much as the index. In such event,
VCA-10 would bear a loss on the call which is not completely offset by movement
in the price of VCA-10's equity securities. It is also possible that the index
may rise when VCA-10's securities do not rise in value. If this occurred, VCA-10
would experience a loss on the call which is not offset by an increase in the
value of its securities holdings and might also experience a loss in its
securities holdings. In addition, when VCA-10 has written a call, there is also
a risk that the market may decline between the time VCA-10 has a call exercised
against it, at a price which is fixed as of the closing level of the index on
the date of exercise, and the time VCA-10 is able to sell stocks in its
portfolio. As with stock options, VCA-10 will not learn that an index option has
been exercised until the day following the exercise date but, unlike a call on
stock where VCA-10 would be able to deliver the underlying securities in
settlement, VCA-10 may have to sell part of its stock portfolio in order to make
settlement in cash, and the price of such stocks might decline before they can
be sold. This timing risk makes certain strategies involving more than one
option substantially more risky with options in stock indices than with stock
options.
There are also certain special risks involved in purchasing put and call options
on stock indices. If VCA-10 holds an index option and exercises it before final
determination of the closing index value for that day, it runs the risk that the
level of the underlying index may change before closing. If such a change causes
the exercise option to fall out of-the-money, VCA-10 will be required to pay the
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difference between the closing index value and the strike price of the option
(times the applicable multiplier) to the assigned writer. Although VCA-10 may be
able to minimize the risk by withholding exercise instructions until just before
the daily cutoff time or by selling rather than exercising an option when the
index level is close to the exercise price, it may not be possible to eliminate
this risk entirely because the cutoff times for index options may be earlier
than those fixed for other types of options and may occur before definitive
closing index values are announced.
Options on Foreign Currencies. VCA-10 may purchase and write put and call
options on foreign currencies traded on U.S. or foreign securities exchanges or
boards of trade. Options on foreign currencies are similar to options on stock,
except that the option holder has the right to take or make delivery of a
specified amount of foreign currency, rather than stock. VCA-10's successful use
of options on foreign currencies depends upon the investment adviser's ability
to predict the direction of the currency exchange markets and political
conditions, which requires different skills and techniques than predicting
changes in the securities markets generally. In addition, the correlation
between movements in the price of options and the price of currencies being
hedged is imperfect.
Options on Futures Contracts. VCA-10 may enter into certain transactions
involving options on futures contracts. VCA-10 will utilize these types of
options for the same purpose that it uses the underlying futures contract. An
option on a futures contract gives the purchaser or holder the right, but not
the obligation, to assume a position in a futures contract (a long position if
the option is a call and a short position if the option is a put) at a specified
price at any time during the option exercise period. The writer of the option is
required upon exercise to assume an offsetting futures position (a short
position if the option is a call and long position if the option is a put). Upon
exercise of the option, the assumption of offsetting futures positions by the
writer and holder of the option will be accomplished by delivery of the
accumulated balance in the writer's futures margin account which represents the
amount by which the market price of the futures contract, at exercise, exceeds,
in the case of a call, or is less than, in the case of a put, the exercise price
of the option on the futures contract. As an alternative to exercise, the holder
or writer of an option may terminate a position by selling or purchasing an
option of the same series. There is no guarantee that such closing transactions
can be effected. VCA-10 intend to utilize options on futures contracts for the
same purposes that it uses the underlying futures contracts.
Options on futures contracts are subject to risks similar to those described
above with respect to options on securities, options on stock indices, and
futures contracts. These risks include the risk that the investment adviser may
not correctly predict changes in the market, the risk of imperfect correlation
between the option and the securities being hedged, and the risk that there
might not be a liquid secondary market for the option. There is also the risk of
imperfect correlation between the option and the underlying futures contract. If
there were no liquid secondary market for a particular option on a futures
contract, VCA-10 might have to exercise an option it held in order to realize
any profit and might continue to be obligated under an option it had written
until the option expired or was exercised. If VCA-10 were unable to close out an
option it had written on a futures contract, it would continue to be required to
maintain initial margin and make variation margin payments with respect to the
option position until the option expired or was exercised against VCA-10.
Forward foreign currency exchange contracts
A forward foreign currency exchange contract is a contract obligating one party
to purchase and the other party to sell one currency for another currency at a
future date and price. When investing in foreign securities, VCA-10 may enter
into such contracts in anticipation of or to protect itself against fluctuations
in currency exchange rates.
VCA-10 generally will not enter into a forward contract with a term of greater
than 1 year. At the maturity of a forward contract, VCA-10 may either sell the
security and make delivery of the foreign currency or it may retain the security
and terminate its contractual obligation to deliver the foreign currency by
purchasing an "offsetting" contract with the same currency trader obligating it
to purchase, on the same maturity date, the same amount of the foreign currency.
VCA-10's successful use of forward contracts depends upon the investment
adviser's ability to predict the direction of currency exchange markets and
political conditions, which requires different skills and techniques than
predicting changes in the securities markets generally.
Interest rate swap transactions
VCA-10 may enter into interest rate swap transactions. Interest rate swaps, in
their most basic form, involve the exchange by one party with another party of
their respective commitments to pay or receive interest. For example, VCA-10
might exchange its right to receive certain floating rate payments in exchange
for another party's right to receive fixed rate payments. Interest rate swaps
can take a variety of other forms, such as agreements to pay the net differences
between two different indices or rates, even if the parties do not own the
underlying instruments. Despite their differences in form, the function of
interest rate swaps is generally the same -- to increase or decrease exposure to
long- or short-term interest rates. For example, VCA-10 may enter into a swap
transaction to preserve a return or spread on a particular investment or a
portion of its
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portfolio or to protect against any increase in the price of securities the
Account anticipates purchasing at a later date. VCA-10 will maintain appropriate
liquid assets in a segregated custodial account to cover its obligations under
swap agreements.
The use of swap agreements is subject to certain risks. As with options and
futures, if the investment adviser's prediction of interest rate movements is
incorrect, VCA-10's total return will be less than if the Account had not used
swaps. In addition, if the counterparty's creditworthiness declines, the value
of the swap would likely decline. Moreover, there is no guarantee that VCA-10
could eliminate its exposure under an outstanding swap agreement by entering
into an offsetting swap agreement with the same or another party.
Loans of portfolio securities
VCA-10 and VCA-11 may from time to time lend their portfolio securities to
broker-dealers, provided that such loans are made pursuant to written agreements
and are continuously secured by collateral in the form of cash, U.S. Government
securities or irrevocable standby letters of credit in an amount equal to at
least the market value at all times of the loaned securities. During the time
portfolio securities are on loan, VCA-10 and VCA-11 will continue to receive the
interest and dividends, or amounts equivalent thereto, on the loaned securities
while receiving a fee from the borrower or earning interest on the investment of
the cash collateral. The right to terminate the loan will be given to either
party subject to appropriate notice. Upon termination of the loan, the borrower
will return to the lender securities identical to the loaned securities. VCA-10
will not have the right to vote securities on loan, but would terminate the loan
and regain the right to vote if that were considered important with respect to
the investment. The primary risk in lending securities is that the borrower may
become insolvent on a day on which the loaned security is rapidly advancing in
price. In such event, if the borrower fails to return the loaned securities, the
existing collateral might be insufficient to purchase back the full amount of
stock loaned, and the borrower would be unable to furnish additional collateral.
The borrower would be liable for any shortage, but VCA-10 and VCA-11 would be
unsecured creditors with respect to such shortage and might not be able to
recover all or any of it. However, this risk may be minimized by a careful
selection of borrowers and securities to be lent.
VCA-10 and VCA-11 will not lend their portfolio securities to broker-dealers
affiliated with Prudential, including Prudential Securities Incorporated. This
will not affect the Accounts' ability to maximize their securities lending
opportunities.
Portfolio Turnover Rate
VCA-10 has no fixed policy with respect to portfolio turnover, which is an index
determined by dividing the lesser of the purchases and sales of portfolio
securities during the year by the monthly average of the aggregate value of the
portfolio securities owned during the year. VCA-10 seeks long term capital
growth rather than short term trading profits. However, during any period when
changing economic or market conditions are anticipated, successful management
requires an aggressive response to such changes which may result in portfolio
shifts that may significantly increase the rate of portfolio turnover. Higher
portfolio turnover involves correspondingly greater brokerage commissions and
other transaction costs, which are borne directly by VCA-10. It is not
anticipated that under normal circumstances the annual portfolio turnover rate
would exceed 100%. During 1996 and 1995 the total portfolio turnover rate for
VCA-10 was ____% and 44.77% respectively.
Portfolio brokerage and related practices
Prudential is responsible for decisions to buy and sell securities for VCA-10
and VCA-11, the selection of brokers and dealers to effect the transactions and
the negotiation of brokerage commissions, if any. Transactions on a stock
exchange in equity securities for VCA-10 will be executed primarily through
brokers who will receive a commission paid by the Account. Fixed income
securities, as well as securities traded in the over-the-counter market, on the
other hand, will not normally incur any brokerage commissions. These securities
are generally traded on a "net" basis with dealers acting as principals for
their own accounts without a stated commission, although the price of the
security usually includes a profit to the dealer. In underwritten offerings,
securities are purchased at a fixed price that includes an amount of
compensation to the underwriter, generally referred to as the underwriter's
concession or discount. On occasion, certain of these securities may be
purchased directly from an issuer, in which case neither commissions nor
discounts are paid.
In placing orders for portfolio transactions of the Accounts, primary
consideration is given to obtaining the most favorable price and best execution.
An attempt is made to effect each transaction at a price and commission, if any,
that provide the most favorable total cost or proceeds reasonably attainable in
the circumstances. However, a higher spread or commission than is otherwise
necessary for a particular transaction may be paid if to do so appears to
further the goal of obtaining the best execution available.
In connection with any securities transaction that involves a commission
payment, the commission is negotiated with the broker on the basis of the
quality and quantity of execution services that the broker provides, in light of
generally prevailing commission rates. Periodically, Prudential and PIC review
the allocation among
10
<PAGE>
brokers of orders for equity securities and the commissions that were paid.
When selecting a broker or dealer in connection with a transaction for either
Account, consideration is given to whether the broker or dealer has furnished
Prudential or PIC with certain services that brokerage houses customarily supply
to institutional investors, provided this does not jeopardize the objective of
obtaining the best price and execution.
These services include statistical and economic data and research reports on
particular companies and industries. Prudential and PIC use these services in
connection with all of their investment activities, and some of the data or
services obtained in connection with the execution of transactions for an
Account may be used in managing other investment accounts. Conversely, brokers
and dealers furnishing such services may be selected for the execution of
transactions of such other accounts, while the data and services may be used in
providing investment management for one or both of the Accounts. Although
Prudential's present policy is not to permit higher spreads or commissions to be
paid on transactions for the Accounts in order to secure research and
statistical services from brokers or dealers, Prudential might in the future
authorize the payment of higher commissions (but not of higher spreads), with
the prior concurrence of an Account's Committee, if it is determined that the
higher commissions are necessary in order to secure desired research and are
reasonable in relation to all the services that the broker provides.
When investment opportunities arise that may be appropriate for more than one
entity for which Prudential serves as investment manager or adviser, one entity
will not be favored over another and allocations of investments among them will
be made in an impartial manner believed to be equitable to each entity involved.
The allocations will be based on each entity's investment objectives and its
current cash and investment positions. Because the various entities for which
Prudential acts as investment manager or adviser have different investment
objectives and positions, from time to time a particular security may be
purchased for one or more such entities while at the same time such securities
may be sold for another.
An affiliated broker may be employed to execute brokerage transactions on behalf
of the Accounts as long as the commissions are reasonable and fair compared to
the commissions received by other brokers in connection with comparable
transactions involving similar securities being purchased or sold on a
securities exchange during a comparable period of time. During 1996, 1995, and
1994, the total dollar amount of commissions paid by VCA-10 to an affiliated
broker, Prudential Securities Incorporated, was $______, $-0-, and $-0-,
respectively. The Accounts may not engage in any transactions in which
Prudential or its affiliates, including Prudential Securities Incorporated, acts
as principal, including over-the-counter purchases and negotiated trades in
which such a party acts as a principal.
Prudential or PIC may enter into business transactions with brokers or dealers
for purposes other than the execution of portfolio securities transactions for
accounts Prudential manages. These other transactions will not affect the
selection of brokers or dealers in connection with portfolio transactions for
the Accounts.
During 1996, 1995, and 1994, $_________, $429,704, and $324,943, respectively,
was paid to various brokers in connection with securities transactions for
VCA-10. Of this amount, approximately ___% 77.6%, and 66.57%, respectively, was
allocated to brokers who provided research and statistical services to
Prudential.
Custody of Securities
Investors Fiduciary Trust Company, 127 West 10th Street, Kansas City, Missouri
64105, is custodian of the assets of VCA-10 and VCA-11 and maintains certain
books and records in connection therewith.
11
<PAGE>
PERFORMANCE INFORMATION
The tables below provide performance information for each variable investment
option through December 31, 1996. The performance information is based on
historical experience and does not indicate or represent future performance.
Annual Average Total Return
Table 1 below shows the average annual rates of total return on hypothetical
investments of $1,000 for periods ended December 31, 1996 in VCA-10, VCA-11 and
the following subaccounts of VCA-24: Diversified Bond, Government Income,
Conservative Balanced, Flexible Managed, Stock Index, Equity and Global. These
figures assume withdrawal of the investments at the end of the period other than
to effect an annuity under the Contract. VCA-24 has been in existence since May
1, 1987. However, the applicable underlying Portfolios of the Fund existed as
funding vehicles for other Prudential products prior to that date. For
performance information purposes, the returns calculated below for periods prior
to inclusion in the MEDLEY Program reflect a hypothetical return as if those
portfolios were part of the MEDLEY Program at that time, using charges
applicable to the MEDLEY Program.
Table 1
Average Annual Total Return
<TABLE>
<CAPTION>
From Date Portfolio
Established Through
One Year Five Years Ten Years 12/31/96 If Portfolio
Date Ended Ended Ended Not in Existence
Established 12/31/96 12/31/96 12/31/96 for Ten Years
----------- -------- ---------- --------- ---------------------
<S> <C> <C> <C> <C> <C>
VCA-10 8/25/82
VCA-11 8/25/82
VCA-24:
Diversified Bond 5/13/83
Government Income 5/1/89
Conservative Balanced 5/13/83
Flexible Managed 5/13/83
Stock Index 10/19/87
Equity 5/13/83
Global 9/19/88
</TABLE>
The average annual rates of total return shown above are computed by finding the
average annual compounded rates of return over the periods shown that would
equate the initial amount invested to the withdrawal value, in accordance with
the following formula: P(1+T)n = ERV. In the formula, P is a hypothetical
investment or contribution of $1,000; T is the average annual total return; n is
the number of years; and ERV is the withdrawal value at the end of the periods
shown. The annual account charge is prorated among the investment options
available under MEDLEY, including the Companion Contract, in the same
proportions as the aggregate annual contract fees are deducted from each option.
These figures assume deduction of the maximum deferred sales charge that may be
applicable to a particular period.
12
<PAGE>
Non-Standard Total Return
Table 2 below shows the average annual rates of return as in Table 1, but
assumes that the contributions or investments are not withdrawn at the end of
the period or that the Participant annuitizes at the end of the period.
Table 2
Average Annual Total Return Assuming No Withdrawal
<TABLE>
<CAPTION>
From Date Portfolio
Established Through
One Year Five Years Ten Years 12/31/96 If Portfolio
Date Ended Ended Ended Not in Existence
Established 12/31/96 12/31/96 12/31/96 for Ten Years
----------- -------- ---------- --------- ---------------------
<S> <C> <C> <C> <C> <C>
VCA-10
VCA-11
VCA-24:
Diversified Bond
Government Income
Conservative Balanced
Flexible Managed
Stock Index
Equity
Global
</TABLE>
Table 3 shows the cumulative total return for the above investment options,
assuming no withdrawal.
Table 3
Cumulative Total Return Assuming No Withdrawal
<TABLE>
<CAPTION>
From Date Portfolio
Established Through
One Year Five Years Ten Years 12/31/96 If Portfolio
Date Ended Ended Ended Not in Existence
Established 12/31/96 12/31/96 12/31/96 for Ten Years
----------- -------- ---------- --------- ---------------------
<S> <C> <C> <C> <C> <C>
VCA-10
VCA-11
VCA-24:
Diversified Bond
Government Income
Conservative Balanced
Flexible Managed
Stock Index
Equity
Global
</TABLE>
VCA-11 Yield
The "yield" and "effective yield" of VCA-11 for the seven days ended December
31, 1996 were % and %, respectively.
The yield is computed by determining the net change, exclusive of capital
changes, in the value of a hypothetical preexisting account having a balance of
one accumulation unit of VCA-11 at the beginning of the period, subtracting a
prorated portion of the annual account charge as explained above, and dividing
the difference by the value of the account at the beginning of the base period,
and then multiplying the base period by (365/7), with the resulting figure
carried to the nearest hundred of 1%.
The yield reflects the deduction of the 1% charge for administrative expenses
and investment management, but does not reflect the deferred sales charge.
The effective yield is obtained by taking the base period return, adding 1,
raising the sum to a power equal to 365 divided by 7, and subtracting 1 from the
result, according to following formula: Effective Yield = [(base period return +
1)365/7]--1.
The yields on amount held in VCA-11 will fluctuate on a daily basis. Therefore,
the stated yields for any given period are not an indication of future yields.
13
<PAGE>
THE VCA-10 AND VCA-11 COMMITTEES
VCA-10 is managed by The Prudential Variable Contract Account-10 Committee
("VCA-10 Committee"). VCA-11 is managed by The Prudential Variable Contract
Account-11 Committee ("VCA-11 Committee"). The members of each Committee are
elected by the persons having voting rights in respect of each Account. The
affairs of each Account are conducted in accordance with the Rules and
Regulations of the Account. The members of each Account's Committee, the
Account's Secretary and Assistant Secretaries and the principal occupation of
each during the past five years are shown below.
VCA-10 Committees
MENDEL A. MELZER*, Chairman and Member of the Committees--Chief Investment
Officer (since 11/96), Prudential Mutual Funds and Annuities (a business unit of
Prudential). Senior Vice President and Chief Financial Officer, Prudential
Preferred Financial Services (a unit of PAMCO) from 1993 to 1995.
Vice-President, Managing Director, Prudential Investment Corporation from 1991
to 1993. Address: 751 Broad Street, Newark, NJ 07102.
SAUL K. FENSTER, Member of the Committee--President, New Jersey Institute of
Technology (education). Address: 323 Martin Luther King Jr. Boulevard, Newark,
New Jersey 07102.
JONATHAN M. GREENE*, Member of the Committee--President of Investment Management
(since 3/96), Prudential Investments. Vice President and Portfolio Manager, T.
Rowe Price Associates, Inc. from 6/74 to 3/96. Address: 751 Broad Street,
Newark, NJ 07102.
W. SCOTT MCDONALD, JR., Member of the Committee--Principal, Scott McDonald &
Associates since 4/95. Prior to 4/95, Executive Vice President, Fairleigh
Dickinson University. Address: 9 Zamrok Way, Morristown, New Jersey 07960.
JOSEPH WEBER, Member of the Committee--Vice President, Interclass (international
corporate learning) since 10/90. President, Alliance for Learning from 3/88 to
10/90. Address: 37 Beachmont Terrace, North Caldwell, New Jersey 07006.
THOMAS A. EARLY, Secretary to the Committee--Vice President and General Counsel,
Prudential Defined Contribution Services since 4/94. Associate General Counsel,
Frank Russell Company from 1988 to 1994. Address: 100 Mulberry Street, Gateway
Center 2, Newark, N.J. 07102
C. CHRISTOPHER SPRAGUE, Assistant Secretary to the Committee--Assistant General
Counsel, Prudential Defined Contribution Services since 12/94. Staff Attorney
and Senior Counsel, U.S. Securities and Exchange Commission from 9/88 to 11/94.
Address:30Scranton Office Park, Moosic, Pennsylvania 18507.
MICHAEL G. WILLIAMSON, Assistant Secretary to the Committee--Director and
Assistant Comptroller, Prudential Defined Contribution Services, since 11/93.
Manager, Prudential Defined Contribution Services from 10/88 to 11/93. Address:
30 Scranton Office Park, Moosic, Pennsylvania 18507.
14
<PAGE>
*These Members of the VCA-10 and VCA-11 Committees are interested persons of
Prudential, its affiliates or the Accounts, as defined in the Investment Company
Act of 1940 (the "1940 Act"). Certain actions of each Committee, including the
annual continuance of the Agreement for Investment Management Services between
each Account and Prudential, must be approved by a majority of the Members of
the Committee who are not interested persons of Prudential, its affiliates or
the Account. Messrs. Melzer and Greene, Members of the Committee, are interested
persons of Prudential, as that term is defined in the 1940 Act, because they are
officers of Prudential, the investment manager of both Accounts. Messrs.
Fenster, McDonald, and Weber are not interested persons of Prudential, its
affiliates, or either Account. However, Mr. Fenster is President of the New
Jersey Institute of Technology. Prudential has issued a group annuity contract
to the Institute and provides group life and group health insurance to its
employees.
Remuneration of Members of the Committees and Certain Affiliated Persons
No member of the Committee of either VCA-10 or VCA-11 nor any other person
(other than Prudential) receives remuneration from an Account. Prudential pays
certain of the expenses relating to the operation of VCA-10 and VCA-11,
including all compensation paid to members of each Committee, its Chairman, its
Secretary and Assistant Secretaries. No member of either Account's Committee,
its Chairman, its Secretary or Assistant Secretaries who is also an officer,
Director or employee of Prudential or an affiliate of Prudential is entitled to
any fee for his services as a member or officer of the Committee.
15
<PAGE>
DIRECTORS AND OFFICERS OF PRUDENTIAL
The names of all Directors and certain officers of Prudential and the positions
and offices and principal occupation of each during the past five years are
shown below. The Contract-holder under each Contract will be entitled to one
vote for the election of Prudential Directors. Participants will not be entitled
to vote.
DIRECTORS
FRANKLIN E. AGNEW, Director since 1994 (current term expires April, 2000).
Member, Committee on Dividends; Member, Finance Committee. Business consultant
since 1987. Senior Vice President H.J. Heinz from 1971 to 1986. Mr.Agnew is also
a director of Bausch & Lomb Inc. and John Wiley & Sons, Inc. Age 61. Address:
One Mellon Bank Center, Suite 2120, Pittsburgh, PA 15219.
FREDERICK K. BECKER, Director since 1994 (current term expires April, 1999).
Member, Auditing Committee, Member, Committee on Business Ethics. President,
Wilentz Goldman and Spitzer (law firm) since 1989, with firm since 1960. Age 60.
Address: 90 Woodbridge Center Drive, Woodbridge, NJ 07095.
WILLIAM W. BOESCHENSTEIN, Director since 1982 (current term expires April,
1997). Chairman, Executive Committee; Member, Auditing Committee. Retired since
1990. Chairman of the Board and Chief Executive Officer, Owens-Corning Fiberglas
Corporation from 1981 to 1990. Mr. Boeschenstein is also a director of FMC Corp.
Age 70. Address: One Seagate, Suite1530, Toledo, OH 43604.
LISLE C. CARTER, JR., Director since 1987 (current term expires April, 1997).
Chairman, Committee on Nominations; Member Executive Committee; Member Finance
Committee. Retired since 1991. Senior Vice President and General Counsel, United
Way of America from 1988 to 1991. Age 70. Address: 1307 Fourth Street, S.W.,
Washington, DC 20024.
JAMES G. CULLEN, Director since 1994 (current term expires April, 2001). Member,
Compensation Committee; Member, Committee on Business Ethics. Vice Chairman,
Bell Atlantic Corporation. President, Bell Atlantic Corporation from 1993 to
1995. President New Jersey Bell 1989 to 1993. Mr. Cullen is also a director of
Johnson & Johnson. Age 53. Address: 1310 North Court House Road, 11th Floor,
Alexandria, VA 22201.
CAROLYNE K. DAVIS, Director since 1989 (current term expires April, 1997).
Member, Finance Committee; Member Committee on Business Ethics; Member,
Compensation Committee. National and International Health Care Advisor, Ernst &
Young since 1985. Dr. Davis is also a director of Merck & Co., Inc., Beckman
Instruments, Inc., Pharmaceutical Marketing Services, Inc. and Science
Applications International Corporation. Age 64. Address: 1225 Connecticut
Avenue, N.W., Washington, DC 20036.
ROGER A. ENRICO, Director since 1994 (current term expires April, 1998). Member,
Committee on Nominations; Member, Compensation Committee. CEO PepsiCo, Inc.
since 1996. Vice Chairman, PepsiCo, Inc. from 1993 to 1996. Chairman and CEO,
Pepsi Co. Worldwide Food, from 1991 to 1993. President and CEO, Pepsi Co.
Worldwide Beverage from 1986-1991. Mr. Enrico is also a director of Dayton
Hudson Corporation and A.H. Belo Corporation. Age 51. Address: 14841 North
Dallas Parkway, Dallas, TX, 75240.
ALLAN D. GILMOUR, Director since 1995 (current term expires April, 1999).
Retired since 1995. Vice Chairman, Ford Motor Company, from 1993 to 1995. Mr.
Gilmour originally joined Ford in 1960. Mr. Gilmour is also a director of
USWest, Inc., Whirlpool Corporation and The Dow Chemical Company. Age 61.
Address: 751 Broad Street, Newark, NJ 07102.
WILLIAM H. GRAY, III, Director since 1991 (current term expires April, 2000).
Member, Finance Committee; Member, Committee on Nominations. President and Chief
Executive Officer, The College Fund/UNCF since 1991. Mr. Gray served in Congress
from 1979 to 1991. Mr. Gray is also a director of Warner-Lambert Co., Chase
Manhattan Corp., Municipal Bond Investors Assurance Corp., Westinghouse Electric
Corp., Union Pacific Corp., Lotus Development Corp., and Rockwell International
Corp. Age 54. Address: 8260 Willow Oaks Corp. Drive, Fairfax, VA 22031.
JON F. HANSON, Director since 1991 (current term expires April, 1997). Member,
Finance Committee; Member, Committee on Dividends. Chairman, Hampshire
Management Co. since 1976. Mr. Hanson is also a director of United Water
Resources. Age 59. Address: 235 Moore Street, Suite 200, Hackensack, NJ 07601.
CONSTANCE J. HORNER, Director since 1994 (current term expires April, 1998).
Member, Auditing Committee; Member, Committee on Nominations. Guest Scholar, The
Brookings Institution since 1993. Assistant to the President and Director of
Presidential Personnel, U.S. Government, 1991-1992. Deputy Secretary, Department
of Health & Human Services from 1989 to 1991. Ms. Horner is also a director of
Pfizer, Inc., Ingersoll-Rand Company and Foster Wheeler Corporation. Age 54.
Address: 1775 Massachusetts Ave., N.W. Washington, D.C. 20036-2188.
ALLEN F. JACOBSON, Director since 1992 (current term expires April, 1997).
Member, Auditing Committee; Member Compensation Committee. Retired since 1991.
Chairman of the Board and Chief Executive Officer, Minnesota Mining &
16
<PAGE>
Manufacturing Co. from 1986 to 1991. Mr. Jacobson is also a director of Abbott
Laboratories, Deluxe Corp., Northern States Power Co., Silicon Graphics, Inc.,
Valmont Industries, 3M, Mobil Corporation, U.S. West, Inc., Sara Lee Corporation
and Potlatch Corporation. Age 69: Address: 3050 Minnesota World Trade Center,
St. Paul, MN 55101.
BURTON G. MALKIEL, Director since 1978 (current term expires April, 1998).
Chairman, Finance Committee; Member, Executive Committee; Member, Committee on
Nominations. Professor, Princeton University, since 1988. Dr. Malkiel is also a
director of The Jeffrey Co., Vanguard Group, Inc., Amdahl Corporation, Baker
Fentress & Company, and Southern New England Telecommunications Co. Age 63.
Address: 110 Fisher Hall, Prospect Avenue, Princeton University, Princeton, NJ
08544-1021.
ARTHUR F. RYAN, Chairman of the Board, President and Chief Executive Officer of
Prudential since 1994. President and Chief Operating Officer, Chase Manhattan
Corp. from 1990 to 1994, with Chase since 1972. Age 53. Address: 751 Broad
Street, Newark, NJ 07102-3777.
CHARLES R. SITTER, Director since 1995 (current term expires April, 1999).
Member, Committee on Dividends. President, Exxon Corporation from 1993 to 1996.
Mr. Sitter began his career with Exxon in 1957; he is currently a director of
Exxon. Age 65. Address: 5959 Las Colinas Boulevard, Irving, TX 75039.
DONALD L. STAHELI, Director since 1995 (current term expires April, 1999).
Member, Compensation Committee. Chairman and Chief Executive Officer,
Continental Grain Company since 1994. Mr. Staheli was Chairman of Continental
Grain from 1988 to 1994. Age 64. Address: 277 Park Avenue, New York, NY 10172.
RICHARD M. THOMSON, Director since 1976 (current term expires April, 2000).
Chairman, Compensation Committee; Member, Committee on Nominations, Member,
Executive Committee. Chairman of the Board and Chief Executive Officer, The
Toronto-Dominion Bank since 1978. Mr. Thomson is also a director of CGC, Inc.,
Eaton's of Canada, Ltd., INCO, Ltd., The Thomson Corp. National Retail Credit
Services Limited, TEC Leaseholds Limited, Thomglen Corporation and S.C. Johnson
& Son, Ltd. Age 62. Address: P.O. Box 1, Toronto-Dominion Centre, Toronto,
Ontario, M5K 1A2, Canada.
JAMES A. UNRUH, Director since 1996 (current term expires April, 2000). Chairman
and Chief Executive Officer of Unisys Corporation since 1990. Mr. Unruh is also
a director of Ameritech Corporation. Age 55. Address: Township Line& Union
Meeting Roads, Blue Bell, PA 19424.
P. ROY VAGELOS, M.D., Director since 1989 (current term expires April, 1997).
Chairman, Auditing Committee; Member, Committee on Dividends; Member, Executive
Committee. Chairman, Regeneron Pharmaceuticals since 1995. Chairman and Chief
Executive Officer, Merck & Co., Inc. from 1986 to 1994. Dr. Vagelos is also a
director of Pepsi Co., Inc., The Estee Lauder Companies Inc. and McDonnell
Douglas Corp. Age 66. Address: One Crossroads Drive, Bedminster, NJ 07921.
STANLEY C. VAN NESS, Director since 1990 (current term expires April, 2002).
Chairman, Committee on Business Ethics; Member, Auditing Committee; Member,
Executive Committee. Attorney, Picco Herbert Kennedy (law firm) from 1990.
Partner of Jamieson, Moore, Peskin & Spicer from 1984 to 1990. Mr. Van Ness is
also a director of Jersey Central Power & Light Company. Age 62. Address: One
State Street Square, Suite 1000, Trenton, NJ 08607-1388.
PAUL A. VOLCKER, Director since 1988 (current term expires April, 2000). Member,
Committee on Dividends; Member, Committee on Nominations. Chairman, James D.
Wolfensohn, Inc. since 1988; Chief Executive Officer, James D. Wolfensohn, Inc.
since 1995. Chairman, J. Rothschild, Wolfensohn & Co. from 1992 to 1995. Mr
Volcker is also a director of Fuji-Wolfensohn International, Nestle, S.A., UAL
Corp. and the Board of Governors, American Stock Exchange. Age 68. Address: 599
Lexington Avenue, New York, NY 10022.
JOSEPH H. WILLIAMS, Director since 1994 (current term expires April, 1998).
Member, Auditing Committee; Member, Committee on Dividends. Chairman of the
Board, The Williams Companies since 1994. Chairman & Chief Executive Officer,
The Williams Companies 1979-1993. Mr. Williams is also a director of Flint
Industries and The Orvis Company. Age 62. Address: One Williams Center, Tulsa,
OK 74102.
17
<PAGE>
EXECUTIVE OFFICERS OF PRUDENTIAL
ARTHUR F. RYAN, Chairman, Chief Executive Officer, and President since 1994. Age
53.
E. MICHAEL CAULFIELD, Chief Executive Officer, Money Management Group since
1995; 1989-92 Managing Director. Age 49.
MARK B. GRIER, Chief Financial Officer since 1995. Age 43.
WILLIAM P. LINK, President and Chief Executive Officer, Prudential HealthCare
Group since 1995; 1987-90: Senior Vice President. Age 49.
JOHN V. SCICUTELLA, Operations and Systems Executive Officer since 1995. Age 47.
ERIC A. SIMONSON, President, Private Asset Management Group since 1995; 1989-94
Senior Managing Director. Age 50.
WILLIAM F. YELVERTON, Chief Executive Officer, Individual Insurance Group since
1995. Age 54.
MARTIN BERKOWITZ, Senior Vice President and Comptroller since 1995. Age 47.
WILLIAM M. BETHKE, Senior Vice President since 1986. Age 48.
ROBERT M. CHMELY, Senior Vice President since 1988. Age 61.
WILLIAM D. FRIEL, Senior Vice President since 1993; 1988-92: Vice President. Age
56.
JAMES R. GILLEN, Senior Vice President and General Counsel since 1984. Age 58.
BRUCE J. GOODMAN, Senior Vice President since 1993. Age 54.
SAMUEL H. HAVENS, Senior Vice President since 1989; 1985-89: Vice President. Age
52.
IRA J. KLEINMAN, Senior Vice President since 1992; 1978-92: Vice President. Age
48.
DONALD C. MANN, Senior Vice President since 1990; 1985-90: Vice President. Age
53.
PRISCILLA A. MYERS, Senior Vice President and Auditor since 1995. Age 46.
RICHARD O. PAINTER, President, Prudential Insurance& Financial Services since
1995. Age 48.
I. EDWARD PRICE, Senior Vice President since 1993; 1990-93; Senior Vice
President and Company Actuary. 1986-90: Senior Vice President. Age 53.
KIYOFUMI SAKAGUCHI, President, Prudential International Insurance since 1995.
Age 53.
GREGORY W. SCOTT, Chief Financial Officer, Prudential Healthcare Group since
1995. Age 42.
C. EDWARD CHAPLIN, Vice President and Treasurer since 1995. Age 39.
SUSAN L. BLOUNT, Vice President and Secretary since 1995. Age 38.
18
<PAGE>
SALE OF THE CONTRACTS
Prudential offers the Contracts on a continuous basis through Corporate Office,
regional home office and group sales office employees in those states in which
the Contracts may be lawfully sold. It may also offer the Contracts through
licensed insurance brokers and agents, or through appropriately registered
direct or indirect subsidiary(ies) of Prudential, provided clearances to do so
are obtained in any jurisdiction where such clearances may be necessary. During
1996, 1995, and 1994, Prudential received $____________, $146,870 and $24,016,
respectively, as deferred sales charges from VCA-10. $___________, $305,297, and
$280,494, respectively, were credited to other broker-dealers for the same
periods in connection with sales of the contracts. During 1996, 1995, and 1994,
Prudential received $__________, $17,399, and $16,777, respectively, from VCA-11
as deferred sales charges and credited $__________, $64,646, and $56,437,
respectively, to other broker-dealers in connection with sales of the contracts.
During 1996, 1995, and 1994, Prudential received $_________, $151,147, and
$62,145 from VCA-24 as deferred sales charges and credited $____________,
$1,128,432, and $1,053,343 respectively to other broker-dealers in connection
with sales of the contracts.
EXPERTS
The financial statements for VCA-10, VCA-11 and VCA-24 included in this
Statement of Additional Information and the condensed financial information for
VCA-10 and VCA-11 in the Prospectus have been audited by Price Waterhouse LLP,
independent auditors, as stated in their reports appearing herein, and the
financial statements have been included in reliance upon the reports of such
firm given upon their authority as experts in accounting and auditing. Price
Waterhouse's business address is 1177 Avenue of the Americas, New York, NY
10036.
Financial Statements for VCA-10, VCA-11, VCA-24 and Prudential, all as of
December 31, 1996, are included in this Statement of Additional Information,
beginning at page 18.
19
<PAGE>
<TABLE>
<CAPTION>
Item 28. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements [To be added by Amendment]
(1) Financial Statements of The Prudential Variable Contract Account-11
(Registrant) consisting of the Statement of Net Assets, as of December 31,
1996; the Statement of Operations for the period ended December 31, 1996;
the Statements of Changes in Net Assets for the periods ended December 31,
1996 and 1995; the Notes relating thereto appear in the statement of
additional information (Part B of the Registration Statement).
(2) Consolidated Financial Statements of The Prudential Insurance Company of
America (Depositor) and subsidiaries consisting of the Consolidated Statements
of Financial Position as of December 31, 1996 and 1995; the Consolidated
Statements of Operations and Changes in Surplus and Asset Valuation Reserve
and the Consolidated Statements of Cash Flows for the years ended December 31,
and the Notes relating thereto appear in the Statement of Additional Information
(Part B of the Registration Statement).
<S> <C> <C>
(b) Exhibits
(1) Resolution of the Board Directors of Incorporated by reference to
The Prudential Insurance Company Exhibit (1) to post effective
of America establishing The amendment No. __ to the Registration
Prudential Variable Contract Statement of The Prudential Variable
Account-11 Contract Account-10, Registration
No. 2-76580, filed February __, 1997
(2) Rules and Regulations of The Incorporated by reference to
Prudential Variable Contract Exhibit (2) to Post-Effective
Account-11 Amendment No. 15 to this
Registration Statement filed
April 28, 1989
(To be filed via EDGAR)
(3) Custodian Agreement with Morgan Incorporated by reference to
Guaranty Trust Company of New Exhibit (8)(i) to Pre-Eftective
York Amendment No. 1 to this
Registration Statement, filed
August 4, 1982
(To be filed via EDGAR)
(4) Investment Management Agreement Incorporated by reference to
between Prudential and The Exhibit (5) to this Registration
Prudential Variable Contract Statement, filed March 19, 1982
Account-11 (To be filed via EDGAR)
(i) Amendment No. 1 to Investment Incorporated by reference to
Management Agreement between Exhibit (5)(i) to Post-Effective
Prudential and The Prudential Amendment No. 4 to this
Variable Contract Account-11 Registration Statement, filed
March 27, 1985
(To be filed via EDGAR)
(5) Agreement Relating to the Sale of Incorporated by reference to
Certain Contracts on a Variable Exhibit (6) to this Registration
Basis between Prudential and The Statement, filed March 19, 1982
Prudential Variable Contract (To be filed via EDGAR)
Account-11
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
(i) Agreement for the Sale of VCA-11 Incorporated by reference to
Contracts between Prudential, The Exhibit (5)(i) to Post-Effective
Prudential Variable Contract Amendment No. 23 to this
Account-11 and Prudential Asset Registration Statement, filed
Management Company Securities April 27, 1993
Corporation (To be filed via EDGAR)
(ii) Agreement for the Sale of
VCA-11 Contracts between
Prudential, The Prudential Variable
Contract Account-11 and Prudential
Retirement Services, Inc.
(iii) Agreement for the Sale of Incorporated by reference to
VCA-11 Contracts between Exhibit (5) (ii) to Post-Effective
Prudential, The Prudential Variable Amendment No. 23 to this
Contract Account-11 and Prudential Registration Statement, filed
Investment Management Services LLC. April 27, 1993
(To be filed via EDGAR)
(6) (i)(a) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1000 for Exhibit (6)(i)(a) to Post-Effective
individual retirement annuities Amendment No. 9 to this
Registration Statement, filed
April 24, 1987
(To be filed via EDGAR)
(i)(b) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1000 for Exhibit (6)(i)(b) to Post-Effective
individual retirement annuity Amendment No. 8 to this
contracts issued after May 1, 1987 Registration Statement, filed
April 1, 1987
(To be filed via EDGAR)
(i)(c) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1000 for Exhibit (6)(i)(c) to Post-Effective
individual retirement annuity Amendment No. 11 to this
contracts issued after May 1, 1988 Registration Statement, filed
April 8, 1988
(To be filed via EDGAR)
(i)(d) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1000 for Exhibit (6)(i)(d) to Post-Effective
individual retirement annuity Amendment No. 17 to this
contracts issued after May 1, 1990 Registration Statement, filed
April 30, 1990
(To be filed via EDGAR)
(i)(e) Specimen Copy of Group Incorporated by reference to
Annuity Amendment Form GAA-7793 Exhibit (6)(i)(e) to Post-Effective
for individual retirement annuity Amendment No. 17 to this
contracts issued before May 1, 1990 Registration Statement, filed
April 30, 1990
(To be filed via EDGAR)
(ii)(a) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-120-82 Exhibit (6)(ii)(a) to Post Effective
for tax-deferred annuities with Amendment No. 9 to this
modifications for certain tax changes Registration Statement, filed
and the exchange offer April 24, 1987
(To be filed via EDGAR)
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</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
(ii)(b) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-120-87 Exhibit (6)(ii)(b) to Post-Effective
for tax-deferred annuity contracts Amendment No. 8 to this
issued after May 1, 1987 Registration Statement, filed
April 1, 1987
(To be filed via EDGAR)
(ii)(c) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-120-87 Exhibit (6)(ii)(c) to Post-Effective
for tax-deferred annuity contracts Amendment No. 11 to this
issued after May 1, 1988 Registration Statement, filed
April 8, 1988
(To be filed via EDGAR)
(ii)(d) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-120-87 Exhibit (6)(ii)(d) to Post-Effective
for tax-deferred annuity contracts Amendment No. 17 to this
issued after May 1, 1990 Registration Statement, filed
April 30, 1990
(To be filed via EDGAR)
(ii)(e) Specimen Copy of Group Incorporated by reference to
Annuity Amendment Form GAA-7764 Exhibit (G)(ii)(e) to Post-Effective
for tax-deferred annuity contracts Amendment No. 17 to this
issued before May 1, 1990 Registration Statement, filed
April 30, 1990
(To be filed via EDGAR)
(iii)(a) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1010 for Exhibit (6)(iii) (a) to Post-Effective
deferred compensation plans Amendment No. 9 to this
Registration Statement, filed
April 24, 1987
(To be filed via EDGAR)
(iii)(b) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1010 for Exhibit (6)(iii)(b) to Post-Effective
deferred compensation plan Amendment No. 8 to this
contracts issued after May 1, 1987 Registration Statement, filed
April 1, 1987
(To be filed via EDGAR)
(iii)(c) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1010 for Exhibit (6)(iii)(c) to Post-Effective
deferred compensation plan Amendment No. 11 to this
contracts issued after May 1, 1988 Registration Statement, filed
April 8, 1988
(To be filed via EDGAR)
(iii)(d) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1010 for Exhibit (6)(iii)(d) to Post-Effective
deferred compensation plan Amendment No. 17 to this
contracts issued after May 1, 1990 Registration Statement, filed
April 30, 1990
(To be filed via EDGAR)
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
(iii)(e) Specimen Copy of Group Incorporated by reference to
Annuity Amendment Form GAA-7792 Exhibit (6)(iii)(e) to Post-Effective
for deferred compensation plan Amendment No. 17 to this
contracts issued before May 1, 1990 Registration Statement, filed
April 30, 1990
(To be filed via EDGAR)
(iii)(f) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form Exhibit 99.1 to Post-Effective
GAA-7900-DefComp for deferred Amendment No. 27 to the
compensation plan contracts issued Registration Statement of The
before May 1, 1996 Prudential Variable Contract
Account-10, Registration Statement
No. 2-76580, filed April 29, 1996.
(iii)(g) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form Exhibit 99.11 to Post-Effective
GAA-7900-DefComp-1 for deferred Amendment No. 27 to the
compensation plan contracts issued Registration Statement of The
before May 1, 1996 Prudential Variable Contract
Account-10, Registration Statement
No. 2-76580, filed April 29, 1996.
(iii)(h) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form Exhibit 99.12 to Post-Effective
GAA-7900-Secular for deferred Amendment No. 27 to the
compensation plan contracts issued Registration Statement of The
before May 1, 1996 Prudential Variable Contract
Account-10, Registration Statement
No. 2-76580, filed April 29, 1996.
(iii)(i) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form Exhibit 99.13 to Post-Effective
GAA-7900-Secular-1 for deferred Amendment No. 27 to the
compensation plan contracts issued Registration Statement of The
before May 1, 1996 Prudential Variable Contract
Account-10, Registration Statement
No. 2-76580, filed April 29, 1996.
(iv) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-110-82 Exhibit (6)(iv) to Post-Effective
for Keogh Plans Amendment No. 8 to this
Registration Statement, filed
April 1, 1987
(To be filed via EDGAR)
(v) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-7454 for Exhibit (4)(v) to Post-Effective
Participants governed by the Texas Amendment No. 5 to this
Optional Retirement Program Registration Statement, filed
April 30, 1985
(To be filed via EDGAR)
(a) Modifications for certain tax Incorporated by reference to
changes Exhibit (6)(v)(a) to Post-Effective
Amendment No. 8 to this
Registration Statement, filed
April 1, 1987
(To be filed via EDGAR)
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
(vi) Specimen Copy of Group Incorporated by reference to
Annuity Contract Form GVA-1010 for Exhibit (6)(vi) to Post-Effective
non-qualified deferred compensation Amendment No. 11 to this
plans Registration Statement, filed
April 8, 1988
(To be filed via EDGAR)
(7) Application and Enrollment Forms as Incorporated by reference to
revised for use after May 1, 1991 Exhibit (7) to Post-Effective
Amendment No. 19 to this
Registration Statement, filed
April 29, 1991
(To be filed via EDGAR)
(8) (i) Certificate of Adoption of Incorporated by reference to
Amendments to Amended Charter of Exhibit (8)(i) to Post-Effective
Prudential and of the Adoption and Amendment No. 11 to this
Ratification of a New Amended Registration filed April 8, 1988
Charter of Statement, such (To be filed via EDGAR)
Corporation (includes restated
Amended Charter)
(ii) Copy of the By-Laws of Incorporated by reference to
Prudential, as amended Exhibit 99.2 to Post-Effective
August 8, 1995 Amendment No. 27 to the
Registration Statement of The
Prudential Variable Contract
Account-10, Registration
No. 2-76580, filed April 29, 1996
(11) (i) Service Agreement between Incorporated by reference to
Prudential and The Prudential Exhibit (10)(i) to Post-Effective
Investment Corporation Amendment No. 4 to this
Registration Statement, filed
March 27, 1985
(To be filed via EDGAR)
(ii) Service Agreement between Incorporated by reference to
Prudential and The Prudential Asset Exhibit (10)(ii) to Post-Effective
Management Company, Inc. Amendment No. __ to the Registation
Statement of The Prudential Variable
Contract Account-10, Registration
No. 2-76580, filed February __, 1997.
(13) (i) Consent of independent public [To be filed by Amendment]
accountants
(ii)Powers of Attorney
(a) Members of the Registrant's Incorporated by reference to Exhibit
Committee: 13(ii)(a) to Post-Effective
M. Melzer Amendment No. 26 to the
S. McDonald Registration Statement of The
J. Greene Prudential Variable Contract
J. Weber Account-10, Registration
No. 2-76580, filed April 28, 1995
</TABLE>
C-5
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
S. Fenster Incorporated by Reference to Exhibit
13(ii)(a) to Post-Effective
Amendment No. 26 to this
Registration Statement, Registration
No. 2-76581, filed April 28, 1995
(b) Directors and Officers of Incorporated by reference to Post-
Prudential Effective Amendment No. 15 to the
Registration Statement of The
F. Agnew, F Becker, Prudential Variable Appreciable
W. Boeschenstein, L. Carter, Account, Registration No.33-20000,
J. Cullen, C. Davis, R. Enrico, filed May 1, 1995
A. Gilmour, W. Gray, J. Hanson,
C. Horner, A. Jacobson,
G. Keith, B. Malkiel, A. Ryan,
C. Sitter, D. Staheli,
R. Thomson, P. Vagelos, S. Van
Ness, P. Volcker, J. Williams
M. Grier Incorporated by reference to the
Registration Statement of The
Prudential Variable Appreciable
Account, Registration No.33-61079,
filed July 17, 1995
J. Unruh To be filed
(16) Calculation of Performance Data [To be added by Amendment]
(17) Financial Data Schedule [To be added by Amendment]
</TABLE>
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<PAGE>
Item 29. DIRECTORS AND OFFICERS OF PRUDENTIAL
Information about Prudential's Directors and Executive Officers appears under
the heading "Directors and Officers of Prudential" in the Statement of
Additional Information (Part B of this Registration Statement).
Item 30. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
Registrant is a separate account of The Prudential Insurance Company of America,
a mutual life insurance company organized under the laws of the State of New
Jersey. The subsidiaries of Prudential are shown on the Organization Chart on
pages following.
In addition to the subsidiaries shown on the Organization Chart, Prudential
holds all of the voting securities of Prudential's Gibraltar Fund, a Delaware
corporation, in three of its separate accounts. Prudential also holds directly
and in three of its other separate accounts, and in The Prudential Variable
Contract Account-24, shares of The Prudential Series Fund, Inc., a Maryland
corporation. The balance of the shares are held in separate accounts of Pruco
Life Insurance Company and Pruco Life Insurance Company of New Jersey,
wholly-owned subsidiaries of Prudential. All of the separate accounts referred
to above are unit investment trusts registered under the Investment Company Act
of 1940. Prudential's Gibraltar Fund and The Prudential Series Fund, Inc. are
registered as open-end, diversified management investment companies under the
Investment Company Act of 1940. The shares of these investment companies are
voted in accordance with the instructions of persons having interests in the
unit investment trusts, and Prudential, Pruco Life Insurance Company and Pruco
Life Insurance Company of New Jersey vote the shares they hold directly in the
same manner that they vote the shares that they hold in their separate accounts.
Registrant may also be deemed to be under common control with The Prudential
Variable Contract Account-2 and The Prudential Variable Contract Account-10,
separate accounts of Prudential registered as open-end, diversified management
investment companies under the Investment Company Act of 1940, and with the
Prudential Variable Contract Account-24, a separate account of Prudential
registered as a unit investment trust.
The Prudential is a mutual insurance company. Its financial statements include
the consolidated accounts of Prudential, its wholly-owned life insurance
subsidiary, Pruco Life Insurance Company, and its non-insurance subsidiaries on
a fully consolidated basis. The financial statements have been prepared in
conformity with generally accepted accounting principles, which as to The
Prudential and its insurance subsidiaries include statutory accounting practices
prescribed or permitted by state regulatory authorities for insurance companies.
C-7
<PAGE>
<TABLE>
<CAPTION>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA AND ITS SUBSIDIARIES
The Prudential Insurance Company of America
<S> <C> <C>
Fine Homes, L.P. (1) (see page 2 for Direct and Indirect subs)
Gibraltar Casualty Company
Health Ventures Partner, Inc.
HSG Health Systems Group Limited
Industrial Trust Company
Jennison Associates Capital Corp. JACC Services Corp.
PGR Advisors I, Inc.
Clive Discount Company Limited Clivco Nominees Limited
Clive Agency Bond Broking Limited
Clivwell Securities Limited
PRICOA Capital Group Limited
PRICOA Funding Limited PRICOA Investment Company
PRICOA Property Investment Management Northern Retail Properties (General
Limited Partner) Limited
PIC Holdings Limited PRICOA P.I.M. (Regulated) Limited
TransEuropean Properties
(General Partner) Limited
TransEuropean Properties
(General Partner) II Limited
Varsity Fund (General Partner) Limited
PRICOA Realty Group Limited
PIC Realty Canada Limited
PREMISYS Real Estate Services, Inc. PREMISYS Real Estate Services, Inc. of
Colorado (2)
PRICOA Vida, Sociedad Anonima de Seguros y PRICOA Invest, Sociedad Anonima, S.G.C.
Reaseguros (3)
PRICOA, Vita S.p.A.
PRUCO, Inc. (see pages 3-6 for Direct and Indirect subs)
Pruco Life Insurance Company Pruco Life Insurance Company of New Jersey
The Prudential Life Insurance Company of
Arizona
Prudential Direct Advisers, Inc.
Prudential Direct Distributors, Inc.
Prudential Fund Management Canada Limited
Prudential Global Funding, Inc. Prudential-Bache Capital Funding (Swaps)
Limited
Prudential Homes Corporation Prudential Texas Residential Services
Corporation
Prudential Mortgage Asset Corporation
Prudential Mortgage Asset Corporation II
Prudential Mutual Fund Management, Inc. (4)
Prudential of America General Insurance OTIP/RAEO Insurance Company, Inc. (5)
Company (Canada)
Prudential of America Life Insurance Company
(Canada) (6)
Prudential Private Placement Investors, Inc.
Prudential Realty Securities II, Inc. (7)
Prudential Select Holdings, Inc. Prudential Select Life Insurance Company
of America
Prudential Service Bureau, Inc.
PruLease, Inc.
PruServicos Participacoes, S.A. (8)
Residential Services Corporation of America (see page 2 for Direct and Indirect subs)
Prudential HealthCare and Life Insurance
Company of America
The Prudential Investment Corporation (see page 7 for Direct and Indirect subs)
The Prudential Life Insurance Company of
Korea, Ltd.
The Prudential Life Insurance Company, Ltd.
The Prudential Real Estate Affiliates, Inc. (see page 2 for Direct and Indirect subs)
U.S. High Yield Management Company
- ------------------
</TABLE>
(1) Fine Homes, L.P. is a partnership which owns subsidiaries.
(2) PREMISYS Real Estate Services, Inc. of Colorado is 80% owned by PREMISYS
Real Estate Services, Inc. and 20% owned by Peter Coakley.
(3) PRUCO, Inc. owns 26 shares ([less-than]1%) of PRICOA Vida, Sociedad Anonima
de Seguros y Reaseguros.
(4) Prudential Mutual Fund Management, Inc. is 85% owned by Prudential
Securities Incorporated and 15% owned by The Prudential.
(5) OTIP/RAEO Insurance Company, Inc. is 95% owned by Prudential of America
General Insurance Company (Canada) and 5% owned by OTIP Insurance Brokers,
Inc.
(6) Prudential of America Life Insurance Company (Canada) is 75% owned by The
Prudential and 25% owned by PPI Financial Group, Ltd.
(7) Prudential Realty Securities II, Inc. is 87% owned by The Prudential and
13% owned by PRUCO, Inc.
(8) PRUCO, Inc. owns 1 share ([less-than]1%) of PruServicos Participacoes, S.A.
6/30/95
C-8
<PAGE>
<TABLE>
<CAPTION>
The Prudential Insurance Company of America
<S> <C> <C>
Major Escrow Corp.
ML/MSB Acquisition, Inc.
PRICOA Relocation Management, Ltd.
PRS Escrow Services, Inc.
Fine Homes, L.P. Prudential Community Interaction Consulting, Inc.
(from p. 1) Prudential New York Homes Corporation
Prudential Oklahoma Homes Corporation
Prudential Relocation Mangagement Company of
Canada Ltd.
Prudential Resources Management Asia, Limited
The Relocation Funding Corporation of America
Residential Lender's Service, Inc. Lender's Service Title Agency, Inc.
Services Private Label Mortgage Services Corporation
Corporation Residential Information Services, Inc.
of America Securitized Asset Sales, Inc.
(from p. 1) Securitized Asset Services Corporation
The Prudential Home Mortgage Company, Inc. The Prudential Home Mortgage Securities
Company, Inc.
The Prudential Prudential Referral Services, Inc.
Real Estate The Prudential Real Estate Financial Services of The Prudential Real Estate Financial Services of
Affiliates, Inc. America, Inc. Long Island, Inc.
(from p. 1)
</TABLE>
C-9
<PAGE>
<TABLE>
The Prudential Insurance Company of America
<S> <C> <C> <C>
Capital Agricultural Property Services, Inc.
Flor-Ag Corporation
GIB Laboratories, Inc.
P.G. Realty, Inc.
PIC Realty Corporation
Pruco Securities Corporation
Prudential Agricultural Credit, Inc.
Prudential Capital and Investment Services, Inc. (See Pages 4-6 for Direct and
Prudential Dental Maintenance Indirect subs)
Organization, Inc.
Prudential Direct, Inc.
Prudential Equity Investors, Inc.
Prudential Funding Corporation
Prudential Health Care Plan, Inc.
Prudential Health Care Plan of California, Inc.
Prudential Health Care Plan of Connecticut, Inc.
Prudential Health Care Plan of Georgia, Inc.
Prudential Health Care Plan of New York, Inc.
PRUCO, Prudential Holdings, Inc.
Inc. (1) Prudential Institutional Fund Management, Inc.
(from p. 1) Prudential Commercial Insurance Company
Prudential Property and Casualty Insurance Prudential General Insurance Company
Company Prudential Insurance Brokerage, Inc.
The Prudential Lloyds (3)
The Prudential Property and Casualty
General Agency, Inc.
The Prudential Property and Casualty
Insurance Company of New Jersey
Prudential Realty Partnerships, Inc.
Prudential Realty Securities, Inc.
Prudential Realty Securities II, Inc. (2)
Prudential Reinsurance Holdings, Inc. Prudential Reinsurance Company Le Rocher Reinsurance, Ltd.
Prudential National Insurance
Company
Prudential Retirement Services, Inc.
Prudential Trust Company PTC Services, Inc.
Prudential Uniformed Services
Administrators, Inc.
The Prudential Bank and Trust Company PBT Mortgage Corporation
The Prudential Savings Bank, F.S.B.
</TABLE>
- -------------------
(1) PRUCO, Inc. owns 1 share ([less-than]1%) of PruServicos Participacoes,
S.A.
(2) Prudential Realty Securities II, Inc. is 87% owned by The Prudential and
13% owned by PRUCO, Inc.
(3) The Prudential Lloyds is controlled by Prudential Property and Casualty
Insurance Company by virtue of a trust agreement with each underwriter.
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<PAGE>
<TABLE>
<CAPTION>
The Prudential Insurance Company of America
PRUCO, Inc.
Prudential Capital and Investment Services, Inc. (from p.3)
<S> <C> <C> <C>
Lapine Holding Lapine Technology Corporation
Company (1)
Bache Insurance Agency of Arkansas, Inc.
Bache Insurance Agency of Louisiana, Prudential-Bache Securities
Inc. (Germany) Inc.
BraeLoch Successor Corporation (See page 5 for Direct and
Indirect subs)
PB Bullion Company, Inc.
PB Services (U.K.)
PGR Advisors, Inc.
Prudential-Bache Agriculture Inc.
Prudential-Bache Capital Funding
(Australia) Limited
Prudential-Bache Capital Funding BV Audley Finance BV
Prudential-Bache Energy Corp.
Prudential-Bache Energy Production Inc.
Prudential-Bache Holdings Inc. Prudential-Bache Partners Inc.
Prudential-Bache International Bank S.A.
Prudential-Bache International (U.K.) (See page 6 for Direct and
Limited Indirect subs)
Prudential-Bache Investor Services Inc.
Prudential-Bache Investor Services II, Inc.
Prudential Prudential-Bache Leasing Inc.
Securities Prudential-Bache Minerals Inc.
Group Inc. Prudential-Bache Program Services Inc.
Prudential-Bache Properties, Inc.
Prudential-Bache Real Estate, Inc.
Prudential-Bache Securities (Australia) (See page 5 for Direct Subs)
Limited
Prudential-Bache Trade Services Inc. PB Trade Ltd.
Prudential-Bache Forex (Hong
Kong) Limited
Prudential-Bache Forex (USA) Prudential-Bache Forex (U.K.)
Inc. Limited
Prudential-Bache Transfer Agent
Services, Inc.
Prudential Securities Incorporated (See page 6 for Direct and
Indirect subs)
Prudential Securities Lease Holding Inc.
Prudential Securities Municipal
Derivatives, Inc.
Prudential Securities Realty Funding
Corporation
Prudential Securities Secured Financing
Corporation
Prudential Securities Structured Assets, P-B Finance Ltd.
Inc.
R&D Funding Corp.
Seaport Futures Management, Inc.
Special Situations Management Inc.
- -----------------
</TABLE>
(1) Lapine Holding Company is 66.7% owned by Prudential Capital and Investment
Services, Inc., 28.3% owned by Kyocera Corp. and 5% owned by Kyocera (Hong
Kong) Ltd.
C-11
<PAGE>
<TABLE>
<CAPTION>
The Prudential Insurance Company of America
PRUCO, Inc.
Prudential Capital and Investment Services, Inc.
<S> <C> <C> <C>
BraeLoch
Successor
Corporation
(from p. 4) BraeLoch Holdings, Inc.
Prudential Prudential-Bache Bache Nominees, Ltd.
Securities Securities Corcarr Funds Management
Group, Inc. (Australia) Limited
Limited Corcarr Management Pty
(from p. 4) Limited
Corcarr Nominees Pty Limited
Corcarr Superannuation Pty
Limited
Divsplit Nominees Pty Limited
PruBache Nominees Pty
Limited
Graham Graham Depository Company II
Resources, Inc. Graham Energy, Ltd.
Graham Exploration, Ltd.
Graham Royalty, Ltd. Graham Production Company
Graham Securities Corporation
</TABLE>
C-12
<PAGE>
<TABLE>
The Prudential Insurance Company of America
PRUCO, Inc.
Prudential Capital and Investment Services, Inc.
Prudential Securities Group, Inc.
<CAPTION>
<S> <C> <C>
Prudential-Bache International Clive Discount Holdings International Limited
(U.K.) Limited (from p. 4) Page & Gwyther Holdings Limited
Page & Gwyther Limited
Prudential-Bache Capital Funding (Equities)
Limited Circle (Nominees) Limited
Prudential-Bache Capital Funding (Gilts) Limited
Prudential-Bache Capital Funding (Money
Brokers) Limited
Prudential-Bache (Futures) Limited
Prudential Securities Bache & Co. (Lebanon) S.A.L.
Incorporated (from p. 4) Bache & Co. S.A. de C.V. (Mexico)
Bache Halsey Stuart Shields (Antilles) N.V.
Bache Insurance Agency, Incorporated
Bache Insurance of Arizona Inc.
Bache Insurance of Kentucky, Inc.
Bache Shields Securities Corporation
Banom Corporation
Gelfand, Quinn & Associates, Inc.
P-B Holding Japan Inc. Prudential Securities (Japan) Limited
Prudential-Bache Futures Asia Pacific Ltd.
Prudential-Bache Futures (Hong Kong) Limited
Prudential-Bache Nominees (Hong Kong) Limited
Prudential-Bache Securities Asia Pacific Ltd.
Prudential-Bache Securities (Belgium) Inc.
Prudential-Bache Securities (Espana) S.A.
Prudential-Bache Securities (France) S.A.
Prudential-Bache Securities (Holland) Inc. Prudential-Bache Securities
(Holland) N.V.
Prudential-Bache Securities (Hong Kong) Limited
Prudential-Bache Securities (Luxembourg) Inc.
Prudential-Bache Securities (Monaco) Inc.
Prudential-Bache Securities (Switzerland) Inc.
Prudential-Bache Securities (U.K.) Inc. Shields Model Roland Company
Prudential Mutual Fund Management, Inc. (1) Prudential Mutual Fund
Distributors, Inc.
Prudential Mutual Fund Services, Inc.
Prudential Securities (Chile) Inc.
Prudential Securities CMO Issuer Inc.
Prudential Securities Futures Management, Inc.
Prudential Securities (South America) Incorporated Prudential Securities (Argentina)
Incorporated
Prudential Securities (Uruguay) S.A.
Shields Model Roland Securities Incorporated
Wexford Clearing Services Corporation
</TABLE>
- --------------
(1) Prudential Mutual Fund Management, Inc. is 85% owned by Prudential
Securities Incorporated and 15% owned by The Prudential.
C-13
<PAGE>
<TABLE>
The Prudential Insurance Company of America
The Prudential Investment Corporation (from p. 1)
<CAPTION>
<S> <C>
Gateway Holdings, S.A. Amicus Investment Company
Global Income Fund Management
Company, S.A.
Global Series Fund II Management
Company, S.A.
Jennison Long Bond Management Company
PAEC Management Company
Prudential Asset Sales and Syndications, Inc.
Prudential Home Building Investors, Inc.
PruSupply, Inc. PruSupply Capital Assets, Inc.
CSI Asset Management, Inc.
Enhanced Investment Technologies, Inc.
Mercator Asset Management, Inc.
PCM International, Inc.
Prudential Asset Management Company, Inc. Prudential Asia Investments Limited (1)
Prudential Asset Management Company
Securities Corporation
Prudential Timber Investments, Inc. (2)
The Prudential Investment Advisory Company, Ltd.
The Prudential Property Company, Inc.
The Prudential Realty Advisors, Inc.
TRGOAG Company, Inc.
</TABLE>
<TABLE>
<S> <C> <C> <C>
PAMA (Indonesia) Limited (4)
PAMA (Singapore) Private Limited
PruAsia DBS Limited (3) Prudential Asset Management
Asia Hong Kong Limited
P.T. PAMA Ventura Indonesia (5)
Prudential Asset Management
Asia Limited (BVI)
S.J. Bedding B.V. Simmons Bedding & Furniture (HK) Simmons Asia Simmons (Southeast Asia)
Ltd. (6) Limited (7) Private Limited
Prudential Asia Fund Management Limited (BVI) Simmons Co., Limited
Prudential Asia Fund
Management Limited
Prudential Asia Fund
Managers (HK) Limited
</TABLE>
- --------------
(1) The Prudential Asset Management Company, Inc. and Prudential Securities
Group, Inc. each own 50% of preferred stock and The Prudential Asset
Management Company, Inc. owns 100% common stock.
(2) The Prudential owns 6 shares (100%) of preferred stock in Prudential Timber
Investments, Inc.
(3) PruAsia DBS Limited is 50% owned by Prudential Asia Investments Limited and
50% owned by DBS, Inc.
(4) PAMA (Indonesia) Limited is 75% owned by Prudential Asset Management Asia
Limited (BVI), 15% owned by BDNI and 10% by IFC.
(5) P.T. PAMA Ventura Indonesia is 65% owned by Prudential Asset Management
Asia Limited (BVI), 20% owned by BDNI and 15% by IFC.
(6) Simmons Co. Limited and Simmons Bedding & Furniture (HK) Ltd. are 66.24%
owned by S.J. Bedding B.V. and 6.8% owned by Simmons U.S.A., 15% owned by
others and 12% by management.
(7) Simmons Asia Limited is 90% owned by Simmons Bedding & Furniture (HK) Ltd.
and 10% owned by Simmons U.S.A.
C-14
<PAGE>
06/30/95
SHORT DESCRIPTION OF EACH SUBSIDIARY
A. SUBSIDIARIES OF THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
1. FINE HOMES, L.P. (A Limited Partnership) (99% owned by Prudential, the
limited partner, and 1% owned by Prudential Homes Corporation, the general
partner) (See Section C for direct and indirect subsidiaries)
A limited partnership to hold real estate related subsidiaries.
2. GIBRALTAR CASUALTY COMPANY (Incorporated in Delaware) (100%)
Previously wrote unusual and non-standard property and casualty risks on a
Surplus Line basis. The company is currently servicing policies that it had
issued, but is not actively seeking new business.
3. HEALTH VENTURES PARTNER, INC. (Incorporated in Illinois) (100%)
Operates as a general partner of the joint venture Rush Prudential Health
Plans.
4. HSG HEALTH SYSTEMS GROUP LIMITED (Incorporated in Canada) (100%)
Provides consulting and administrative services to corporate fitness
facilities and wellness programs in Canada.
5. INDUSTRIAL TRUST COMPANY (Incorporated in Prince Edward Island, Canada)
(100%)
Holds a permit to operate as a trust and loan company in Prince Edward
Island. Currently inactive.
6. JENNISON ASSOCIATES CAPITAL CORP. (Incorporated in New York) (100%)
Provides institutional clients (employee benefit plans, endowments,
foundations, etc.) with discretionary management of portfolios investing in
stocks and bonds and acts as an advisor to The Prudential Institutional
Fund.
6a. JACC SERVICES CORP. (Incorporated in New York) (Owned by Jennison
Associates Capital Corp.) (100%)
Provides computer and accounting support necessary to handle portfolio
accounting and reporting.
7. PGR ADVISORS I, INC. (Incorporated in Delaware) (100%)
A general partner which provides management, advisory, and administrative
services to Global Realty Advisors, a Bermudian partnership that acts as
investment manager to the Prudential Global Real Estate Investment
Programme. Also ownes Global Realty Advisors (Bermuda) Limited, a Bermuda
liability company which acts as an investment manager to The South East
Asia Property Company Limited and to Seaprime Investments Pte Ltd. (an
unaffiliated entity).
C-15
<PAGE>
8. PIC HOLDINGS LIMITED (Incorporated in U.K.) (100%) (See section B for
direct and indirect subsidiaries)
Acts as a holding company to house the operating entities of Clive Discount
Company Limited., Clivco Nominees Limited, Clive Agency Bond Broking
Limited, Clivwell Securities Limited, PRICOA Capital Group Limited, PRICOA
Funding Limited, PRICOA Investment Company, PRICOA Property Investment
Management Limited., PRICOA P.I.M. (Regulated) Limited, TransEuropean
Properties (General Partner) Limited, Northern Retail Properties (General
Partner) Limited, TransEuropean Properties (General Partner) II Limited,
Varsity Fund (General Partner) Limited and PRICOA Realty Group Limited.
9. PIC REALTY CANADA LIMITED (Incorporated in Canada) (100%)
Owns, develops, operates, manages and leases real estate in Canada.
10. PREMISYS REAL ESTATE SERVICES, INC. (Incorporated in Pennsylvania) (100%)
Provides real estate properties/facilities management for The Prudential
and third parties and advisory services with respect to activities of this
type.
10a. PREMISYS REAL ESTATE SERVICES INC. OF COLORADO (Incorporated in Colorado)
(Owned by Premisys Real Estate Services, Inc.) (80%)
Provides real estate management and related services to unrelated third
parties in Colorado.
11. PRICOA VIDA, SOCIEDAD ANONIMA DE SEGUROS Y REASEGUROS (Incorporated in
Spain) (Less than 1% owned by PRUCO, Inc. and The Prudential Investment
Corporation. The remainder is owned by The Prudential)
Conducts individual life, group pension and group life business in Spain.
11a. PRICOA INVEST, SOCIEDAD ANONIMA, S.G.C. (Incorporated in Spain) (100% owned
by PRICOA Vida Sociedad Anonima de Seguros y Reaseguros)
Licensed to engage in third party investment management and actuarial
consulting in Spain.
12. PRICOA VITA S.P.A. (Incorporated in Italy) (100%)
Organized to sell life insurance and related financial products within
Italy.
13. PRUCO, INC. (Incorporated in New Jersey) (100%) (See Section F for direct
and indirect subsidiaries)
A holding company for other subsidiaries.
14. PRUCO LIFE INSURANCE COMPANY (Incorporated in Arizona) (100%)
Conducts individual life insurance and single pay deferred annuity business
in all states except New York. In addition, the Company markets individual
life insurance through it's branch office in Taiwan.
14a. PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY (Incorporated in New Jersey)
(Owned by Pruco Life Insurance Company) (100%)
Issues a product line corresponding to that of Pruco Life Insurance Company
in the states of New Jersey and New York.
C-16
<PAGE>
14b. THE PRUDENTIAL LIFE INSURANCE COMPANY OF ARIZONA (Incorporated in Arizona)
(Owned by Pruco Life Insurance Company) (100%)
A company licensed to sell life insurance in the state of Arizona.
15. PRUDENTIAL DIRECT ADVISERS, INC. (Incorporated in New Jersey) (100%)
Acts as the general partner and manages the affairs of the Prudential
Direct Advisers, L.P.
16. PRUDENTIAL DIRECT DISTRIBUTORS, INC. (Incorporated in New Jersey) (100%)
Serves as the distributor of mutual funds and related no-load products
managed or advised by the Prudential Direct Advisers, L.P.
17. PRUDENTIAL FUND MANAGEMENT CANADA LIMITED (Incorporated in Canada) (100%)
Manages and distributes mutual funds in Canada.
18. PRUDENTIAL GLOBAL FUNDING, INC. (Incorporated in Delaware) (100%)
Provides interest rate and currency swaps and other derivative products.
19. PRUDENTIAL-BACHE CAPITAL FUNDING (SWAPS) LIMITED (Incorporated in Canada)
(Owned by Prudential Global Funding, Inc.) (100%)
In liquidation.
20. PRUDENTIAL HOMES CORPORATION (Incorporated in New York) (100%)
Acts as the sole general partner of Fine Homes, L.P. and Prudential
Residential Services, Limited Partnership. It also acts as one of the two
general partners of The Prudential Relocation Management, Limited
Partnership.
20a. PRUDENTIAL TEXAS RESIDENTIAL SERVICES CORPORATION (Incorporated in Texas)
(Owned by Prudential Homes Corporation) (100%)
Acts as one of the two general partners of The Prudential Relocation
Management, Limited Partnership.
21. PRUDENTIAL MORTGAGE ASSET CORPORATION (Incorporated in Delaware) (100%)
Involved in the purchase and sale of mortgage related assets, mortgage
loans and mortgage pass-through certificates.
22. PRUDENTIAL MORTGAGE ASSET CORPORATION II (Incorporated in Delaware) (50%)
Inactive.
23. PRUDENTIAL MUTUAL FUND MANAGEMENT, INC. (Incorporated in Delaware) (15%
owned by The Prudential and 85% owned by Prudential Securities
Incorporated)
Mutual fund management company.
24. PRUDENTIAL OF AMERICA GENERAL INSURANCE COMPANY (CANADA) (Incorporated in
Canada) (100%)
Provides automobile and homeowner insurance in Canada.
C-17
<PAGE>
24a. OTIP/RAEO INSURANCE COMPANY, INC. (Incorporated in Canada) (95% owned by
Prudential of America General Insurance Company [Canada])
Provides automobile and homeowner insurance in Canada. This company markets
its products to those employed in the education sector.
25. PRUDENTIAL OF AMERICA LIFE INSURANCE COMPANY (CANADA) (Incorporated in
Canada) (75%)
Markets specialized life insurance products to the upper income segment of
the Canadian market place.
26. PRUDENTIAL PRIVATE PLACEMENT INVESTORS, INC. (Incorporated in New Jersey)
(100%)
Serves as General Partner to a newly formed partnership, Prudential Private
Placement Investors, L.P. ("PPPI, LP"), a Delaware Limited Partnership. It
is anticipated that PPPI, LP will provide investment advisory services to
pension plans and other institutional investors.
27. PRUDENTIAL REALTY SECURITIES II, INC. (Incorporated in Delaware) (87% owned
by The Prudential and 13% owned by PRUCO, Inc.)
Issues bonds secured by real estate mortgages.
28. PRUDENTIAL SELECT HOLDINGS, INC. (Incorporated in Delaware) (100%)
A holding company for the Prudential Select Life Insurance Company of
America.
29. PRUDENTIAL SELECT LIFE INSURANCE COMPANY OF AMERICA (Incorporated in
Minnesota) (Owned by Prudential Select Holdings, Inc.) (100%)
Intends to sell universal life insurance products to upper income and high
net worth individuals and corporations in all states except New York.
30. PRUDENTIAL SERVICE BUREAU, INC. (Incorporated in Kentucky) (100%)
Provides administrative services for employee benefits packages (i.e. COBRA
and FLEX) and pays medical and dental claims.
31. PRULEASE, INC. (Incorporated in Delaware) (100%)
Has an investment portfolio of loans, leases, and other forms of financing.
32. PRUSERVICOS PARTICIPACOES, S.A. (Incorporated in Brazil) (Less than 1%
owned by PRUCO, Inc. The remainder owned by The Prudential Insurance
Company of America.)
A holding company owning preferred shares, having certain limited voting
rights, representing 49 percent of the share capital of
Atlantica-Prudential Participacoes S.A., which in turn owns approximately
95 percent of the share capital of Prudential-Atlantica Companhia
Brasileria de Segu Brazilian property and casualty insurer.
33. RESIDENTIAL SERVICES CORPORATION OF AMERICA (Incorporated in Delaware)
(100%) (See Section D for direct and indirect subsidiaries)
A company which engages in the activities of its direct wholly owned
subsidiaries: Lender's Service, Inc., Private Label Mortgage Services
Corporation, Securitized Asset Sales, Inc., Securitized Asset Services
Corporation, The Prudential Home Mortgage Company, Inc., Residential
Information Services, Inc. and their subsidiaries.
C-18
<PAGE>
34. PRUDENTIAL HEALTHCARE AND LIFE INSURANCE COMPANY OF AMERICA (Incorporated
in New Jersey) (100%)
A life insurance company which presently is qualified only in New Jersey.
It has not yet commenced as an insurance business.
35. THE PRUDENTIAL INVESTMENT CORPORATION (Incorporated in New Jersey) (100%)
(See Section H for direct and indirect subsidiaries)
Has responsibility for the investment business of The Prudential. It in
turn owns all the outstanding stock of Gateway Holdings, S.A., Prudential
Asset Sales and Syndications, Inc., Prudential Home Building Investors,
Inc., PruSupply, Inc., The Prudential Asset Management Company, Inc.,
Prudential Investment Advisory Company, Ltd., TRGOAG Company, Inc., The
Prudential Property Company, Inc., and The Prudential Realty Advisors, Inc.
36. THE PRUDENTIAL LIFE INSURANCE COMPANY OF KOREA, LTD. (Incorporated in
Korea) (100%)
Organized to sell life insurance products within Korea.
37. THE PRUDENTIAL LIFE INSURANCE COMPANY, LTD. (Incorporated in Japan) (100%)
Organized to sell traditional and variable life insurance products within
Japan.
38. THE PRUDENTIAL REAL ESTATE AFFILIATES, INC. (Incorporated in Delaware)
(100%) (See Section E for direct and indirect subsidiaries)
Offers franchises to independently owned residential real estate brokers.
39. U.S. HIGH YIELD MANAGEMENT COMPANY (Incorporated in New Jersey) (100%)
Provides management services (through the Capital Markets Group) to the
U.S. High Yield Fund, a high yield corporate bond fund organized in
Luxembourg.
B. SUBSIDIARIES OF PIC HOLDINGS LIMITED
1. Clive Discount Company Limited (Incorporated in U.K.) (Owned by PIC
Holdings Limited) (100%)
Operates as a discount house in the London market.
1a. CLIVCO NOMINEES LIMITED (Incorporated in the U.K.) (Owned by Clive Discount
Company Limited) (100%)
Inactive.
1b. CLIVE AGENCY BOND BROKING LIMITED (Incorporated in U.K.) (Owned by Clive
Discount Company Limited) (100%)
Identifies attractive investment opportunities in the business of brokering
Government Bonds in the United Kingdom and continental Europe.
C-19
<PAGE>
2. CLIVWELL SECURITIES LIMITED (Incorporated in U.K.) (Owned by PIC Holdings
Limited) (100%)
An investment company which consists of Mithras Investment Trust holdings
and an 8.5% interest in a real estate investment trust which holds a
leasehold interest in a 12 story commercial building in London, England.
3. PRICOA CAPITAL GROUP LIMITED (Incorporated in U.K.) (Owned by PIC Holdings
Limited) (100%)
Identifies attractive investment opportunities in the United Kingdom and
continental Europe.
4. PRICOA FUNDING LIMITED (Incorporated in U.K.) (Owned by PIC Holdings
Limited) (100%)
A finance company borrowing capital from The Prudential, and lending the
capital to its subsidiary company PRICOA Investment Company to fund its
investment activities.
4a. PRICOA INVESTMENT COMPANY (Incorporated in U.K.) (Owned by PRICOA Funding
Limited) (100%)
To identify attractive investment opportunities in the United Kingdom and
continental Europe for sale to, or managed on behalf of, third party
clients.
5. PRICOA PROPERTY INVESTMENT MANAGEMENT LIMITED (Incorporated in U.K.) (Owned
by PIC Holdings Limited) (100%)
Provides investment management and investment advisory services to
international institutional clients who invest in U.K. and continental
European real estate.
5a. NORTHERN RETAIL PROPERTIES (GENERAL PARTNER) LIMITED (Incorporated in U.K.)
(Owned by PRICOA Property Investment Management Limited) (100%)
Serves as general partner to Northern Retail Property Ltd. Partnership. A
U.K. limited partnership whose principle activity is investment in three
retail units in northern Britain.
5b. PRICOA P. I. M. (REGULATED) LIMITED (Incorporated in the U.K.) (Owned by
PRICOA Property Investment Management Limited) (100%)
Provides investment management and investment advisory services to
international institutional clients who invest in U.K. and continental
European real estate.
5c. TRANSEUROPEAN PROPERTIES (GENERAL PARTNER) LIMITED (Incorporated in the
U.K.) (Owned by PRICOA Property Investment Management Limited) (100%)
Serves as general partner to TransEuropean Property Limited Partnership, a
U.K. limited partnership. The principal activity of TransEuropean Property
Limited Partnership is investment in European property.
5d. TRANSEUROPEAN PROPERTIES (GENERAL PARTNER) II LIMITED (Incorporated in the
U.K.) (Owned by PRICOA Property Investment Management Limited) (100%)
Will serve as the general partner to TransEuropean Property Limited
Partnership II, a partnership formed to invest in European real estate.
C-20
<PAGE>
5e. VARSITY FUND (GENERAL PARTNER) LIMITED (Incorporated in the U.K.) (100%
owned by PRICOA Property Investment Management Limited)
Formed to serve as general partner of a limited partnership investing in
U.K. college and university student accommodations. The plans for this fund
changed, and this entity is currently "on the shelf" and not being used.
6. PRICOA REALTY GROUP LIMITED (Incorporated in U.K.) (Owned by PIC Holdings
Limited) (100%)
Provides international real estate services to PGR Advisors I, Inc. in
connection with the Prudential Global Real Estate Programme, and provides
The Prudential with a presence in London to monitor developments and
identify attractive investment opportunities in European property markets,
as well as identifying investment opportunities in other international
markets.
C. SUBSIDIARIES OF FINE HOMES, L.P.
Subsidiaries C.1 through C.9 are 100% owned by Prudential Residential
Services, Limited Partnership ("PRS LP").
1. MAJOR ESCROW CORP. (Incorporated in California) (100%)
Inactive.
2. ML/MSB ACQUISITION, INC. (Incorporated in Delaware) (100%)
Acts as the general partner of Moran, Stahl & Boyer, L.P.
3. PRICOA RELOCATION MANAGEMENT, LTD. (Incorporated in U.K.) (100%)
Involved in the relocation consulting business.
4. PRS ESCROW SERVICES, INC. (Incorporated in California) (100%)
Inactive.
5. PRUDENTIAL COMMUNITY INTERACTION CONSULTING, INC. (Incorporated in
Delaware) (100%)
Consulting activities involving community relations for Prudential
Resources Management's corporate clients with facilities which have had or
might have an adverse environmental impact on surrounding communities.
6. PRUDENTIAL NEW YORK HOMES CORPORATION (Incorporated in New York) (100%)
General partner of Moran, Stahl & Boyer, a New York general partnership and
Prudential Relocation Management, a New York general partnership.
7. PRUDENTIAL OKLAHOMA HOMES CORPORATION (Incorporated in Oklahoma) (100%)
Inactive.
8. PRUDENTIAL RELOCATION MANAGEMENT COMPANY OF CANADA LTD. (Incorporated in
Ontario, Canada) (100%)
Involved in the relocation business.
C-21
<PAGE>
9. PRUDENTIAL RESOURCES MANAGEMENT ASIA, LIMITED (Incorporated in Hong Kong)
(100%)
Provides relocation services in Asia -- on-site center for Goldman Sachs in
Hong Kong.
10. THE RELOCATION FUNDING CORPORATION OF AMERICA (Incorporated in California)
(100%)
Involved in the relocation business.
D. SUBSIDIARIES OF RESIDENTIAL SERVICES CORPORATION OF AMERICA
1. LENDER'S SERVICE, INC. (Incorporated in Delaware) (100%)
Obtains residential mortgage appraisals on behalf of mortgage lenders,
provides title agency services, and manages the provision of closing
services.
1a. LENDER'S SERVICE TITLE AGENCY, INC. (Incorporated in Ohio) (Owned by
Lender's Service, Inc.) (100%)
Acts as a title agent in the state of Ohio.
2. PRIVATE LABEL MORTGAGE SERVICES CORPORATION (Incorporated in Delaware)
(100%)
Provides residential mortgage loan underwriting and origination services to
other companies for a fee.
3. RESIDENTIAL INFORMATION SERVICES, INC. (Incorporated in Delaware) (100%)
Serves as the sole general partner of Residential Information Services
Limited Partnership, which provides technology and information services to
mortgage banking industry.
4. SECURITIZED ASSET SALES, INC. (Incorporated in Delaware) (100%)
Registrant of new rent-a-shelf business and sells public and private
mortgage-backed securities.
5. SECURITIZED ASSET SERVICES CORPORATION (Incorporated in New Jersey) (100%)
Services and administers mortgage loans and related real property and
provides security administration services.
6. THE PRUDENTIAL HOME MORTGAGE COMPANY, INC. (Incorporated in New Jersey)
(100%)
Finances residential mortgage loans, through direct origination and
purchases, services and sells residential mortgage loans, and engages in
other residential mortgage banking activities.
6a. THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC. (Incorporated in
Delaware) (Owned by The Prudential Home Mortgage Company, Inc.) (100%)
Issues public and private mortgage-backed securities.
C-22
<PAGE>
E. SUBSIDIARIES OF THE PRUDENTIAL REAL ESTATE AFFILIATES, INC.
1. PRUDENTIAL REFERRAL SERVICES, INC. (Incorporated in Delaware) (100%)
Operates a residential real estate referral network.
2. THE PRUDENTIAL REAL ESTATE FINANCIAL SERVICES OF AMERICA, INC.
(Incorporated in California) (100%)
Inactive.
2a. THE PRUDENTIAL REAL ESTATE FINANCIAL SERVICES OF LONG ISLAND, INC.
(Incorporated in California) (Owned by The Prudential Real Estate Financial
Services of America, Inc.) (100%)
Inactive.
F. SUBSIDIARIES OF PRUCO, INC.
1. CAPITAL AGRICULTURAL PROPERTY SERVICES, INC. (Incorporated in Delaware)
(100%)
Provides management and real estate brokerage services for agricultural
properties of The Prudential and others.
2. FLOR-AG CORPORATION (Incorporated in Florida) (100%)
Engages primarily in the purchase, development, operation, lease and sale
of farmland in Florida.
3. GIB LABORATORIES, INC. (Incorporated in New Jersey) (100%)
Provides clinical bioanalytical services to The Prudential, as well as to
other insurance companies and industries in the United States and Canada.
4. P.G. REALTY, INC. (Incorporated in Nebraska) (100%)
Engages primarily in the purchase, development, operation, lease and sale
of farmland in Nebraska.
5. PIC REALTY CORPORATION (Incorporated in Delaware) (100%)
Engages in the business of owning, developing, operating, managing, and
leasing real estate property in the United States either directly or
through participation in joint venture partnerships.
6. PRUCO SECURITIES CORPORATION (Incorporated in New Jersey) (100%)
Acts as a registered securities broker-dealer, licensed in every state,
Washington D.C. and Guam. Serves primarily as the medium through which
registered agents of The Prudential sell Prudential Securities Incorporated
mutual funds and offer variable products from Pruco Life and The
Prudential.
7. PRUDENTIAL AGRICULTURAL CREDIT, INC. (Incorporated in Tennessee) (100%)
Provides a broad range of financial services to agriculture, including farm
real estate mortgages, short term financing and equipment leasing.
C-23
<PAGE>
8. PRUDENTIAL CAPITAL AND INVESTMENT SERVICES, INC. (Incorporated in Delaware)
(100%) (See Section G for direct and indirect subsidiaries)
A holding company for other subsidiaries.
9. PRUDENTIAL DENTAL MAINTENANCE ORGANIZATION, INC. (Incorporated in Texas)
(100%)
A Dental Maintenance Organization which serves the state of Texas.
10. PRUDENTIAL DIRECT, INC. (Incorporated in Georgia) (100%)
Provides direct response and direct marketing services to The Prudential
and its subsidiaries.
11. PRUDENTIAL EQUITY INVESTORS, INC. (Incorporated in New York) (100%)
As a registered investment advisor, it makes private equity investments
through Limited Partnerships comprised of institutional investors including
The Prudential.
12. PRUDENTIAL FUNDING CORPORATION (Incorporated in New Jersey) (100%)
Serves as a financing company for The Prudential and its subsidiaries.
Funds are obtained primarily through the issuance of commercial paper,
private placement medium term notes, Eurobonds, Eurocommercial paper,
Euro-medium term notes and master notes.
13. PRUDENTIAL HEALTH CARE PLAN, INC. (Incorporated in Texas) (100%)
A federally-qualified Health Maintenance Organization which serves the New
Jersey; Houston, Dallas, San Antonio, Austin and El Paso, Texas; Nashville
and Memphis, Tennessee; Chicago, Illinois; Jacksonville, Tampa, Orlando and
South Florida, Florida; Richmond, Virginia; St. Louis and Kansas City,
Missouri; Columbus, Cleveland and Cincinnati, Ohio; Charlotte, and
Raleigh/Durham/Chapel Hill, North Carolina; Denver, Colorado; Oklahoma City
and Tulsa, Oklahoma; Baltimore, Maryland; Washington, D.C.; Philadelphia,
Pennsylvania; Kansas City, Kansas; Little Rock, Arkansas; Massachusetts and
Indiana areas.
14. PRUDENTIAL HEALTH CARE PLAN OF CALIFORNIA, INC. (Incorporated in
California) (100%)
A Health Maintenance Organization which serves the California area.
15. PRUDENTIAL HEALTH CARE PLAN OF CONNECTICUT, INC. (Incorporated in
Connecticut) (100%)
A Health Maintenance Organization which serves the Connecticut area.
16. PRUDENTIAL HEALTH CARE PLAN OF GEORGIA, INC. (Incorporated in Georgia)
(100%)
A Health Maintenance Organization which serves the Georgia area.
17. PRUDENTIAL HEALTH CARE PLAN OF NEW YORK, INC. (Incorporated in New York)
(100%)
A Health Maintenance Organization which serves the New York area.
18. PRUDENTIAL HOLDINGS, INC. (Incorporated in Delaware) (100%)
A holding company that does not currently hold any other companies.
C-24
<PAGE>
19. PRUDENTIAL INSTITUTIONAL FUND MANAGEMENT, INC. (Incorporated in
Pennsylvania) (100%)
A registered investment advisor which manages a series of mutual funds. The
funds are offered to institutional investors, principally
employer-sponsored defined contribution plans.
20. PRUDENTIAL PROPERTY AND CASUALTY INSURANCE COMPANY (Incorporated in
Indiana) (100%)
Provides dwelling, fire, automobile, homeowners or personal catastrophe
insurance for all states except New Jersey.
20a. PRUDENTIAL COMMERCIAL INSURANCE COMPANY (Incorporated in Delaware) (Owned
by Prudential Property and Casualty Insurance Company) (100%)
Writes automobile insurance and various commercial coverage in many states.
The company's contract as a servicing carrier, for the New Jersey
Automobile Full Insurance Underwriting Association, expired in March, 1989.
The company will continue to service claims during the run-off period.
20b. PRUDENTIAL GENERAL INSURANCE COMPANY (Incorporated in Delaware) (Owned by
Prudential Property and Casualty Insurance Company) (100%)
Provides coverage for preferred homeowners and private passenger
automobiles in many states.
20c. PRUDENTIAL INSURANCE BROKERAGE, INC. (Incorporated in Arizona) (Owned by
Prudential Property and Casualty Insurance Company) (100%)
Acts as an insurance broker and agency in many states.
20d. THE PRUDENTIAL LLOYDS (Incorporated in Texas) (100% owned by Prudential
Property and Casualty Insurance Company by virtue of a trust agreement with
each underwriter.)
A Lloyds insurer authorized to transact fire and casualty insurance
business within the State of Texas.
20e. THE PRUDENTIAL PROPERTY AND CASUALTY GENERAL AGENCY, INC. (Incorporated in
Texas) (Owned by Prudential Property and Casualty Insurance Company) (100%)
Acts as Managing General Agency in the state of Texas.
21. THE PRUDENTIAL PROPERTY AND CASUALTY INSURANCE COMPANY OF NEW JERSEY
(Incorporated in New Jersey) (100%)
Writes automobile, homeowner and personal catastrophe liability lines of
business in the state of New Jersey.
22. PRUDENTIAL REALTY PARTNERSHIPS, INC. (Incorporated in Delaware) (100%)
Acts as a general partner in limited partnerships which own real estate.
23. PRUDENTIAL REALTY SECURITIES, INC. (Incorporated in Delaware) (100%)
Issues zero coupon bonds secured by residential mortgages.
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24. PRUDENTIAL REALTY SECURITIES II, INC. (Incorporated in Delaware) (87% owned
by The Prudential and 13% owned by PRUCO, Inc.)
Issues bonds secured by real estate mortgages.
25. PRUDENTIAL REINSURANCE HOLDINGS, INC. (Incorporated in Delaware) (100%)
A holding company which is the sole owner of Prudential Reinsurance
Company.
25a. PRUDENTIAL REINSURANCE COMPANY (Incorporated in Delaware) (Owned by
Prudential Reinsurance Holdings, Inc.) (100%)
Writes substantially all types of property and casualty reinsurance.
25b. LE ROCHER REINSURANCE LTD. (Incorporated in U.K.) (Owned by Prudential
Reinsurance Company) (100%)
Engages in the property and casualty reinsurance business, principally in
Europe.
25c. PRUDENTIAL NATIONAL INSURANCE COMPANY (Incorporated in Arizona) (Owned by
Prudential Reinsurance Company) (100%)
Writes commercial property and casualty insurance in the alternative risk
market.
26. PRUDENTIAL RETIREMENT SERVICES, INC. (Incorporated in New Jersey) (100%)
Acts as the broker-dealer which distributes securities on behalf of
Prudential Defined Contribution Services. These securities consist of
shares of the Prudential Institutional Fund and four registered separate
accounts of The Prudential.
27. PRUDENTIAL TRUST COMPANY (Incorporated in Pennsylvania) (100%)
Responsible for the management of assets in trust of certain employee
benefit trusts and other tax exempt trusts.
27a. PTC SERVICES, INC. (Incorporated in New Jersey) (Owned by Prudential Trust
Company) (100%)
Oversees the activities of investment advisers who manage certain assets
held in trust by Prudential Trust Company.
28. PRUDENTIAL UNIFORMED SERVICES ADMINISTRATORS, INC. (Incorporated in
Oklahoma) (100%)
Established to administer CHAMPUS (Civilian Health and Medical Program of
Uniformed Service) Insurance for all CHAMPUS eligibles in the states of
Texas, Oklahoma, Arkansas and Louisiana. Currently inactive.
29. THE PRUDENTIAL BANK AND TRUST COMPANY (Incorporated in Georgia) (100%)
Operates as a Georgia chartered commercial bank, it issues credit cards,
and provides commercial, home equity and consumer loans and deposit
products (other than demand deposits) on a national basis, and trust
services in selected states.
29a. PBT MORTGAGE CORPORATION (Incorporated in Georgia) (Owned by The Prudential
Bank and Trust Company) (100%)
As a wholly-owned subsidiary of The Prudential Bank and Trust Company, it
holds home equity loans in various states.
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30. THE PRUDENTIAL SAVINGS BANK, F.S.B. (Incorporated in Georgia) (100%)
Operating as a federal savings bank, it provides commercial and consumer
loans and deposit products in the state of Georgia. It also originates home
equity loans and offers deposit products on a national basis.
G. SUBSIDIARIES OF PRUDENTIAL CAPITAL AND INVESTMENT SERVICES, INC.
1. LAPINE HOLDING COMPANY (Incorporated in Delaware) (67%)
Holding company for Lapine Technology Corporation.
2. LAPINE TECHNOLOGY CORPORATION (Incorporated in California) (Owned by Lapine
Holding Company) (100%)
Inactive.
3. PRUDENTIAL SECURITIES GROUP INC. (Incorporated in Delaware) (PRUCO, Inc.
owns 100% Series B common stock and Prudential Capital & Investment
Services, Inc. owns 100% Series A common stock.)
A holding company.
4. BACHE INSURANCE AGENCY OF ARKANSAS, INC. (Incorporated in Arkansas) (Owned
by Prudential Securities Group Inc.) (100%)
Insurance agent in the state of Arkansas.
5. BACHE INSURANCE AGENCY OF LOUISIANA, INC. (Incorporated in Louisiana)
(Owned by Prudential Securities Group Inc.) (100%)
Insurance agent in the state of Louisiana. Holding company for
Prudential-Bache Securities (Germany) Inc.
6. PRUDENTIAL-BACHE SECURITIES (GERMANY) INC. (Incorporated in Delaware)
(Owned by Bache Insurance Agency of Louisiana, Inc.) (100%)
Correspondent of Prudential Securities Incorporated in Germany.
7. BRAELOCH SUCCESSOR CORPORATION (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Owns Braeloch Holdings Inc. which is an oil and gas company engaged in
partnership management, oil and gas property management, and gas marketing
and transportation.
8. BRAELOCH HOLDINGS INC. (Incorporated in Delaware) (Owned by BraeLoch
Successor Corporation) (100%)
Holding company.
9. GRAHAM RESOURCES, INC. (Incorporated in Delaware) (Owned by BraeLoch
Holdings Inc.) (100%)
Holding company for all partnership management and administration
activities.
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10. GRAHAM DEPOSITORY COMPANY II (Incorporated in Delaware) (Owned by Graham
Resources, Inc.) (100%)
Growth Fund depository company.
11. GRAHAM ENERGY, LTD. (Incorporated in Louisiana) (Owned by Graham Resources,
Inc.) (100%)
General Partner in Growth Fund and related products involved primarily in
the investment in oil and gas related companies and assets.
12. GRAHAM EXPLORATION, LTD. (Incorporated in Louisiana) (Owned by Graham
Resources, Inc.) (100%)
General Partner in various limited and general partnerships involved in
exploratory oil and gas operations.
13. GRAHAM ROYALTY, LTD. (Incorporated in Louisiana) (Owned by Graham
Resources, Inc.) (100%)
General Partner of Prudential-Bache Energy Income Funds. Named operator of
oil and gas properties.
14. GRAHAM PRODUCTION COMPANY (Incorporated in Delaware) (Owned by Graham
Royalty, Ltd.) (100%)
Inactive.
15. GRAHAM SECURITIES CORPORATION (Incorporated in Delaware) (Owned by Graham
Resources, Inc.) (100%)
In liquidation.
16. PB BULLION COMPANY, INC. (Incorporated in Delaware) (Owned by Prudential
Securities Group Inc.) (100%)
Purchases metals for resale to processors, fabricators, and other dealers.
17. PB SERVICES (U.K.) (Incorporated in U.K.) (Owned by Prudential Securities
Group Inc.) (100%)
Holds unsecured subordinated loan stock for Prudential-Bache International
(U.K) Limited.
18. PGR ADVISORS, INC. (Incorporated in Delaware) (Owned by Prudential
Securities Group Inc.) (100%)
Vehicle utilized in home office relocation.
19. PRUDENTIAL-BACHE AGRICULTURE INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Inactive.
20. PRUDENTIAL-BACHE CAPITAL FUNDING (AUSTRALIA) LIMITED (Incorporated in
Australia) (Owned by Prudential Securities Group Inc.) (100%)
Dealer in fixed interest securities.
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21. PRUDENTIAL-BACHE CAPITAL FUNDING BV (Incorporated in The Netherlands)
(Owned by Prudential Securities Group Inc.) (100%)
Management company for special purpose vehicle (Audley Finance BV).
21a. AUDLEY FINANCE BV (Incorporated in Haarlem, The Netherlands) (Owned by
Prudential-Bache Capital Funding BV) (100%)
Investment vehicle.
22. PRUDENTIAL-BACHE ENERGY CORP. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Inactive.
23. PRUDENTIAL-BACHE ENERGY PRODUCTION INC. (Incorporated in Delaware) (Owned
by Prudential Securities Group Inc.) (100%)
Inactive.
24. PRUDENTIAL-BACHE HOLDINGS INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Holding company for Prudential-Bache Partners Inc.
25. PRUDENTIAL-BACHE PARTNERS INC. (Incorporated in Nevada) (Owned by
Prudential-Bache Holdings Inc.) (100%)
Insurance agent in the State of Nevada; general partner to employee
investment partnership.
26. PRUDENTIAL-BACHE INTERNATIONAL BANK S.A. (Incorporated in Luxembourg)
(Owned by Prudential Securities Group Inc.) (100%)
Private banking institution providing secured loan and deposit facilities
and investment services brokerage for retail and institutional clients.
27. PRUDENTIAL-BACHE INTERNATIONAL (UK) LIMITED (Incorporated in U.K.) (Owned
by Prudential Securities Group Inc.) (100%)
Holding & service company for U.K. subsidiaries.
28. CLIVE DISCOUNT HOLDINGS INTERNATIONAL LIMITED (Incorporated in U.K.) (Owned
by Prudential-Bache International [UK] Limited) (100%)
Inactive.
29. PAGE & GWYTHER HOLDINGS LIMITED (Incorporated in U.K.) (Owned by
Prudential-Bache International [UK] Limited) (100%)
Inactive.
30. PAGE & GWYTHER LIMITED (Incorporated in U.K.) (Owned by Prudential-Bache
International [U.K.] Limited) (100%)
Inactive.
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31. PRUDENTIAL-BACHE CAPITAL FUNDING (EQUITIES) LIMITED (Incorporated in U.K.)
(Owned by Prudential-Bache International (UK) Limited) (100%)
London Stock Exchange broker and group custodian services.
32. CIRCLE (NOMINEES) LIMITED (Incorporated in U.K.) (Owned by Prudential-Bache
Capital Funding [Equities] Limited) (100%)
To hold stock for Prudential Capital Funding (Equities) Limited and
Prudential Securities' customers in nominee name.
33. PRUDENTIAL-BACHE CAPITAL FUNDING (GILTS) LIMITED (Incorporated in U.K.)
(Owned by Prudential-Bache International [UK] Limited) (100%)
Inactive.
34. PRUDENTIAL-BACHE CAPITAL FUNDING (MONEY BROKERS) LIMITED (Incorporated in
U.K.) (Owned by Prudential-Bache International [UK] Limited) (100%)
London Stock Exchange money broker.
35. PRUDENTIAL-BACHE (FUTURES) LIMITED (Incorporated in England) (Owned by
Prudential-Bache International [U.K.] Limited) (100%)
Broker/trader in financial futures and commodities.
36. PRUDENTIAL-BACHE INVESTOR SERVICES INC. (Incorporated in Delaware) (Owned
by Prudential Securities Group Inc.) (100%)
Serves as assignor limited partner for public deals offered by the
Specialty Finance Department.
37. PRUDENTIAL-BACHE INVESTOR SERVICES II, INC. (Incorporated in Delaware)
(Owned by Prudential Securities Group Inc.) (100%)
Serves as an assignor limited partner for public deals offered by the
Specialty Finance Department.
38. PRUDENTIAL-BACHE LEASING INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Inactive.
39. PRUDENTIAL-BACHE MINERALS INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Acts as co-general partner in the Prudential Securities/Barrick Gold
Acquisition Fund (a limited partnership).
40. PRUDENTIAL-BACHE PROGRAM SERVICES INC. (Incorporated in New York) (Owned by
Prudential Securities Group Inc.) (100%)
Issuer of puts in municipal bond offerings underwritten by Prudential
Securities Incorporated.
41. PRUDENTIAL-BACHE PROPERTIES, INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Monitors syndicated private placements of investments in real estate and
acts as general partner for real estate and other limited partnerships.
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42. PRUDENTIAL-BACHE REAL ESTATE, INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Inactive.
43. PRUDENTIAL-BACHE SECURITIES (AUSTRALIA) LIMITED (Incorporated in Australia)
(Owned by Prudential Securities Group Inc.) (100%)
Stock brokerage.
44. BACHE NOMINEES LTD. (Incorporated in Australia) (Owned by Prudential-Bache
Securities [Australia] Limited) (100%)
Nominee company for the fixed income department.
45. CORCARR FUNDS MANAGEMENT LIMITED (Incorporated in Australia) (Owned by
Prudential-Bache Securities [Australia] Limited) (100%)
Inactive.
46. CORCARR MANAGEMENT PTY LIMITED (Incorporated in Australia) (Owned by
Prudential-Bache Securities [Australia] Limited) (100%)
Inactive.
47. CORCARR NOMINEES PTY LIMITED (Incorporated in Australia) (Owned by
Prudential-Bache Securities [Australia} Limited) (100%)
Nominee company for the safe custody of clients' scrip.
48. CORCARR SUPERANNUATION PTY LIMITED (Incorporated in Australia) (Owned by
Prudential-Bache Securities [Australia] Limited) (100%)
Inactive.
49. DIVSPLIT NOMINEES PTY LIMITED (Incorporated in Australia) (Owned by
Prudential-Bache Securities [Australia] Limited) (100%)
Nominee company for the protection of client dividends, new issues and
takeovers.
50. PRUBACHE NOMINEES PTY. LTD. (Incorporated in Australia) (50% Owned by
Prudential-Bache Securities [Australia] Limited and 50% owned
by Corcarr Nominees Pty. Limited, as trustee for Prudential-Bache
Securities (Australia) Limited)
Nominee/custodian for clients of Prudential-Bache Securities (Australia)
Limited and Prudential Securities Incorporated.
51. PRUDENTIAL-BACHE TRADE SERVICES INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Holding company for PB Trade Ltd., and Prudential-Bache Forex (USA) Inc.
52. PB TRADE LTD. (Incorporated in U.K.) (Owned by Prudential-Bache Trade
Services Inc.) (100%)
Inactive.
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53. PRUDENTIAL-BACHE FOREX (USA) INC. (Incorporated in Delaware) (Owned by
Prudential-Bache Trade Services Inc.) (100%)
To engage in the foreign exchange business; holding company for
Prudential-Bache Forex (Hong Kong) Limited and Prudential-Bache Forex
(U.K.) Limited.
54. PRUDENTIAL-BACHE FOREX (HONG KONG) LIMITED (Incorporated in Hong Kong)
(Owned by Prudential-Bache Forex [USA] Inc.) (100%)
Foreign exchange.
55. PRUDENTIAL-BACHE FOREX (U.K.) LIMITED (Incorporated in U.K.) (Owned by
Prudential-Bache Forex [USA] Inc.) (100%)
Foreign exchange.
56. PRUDENTIAL-BACHE TRANSFER AGENT SERVICES, INC. (Incorporated in New York)
(Owned by Prudential Securities Group Inc.) (100%)
Acts as a transfer agent for limited partnerships sponsored by Prudential
Securities Group Inc. or sold by Prudential Securities Incorporated.
57. PRUDENTIAL SECURITIES INCORPORATED (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Securities and commodity broker-dealer, underwriter.
58. BACHE & CO. (LEBANON) S.A.L. (Incorporated in Lebanon) (Owned by Prudential
Securities Incorporated) (100%)
Inactive.
59. BACHE & CO. S.A. DE C.V. (MEXICO) (Incorporated in Mexico) (96% owned by
Prudential Securities Incorporated 4% owned by other individuals)
Inactive.
60. BACHE HALSEY STUART SHIELDS (ANTILLES) N.V. (Incorporated in The
Netherlands Antilles) (Prudential Securities Incorporated) (100%)
Inactive.
61. BACHE INSURANCE AGENCY, INCORPORATED (Incorporated in Massachusetts) (Owned
by Prudential Securities Incorporated) (100%)
Insurance agent in Massachusetts.
62. BACHE INSURANCE OF ARIZONA INC. (Incorporated in Arizona) (Owned by
Prudential Securities Incorporated) (100%)
Inactive.
63. BACHE INSURANCE OF KENTUCKY, INC. (Incorporated in Kentucky) (Owned by
Prudential Securities Incorporated) (100%)
Insurance agent in Kentucky.
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64. BACHE SHIELDS SECURITIES CORPORATION (Incorporated in Delaware) (Owned by
Prudential Securities Incorporated) (100%)
Inactive.
65. BANOM CORPORATION (Incorporated in New York) (Owned by Prudential
Securities Incorporated) (100%)
Inactive.
66. GELFAND, QUINN & ASSOCIATES INC. (Incorporated in Ohio) (Owned by
Prudential Securities Incorporated) (100%)
Inactive.
67. P-B HOLDING JAPAN INC. (Incorporated in Delaware) (Owned by Prudential
Securities Incorporated) (100%)
Holding company of Prudential Securities (Japan) Ltd.
68. PRUDENTIAL SECURITIES (JAPAN) LIMITED (Incorporated in Delaware) (Owned by
P-B Holding Japan Inc.) (100%)
Service affiliate of Prudential Securities Incorporated; registered
broker-dealer.
69. PRUDENTIAL-BACHE FUTURES ASIA PACIFIC LTD. (Incorporated in Delaware)
(Owned by Prudential Securities Incorporated) (100%)
To introduce customers to Prudential Securities for futures transactions on
U.S. Exchanges and execute futures orders on the behalf of Prudential
Securities on SIMEX.
70. PRUDENTIAL-BACHE FUTURES (HONG KONG) LIMITED (Incorporated in Hong Kong)
(Owned by Prudential Securities Incorporated) (100%)
Non-active clearing member of the Hong Kong Futures Exchange.
71. PRUDENTIAL-BACHE NOMINEES (HONG KONG) LIMITED (Incorporated in Hong Kong)
(Owned by Prudential Securities Incorporated) (100%)
Acting as a nominee company for Hong Kong equities.
72. PRUDENTIAL-BACHE SECURITIES ASIA PACIFIC LTD. (Incorporated in New York)
(Owned by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Singapore.
73. PRUDENTIAL-BACHE SECURITIES (BELGIUM) INC. (Incorporated in Delaware)
(Owned by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Belgium.
74. PRUDENTIAL-BACHE SECURITIES (ESPANA) S.A. (Incorporated in Spain) (Owned by
Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Spain.
75. PRUDENTIAL-BACHE SECURITIES (FRANCE) S.A. (Incorporated in France) (Owned
by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in France.
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76. PRUDENTIAL-BACHE SECURITIES (HOLLAND) INC. (Incorporated in Delaware)
(Owned by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Holland.
77. PRUDENTIAL-BACHE SECURITIES (HOLLAND) N.V. (Incorporated in Holland) (Owned
by Prudential-Bache Securities [Holland] Inc.) (100%)
Inactive.
78. PRUDENTIAL-BACHE SECURITIES (HONG KONG) LIMITED (Incorporated in Hong Kong)
(Owned by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Hong Kong.
79. PRUDENTIAL-BACHE SECURITIES (LUXEMBOURG) INC. (Incorporated in Delaware)
(Owned by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Luxembourg.
80. PRUDENTIAL-BACHE SECURITIES (MONACO) INC. (Incorporated in New York) (Owned
by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Monaco.
81. PRUDENTIAL-BACHE SECURITIES (SWITZERLAND) INC. (Incorporated in Delaware)
(Owned by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Switzerland.
82. PRUDENTIAL-BACHE SECURITIES (U.K.) INC. (Incorporated in Delaware) (Owned
by Prudential Securities Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in the U.K.
82a. SHIELDS MODEL ROLAND COMPANY (Incorporated in U.K.) (Owned by
Prudential-Bache Securities (U.K.) Inc.) (100%)
Inactive.
83. PRUDENTIAL MUTUAL FUND MANAGEMENT, INC. (Incorporated in Delaware) (15%
owned by The Prudential and 85% owned by Prudential Securities
Incorporated)
Mutual fund management company.
84. PRUDENTIAL MUTUAL FUND DISTRIBUTORS, INC. (Incorporated in Delaware) (Owned
by Prudential Mutual Fund Management, Inc.) (100%)
Principal underwriter and distributor of mutual funds.
85. PRUDENTIAL MUTUAL FUND SERVICES, INC. (Incorporated in New Jersey) (Owned
by Prudential Mutual Fund Management, Inc.) (100%)
Mutual fund transfer agent and shareholder services company.
86. PRUDENTIAL SECURITIES (CHILE) INC. (Incorporated in Delaware) (Owned by
Prudential Securities Incorporated) (100%)
Inactive.
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87. PRUDENTIAL SECURITIES CMO ISSUER INC. (Incorporated in Delaware) (Owned by
Prudential Securities Incorporated) (100%)
Ownership of Delaware Business Trust utilized by Mortgage Finance Unit to
facilitate CALI Transaction.
88. PRUDENTIAL SECURITIES FUTURES MANAGEMENT INC. (Incorporated in Delaware)
(Owned by Prudential Securities Incorporated) (100%)
1) General partner of a limited partnership with assets invested in
commodities, futures contracts and commodity-related products and 2)
Commodities and futures contract business.
89. PRUDENTIAL SECURITIES (SOUTH AMERICA) INCORPORATED (Incorporated in
Delaware) (Owned by Prudential Securities Incorporated) (100%)
Holding company for Prudential Securities (Argentina) Incorporated and
Prudential Securities (Uruguay) S.A.
90. PRUDENTIAL SECURITIES (ARGENTINA) INCORPORATED (Incorporated in Delaware)
(Owned by Prudential Securities [South America] Incorporated)
(100%)
Service affiliate of Prudential Securities Incorporated in Argentina.
91. PRUDENTIAL SECURITIES (URUGUAY) S.A. (Incorporated in Uruguay) (Owned by
Prudential Securities [South America] Incorporated) (100%)
Service affiliate of Prudential Securities Incorporated in Uruguay.
92. SHIELDS MODEL ROLAND SECURITIES INCORPORATED (Incorporated in New York)
(Owned by Prudential Securities Incorporated) (100%)
Inactive.
93. WEXFORD CLEARING SERVICES CORPORATION (Incorporated in Delaware) (Owned by
Prudential Securities Incorporated) (100%)
Inactive.
94. PRUDENTIAL SECURITIES LEASE HOLDING INC. (Incorporated in New York) (Owned
by Prudential Securities Group Inc.) (100%)
Owns IBM computers and leases them to Prudential Securities Incorporated.
95. PRUDENTIAL SECURITIES MUNICIPAL DERIVATIVES, INC. (Incorporated in
Delaware) (Owned by Prudential Securities Group Inc.) (100%)
Serves as a general partner in a limited partnership structure providing
floating rate & inverse floating rate municipal securities.
96. PRUDENTIAL SECURITIES REALTY FUNDING CORPORATION (Incorporated in Delaware)
(Owned by Prudential Securities Group Inc.) (100%)
Purchase and sale of residential first mortgage whole loans, including
purchase and sales under repurchase agreements. Sales may be in whole loan,
participation certificates, agency or securitized format.
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97. PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION (Incorporated in
Delaware) (Owned by Prudential Securities Group Inc.) (100%)
Purchase and securitization of mortgages and other assets.
98. PRUDENTIAL SECURITIES STRUCTURED ASSETS, INC. (Incorporated in Ohio) (Owned
by Prudential Securities Group Inc.) (100%)
Inactive.
99. P-B FINANCE LTD. (Incorporated in The Cayman Islands) (Owned by Prudential
Securities Structured Assets, Inc) (100%)
Finances commodity margin calls, both original and variation, and does
other financing transactions for a select group of international and
domestic customers.
100. R&D FUNDING CORP. (Incorporated in Delaware) (Owned by Prudential
Securities Group Inc.) (100%)
Acts as a general partner in research and development partnerships.
101. SEAPORT FUTURES MANAGEMENT, INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
1) General partner of limited partnership with assets invested in
commodities, futures contracts and commodity-related products, 2)
Commodities and futures contracts business.
102. SPECIAL SITUATIONS MANAGEMENT INC. (Incorporated in Delaware) (Owned by
Prudential Securities Group Inc.) (100%)
Inactive.
H. SUBSIDIARIES OF THE PRUDENTIAL INVESTMENT CORPORATION
1. GATEWAY HOLDINGS, S.A. (Incorporated in Luxembourg) (100%)
A financial holding company which owns Luxembourg registered investment
management companies. Gateway Holdings, S.A. is the parent of Amicus
Investment Company, Global Income Fund Management Company, S.A., Global
Series Fund II Management Company, S.A., Jennison Long Bond Management
Company, and PAEC Management Company.
2. AMICUS INVESTMENT COMPANY (Incorporated in the Cayman Islands) (Owned by
Gateway Holdings, S.A.) (100%)
Provides promotion and sponsorship functions for the Amicus Equity Fund, an
open-ended investment trust established under the jurisdiction of the
Cayman Islands.
3. GLOBAL INCOME FUND MANAGEMENT COMPANY, S.A. (Incorporated in Luxembourg)
(Owned by Gateway Holdings, S.A.) (100%)
Acts as the management company for Global Income Fund, an investment fund
organized in Luxembourg.
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4. GLOBAL SERIES FUND II MANAGEMENT COMPANY, S.A. (Incorporated in Luxembourg)
(Owned by Gateway Holdings, S.A.) (100%)
Acts as the management company for Global Series Fund II, an investment
fund organized in Luxembourg.
5. JENNISON LONG BOND MANAGEMENT COMPANY (Incorporated in Luxembourg) (Owned
by Gateway Holdings, S.A.) (100%)
Acts as the management company for Jennison Long Bond Fund, an investment
fund organized in Luxembourg. The Fund invests in a diversified portfolio
of securities issued or guaranteed by the U.S. Government of which units of
the fund are offered privately to Japanese institutional investors through
PIC's Japan representative office in Tokyo.
6. PAEC MANAGEMENT COMPANY (Incorporated in Luxembourg) (Owned by Gateway
Holdings, S.A.) (100%)
Inactive.
7. PRUDENTIAL ASSET SALES AND SYNDICATIONS, INC. (Incorporated in Delaware)
(100%)
Registered broker/dealer which engages in the investment banking business.
Also responsible for the syndication or sale of Prudential originated
private placement deals.
8. PRUDENTIAL HOME BUILDING INVESTORS, INC. (Incorporated in New Jersey)
(100%)
Acts as the general partner of a limited partnership, Prudential Home
Building Advisors, L.P. Through this partnership it provides investment
advisory services in a portfolio of residential land improvement and/or
single family home construction projects.
9. PRUSUPPLY, INC. (Incorporated in Delaware) (100%)
Serves as an inventory facility, holding investments pending sale for
Prudential Asset Sales and Syndications, Inc. Enters into contracts for the
supply of fossil fuel and other inventory.
10. PRUSUPPLY CAPITAL ASSETS, INC. (Incorporated in New Jersey) (Owned by
PruSupply, Inc.) (100%)
Serves as a capital base for the syndication activity of Prudential Asset
Sales and Syndications, Inc. It will hold, invest, and reinvest stocks,
bonds, etc. to support the borrowing capacity of PruSupply, Inc.
11. THE PRUDENTIAL ASSET MANAGEMENT COMPANY, INC. (Incorporated in New Jersey)
(100%)
Provides various record keeping, benefit payment, and plan consulting
services to The Prudential and its clients. It also acts as a solicitor on
behalf of affiliates who are investment advisors.
12. CSI ASSET MANAGEMENT, INC. (Incorporated in Delaware) (Owned by The
Prudential Asset Management Company, Inc.) (100%)
Provides institutional clients (primarily state and municipal employee
benefit plans) with discretionary management of portfolios investing in
U.S. stocks and bonds.
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13. ENHANCED INVESTMENT TECHNOLOGIES, INC. (Incorporated in New Jersey) (Owned
by The Prudential Asset Management Company, Inc.) (100%)
Provides investment advisory services to institutional clients using
domestic index portfolios.
14. MERCATOR ASSET MANAGEMENT, INC. (Incorporated in Florida) (Owned by The
Prudential Asset Management Company, Inc.) (100%)
Serves as an investment advisor with a focus on global and international
investing for institutional clients.
15. PCM INTERNATIONAL, INC. (Incorporated in New Jersey) (Owned by The
Prudential Asset Management Company, Inc.) (100%)
Serves as an investment advisor with a focus on global and international
investing for institutional clients.
16. PRUDENTIAL ASIA INVESTMENTS LIMITED (Incorporated in the British Virgin
Islands) (Common stock 100% owned by The Prudential Asset Management
Company, Inc. and preferred stock 50% owned by The Prudential Asset
Management Company, Inc. and 50% owned by Prudential Securities Group Inc.)
A holding company for subsidiaries engaged in investment management,
merchant banking, portfolio management and direct investment activities in
the Far East.
17. PRUASIA DBS LIMITED (Incorporated in Hong Kong) (Owned by Prudential Asia
Investments Limited) (50%)
Provides corporate finance services in the Far East.
18. PRUDENTIAL ASIA FUND MANAGEMENT LIMITED (BVI) (Incorporated in the British
Virgin Islands) (Owned by Prudential Asia Investments Limited) (100%)
A holding company for Prudential Asia Fund Management Limited and
Prudential Asia Fund Managers (HK) Limited and engages in portfolio
investment management and advisory services with a concentration on
publicly traded securities.
19. PRUDENTIAL ASIA FUND MANAGEMENT LIMITED (Incorporated in Hong Kong) (Owned
by Prudential Asia Fund Management Limited [BVI]) (100%)
Provides investment advisory activities in the United States.
20. PRUDENTIAL ASIA FUND MANAGERS (HK) LIMITED (Incorporated in Hong Kong)
(Owned by Prudential Asia Fund Management Limited [BVI]) (100%)
Provides investment advisory activities in Hong Kong.
21. PRUDENTIAL ASSET MANAGEMENT ASIA LIMITED (BVI) (Incorporated in the British
Virgin Islands) (Owned by Prudential Asia Investments Limited) (100%)
Makes direct investments and provides investment advisory services in
China, Taiwan, Korea, Japan, Australia and New Zealand.
22. PAMA (INDONESIA) LIMITED (Incorporated in the British Virgin Islands)
(Owned by Prudential Asset Management Asia Limited (BVI)) (75%)
Engaged in the management and operation of PT PAMA Indonesia, an Indonesian
Venture Capital Company, and a unit trust which makes direct investments in
Indonesian companies.
C-38
<PAGE>
23. PAMA (SINGAPORE) PRIVATE LIMITED (Incorporated in Singapore) (Owned by
Prudential Asset Management Asia Limited [BVI]) (100%)
Engaged in direct investments, corporate finance and portfolio management
activities in Singapore.
24. PRUDENTIAL ASSET MANAGEMENT ASIA HONG KONG LIMITED (Incorporated in Hong
Kong) (Owned by Prudential Asset Management Asia Limited [BVI]) (100%)
Engaged in direct investments and portfolio management activities in Hong
Kong.
25. P.T. PAMA VENTURA INDONESIA (Incorporated in Indonesia) (Owned by
Prudential Asset Management Asia Limited [BVI]) (65%)
An Indonesian Venture Capital Company which invests directly in Indonesian
companies or in a trust that invests in Indonesian companies.
26. SJ BEDDING B.V. (Incorporated in the Netherlands) (Owned by Prudential Asia
Investments Limited) (100%)
A holding company for Prudential Asia Investments Limited's investment in
the shares of Simmons Co., Limited.
27. SIMMONS BEDDING AND FURNITURE (HK) LIMITED (Incorporated in Hong Kong)
(Owned by SJ Bedding BV) (66.24%)
Collectively with its affiliates engages in the manufacturing, sales and
distribution of bedding products, furniture and accessories in Japan, Hong
Kong, Singapore and Macau.
28. SIMMONS ASIA LIMITED (Incorporated in the British Virgin Islands) (Owned by
Simmons Bedding & Furniture [HK] Limited) (90%)
Engages in the business of licensing Simmons related trademarks and
technology in Asia Pacific countries other than those covered by Simmons
Co., Limited.
29. SIMMONS (SOUTHEAST ASIA) PRIVATE LIMITED (Incorporated in Singapore) (Owned
by Simmons Asia Limited) (100%)
Carries out manufacturing and distribution activities of the bedding
products, furniture and accessories in Singapore.
30. SIMMONS CO., LIMITED (Incorporated in Japan) (Owned by SJ Bedding B.V.)
(66.24%)
A holding company for Simmons Bedding and Furniture (HK) Limited.
31. PRUDENTIAL ASSET MANAGEMENT COMPANY SECURITIES CORPORATION (Incorporated in
Delaware) (Owned by The Prudential Asset Management Company, Inc.) (100%)
Markets to institutional clients investment products developed by other
Prudential affiliates that must be sold by an SEC registered broker-dealer
with a membership in the NASD.
32. PRUDENTIAL TIMBER INVESTMENTS, INC. (Incorporated in New Jersey) (100% of
common stock owned by The Prudential Asset Management Company, Inc.) (100%
of preferred stock owned by The Prudential Insurance Company of America.)
Provides timber investment management services to institutional clients.
Acquires and manages commercial timber properties with the goal of
generating competitive returns.
C-39
<PAGE>
33. THE PRUDENTIAL INVESTMENT ADVISORY COMPANY, LTD. (Incorporated in Japan)
(100%)
Provides investment management services to Japanese institutional investors
and for Prudential's General Account with respect to Japanese and global
securities.
34. THE PRUDENTIAL PROPERTY COMPANY, INC. (Incorporated in New Jersey) (100%)
Inactive.
35. THE PRUDENTIAL REALTY ADVISORS, INC. (Incorporated in New Jersey) (100%)
Provides advice and administrative services to others with respect to the
ownership, sale, and management of real property.
36. TRGOAG COMPANY, INC. (Incorporated in Delaware) (100%)
Organized to own interests in oil and gas properties.
C-40
<PAGE>
Item 31. NUMBER OF CONTRACTOWNERS
As of February 28, 1997, the number of contractowners of qualified contracts
offered by Registrant was ___, and the number of contractowners of non-qualified
contracts offered by Registrant was __.
Item 32. INDEMNIFICATION
The Prudential Directors' and Officers' Liability and Corporation Reimbursement
Insurance Program, purchased by The Prudential from Aetna Casualty & Surety
Company, CNA Insurance Companies, Lloyds of London, Great American Insurance
Company, Reliance Insurance Company, Corporate Officers & Directors Assurance
Ltd., A.C.E. Insurance Company, Ltd., XL Insurance Company, Ltd., and
Zurich-American Insurance Company, provides reimbursement for "Loss" (as defined
in the policies) which the Company pays as indemnification to its directors or
officers resulting from any claim for any actual or alleged act, error,
misstatement, misleading statement, omission, or breach of duty by persons in
the discharge of their duties solely in their capacities as directors or
officers of The Prudential, any of its subsidiaries, or certain investment
companies affiliated with The Prudential. Coverage is also provided to the
individual directors or officers for such Loss, for which they shall not be
indemnified. Loss essentially is the legal liability on claims against a
director or officer, including adjudicated damages, settlements and reasonable
and necessary legal fees and expenses incurred in defense of adjudicatory
proceedings and appeals therefrom. Loss does not include punitive or exemplary
damages or the multiplied portion of any multiplied damage award, criminal or
civil fines or penalties imposed by law, taxes or wages, or matters which are
uninsurable under the law pursuant to which the policies are construed.
There are a number of exclusions from coverage. Among the matters excluded are
Losses arising as the result of (1) claims brought about or contributed to by
the criminal or fraudulent acts or omissions or the willful violation of any law
by a director or officer, (2) claims based on or attributable to directors or
officers gaining personal profit or advantage to which they are not legally
entitled, and (3) claims arising from actual or alleged performance of, or
failure to perform, services as, or in any capacity similar to, an investment
adviser, investment banker, underwriter, broker or dealer, as those terms are
defined in the Securities Act of 1933, the Securities Exchange Act of 1934, the
Investment Advisers Act of 1940, the Investment Company Act of 1940, any rules
or regulations thereunder, or any similar federal, state or local statute, rule
or regulation.
The limit of coverage under the Program for both individual and corporate
reimbursement coverage is $150,000,000. The retention for corporate
reimbursement coverage is $10,000,000 per loss.
The relevant provisions of New Jersey Law permitting or requiring
indemnification, New Jersey being the state of organization of The Prudential,
can be found in Section 14A:3-5 of the New Jersey Statutes Annotated. The text
of The Prudential's by-law 26, which relates to indemnification of officers and
directors, is incorporated by reference to Exhibit (8)(ii) to this Registration
Statement.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a 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 Registrant 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 Act and will be governed by the final adjudication of
such issue.
C-41
<PAGE>
Item 33. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
Prudential does have other business of a substantial nature besides activities
relating to the assets of the registrant. Prudential is involved in insurance,
reinsurance, securities, pension services, real estate and banking.
The Prudential Investment Corporation (PIC) is an investment unit of Prudential
and is actively engaged in the business of giving investment advice. The
officers and directors of Prudential and PIC who are engaged directly or
indirectly in activities relating to the registrant have no other business,
profession, vocation, or employment of a substantial nature, and have not had
such other connections during the past two years.
The business and other connections, including principal business address, of
Prudential's Directors are listed under "Directors and Officers of Prudential"
in the Statement of Additional Information (Part B of this Registration
Statement).
Item 34. PRINCIPAL UNDERWRITER
(a) Prudential Investment Management Services LLC a direct
wholly-owned subsidiary of Prudential, acts as the principal
underwriter for The Prudential Variable Contract Account-2, the
Prudential Variable Contract Account-10, The Prudential Variable
Contract Account-24, The Prudential Institutional Fund and for the
Registrant, all (except for The Prudential Variable Contract
Account-24) registered as open-end management investment companies
under the Investment Company Act of 1940.
<TABLE>
<CAPTION>
(b) (1) (2) (3)
<S> <C> <C>
Name and Principal Position and Offices Positions and Offices
Business Address with Underwriter with Registrant
--------------------- ------------------------- ------------------------
</TABLE>
(c) Reference is made to the Section entitled "Charges" of the
prospectus (Part A of this Registration Statement), "Investment
Management and Administration of VCA-10, VCA-11 and VCA-24" on
page 2 of the Statement of Additional Information (Part B of this
Registration Statement) Exhibit (5)(ii).
C-42
<PAGE>
Item 35. LOCATION OF ACCOUNTS AND RECORDS
The names and addresses of the persons who maintain physical possession of the
accounts, books and documents required to be maintained by Section 31(a) of the
Investment Company Act of 1940 and the rules thereunder are:
The Prudential Insurance Company of America
and The Prudential Investment Corporation
Prudential Plaza
Newark, New Jersey 07102-3777
The Prudential Insurance Company of America
and The Prudential Investment Corporation
Gateway Three Building and Gateway Four Building
100 Mulberry Street
Newark, New Jersey 07102
The Prudential Insurance Company of America
and The Prudential Investment Corporation
56 North Livingston Avenue
Roseland, New Jersey 07068
The Prudential Insurance Company of America
c/o Prudential Defined Contribution Services
30 Scranton Office Park
Moosic, Pennsylvania 18507-1789
The Prudential Insurance Company of America
c/o The Prudential Asset Management Company, Inc.
71 Hanover Road
Florham Park, New Jersey 07932
Investors Fiduciary Trust Company
127 West 10th Street
Kansas City, Missouri 64105
Item 36. MANAGEMENT SERVICES
Not Applicable
Item 37. UNDERTAKINGS
The Prudential Insurance Company of America ("Prudential") 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 Prudential.
Subject to the terms and conditions of Section 15(d) of the Securities Exchange
Act of 1934, the undersigned Registrant hereby undertakes to file with the
Securities and Exchange Commission such supplementary and periodic information,
documents and reports as may be prescribed by any rule or regulation of the
Commission heretofore or hereafter duly adopted pursuant to authority conferred
in that section. Registrant also undertakes (1) to file a post-effective
amendment to this registration statement as frequently as is necessary to ensure
that the audited financial statements in the registration statement are never
more than 16 months old as long as payment under the contracts may be accepted;
(2) to affix to the prospectus a postcard that the applicant can remove to send
for a Statement of Additional Information or to include 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; and (3) to
deliver any Statement of Additional Information promptly upon written or oral
request.
Restrictions on withdrawal under Section 403(b) Contracts are imposed in
reliance upon, and in compliance with, a no-action letter issued by the Chief of
the Office of Insurance Products and Legal Compliance of the Securities and
Exchange Commission to the American Council of Life Insurance on November 28,
1988.
REPRESENTATION PURSUANT TO RULE 6c-7
Registrant represents that it is relying upon Rule 6c-7 under the Investment
Company Act of 1940 in connection with the sale of its group variable contracts
to participants in the Texas Optional Retirement Program. Registrant also
represents that it has complied with the provisions of paragraphs (a) - (d) of
the Rule.
C-43
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act
of 1940, the Registrant has caused this Post-Effective Amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Newark, and State of New Jersey, on the __day of
_______, 1997.
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
By: /s/ MENDEL A. MELZER
----------------------------
Mendel A. Melzer
Chairman
C-44
<PAGE>
SIGNATURES
As required by the Securities Act of 1933, this Amendment to the
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
Signature Title Date
- --------- ----- ----
MENDEL A. MELZER Member and Chairman, The ) February __, 1997
- ---------------------------- Prudential Variable Contract )
Mendel A. Melzer Account-11 Committee )
*W. SCOTT McDONALD, JR. Member, The Prudential )
- ---------------------------- Variable Contract )
W. Scott McDonald, Jr. Account-11 Committee )
JONATHAN GREENE Member, The Prudential )
- ---------------------------- Variable Contract )
Jonathan Greene Account-11 Committee )
*JOSEPH WEBER Member, The Prudential )
- ---------------------------- Variable Contract )
Joseph Weber Account-11 Committee )
*SAUL K. FENSTER Member, The Prudential )
- ---------------------------- Variable Contract )
Saul K. Fenster Account-11 Committee )
*By: /s/ C. CHRISTOPHER SPRAGUE
-------------------------------
C. Christopher Sprague
(Attorney-in-Fact)
C-45
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, The Prudential Insurance Company of America has caused this Amendment to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Newark, and State of New Jersey, on
the th day of _______, 1996.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
By: /s/ MENDEL A. MELZER
--------------------------
Mendel A. Melzer
Vice President
As required by the Securities Act of 1933, this Amendment to the
Registration Statement has been signed below by the following Directors and
Officers of The Prudential Insurance Company of America in the capacities and on
the date indicated.
Signature Title Date
- --------- ----- ----
*ARTHUR F. RYAN Chairman of the Board, )
- ---------------------------- President and Chief ) February 28, 1997
Arthur F. Ryan Executive Officer )
*By: /s/ C. CHRISTOPHER SPRAGUE
------------------------------
C. Christopher Sprague
(Attorney-in-Fact)
C-46
<PAGE>
Signature Title Date
- --------- ----- ----
*MARK B. GRIER Senior Vice President )
- ---------------------------- and Comptroller and )
Mark B. Grier Principal Financial )
Officer )
*FRANKLIN E. AGNEW )
- ---------------------------- Director )
Franklin E. Agnew )
*FREDERIC K. BECKER )
- ---------------------------- Director )
Frederic K. Becker )
*WILLIAM W. BOESCHENSTEIN )
- ---------------------------- Director )
William W. Boeschenstein )
*LISLE C. CARTER, JR. )
- ---------------------------- Director )
Lisle C. Carter, Jr. )
*JAMES G. CULLEN )
- ---------------------------- Director )
James G. Cullen )
*CAROLYNE K. DAVIS )
- ---------------------------- Director ) February 28, 1997
Carolyne K. Davis )
*ROGER A. ENRICO )
- ---------------------------- Director )
Roger A. Enrico )
*ALLAN D. GILMOUR )
- ---------------------------- Director )
Allan D. Gilmour )
*WILLIAM H. GRAY, III )
- ---------------------------- Director )
William H. Gray, III )
*JON F. HANSON )
- ---------------------------- Director )
Jon F. Hanson )
*CONSTANCE J. HORNER )
- ---------------------------- Director )
Constance J. Horner )
*ALLEN F. JACOBSON )
- ---------------------------- Director )
Allen F. Jacobson )
*BURTON G. MALKIEL )
- ---------------------------- Director )
Burton G. Malkiel )
*By: /s/ C. CHRISTOPHER SPRAGUE
---------------------------------
C. Christopher Sprague
(Attorney-in-Fact)
C-47
<PAGE>
Signature Title Date
- --------- ----- ----
*CHARLES R. SITTER )
- ---------------------------- Director )
Charles R. Sitter )
*DONALD L. STAHELI )
- ---------------------------- Director )
Donald L. Staheli )
*RICHARD M. THOMSON )
- ---------------------------- Director )
Richard M. Thomson )
*P. ROY VAGELOS, M.D. )
- ---------------------------- Director ) February 28, 1997
P. Roy Vagelos, M.D. )
*STANLEY C. VAN NESS )
- ---------------------------- Director )
Stanley C. Van Ness )
*PAUL A. VOLCKER )
- ---------------------------- Director )
Paul A. Volcker )
*JOSEPH H. WILLIAMS )
- ---------------------------- Director )
Joseph H. Williams )
*By: /s/ C. CHRISTOPHER SPRAGUE
------------------------------
C. Christopher Sprague
(Attorney-in-Fact)
C-48
<PAGE>
Exhibit Index
-------------
Ex-99.01 ByLaws of the Prudential Insurance
Company of America
Ex-99.10(iii) (f) Specimen Copy of Group Annuity C - 49
Contract Form GAA-7900-DefComp for
deferred compensation plan contracts
issued before May 1, 1996
Ex-99.11(iii) (g) Specimen Copy of Group Annuity C - 49
Contract Form GAA-7900-DefComp-1 for
deferred compensation plan contracts
issued before May 1, 1996
Ex-99.12(iii) (h) Specimen Copy of Group Annuity C - 49
Contract Form GAA-7900-Secular for
deferred compensation plan contracts
issued before May 1, 1996
Ex-99.13(iii) (i) Specimen Copy of Group Annuity C - 49
Contract Form GAA-7900-Secular-1 for
deferred compensation plan contracts
issued before May 1, 1996
Ex-99.14(i) Consent of Independent Auditors C - 50
Ex-99.14(ii) (a) Power of Attorney-Registrant's C - 51
Committee
Ex-99.16 Calculation of Performance Data C - 52
C-49
POWER OF ATTORNEY
Know all men by these presents:
That I, JONATHAN M. GREENE, of Newark, New Jersey, an officer of THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-2, THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-10 AND THE
PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11, (the "Accounts"), do hereby make,
constitute and appoint as my true and lawful attorneys in fact THOMAS A. EARLY
and CHRISTOPHER SPRAGUE or either of them for me and in my name, place and stead
to sign registration statements and any and all amendments thereto executed on
behalf of any or all of the Accounts, and filed with the Securities and Exchange
Commission, as follows:
Registration Statement on Form N-3 for the registration under the
Securities Act of 1933 and the Investment Company Act of 1940 of the Accounts.
IN WITNESS WHEREOF, I have hereunto set my hand this 27TH day of FEBRUARY,
1997.
/s/ JONATHAN M. GREENE
-------------------------------
Jonathan M. Greene
STATE OF NEW JERSEY )
) SS:
COUNTY OF ESSEX )
On this 27TH day of FEBRUARY, 1997, before me personally appeared JONATHAN
M. GREENE, to me known and known to me to be the person mentioned and described
in and who executed the foregoing instruments and he duly acknowledged to me
that he executed
/s/ CLEMENTINA FERRIGNO
-----------------------------
NOTARY PUBLIC
My commission expires:
CLEMENTINA FERRIGNO
NOTARY PUBLIC OF NEW JERSEY
My Commission Expires Mar. 31, 1998
[COPY TO COME]
VCA-11
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
VARIABLE CONTRACT ACCOUNT-11
RULES AND REGULATIONS
ARTICLE I
GENERAL
SECTION 1. NAME. The name of this account shall be The Prudential Variable
Contract Account-ll ("VCA-ll").
SECTION 2. PURPOSE. VCA-ll is a variable contract account established pursuant
to the provisions of Chapter 28 of Title 17B of the Revised Statutes of New
Jersey, as amended. Its purpose is to provide a funding medium for such
contracts on a variable basis issued and administered by The Prudential
Insurance Company of America ("Prudential") as Prudential shall elect to
designate as participating therein.
ARTICLE II
MEETINGS OF PERSONS HAVING VOTING RIGHTS IN VCA-ll
SECTION 1. MEETINGS. Meetings of the persons having voting rights in respect of
VCA-ll under Section 6 of this Article may be called by a majority of the
Committee referred to in Article III hereof. The notice of the meeting shall
state the purpose or purposes of the meeting. All such meetings
<PAGE>
shall be held at the Corporate Home Office of Prudential or at such other place
as may be determined by the Committee, at the time and place stated in the
notice of the meeting.
SECTION 2. REQUIRED MEETINGS. (a) In the event that at any time less than a
majority of members of the Committee holding office at that time were elected by
persons having voting rights in respect of VCA-ll, the Committee shall forthwith
cause to be held as promptly as possible, and in any event within 60 days, a
meeting of such persons for the purpose of electing Committee members to fill
any existing vacancies, unless the United States Securities and Exchange
Commission shall by order extend such period.
(b) The Committee shall call a meeting of the persons having voting rights in
respect of VCA-ll for the purpose of submitting the selection of an independent
public accountant for ratification or rejection if the Committee selects an
accountant other than the accountant whose selection was most recently ratified
by persons having voting rights in respect of VCA-ll.
SECTION 3. NOTICE OF MEETING. A written or printed notice stating the place, day
and hour of the meeting and the purpose or purposes for which the meeting is
called, shall be given by mail, postage prepaid, to each person having voting
rights in respect of VCA-ll as of the date of such meeting, at his address as
carried on the records of VCA-ll.
-2-
<PAGE>
Such notice shall be placed in the mail not less than 25 days prior to the date
of the meeting.
SECTION 4. QUORUM. Persons entitled to cast more than thirty-five percent of the
votes which may be cast in accordance with Section 6 of this Article II,
represented either in person or by proxy, shall constitute a quorum for the
transaction of business at any meeting provided for by this Article, except
insofar as a higher quorum for the transaction of any particular item of
business may be required by applicable law. If a quorum shall not be present,
persons entitled to cast more than fifty percent of the votes represented in
person or by proxy at the meeting may adjourn the meeting to some later time.
When a quorum is present, the vote of more than fifty percent of the votes
represented in person or by proxy shall determine any question except as may be
otherwise provided by these Rules and Regulations or by law.
SECTION 5. PROXIES. A vote may be cast either in person or by proxy duly
executed in writing. A proxy for any meeting shall be valid for any adjournment
of such meeting.
SECTION 6. VOTING. (a) For the purpose of determining the persons having voting
rights in respect of VCA-ll who are entitled to notice of and to vote at any
meeting of such persons or any adjournment thereof, or to express consent to
-3-
<PAGE>
or dissent from any proposal without a meeting, or for the purpose of any other
action, the Committee may fix, in advance, a date as the record date for any
such determination of such persons. Such date shall not be more than 70 nor less
than 10 days before the date of such meeting, nor more than 70 days prior to any
other action. (b) The following persons shall have voting rights in respect of
VCA-ll as of the date of any meeting provided for by this Article:
(1) each person who had an individual accumulation account in VCA-ll as of
the record date fixed in accordance with paragraph (a) of this
Section;
(2) each holder of a contract issued in connection with deferred
compensation plans established under Section 457 of the Internal
Revenue code under which one or more accumulation accounts in VCA-ll
are maintained as of the record date so fixed; and
(3) Prudential, if it had its own funds invested in VCA-ll as of the
record date so fixed.
(c) The number of votes which each such person described in Paragraph (b)(l) of
this Section may cast at a meeting provided for by this Article shall be equal
to the number of dollars and fractions thereof in his individual accumulation
account in VCA-ll as of the record date fixed in accordance with Paragraph (a)
of this Section. The number of votes which each such person described in
Paragraph (b)(2) of this Section may cast at a meeting provided for by this
Article
-4-
<PAGE>
shall be equal to the aggregate number of dollars and fractions thereof in the
accumulation accounts under the contract as of the record date so fixed. The
number of votes which Prudential may cast at a meeting provided for by this
Article shall be equal to the number of dollars and fractions thereof of
Prudential's own funds invested in VCA-ll as of the record date so fixed;
provided however, that:
(1) With respect to the election of members of the VCA-ll Committee,
Prudential shall cast its votes FOR each nominee and shall WITHHOLD
its votes from each nominee in the same proportion as all other votes
represented at the meeting, in person or by proxy; and
(2) With respect to each other issue considered at a meeting, Prudential
shall cast its votes FOR and AGAINST the issue and shall ABSTAIN from
casting its votes on the issue in the same proportion as all other
votes represented at the meeting, in person or by proxy.
SECTION 7. ORDER OF BUSINESS. The order of business at the meetings provided for
in this Article shall be determined by the presiding officer.
SECTION 8. INSPECTORS. At each meeting of persons having voting rights in
respect of VCA-ll the polls shall be opened
-5-
<PAGE>
and closed, the proxies and ballots shall be received and be taken in charge,
and all questions touching the qualification of voters, the validity of proxies
or the acceptance or rejection of votes shall be decided by three inspectors.
Such inspectors, who need not be persons having voting rights in respect of
VCA-11, shall be appointed by the Committee before the meeting, or if no such
appointment shall have been made, then by the presiding officer of the meeting.
In the event of failure, refusal or inability of any inspector previously
appointed to serve, the presiding officer may appoint any person to fill such
vacancy.
ARTICLE III
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11 COMMITTEE
SECTION 1. COMPOSITION. The Committee shall consist of not less than three nor
more than nine members. The initial Committee, which shall consist of five
members, shall be appointed by the Chairman of the Board and Chief Executive
Officer, the President or the Vice Chairman of Prudential. The Committee shall,
prior to giving notice of each meeting at which members of the Committee are to
be elected, fix the number of members that shall constitute the Committee until
the next such meeting. The members of the Committee elected at the September
1988 meeting of persons having voting rights in respect of VCA-11 shall serve
indefinite terms.
-6-
<PAGE>
Any vacancy may be filled either by vote of the Committee pursuant to Section 9
of this Article or by a ballot at a meeting of persons having voting rights in
respect of VCA-ll. Members elected to the Committee pursuant to Section 9 of
this Article shall serve until the next meeting of persons having voting rights
in respect of VCA-ll. Members elected by vote of persons having voting rights in
respect of VCA-ll shall serve indefinite terms. Members of the Committee need
not have voting rights in respect of VCA-ll.
SECTION 2. POWERS. The Committee shall have the following powers:
(a) to negotiate and approve agreements, required by the Investment
Company Act of 1940, entered into by VCA-ll providing for services
relating to investment management and to the sale of contracts on a
variable basis issued and administered by Prudential to the extent
they include participating interests in VCA-ll and to submit any
agreement for investment management services to the persons having
voting rights in respect of VCA-ll for their approval;
(b) to determine the initial fundamental investment policy of VCA-ll and
review investments made for VCA-ll to determine that they conform to
such policy;
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<PAGE>
(c) to consider changes in the fundamental investment policy of VCA-ll and
submit any recommendations with respect thereto to the persons having
voting rights in respect of VCA-ll for their approval;
(d) to select an independent public accountant for VCA-ll and submit such
selection to the persons having voting rights in respect of VCA-ll for
their approval;
(e) to authorize the filing of all registration statements and
applications for exemptions, and related reports and documents to be
filed by VCA-ll with the Securities and Exchange Commission under the
Investment Company Act of 1940 and the Securities Act of 1933 and the
rules and regulations thereunder; and
(f) to perform such additional acts for VCA-ll as may be required to
comply with the Investment Company Act of 1940 or as may be necessary
to carry out the functions of VCA-ll as provided for by resolution of
the Board of Directors of Prudential.
SECTION 3. SUBCOMMITTEES. The Committee may elect by vote of a majority thereof,
which majority shall include a majority of the members who are not affiliated
persons of Prudential, two or more of its members to constitute an Executive
Subcommittee, which subcommittee shall have, and
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<PAGE>
may exercise when the Committee is not in session, any or all powers of the
Committee.
The Committee by a majority thereof may appoint from among its members
other subcommittees, from time to time, and may determine the number of members
(not less than two) composing such subcommittees, and their functions.
Each subcommittee may make rules for the notice and conduct of its meetings
and the keeping of the records thereof. The term of any member of any
subcommittee shall be fixed by the Committee but no member of a subcommittee
shall hold office after the first meeting of the Committee following a meeting
of the persons having voting rights in VCA-ll at which one or more members of
the Committee is elected, unless reappointed.
SECTION 4. MEETINGS. Regular meetings of the Committee shall be held at such
places and at such times as the Committee, by majority vote, may determine from
time to time, and if so determined, no call or notice thereof need be given
except that at least two days' notice shall be given of the first regular
meeting following a change in the date of regular meetings. Special meetings of
the Committee may be held at any time or place, whenever called by the Chairman
of the Committee, or two or more members of the Committee. Notice thereof shall
be given to each member by the Secretary or any Assistant Secretary to the
Committee, unless all members are present or unless those not present
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<PAGE>
shall have waived notice thereof in writing, which waivers shall be filed with
the records of the meeting. Notice of special meetings stating the time and
place thereof shall be given by mail to each member at his residence or business
address at least two days before the meeting, or by delivering or telephoning
the same to him personally or by telephoning the same to him at his residence or
business address at least one day before the meeting; provided, that the
Chairman of the Committee may prescribe a shorter notice to be given personally
or be telephone or telegraph to each member at his residence or business
address. The Chairman of the Committee shall preside at all meetings of the
Committee at which he is present.
SECTION 5. QUORUM. A majority of the members of the Committee shall constitute a
quorum for the transaction of business. When a quorum is present at any meeting,
a majority of the members present shall decide any question brought before such
meeting except as otherwise provided by law, or by these Rules and Regulations.
SECTION 6. ACTION OTHER THAN AT MEETINGS. Any action which may validly be taken
by the Committee at a regular or special meeting thereof may also be taken
without a meeting, provided that unanimous approval of such action has been
obtained either by telephonic communication with or in writing from each member
of the Committee. A record of any
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such action shall be maintained as part of the minutes of the meetings of the
Committee.
SECTION 7. OFFICERS. At the first meeting of the Committee and at the first
meeting following each meeting of the persons having voting rights in respect to
VCA-11 at which one or more members of the Committee is elected, the Committee
shall elect one of its members to act as Chairman of the Committee and he shall
hold office until his successor is elected and qualified.
The Committee shall appoint a Secretary to the Committee and such other
officers and assistant officers as it may deem advisable. With the exception of
the Chairman, none of the officers or assistant officers need be members of the
Committee. The Secretary and any Assistant Secretary shall have the power to
certify the minutes of the meetings, or any portion thereof, of the persons
having voting rights in respect of VCA-11 and of the Committee, shall perform
the duties customarily associated with the Secretary of a corporation, and shall
perform such other duties and have such other powers as the Committee shall
designate from time to time. All other officers and assistant officers shall
perform such duties and have such powers as the Committee shall designate from
time to time.
SECTION 8. RESIGNATIONS. Any member of the Committee, the Chairman, the
Secretary or any other officer or assistant
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officer may resign his membership or office at any time by mailing or delivering
his resignation in writing to the Chairman or to a meeting of the Committee. Any
such resignation shall take effect at the time specified therein or, if the time
be not specified, upon acceptance thereof by the Committee.
SECTION 9. VACANCIES. (a) Vacancies occurring by reason of death, resignation or
otherwise of members of the Committee may be filled by a majority vote of all
the remaining members, provided that, immediately after filling any such vacancy
at least two-thirds of the members then holding office shall have been elected
to such office by persons having voting rights in respect of VCA-11. Members
elected pursuant to this Section shall serve until the next meeting of the
persons having voting rights in respect of VCA-11.
(b) The Committee shall have and may exercise all its powers notwithstanding the
existence of one or more vacancies in its number, provided there are at least
three members in office. If the office of any member of any subcommittee, or the
Chairman of the Committee, the Secretary or any other officer or assistant
officer becomes vacant, the Committee may elect a successor by vote of a
majority of the members then in office. Each successor shall hold office until
his successor shall be duly elected or appointed and qualified.
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<PAGE>
SECTION 10. REMOVAL. Any member of the Committee, the Chairman, the Secretary
or any other officer or assistant officer may be removed from office by a vote
of three-fifths of the Committee members then in office.
No person shall serve as a member of the Committee after the persons having
two-thirds or more of the voting rights in respect of VCA-ll have declared,
either in a writing filed with Prudential or by votes cast in person or by proxy
at a meeting, called for such purpose, of persons having voting rights in
respect of VCA-ll, that such person should be removed as a Committee member.
The Committee shall promptly call a meeting of persons with voting rights
in respect of VCA-ll to vote on the removal of any Committee member when asked
to do so by persons having 10% or more of the voting rights in respect to
VCA-ll.
Whenever ten or more persons having voting rights in respect of VCA-ll who
hold, in the aggregate, interests in VCA-ll having a net asset value of at least
$25,000 or 1% of the voting rights in respect of VCA-ll, whichever is less,
shall advise the Committee in writing that they wish to communicate with other
persons having voting rights in respect of VCA-ll with a view to a request for a
meeting for the purpose of removing any member or members of the Committee from
office, and such advice is accompanied by a form of communication and request
which they wish to transmit, the Committee shall within five business days
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<PAGE>
after receiving such advice either afford such persons access to a list of the
names and addresses of persons having voting rights in respect of VCA-ll or
inform them as to the approximate number of persons having voting rights in
respect of VCA-ll and the approximate cost of mailing the proposed form of
communication and request.
If the Committee elects to provide the information regarding the
approximate number of persons having voting rights in respect of VCA-ll and the
approximate cost of mailing to them the proposed communication and form of
request, the Committee, upon the written request of those desiring such a
mailing, accompanied by a tender of the material to be mailed and of the
reasonable expenses of mailing, shall, with reasonable promptness, mail such
material to all persons having voting rights in respect of VCA-ll at their
addresses of record, unless within five business days after such tender the
Committee shall mail to the persons requesting the mailing and file with the
U.S. Securities and Exchange Commission, together with a copy of the material to
be mailed, a written statement signed by at least a majority of the members of
the Committee to the effect that in their opinion either such material contains
untrue statements of fact or omits to state facts necessary to make the
statements contained therein not misleading, or would be in violation of
applicable law, and specifying the basis of such opinion.
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<PAGE>
The Committee shall mail copies of such material to all persons having
voting rights in respect of VCA-ll with reasonable promptness after the entry of
an order by the Securities and Exchange Commission so providing and the renewal
of such tender.
ARTICLE IV
COMPENSATION
The members of the Committee who are affiliated with Prudential shall not
receive any additional compensation for services which they may perform for or
on behalf of VCA-ll. Members of the Committee who are not so affiliated shall be
compensated by Prudential. The Secretary and other officers or assistant
officers shall serve without additional compensation.
ARTICLE V
CHANGE OF CLASSIFICATION OF VCA-ll
Any plan of reorganization pursuant to which the classification of VCA-ll
is changed from a management company to a unit investment trust, as defined in
Section 4(2) of the Investment Company Act of 1940, must be submitted to the
persons holding voting rights in respect of VCA-ll and approved by a majority of
the votes cast by such persons.
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CUSTODY AGREEMENT
AGREEMENT dated July 14, 1982 between THE PRUDENTIAL VARIABLE CONTRACT
ACCOUNT-11 ("VCA-11"), a separate account of The Prudential Insurance Company of
America ("Prudential") registered as an open-end, diversified management
investment company under the Investment Company Act of 1940, and MORGAN GUARANTY
TRUST COMPANY OF NEW YORK, a banking corporation organized under the laws of the
State of New York ("Custodian").
W I T N E S S E T H
WHEREAS, VCA-11 desires to employ Custodian as a custodian of the
securities and property of VCA-11, and Custodian desires to accept such
employment, on the terms and conditions herinafter set forth;
NOW THEREFORE, in consideration of the mutual agreements herein made,
VCA-11 and Custodian hereby agree as follows:
1. RECEIPT AND DISBURSEMENT OF CASH
A. Custodian shall open and maintain a custody account (the "Account")
in the name of VCA-11, subject only to draft or order by Custodian acting
pursuant to the terms of this Agreement. Custodian shall hold in the Account
all cash received by it from, or for the account of, VCA-11.
B. Custodian shall make payments of cash for the account of VCA-11 only
(i) for the purchase of securities for the portfolio of VCA-11
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upon the delivery of such securities to Custodian, either registered in the mane
of VCA-11 of Custodian's nominee referred to in Section 2 below or in bearer
form or proper form for transfer, or by Federal Reserve book-entry delivery to
Custodian's account for the benefit of VCA-11; (ii) to another Prudential bank
for the purpose of making payments to VCA-11 participants or beneficiaries of
participants in accordance with their respective contracts as a result of the
withdrawal of all or a portion of an accumulation account, an election to
purchase an annuity or the payment of a death benefit provided for under the
contract; (iii) to Prudential, as a result of the election by a VCA-11
participant or a beneficiary of a participant to transfer all or a portion of
his accumulation account to a companion variable or fixed-dollar contract; (iv)
to Prudential, upon withdrawal by Prudential or all or part of the
proportionate interest in VCA-11 then held by it; (v) for the payment of
interest, dividends, taxes, advisory, management or supervisory fees or
operating and administrative expenses (including, without limitation, fees and
expenses payable to Prudential and fees for legal, accounting and auditing
services); (vi) for payments in connection with the conversion, exchange or
surrender of securities owned or subscribed to be VCA-11 held by or to be
delivered to Custodian; (vii) to any other custodian of the securities or
property of VCA-11, or (viii) for other proper account purposes. Before making
any such payment, Custodian shall receive (and may rely upon) an officers'
certificate, defined in Section 10 below, requesting such payment and stating
that it is for a purpose permitted under the terms of items (i) through(vii) of
this subsection B, and also, in respect of item (viii),
<PAGE>
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upon receipt of an officers' certificate and a certified copy of a resolution of
the VCA-11 Committee specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring such purpose to be a
proper account purpose and naming the person or persons to whom such payment is
to be made.
C. Custodian is hereby authorized to endorse and collect all checks,
drafts or other orders for the payment of money received by Custodian for the
account of VCA-11.
2. RECEIPT OF SECURITIES
Custodian shall hold in the Account, pursuant to the provisions of this
Agreement, all securities received by it for the account of VCA-11. All such
securities shall be held or disposed by Custodian for, and subject at all times
to the instructions of, VCA-11 pursuant to the provisions of this Agreement.
Custodian shall be authorized to utilize the Federal Reserve book-entry system
for such of the securities of VCA-11 as are eligible therefor. Any securities
held in the Federal Reserve book-entry system shall be represented in one or
more accounts in the name of Custodian which do not include any of Custodian's
assets other than assets held as fiduciary, custodian or otherwise for
customers. Securities held by Custodian in definitive form, i.e., not held in
the Federal Reserve book-entry system, shall be registered in the name of
Custodian's nominee, Schmidt & Co., which shall be used only for registration of
securities owned by or in portfolios managed by
<PAGE>
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Prudential. All of VCA-11 securities which are registered in the name of
Schmidt & Co. shall be physically segregated at all times from the securities of
any other persons, firms or corporations, including, without limitation, any
other securities registered in the name of Schmidt & Co. under the terms of
other custody agreements. Custodian shall have no power or authority to lend,
assign, hypothecate, pledge or otherwise dispose of any such securities and
investments, except pursuant to the directive of VCA-11 and only for the account
of VCA-11 as set forth in Section 3 below.
3. TRANSFER, EXCHANGE, REDELIVERY, ETC. OF SECURITIES
Custodian shall have sole power to release or deliver any securities of
VCA-11 held by it pursuant to this Agreement. Custodian agrees to transfer,
exchange, or deliver securities held by it hereunder only (a) for sales of such
securities for the account of VCA-11 upon receipt of Custodian of payment
therefor, (b) when such securities are called, redeemed or retired or otherwise
become payable, (c) for examination by any broker selling any such securities in
accordance with "street delivery" custom, (d) in exchange for or upon conversion
into other securities alone or other securities and cash whether pursuant to any
plan or merger, consolidation, reorganization, recapitalization or readjustment,
or otherwise, (e) upon conversion of such securities pursuant to their terms
into other securities, (f) upon exercise of subscription, purchase or other
similar rights represented by such securities, (g) for the purpose of exchanging
interim receipts or
<PAGE>
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temporary securities for definitive securities, or (h) for other proper account
purposes. As to any deliveries made by Custodian pursuant to items (b), (d),
(e), (f), and (g), securities or cash receivable in exchange therefor
shall be deliverable to Custodian. Before making any transfer, exchange
or delivery under the terms of items (a), (b), (c), (d), (e), (f), or (g) of
this Section 3, the Custodian shall receive an officers' certificate
authorizing such transfer, exchange or delivery and stating that it is for a
purpose permitted by such items and also, in respect of item (h), upon
receipt of an officers' certificate and a certified copy of a resolution of
the VCA-11 Committee specifying the securities to be delivered, setting forth
the purpose for which such delivery is to be made, declaring such purpose to
be a proper account purpose, and naming the person or persons to whom
delivery of such securities shall be made.
4. CUSTODIAN'S ACTS WITHOUT INSTRUCTIONS
Unless and until Custodian receives an officers' certificate to the
contrary, Custodian shall: (a) Present for payment all coupons and other income
items held by it for the account of VCA-11 which call for payment upon
presentation and hold the cash received by it upon such payment for the account
of VCA-11; (b) Collect interest received, with notice to VCA-11, for the account
of VCA-11, provided that interest on securities held in the Account, either in
book-entry form or otherwise, shall be credited automatically to the account on
the payable date whether or not actually collected by Custodian on that date;
and (c) execute as
<PAGE>
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agent on behalf of VCA-11 all necessary ownership certificates required by the
Internal Revenue Code or the Income Tax Regulations of the United States
Treasury Department or under the laws of any State now or hereafter in effect,
inserting VCA-11's name on such certificate as the owner of the securities
covered thereby, to the extent it may lawfully do so.
5. TAXES
Custodian shall execute and deliver such certificates in connection with
securities delivered to it or by it under Agreement as may be required under
the provisions of the Internal Revenue Code and any Regulations of the
Treasury Department issued thereunder, or under the laws of any State, to exempt
from taxation any exemptable transfers and/or deliveries of any such securities.
6. FEES AND EXPENSES
Custodian shall be compensated for its services pursuant to this Agreement
by fee and/or balance arrangements agreed upon by the parties from time to time.
Expenses incurred for postage, insurance, exchange, correspondent and similar
charges in connection with transactions under this Agreement may not be deducted
from sales proceeds or charged against the Account or any other Prudential
account without specific authorization.
<PAGE>
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7. MATTERS RELATING TO LIABILITY OF CUSTODIAN
A. Custodian shall maintain detailed records or all securities and
property held in the Account. All securities and property held by Custodian in
the Account shall be kept with the care exercised by Custodian with respect to
its own securities. Custodian's responsibility for all securities and property
held under this Agreement shall be that of a bailee for hire under the statutory
and case law of the State of New York.
B. Custodian represents and warrants to VCA-11 that it presently has in
force, and will maintain in force during the term of this Agreement, Bankers
Blanket Bond insurance coverage under Form No. 24 in an amount which Custodian
deems to be appropriate, together with a "Central Handling of Securities -
Discovery Form" Rider thereto. Although Custodian carries Bankers Blanket Bond
insurance coverage to insure itself against loss from any cause, it is
understood that Custodian shall be under no obligation to insure for the direct
benefit of VCA-11.
C. Custodian shall not be liable for any action taken in good faith upon
any certificate herein described or certified copy of any resolution of the VCA-
11 Committee, and may rely on the genuineness of any such document which it may,
in good faith, believe to have been validly executed. Custodian shall not be
liable for executing, failing to execute, or any mistake in the execution of,
telephonic, facsimile or other non-written instructions from VCA-11 with respect
to the Account prior to
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confirmation thereof in writing, except in case of the negligence or willful
misconduct of Custodian and/or its employees.
D. In consideration of Custodian's registration of any securities in the
name of its nominee, VCA-11 agrees to indemnify and hold harmless Custodian and
its nominee from all taxes, charges, expenses, assessments, claims and
liabilities (including counsel fees) incurred or assessed against it or its
nominee by reason of such registration, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct.
Custodian is authorized to charge any account of VCA-11 for such items.
E. Custodian shall not deliver any cash, securities or other property
from the Account to or for the account of any natural person, other than a
natural person acting in his official capacity on behalf of an instrumentality
of the Federal government or of any state government.
8.MATTERS RELATING TO USE OF FEDERAL RESERVE BOOK-ENTRY SYSTEM
A. Custodian shall promptly send or cause to be sent to VCA-11 a
confirmation of all transfers to or from the account, clearly distinguishing
between securities held in the Federal Reserve book-entry system and those not
so held. Transaction statements shall be furnished to VCA-11 on a daily basis.
B. With regard to securities held in the Federal Reserve book-entry
system, Custodian shall also, by book-entry or otherwise,
<PAGE>
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identify as belonging to VCA-11 a quantity of securities in a fungible bulk of
securities either (i) held in account in the name of Custodian in the Federal
Reserve book-entry system, or (ii) registered in the name of Schmidt & Co.
C. Custodian shall promptly send to VCA-11 (i) all reports which it
receives from the Federal Reserve book-entry system on its system of internal
accounting control, and (ii) such reports on the system of internal accounting
control of Custodian as VCA-11 may reasonably request from time to time.
9. REPORTS AND OTHER DOCUMENTS; INSPECTION
A. Custodian shall furnish VCA-11 with such reports as VCA-11 shall
reasonably request with respect to the securities and property of VCA-11 held in
the Account.
B. Custodian shall maintain records sufficient to determine and verify
information relating to the securities and property in the Account that may be
reported in Prudential's Annual Statement and supporting Schedules as filed with
various regulatory authorities and in connection with the audit of the financial
statements of VCA-11.
C. Custodian shall provide, upon request, affidavits for the Account in
the form of Attachments B and D to Circular Letter #2 (1977) of New York State
Insurance Department or such other form as may be acceptable to Custodian,
Prudential and the New York State Insurance
<PAGE>
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Department in order for the securities and property in the Account to be
recognized by the New York State Insurance Department as admitted assets of
Prudential, and to provide similar affidavits for submission to the Insurance
Departments of other states, if requested by VCA-11.
D. The books and records of Custodian pertaining to its actions under
this Agreement shall be open to inspection and audit at reasonable times by
officers, employees and independent auditors employed by VCA-11 and by any
representative of an appropriate regulatory body; provided, however, that
written instructions to that effect are furnished to Custodian by the Chairman
or Secretary of VCA-11 or by the Treasurer, the Comptroller, any Assistant
Treasurer or any Assistant Comptroller of Prudential.
10. OFFICERS' CERTIFICATES
As used herein, the term "officers' certificate" shall mean a request or
direction or certification signed and countersigned on behalf of VCA-11 by
Prudential in accordance with the provisions of the By-Laws of Prudential and
related resolutions of the Finance Committee of the Board of Directors of
Prudential which form part of Prudential's Booklet of Authorized Signatures
furnished to Custodian, as such Booklet may be revised from time to time. Any
requirement in this Agreement that an officers' certificate be furnished to
Custodian shall be satisfied if telephonic, facsimile or other non-written
instructions to Custodian are
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confirmed promptly by the delivery to Custodian of an officers' certificate in
accordance with the first sentence of this Section.
11. TERMINATION; ASSIGNMENT
A. This Agreement may be terminated by VCA-11, or by Custodian, on 60
days' notice, given in writing and sent by registered mail to the following
addresses:
(i) If to VCA-11, to: Prudential Plaza,
Newark, New Jersey 07101
Attention: Malcolm D. MacKinnon
with a copy to: Irving Patrick Fox
Vice President and Associate General Counsel
at the same address;
(ii) If to Custodian, to:
23 Wall Street
New York, New York 10015
Upon termination of this Agreement, pending (i) appointment of a successor
to Custodian or (ii) a determination by the VCA-11 Committee to hold its cash,
securities and other property in its own custody, Custodian shall not deliver
cash, securities, or other property of VCA-11 to VCA-11 but may deliver them to
a bank or trust company in the City of New York of its own selection, having an
aggregate capital, surplus and undivided profits, as shown by its last published
report of not less than Five Hundred Thousand Dollars ($500,000) as a temporary
Custodian for VCA-11 to be held under terms similar to those of this Agreement;
provided, however, that Custodian shall not be required to make any such
delivery or payment until full payment shall have been made by VCA-11 of all
liabilities constituting a charge on or against the properties then held by
Custodian
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or on or against Custodian, and until full payment shall have been made to
Custodian of all its fees, compensation, costs and expenses, subject to the
provisions of Section 7 of this Agreement.
B. This Agreement may not be assigned by Custodian without the consent
of VCA-11 authorized by a resolution of the VCA-11 Committee.
12. MISCELLANEOUS
A. The waiver by either party of the breach of any provision of this
Agreement shall not operate or be constructed as a waiver or any other or
subsequent breach.
B. This Agreement cannot be amended or terminated orally.
C. This Agreement shall be governed by and construed in accordance with
the law of the State of New York.
D. This Agreement may be executed in several counterparts.
E. Headings herein are for reference purposes only and shall not be
deemed to have any substantive effect.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
THE PRUDENTIAL VARIABLE CONTRACT
ACCOUNT-11
By: /s/ Malcolm D. Mackinnon
-------------------------
MALCOLM D. MACKINNON
CHAIRMAN, VCA-11 COMMITTEE
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK
By: /s/ Walter E. King
-------------------------
Walter E. King
Vice-President
Approved and agreed to:
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: /s/ James J. Straine
---------------------
James J. Straine
ASSISTANT TREASURER
VCA-11
INVESTMENT MANAGEMENT AGREEMENT
STATEMENT OF FACTS
A. On January 12, 1982, the Board of Directors of The Prudential
Insurance Company of America ("Prudential") adopted a resolution establishing
The Prudential Variable Contract Account-11 ("VCA-11") as a funding medium for
such contracts on a variable basis sold and administered by Prudential as may
be designated by it as participating therein.
B. Pursuant to the requirements of the Investment Company Act of 1940
("1940 Act") VCA-11 will be registered thereunder as an investment company.
C. The 1940 Act forbids any person from acting as investment manager to a
registered investment company except pursuant to a written contract and
Prudential may be regarded as the investment manager of VCA-11.
AGREEMENT
NOW THEREFORE, Prudential and VCA-11 do agree as follows:
1. Prudential shall manage the investment and reinvestment of the assets
held in VCA-11 in a manner consistent with the investment policies as set forth
in the registration statement of VCA-11, as from time to time amended, under the
1940 Act.
2. Prudential shall determine what securities shall be purchased or sold
for VCA-11 and shall arrange for the necessary placement of orders and execution
of transactions. All brokers' commissions, taxes or governmental
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fees attributable to transactions for VCA-11, and all other applicable taxes
arising out of the investment operations of VCA-11, including income and
capital gains taxes, if any, shall be charged against VCA-11.
3. At least once each month Prudential shall furnish to The Prudential
Variable Contract Account-11 Committee ("Committee") a schedule of the
investments held in VCA-11 and shall include therein a statement of all
purchases and sales made on behalf of VCA-11 during the period since the
preceding report.
4. For the services performed hereunder, Prudential will, in determining
unit values under the contracts participating in VCA-11 and in the manner
specified in such contracts, deduct an investment management fee at the
effective annual rate of one-fourth of one percent (0.25 percent).
5. This agreement shall remain in force until the first meeting of the
participants in VCA-11, and from year to year thereafter, but only so long as
such continuance is approved at least annually by the affirmative vote of a
majority of the members of the Committee, including the specific approval of a
majority of the members of the Committee who are not interested persons of
Prudential, or by a majority of the votes cast by those persons having voting
rights in respect of VCA-11, as provided for by the Rules and Regulations of
VCA-11.
6. This agreement shall automatically terminate in the event it shall not
be approved by a majority of the votes cast by those persons having voting
rights in respect of VCA-11 at their first meeting, or at any subsequent meeting
at which the question of the renewal or continuance of this agreement
<PAGE>
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shall be voted upon. This agreement shall also terminate automatically in the
event of its assignment by Prudential.
7. This agreement may be terminated at any time, and without payment of
any penalty, by the Committee or by a majority of the votes cast by those
persons having voting rights in respect of VCA-11, on 60 days' written notice
to Prudential. This agreement may be terminated by Prudential on 90 days'
written notice to the Committee.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
this 17th day of March, 1982.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
Attest:
/s/ Isabelle L. Kirchner By /s/ Robert M. Chmely
- ------------------------ -------------------------
Secretary Vice President
ISABELLE L. KIRCHNER ROBERT M. CHMELY
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
Witnessed:
/s/ Irving Patrick Fox By /s/ Malcolm D. MacKinnon
- ------------------------ -------------------------
Secretary to the Committee Chairman of the Committee
IRVING PATRICK FOX MALCOLM D. MACKINNON
VCA-11
AMENDMENT NO. 1 to
INVESTMENT MANAGEMENT AGREEMENT
Amendment No. 1 dated as of the 1Oth day of June, 1983 to AGREEMENT dated
the 17th day of March, 1982 (herein referred to as the "Agreement") by and
between THE PRUDENTIAL INSURANCE COMPANY OF AMERICA (herein referred to as
"Prudential"), and THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-ll (herein referred
to as "VCA-11").
Prudential and VCA-ll hereby agree that Section 3 of the Agreement shall be
amended to read as follows:
"3. At least once every three months Prudential shall furnish to The
Prudential Variable Contract Account-ll Committee ("Committee") a schedule of
the investments held in VCA-ll and shall include therein a statement of all
purchases and sales made on behalf of VCA-ll during the period since the
preceding report."
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed on their behalf by their duly authorized officers as of the date first
hereinabove mentioned.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
Attest:
/s/ Isabelle L. Kirchner By /s/ Garnett L. Keith
- ------------------------------------------ --------------------------------
Secretary Vice President
ISABELLE L. KIRCHNER GARNETT L. KEITH
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-ll
Attest:
/s/ Irving Patrick Fox By /s/ James H. Gately
- ------------------------------------------ --------------------------------
Secretary to the Committee Chairman of the Committee
IRVING PATRICK FOX JAMES H. GATELY
VCA-11
AGREEMENT RELATING TO THE SALE OF CERTAIN
CONTRACTS ON A VARIABLE BASIS
STATEMENT OF FACTS
A. On January 12, 1982, the Board of Directors of The Prudential Insurance
Company of America ("Prudential") adopted a resolution establishing The
Prudential Variable Contract Account-11 ("VCA-11") as a funding medium for
such contracts on a variable basis sold and administered by Prudential as
may be designated by it as participating therein.
B. Prudential will perform administrative and recordkeeping functions in
connection with the contracts on a variable basis which it may issue,
including enrolling participants, receiving and allocating contributions,
maintaining participants' accumulation accounts, preparing and distributing
confirmations, statements and reports. More particularly, Prudential will:
(a) maintain such books of account and records of all transactions
relating to VCA-11 as may be necessary to reflect clearly the assets
and liabilities attributable to VCA-11, and in that connection all
investments and liabilities attributable to VCA-11, at all times,
shall be identifiable and distinguishable from the other investments
and liabilities of Prudential;
(b) prepare and transmit to the VCA-11 Committee for its approval all
notices, proxies, proxy statements and periodic reports that are
required to be, or may be, transmitted to persons having voting
rights in respect of VCA-11, as provided for by the Rules and
Regulations of VCA-11, and upon the Committee's approval transmit the
same to such persons;
<PAGE>
-2-
(c) prepare and file all reports required by law to be filed with any
state or federal regulatory authority; and
(d) pay all costs, taxes and other expenses attributable to the
operations of VCA-ll, including, but not limited to, salary, rent,
postage, telephone, travel, legal, actuarial and accounting fees,
office equipment, stationery, and maintenance of computer and other
systems, but excluding brokers' commissions, taxes or governmental
fees attributable to transactions for VCA-ll, and all other
applicable taxes arising out of the investment operations of VCA-ll,
including income and capital gains taxes, if any. Such payment shall
not result in any reduction of the value or number of Unites credited
to persons who hold participating interests in VCA-ll or in the
amounts which they are entitled to receive under contracts on a
variable basis issued by Prudential other than in a manner set forth
in each such contract. Each such contract will set forth, either in
terms of dollars or of a percentage, or both, by which the value of
the amounts credited to persons holding participating interests in
VCA-ll will be reduced, the charge that will be made in order to
provide funds intended to defray the expenses of administering the
contracts.
C. Prudential will sell its contracts on a variable basis through agents
employed by it and through independent brokers and will pay certain sales
commissions in that connection as well as other expenses attributable to
the marketing sale, and distribution of such contracts.
D. Pursuant to the requirements of the 1940 Act, VCA-ll will be registered
thereunder as an investment company.
E. The 1940 Act forbids any person from acting as principal underwriter to a
registered investment company except pursuant to a written contract and
Prudential may be regarded as the principal underwriter of VCA-ll.
<PAGE>
-3-
AGREEMENT
NOW THEREFORE, Prudential and VCA-ll agrees as follows:
1. Prudential will sell contracts on a variable basis that include
participating interests in VCA-11.
2. Each form of contract on a variable basis participating in VCA-ll sold by
Prudential shall set forth explicitly a schedule of deferred sales charges.
The deferred sales charge is imposed on certain withdrawals from VCA-ll.
This deferred sales charge will be retained by Prudential and may be used
by it, to the extent necessary, for the payment of commissions to persons
instrumental in the sale of such form of contract and for payment of other
expenses incurred in connection with the marketing, sale and distribution
of such form of contract.
3. Promptly after it issues a form of contract on a variable basis that
includes participating interests in VCA-ll, Prudential shall advise the
Prudential Variable Contract Account-ll Committee ("Committee") of the
amount of the deferred sales charge that will be imposed upon withdrawals.
Prudential shall also promptly advise the Committee of any change in the
form of contract that increases or decreases such charge.
4. It is understood that the compensation to Prudential, resulting from the
deferred sales charge imposed upon withdrawals made by participants under
variable basis, is separate and apart from he any form of contract on
additional compensation, more fully described in a separate contract
between the parties also executed as of this date, providing for the
performance of investment management, and is also separate from and
additional to the charge or charges made, as described in Paragraph B,
subparagraph (d), of the Statement of Facts preceding this Agreement, for
the purpose of providing
<PAGE>
-4-
funds to defray the expenses of administering the contracts.
5. This Agreement shall remain in force until the first meeting of the
participants in VCA-ll and from year to year thereafter, but only so long
as such continuance is approved at least annually by the affirmative vote
of the Committee, including the specific approval of a majority of the
members of the Committee who are not persons affiliated with Prudential, or
by a majority of the votes by those persons having voting rights in respect
of VCA-ll, as provided for by the Rules and Regulations of VCA-ll.
6. This agreement shall automatically terminate in the event of its assignment
by Prudential.
<PAGE>
-5-
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
this 17th day of March, 1982.
Attest: THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
/s/ Isabelle L. Kirchner By: /s/ Robert M. Chmely
- ------------------------------- -----------------------------
Secretary Vice President
Witnessed: THE PRUDENTIAL VARIABLE CONTRACT
ACCOUNT-11
/s/ Irving Patrick Fox By: /s/ Malcolm D. MacKinnon
- ------------------------------- -----------------------------
Secretary to the Committee Chairman of the Committee
VCA-11
AGREEMENT FOR THE SALE OF VCA-ll CONTRACTS
AGREEMENT dated as of May 1, 1992, among THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA ("Prudential"), a New Jersey corporation, THE PRUDENTIAL VARIABLE
CONTRACT ACCOUNT-ll ("VCA-11"), a separate account of Prudential registered as
an open-end, diversified management investment company under the Investment
Company Act of 1940, and PRUDENTIAL ASSET MANAGEMENT COMPANY SECURITIES
CORPORATION ("PAMSEC"), a wholly-owned indirect subsidiary of Prudential
registered as a broker-dealer under the Securities Exchange Act of 1934.
WHEREAS, VCA-11 serves as the funding medium for such variable contracts
issued by Prudential as may be designated by Prudential as participating therein
(the "Contracts"); and
WHEREAS, Prudential and VCA-11 desire that PAMSEC provide sales and
distribution services for the Contracts;
NOW, THEREFORE, in consideration of the promises and mutual considerations
provided here, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. PAMSEC will provide sales and distribution services (the "Services") for
the Contracts.
2. In exchange for the Services, Prudential shall compensate PAMSEC in an
amount equal to the commissions and other expenses incurred by PAMSEC in
connection with the Services. PAMSEC shall itemize such commissions and expenses
at Prudential's request.
3. Amounts retained by Prudential from the payment of the deferred sales
charge under the Contracts shall be applied to the payments to be made by
Prudential to PAMSEC for the Services. The deferred sales charge shall be as
described in the prospectus for the sale of the Contracts. To the extent that
the deferred sales charge does not cover the payments to be made by Prudential
to PAMSEC for the services, the difference will be made up from Prudential's
surplus.
4. This agreement shall by approved by the affirmative vote of the VCA-ll
Committee, including the specific approval of a majority of the members of the
Committee who are not persons affiliated with Prudential, or by a majority of
the votes cast by those persons having voting rights in respect of VCA-ll, as
provided for by the Rules and Regulations of VCA-11. This agreement shall remain
in force only so long as its continuance is approved at least annually by such
vote of the Committee or persons with VCA-11 voting rights described in the
previous sentence.
<PAGE>
5. This agreement shall automatically terminate in the event of its
assignment by Prudential or PAMSEC.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first above written.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: Dorothy K. Light
----------------------------------------
Vice President
THE PRUDENTIAL VARIABLE CONTRACT
ACCOUNT-11
By: Bruce F. Vane
----------------------------------------
Chairman of the Committee
PRUDENTIAL ASSET MANAGEMENT COMPANY
SECURITIES CORPORATION
By: H. R. Hopkins Jr.
----------------------------------------
Vice President
VCA-11
AGREEMENT FOR THE SALE OF VCA-11 CONTRACTS
AGREEMENT dated as of May 1, 1993, among THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA ("Prudential"), a New Jersey corporation, THE PRUDENTIAL
VARIABLE CONTRACT ACCOUNT-11 ("VCA-11"), a separate account of Prudential
registered as an open-end, diversified management investment company under the
Investment Company Act of 1940, and PRUDENTIAL RETIREMENT SERVICES, INC.
("PRSI"), a wholly-owned indirect subsidiary of Prudential registered as a
broker-dealer under the Securities Exchange Act of 1934.
WHEREAS, VCA-11 serves as the funding medium for such variable contracts
issued by Prudential as may be designated by Prudential as participating therein
(the "Contracts"); and
WHEREAS, Prudential and VCA-11 desire that PRSI provide sales and
distribution services for the Contracts;
NOW, THEREFORE, in consideration of the promises and mutual considerations
provided here, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. PRSI will provide sales and distribution services (the "Services") for
the Contracts.
2. In exchange for the Services, Prudential shall compensate PRSI in an
amount equal to the commissions and other expenses incurred by PRSI in
connection with the Services. PRSI shall itemize such commissions and expenses
at Prudential's request.
3. Amounts retained by Prudential from the payment of the deferred sales
charge under the Contracts shall be applied to the payments to be made by
Prudential to PRSI for the Services. The deferred sales charge shall be as
described in the prospectus for the sale of the Contracts. To the extent that
the deferred sales charge does not cover the payments to be made by Prudential
to PRSI for the services, the difference will be made up from Prudential's
surplus.
4. This agreement shall be approved by the affirmative vote of the VCA-11
Committee, including the specific approval of a majority of the members of the
Committee who are not persons affiliated with Prudential, or by a majority of
the votes cast by those persons having voting rights in respect of VCA-11, as
provided for by the Rules and Regulations of VCA-11. This agreement shall remain
in force only so long as its continuance is approved at least annually by such
vote of the Committee or persons with VCA-11 voting rights described in the
previous sentence.
<PAGE>
-2-
5. This agreement shall automatically terminate in the event of its
assignment by Prudential or PRSI.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first above written.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: Dorothy K. Light
----------------------------------------
Vice President
THE PRUDENTIAL VARIABLE CONTRACT
ACCOUNT-11
By: Bruce F. Vane
----------------------------------------
Chairman of the Committee
PRUDENTIAL RETIREMENT SERVICES, INC.
By: Mark R. Fetting
----------------------------------------
President
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
-----------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Isabelle L. Kirchner
--------------------------
Attest
-------------------------
Date:
-------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED
IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1000 19081
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Account. . . . . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . . . . 110
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawals. . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts. . . . . . . . . . 310
3.4 Transfers to Another Funding Agent . . . . . . . . . . 310
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . . . . . . . 320
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . . . . . . 400
4.3 Small Annuities and Accounts . . . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . . . . . . 400
4.5 Payees . . . . . . . . . . . . . . . . . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . . . . . . . . 710
GVA-1010
TC-100 (10)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Provision Serial Page
7.7 Divisible Surplus. . . . . . . . . . . . . . . . . . . 720
7.8 Limit on Assignment. . . . . . . . . . . . . . . . . . 720
7.9 Certificates . . . . . . . . . . . . . . . . . . . . . 720
7.10 Entire Contract -- Construction. . . . . . . . . . . . 720
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased. . . . . A-100
Schedule B Life - Payment Certain Annuity . . . . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . . . . S-100
GVA/GAA-1000/7327
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the Qualified Retirement Contributions (see
Section 219(e)(1)(B) of the Federal Internal Revenue Code) the
Participant has directed for payment hereunder. Contributions
will be transmitted by the Contract-Holder. A Participant is a
person for whom contributions have been paid under this contract
and whose Participant's Account (see section 1.2) has not been
cancelled.
No contribution may be made for a Participant in or after his tax
year in which he reaches age 70 1/2. Tax year means the one for
Federal Income Tax purposes.
Any contribution for a Participant made on other than a periodic
basis may not be less than $500.
The contributions made for a Participant for any of his tax years
are subject to certain limits. They may not exceed $2,000, or his
total earnings in the year if less, or any higher amount
permitted under the Internal Revenue Code. If made after the end
of a tax year, they are made in the next year before the filing
date for his tax return in that year. (For most Participants, tax
years and calendar years are the same.)
A contribution may be made for a non-working spouse of a
Participant. However, the sum of the contribution made for the
working and non-working spouses may not exceed $2250 for any tax
year, or any higher amount permitted by the Internal Revenue
Code. (A non-working spouse for whom a contribution is made is a
Participant.)
(To save words, male pronouns are used in this contract to refer
to both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to
the Federal Internal Revenue Code may be transferred to and paid
under this contract as a contribution for a Participant.
Prudential may require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
GVA-1000
Serial 100 1.1-1.3
<PAGE>
5/87
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Similarly, on any other day on which a Participant's
Account is cancelled, an amount will be withdrawn from his Account equal to
the Annual Account Charge. However, no Charge will be withdrawn if the
Participant's Account is being cancelled on a January 1 to purchase an
annuity for him under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Qualified Retirement Contributions
under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition, to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1000
Serial 110 (as modified by Form GAA-7472A) 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1000 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
This section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (10)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1000 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (11)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account. The
minimum withdrawal is $500, or the dollar value of his Account if smaller.
Payment to the Participant will normally be made within seven days of
Prudential's receipt of a duly completed request for it. However, it may be
paid at a later day if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
-------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). The
payment will be made in one sum unless the Participant has directed
Prudential to purchase an annuity for the Beneficiary. Instead of a one sum
payment, the Beneficiary may elect to have the dollar value of the
Participant's Account applied to purchase an annuity. A one sum payment
will be made on the fifth anniversary of the Participant's death if no
other election has been made by then. However, proof of the Participant's
death must be received by Prudential before any payment will be made.
GVA-1000
Serial 300 3.1-3.2
<PAGE>
5/87
The annuity form may be any of those described in section 4.4. If annuity
payments are to start at a future date, the Participant's Account will be
maintained for the Beneficiary in the same manner as for the Participant.
The date for payments to start must be on or before the fifth anniversary
of the Participant's death. No contributions may be made to the Account
after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract. The minimum
withdrawal to provide a transfer is $500, or the dollar value of his
Account if smaller. The transfer will normally be made within seven days of
receipt of a duly completed request for it. Section 3.1 does not apply to a
withdrawal for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However, in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Account may be transferred to
an individual retirement account or individual retirement annuity
contract provided by another financial institution. The transfer may
be made directly to that institution or by a payment (or payments) to
the Participant who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be in full settlement of Prudential's liability for
the Participant's Account.
GVA-1000
Serial 310 3.3.-3.4
<PAGE>
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made.
Each person who does not make this election will have his Account
retained under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date. A single liquidation
account will be established equal to the sum of the Withdrawal Values
expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
The Contract-Holder may notify Prudential that this section 3.4(b) is
to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by the Contract-Holder. He may
become employed by an employer to whom Prudential has issued a contract
similar to this contract. If so, that Participant may request a transfer to
that similar contract from this contract. The transfer will normally be
made within seven days of receipt of the request. The dollar value of the
Participant's Account will be the amount transferred. The Account will be
cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by the
Contract-Holder. The transferred amount will be treated as a contribution
paid for that person. However, in determining any withdrawal charge, any
part of the transferred amount which is investment income will not be
considered contribution.
This section may be changed as provided in section 5.1.
GVA-1000
Serial 320 3.5
<PAGE>
5/87
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential, elect to have his
Participant's Account applied to purchase an annuity for him. The dollar
value of the Account will be applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in any of the Participant's Accounts
or in an Account for him under a companion contract, his Account is
cancelled.
If the Participant's Account has not been cancelled before the end of the
calendar year in which he reaches age 70 1/2, a 120 monthly Payment Certain
annuity will be purchased for him at the end of that year (see section
4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
A Participant may elect that only a portion of his Participant's Account be
applied to purchase an annuity with the balance being paid in a single sum.
The first portion will be subject to section 4.1 and the balance to section
3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-1000
Serial 400 (as modified by Form GAA-7472A) 4.1-4.4
<PAGE>
9/84
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased for a Participant which provides for
payments
(i) over a period longer than his life, or his and his spouse's life, or
(ii) over a term certain extending beyond his life expectancy, or his and
his spouse's combined life expectancy.
No form of annuity will be purchased for a Beneficiary which provides for
payments
(iii) over a period longer than his life, or
(iv) over a term certain extending beyond his life expectancy.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-1000/7327
Serial 410 (as modified by Forms GAA-7472A/7472) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge, the
minimum dollar contribution made on other than a periodic basis, and
the terms and amounts, (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III
may be changed periodically on and after the fifth anniversary of the
Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency regulating Qualified Retirement
Contributions funding arrangements.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1000
Serial 500 (as modified by Form GAA-7472A) 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted
hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity payments are payable from this contract.
GVA/GAA-1000/7327
Serial 600 6.1-6.3
<PAGE>
5/87
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1000/7327
Serial 700 (as modified by Forms GAA-7472A/7472) 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to effect such annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant or
Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA/GAA-1000/7327
Serial 710 (as modified by Forms GAA-7472A/7472) 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1000/7327
Serial 720 7.7-7.10
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
FORM OF PAYMENT PAYABLE APPLICABLE SCHEDULE
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown
in the following schedules for annuities purchased during any period
specified by Prudential. Annuity purchase rates for other forms of annuity
consented to by Prudential will be furnished upon request. The following
schedules may be changed as provided in section 5.1.
GVA/GAA-1000/7327
Serial A-100 (as modified by Forms GAA-7472A/7472) Schedule A
<PAGE>
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
AGE
- --- ---- ---- ---- ----
60
65
70
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
AGE
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60
65
70
If specified percentage to Contingent Annuitant is 50%:
60
65
70
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain
- ----------------- ----- ----- ----- -----
60
120
180
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1000/7327
Serial S-100 (as modified by Forms GAA-7472A/7472) Schedules B-D
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
------------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Isabelle Kirchner
----------------------------
Attest
--------------------
Date:
---------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED
IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1000 19081
<PAGE>
TABLE OF CONTENTS
Serial Page
PROVISION
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts. . . . . . . . . . . . 100
1.3 Annual Account Charge . . . . . . . . . . . . 110
1.4 Reports . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . 200
2.2 VCA-10 Unit Value . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee. . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawal. . . . . . . . . . . 300
3.2 Death Payments. . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts . . . . . 310
3.4 Transfers to Another Funding Agent. . . . . . 310
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . 320
IV. ANNUITIES
4.1 Annuity Elections . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination. . . 400
4.3 Small Annuities and Accounts. . . . . . . . . 400
4.4 Terms of Payment of Annuities . . . . . . . . 400
4.5 Payees. . . . . . . . . . . . . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential . . . . . . . . . . . . 500
5.2 Changes by Agreement. . . . . . . . . . . . . 500
5.3 Changes to Conform to Law . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . 600
6.3 Termination of Contract . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder . . . . . . . . . . . . . . . 700
7.2 Communications. . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . 700
7.4 Information -- Records. . . . . . . . . . . . 710
7.5 Misstatements . . . . . . . . . . . . . . . . 710
7.6 Beneficiary . . . . . . . . . . . . . . . . . 710
GVA-1000
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Serial Page
Provision
7.7 Divisible Surplus . . . . . . . . . . . . . 720
7.8 Limit on Assignment . . . . . . . . . . . . 720
7.9 Certificates. . . . . . . . . . . . . . . . 720
7.10 Entire Contract -- Construction . . . . . . 720
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased . . A-100
Schedule B Life - Payment Certain Annuity. . . . . . . S-100
Schedule C Life - Contingent Annuity . . . . . . . . . S-100
Schedule D Payment Certain Annuity . . . . . . . . . . S-100
GVA/GAA-1000/7327
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the Qualified Retirement Contributions (see Section
219(e)(1)(B) of the Federal Internal Revenue Code) the Participant has
directed for payment hereunder. Contributions will be transmitted by
the Contract-Holder. A Participant is a person for whom contributions
have been paid under this contract and whose Participant's Account
(see section 1.2) has not been cancelled.
No contribution may be made for a Participant in or after his tax year
in which he reaches age 70 1/2. Tax year means the one for Federal
Income Tax purposes.
Any contribution for a Participant made on other than a periodic basis
may not be less than $500.
The contributions made for a Participant for any of his tax years are
subject to certain limits. They may not exceed $2,000, or his total
earnings in the year if less, or any higher amount permitted under the
Internal Revenue Code. If made after the end of a tax year, they are
made in the next year before the filing date for his tax return in
that year. (For most Participants, tax years and calendar years are
the same.)
A contribution may be made for a non-working spouse of a Participant.
However, the sum of the contribution made for the working and
non-working spouses may not exceed $2250 for any tax year, or any
higher amount permitted by the Internal Revenue Code. (A nonworking
spouse for whom a contribution is made is a Participant.)
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant. Prudential may
require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
GVA-1000
Serial 100 1.1-1.3
<PAGE>
5/87
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Similarly, on any other day on which a Participant's
Account is cancelled, an amount will be withdrawn from his Account equal to
the Annual Account Charge. However, no Charge will be withdrawn if the
Participant's Account is being cancelled on a January 1 to Purchase an
annuity for him under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Qualified Retirement Contributions
under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition, to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1000
Serial 110 (as modified by Form GAA-7472A) 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $l.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1000 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
This section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (10)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1000 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (11)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account. The
minimum withdrawal is $500, or the dollar value of his Account if smaller.
Payment to the Participant will normally be made within seven days of
Prudential's receipt of a duly completed request for it. However, it may be
paid at a later day if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). The
payment will be made in one sum unless the Participant has directed
Prudential to purchase an annuity for the Beneficiary. Instead of a one sum
payment, the Beneficiary may elect to have the dollar value of the
Participant's Account applied to purchase an annuity. A one sum payment
will be made on the fifth anniversary of the Participant's death if no
other election has been made by then. However, proof of the Participant's
death must be received by Prudential before any payment will be made.
GVA-1000
Serial 300 3.1-3.2
<PAGE>
5/87
The annuity form may be any of those described in section 4.4. If annuity
payments are to start at a future date, the Participant's Account will be
maintained for the Beneficiary in the same manner as for the Participant.
The date for payments to start must he on or before the fifth anniversary
of the Participant's death. No contributions may be made to the Account
after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract. The minimum
withdrawal to provide a transfer is $500, or the dollar value of his
Account if smaller. The transfer will normally be made within seven days of
receipt of a duly completed request for it. Section 3.1 does not apply to a
withdrawal for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However, in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a Contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Account may be transferred to
an individual retirement account or individual retirement annuity
contract provided by another financial institution. The transfer may
be made directly to that institution or by a payment (or payments) to
the Participant who then makes payment to the Institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be in full settlement of Prudential's liability for
the Participant's Account.
GVA-1000
Serial 310 3.3.-3.4
<PAGE>
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made.
Each person who does not make this election will have his Account
retained under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date. A single liquidation
account will be established equal to the sum of the Withdrawal Values
expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
The Contract-Holder may notify Prudential that this section 3.4(b) is
to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by the Contract-Holder. He may
become employed by an employer to whom Prudential has issued a contract
similar to this contract. If so, that Participant may request a transfer to
that similar contract from this contract. The transfer will normally be
made within seven days of receipt of the request. The dollar value of the
Participant's Account will be the amount transferred. The Account will be
cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by the
Contract-Holder. The transferred amount will be treated as a contribution
paid for that person. However, in determining any withdrawal charge, any
part of the transferred amount which is investment income will not be
considered a contribution.
This section may be changed as provided in section 5.1.
GVA-1000
Serial 320 3.5
<PAGE>
5/87
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential, elect to have his
Participant's Account applied to purchase an annuity for him. The dollar
value of the Account will be applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in any of the Participant's Accounts
or in an Account for him under a companion contract, his Account is
cancelled.
If the Participant's Account has not been cancelled before the end of the
calendar year in which he reaches age 70 1/2, a 120 monthly Payment Certain
annuity will be purchased for him at the end of that year (see section
4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION;
A Participant may elect that only a portion of his Participant's Account be
applied to purchase an annuity with the balance being paid in a single sum.
The first portion will be subject to section 4.1 and the balance to section
3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-1000
Serial 400 (as modified by Form GAA-7472A) 4.1-4.4
<PAGE>
9/84
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased for a Participant which provides for
payments
(i) over a period longer than his life, or his and his spouse's life, or
(ii) over a term certain extending beyond his life expectancy, or his and
his spouse's combined life expectancy.
No form of annuity will be purchased for a Beneficiary which provides for
payments
(iii) over a period longer than his life, or
(iv) over a term certain extending beyond his life expectancy.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-1000/7327
Serial 410 (as modified by Forms GAA-7472A/7472) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge,
the minimum dollar contribution made on other than a periodic basis,
and
the terms and amounts, (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III
may be changed periodically on and after the fifth anniversary of the
Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency regulating Qualified Retirement
Contributions funding arrangements.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1000
Serial 500 (as modified by Form GAA-7472A) 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted
hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity payments are payable from this contract.
GVA/GAA-1000/7327
Serial 600 6.1-6.3
<PAGE>
5/87
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1000/7327
Serial 700 (as modified by Forms GAA-7472A/7472) 7.1--7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to effect such annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant or
Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA/GAA-1000/7327
Serial 710 (as modified by Forms GAA-7472A/7472) 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1000/7327
Serial 720 7.7-7.10
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
FORM OF PAYMENT PAYABLE APPLICABLE SCHEDULE
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished upon request. The following schedules may be
changed as provided in section 5.1.
GVA/GAA-1000/7327
Serial A-100 (as modified by Forms GAA-7472A/7472) Schedule
<PAGE>
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age
- --- --- --- --- ---
60
65
70
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
-------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
Age
- --- --- --- --- ---
If specified percentage to Contingent Annuitant is 100%:
60
65
70
If specified percentage to Contingent Annuitant is 50%:
60
65
70
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain
- ---------------- --- --- --- ---
60
120
180
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1000/7327
Serial S-100 (as modified by Forms GAA-7472A/7472) Schedules B-D
THE PRUDENTIAL [Logo] THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
---------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Dorothy K. Light
-------------------------
Attest
-----------------------------
Date:
------------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1000 19081-A
<PAGE>
TABLE OF CONTENTS
Provision Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Account. . . . . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . . . . 110
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawal . . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . . . 300
3.3 Transfers Between Related Contracts. . . . . . . . . . 310
3.4 Transfers to Another Funding Agent . . . . . . . . . . 310
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . . . . . . 320
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . . . . . . 400
4.3 Small Annuities and Accounts . . . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . . . . . . 400
4.5 Payees . . . . . . . . . . . . . . . . . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . . . . . . . . 710
GVA-1000
TC-100 (10)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Provision Serial Page
7.7 Divisible Surplus. . . . . . . . . . . . . . . . . . . 720
7.8 Limit on Assignment. . . . . . . . . . . . . . . . . . 720
7.9 Certificates . . . . . . . . . . . . . . . . . . . . . 720
7.10 Entire Contract -- Construction. . . . . . . . . . . . 720
SCHEDULES
Schedule A Forms of Annuity which May be Purchased. . . . A-100
Schedule B Life - Payment Certain Annuity . . . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . . . S-100
GVA/GAA-1000/7327
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the Qualified Retirement Contributions (see SECTION
219(e)(1)(B) of the Federal Internal Revenue Code) the Participant has
directed for payment hereunder. Contributions will be transmitted by
the Contract-Holder. A Participant is a person for whom contributions
have been paid under this contract and whose Participant's Account
(see section 1.2) has not been cancelled.
No contribution may be made for a Participant in or after his tax year
in which he reaches age 70 l/2. Tax year means the one for Federal
Income Tax purposes.
Any contribution for a Participant made on other than a periodic basis
may not be less than $500.
The contributions made for a Participant for any of his tax years are
subject to certain limits. They may not exceed $2,000, or his total
earnings in the year if less, or any higher amount permitted under the
Internal Revenue Code. If made after the end of a tax year, they are
made in the next year before the filing date for his tax return in
that year. (For most Participants, tax years and calendar years are
the same.)
A contribution may be made for a non-working spouse of a Participant.
However, the sum of the contribution made for the working and
non-working spouses may not exceed $2250 for any tax year, or any
higher amount permitted by the Internal Revenue Code. (A non-working
spouse for whom a contribution is made is a Participant.)
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant. Prudential may
require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
GVA-1000
Serial 100 1.1-1.2
<PAGE>
5/87
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Similarly, on any other day on which a Participant's
Account is cancelled, an amount will be withdrawn from his Account equal to
the Annual Account Charge. However, no Charge will be withdrawn if the
Participant's Account is being cancelled on a January 1 to purchase an
annuity for him under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Qualified Retirement Contributions
under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition, to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1000
Serial 110 (as modified by Form GAA-7472A) 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted form principal.
GVA-1000 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days from the end of the
prior Business Day to the end of the current Business Day.
In addition, the result found in (c) is the VCA-10 Unit Change Factor for
that Business Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will notify
the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (10) (as modified by GAA-7663)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT Values - COMMITTEE
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11 Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts off this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted form principal.
GVA-1000 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days from the-end of the
prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-11 Account. Prudential will notify
the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (11) (as modified by GAA-7663)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account. The
minimum withdrawal is $500, or the dollar value of his Account if smaller.
Payment to the Participant will normally be made within seven days of
Prudential's receipt of a duly completed request for it. However, it may be
paid at a later day if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ----------------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). The
payment will be made in one sum unless the Participant has directed
Prudential to purchase an annuity for the Beneficiary. Instead of a one sum
payment, the Beneficiary may elect to have the dollar value of the
Participant's Account applied to purchase an annuity. A one sum payment
will be made on the fifth anniversary of the Participant's death if no
other election has been made by then. However, proof of the Participant's
death must be received by Prudential before any payment will be made.
GVA-1000
Serial 300 3.1-3.2
<PAGE>
5/87
The annuity form may be any of those described in section 4.4. If annuity
payments are to start at a future date, the Participant's Account will be
maintained for the Beneficiary in the same manner as for the Participant.
The date for payments to start must be on or before the fifth anniversary
of the Participant's death. No contributions may be made to the Account
after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract. The minimum
withdrawal to provide a transfer is $500, or the dollar value of his
Account if smaller. The transfer will normally be made within seven days of
receipt of a duly completed request for it. Section 3.1 does not apply to a
withdrawal for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However, in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Account may be transferred to
an individual retirement account or individual retirement annuity
contract provided by another financial institution. The transfer may
be made directly to that institution or by a payment (or payments) to
the Participant who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be in full settlement of Prudential's liability for
the Participant's Account.
GVA-1000
Serial 310 3.3-3.4
<PAGE>
5/87
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made.
Each person who does not make this election will have his Account
retained under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date. A single liquidation
account will be established equal to the sum of the Withdrawal Values
expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn
and the Unit Value for the day of withdrawal will be transferred
within seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
The Contract-Holder may notify Prudential that this section 3.4(b)
is to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by the Contract-Holder. He may
become employed by an employer to whom Prudential has issued a contract
similar to this contract. If so, that Participant may request a transfer to
that similar contract from this contract. The transfer will normally be
made within seven days of receipt of a duly completed request. The dollar
value of the Participant's Account will be the amount transferred. The
Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by the
Contract-Holder. The transferred amount will be treated as a contribution
paid for that person. However, in determining any withdrawal charge, any
part of the transferred amount which is investment income will not be
considered a contribution.
This section may be changed as provided in section 5.1.
GVA-1000
Serial 320 3-5
<PAGE>
5/87
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential, elect to have his
Participant's Account applied to purchase an annuity for him. The dollar
value of the Account will be applied. The schedule of annuity purchase
rates that applies is determined from Schedule A. The monthly amount of any
annuity is determined from the schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
If the Participant's Account has not been cancelled before the end of the
calendar year in which he reaches age 70 1/2, a 120 monthly Payment Certain
annuity will be purchased for him at the end of that year (see section
4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
A Participant may elect that only a portion of his Participant's Account be
applied to purchase an annuity with the balance being paid in a single sum.
The first portion will be subject to section 4.1 and the balance to section
3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-1000
Serial 400 (as modified by Form GAA-7472A) 4.1-4.4
<PAGE>
9/84
(a) Life Form of Annuity
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life-Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of each month thereafter throughout the Contingent
Annuitant's remaining lifetime. The last monthly payment is payable
for the month in which his death occurs. The amount of each monthly
Contingent Annuity payment will be a percentage of the monthly annuity
payment payable before the Annuitant's death. The percentage is
established when the annuity is purchased and may be 33 1/3%, 50%, 66
2/3% or 100%, or any other percentage accepted by Prudential. Under a
Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased which provides for payments
(i) over a period longer than his life, or his and his spouse's life, or
(ii) over a term certain extending beyond his life expectancy, or his and
his spouse's combined life expectancy.
No form annuity will be purchased for a Beneficiary which provides for
payments
(iii) over a period longer than his life, or
(iv) over a term certain extending beyond his life expectancy.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-1000/7327
Serial 410 (as modified by Forms GAA-7472A/7472) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge,
the minimum dollar contribution made on other than a periodic basis,
and
the terms and amounts, (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III
may be changed periodically on and after the fifth anniversary of the
Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency regulating Qualified Retirement
Contributions funding arrangements.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1000
Serial 500 (as modified by Form GAA-7472A) 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity payments are payable from this contract.
GVA/GAA-1000/7327
Serial 600 6.1-6.3
<PAGE>
5/87
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1000/7327
Serial 700 (as modified by Forms GAA-7472A/7472) 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
a form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to effect such annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant
or Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA/GAA-1000/7327
Serial 710 (as modified by Forms GAA-7472A/7472) 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brother or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1000/7327
Serial 720 7.7-7.10
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASES
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown
in the following schedules for annuities purchased during any period
specified by Prudential. Annuity purchase rates for other forms of annuity
consented to by Prudential will be furnished upon request. The following
schedules may be changed as provided in section 5.1.
GVA/GAA-1000/7327
Serial A-100 (as modified by Forms GAA-7472A/7472) Schedule A
<PAGE>
1/88
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
60 $52.94 $41.56 $40.58 $39.85
65 58.01 46.81 45.60 44.68
70 64.46 53.48 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.28 $36.06 $35.31 $34.78
65 51.11 40.07 39.10 38.39
70 56.56 45.62 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $50.36 $38.89 $38.00 $37.34
65 55.18 43.77 42.61 41.75
70 61.91 50.47 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain 1988 1990 1995 2000
- ---------------- ---- ---- ---- ----
60 $173.76 $165.62 $164.73 $164.73
120 97.43 88.93 88.45 88.45
180 72.47 63.55 63.20 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1000/7327
Serial S-100 Schedules B-D
THE PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
------------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Dorothy K. Light
---------------------------
Attest
-----------------------
Date:
------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1000 19081
<PAGE>
TABLE OF CONTENTS
Provision Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Account. . . . . . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . . . . . 110
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawal . . . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . . . . 300
3.3 Transfers Between Related Contracts. . . . . . . . . . . 320
3.4 Transfers to Another Funding Agent . . . . . . . . . . . 330
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . . . . . . . . 340
IV. DISTRIBUTIONS
4.1 Distributions. . . . . . . . . . . . . . . . . . . . . . 400
4.2 Required Distribution Date . . . . . . . . . . . . . . . 400
4.3 Minimum Required Distributions . . . . . . . . . . . . . 400
4.4 Annuities. . . . . . . . . . . . . . . . . . . . . . . . 410
4.5 Small Annuities and Accounts . . . . . . . . . . . . . . 420
4.6 Payees . . . . . . . . . . . . . . . . . . . . . . . . . 420
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . . . . . . . . . 710
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
TC-100 (10)
<PAGE>
TABLE OF CONTENTS
(Continued)
Provision Serial Page
7.7 Divisible Surplus. . . . . . . . . . . . . . . . . . . . 720
7.8 Limit on Assignment. . . . . . . . . . . . . . . . . . . 720
7.9 Certificates . . . . . . . . . . . . . . . . . . . . . . 720
7.10 Entire Contract - Construction . . . . . . . . . . . . . 720
SCHEDULES
Schedule A Forms of Annuity which May be Purchased. . . . . . A-100
Schedule B Life - Payment Certain Annuity . . . . . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . . . . . S-100
GVA/GAA-1000/7327
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the Qualified Retirement Contributions described in
Section 219(e) of the Federal Internal Revenue Code of 1986, as amended
(the "Code"), which the Participant has directed for payment hereunder.
Contributions will be transmitted by the Contract-Holder. A
Participant is a person for whom contributions have been paid under
this contract and whose Participant's Account (see section 1.2) has
not been cancelled.
No contribution may be made for a Participant in or after his tax year
in which he reaches age 70 1/2. Tax year means the one for Federal
Income Tax purposes.
Any contribution for a Participant made on other than a periodic basis
may not be less than $500.
The contributions made for a Participant for any of his tax years are
subject to certain limits. They may not exceed the amounts specified
in Code Section 219(b)(1) for any tax year. If made after the end of a
tax year, they are made in the next year before the filing date for
his tax return in that year. (For most Participants, tax years and
calendar years are the same.)
A contribution may be made for a non-working spouse of a Participant.
However, the sum of the contribution made for the working and
non-working spouses may not exceed the amounts specified in Code
Section 219(c)(2) for any tax year. (A non-working spouse for whom a
contribution is made is a Participant.)
The contribution limits described in the two preceding paragraphs may
be reduced for certain Participants as provided in Code Section
219(g).
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant. Prudential may
require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 100 1.1-1.2
<PAGE>
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Similarly, on any other day on which a Participant's
Account is cancelled, an amount will be withdrawn from his Account equal to
the Annual Account Charge. However, no Charge will be withdrawn if the
Participant's Account is being cancelled on a January 1 to purchase an
annuity for him under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Qualified Retirement Contributions
under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition, to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 110 1.2-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1000 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days from the end of the
prior Business Day to the end of the current Business Day.
In addition, the result found in (c) is the VCA-10 Unit Change Factor for
that Business Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will notify
the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (10) (as modified by GAA-7663)
Serial 210 2.2-2 3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1000 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-11 Account. Prudential will notify
the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-1000 (11) (as modified by GAA-7663)
Serial 210 2.2-2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account. The
minimum withdrawal is $500, or the dollar value of his Account if smaller.
Payment to the Participant will normally be made within seven days of
Prudential's receipt of a duly completed request for it. However, it may be
paid at a later day if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
-------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a companion
contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions made
for the Participant.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6).
However, proof of the Participant's death must be received by Prudential
before any payment will be made. Death benefits payable under the contract
to a Participant's Beneficiary prior to the date (i) on which an annuity
has been purchased for the Participant or (ii) on which minimum
distributions have commenced to the Participant pursuant to Code Section
401(a)(9) will be paid as set forth in this section 3.2. Death benefits
payable under the contract to a Participant's Beneficiary on or
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 300 3.1-3.2
<PAGE>
after the date on which an annuity has been purchased for the
Participant or on which minimum distributions have commenced to the
Participant pursuant to Code Section 401(a)(9) will be paid as set
forth in section 4.1 of the contract.
The Beneficiary may elect payment in any of the following forms,
unless the Participant has directed otherwise:
(a) a lump sum;
(b) an annuity form described in section 4.4, other than one which
provides for payment after the death of the Annuitant to a
Contingent Annuitant;
(c) any other settlement method to which Prudential consents; or
(d) a combination of all or any two of (a), (b and (c) above.
Any lump sum payment to a Beneficiary will be subject to the
following:
- If the lump sum is payable to the Participant's spouse, payment
of such lump sum will be made no later than the later of (i) the
December 31 of the calendar year following the one in which the
Participant's death occurred or (ii) the December 31 of the
calendar year in which the Participant would have attained age 70
1/2.
- If the lump sum is payable to a Beneficiary who is other than the
Participant's Spouse, payment of such lump sum will be made no
later than the December 31 of the calendar year in which the
fifth anniversary of the Participant's death occurs.
- If a lump sum payment is made to the Beneficiary within one year
of the Participant's death, it will be at least equal to the
contributions made for him under this contract less any
withdrawals and transfers.
If payments are to be made to a Beneficiary in a form other than a
lump sum, such payments will be subject to the following:
- If the Beneficiary is the Participant's spouse, payments must
commence no later than the later of (i) the December 31 of the
calendar year following the one in which the Participant's death
occurred or (ii) the December 31 of the calendar year in which
the Participant would have attained age 70 1/2. Such payments
must be paid over the life of the spouse or over a period not
exceeding the life expectancy of the spouse.
- If the Beneficiary is other than the Participant's spouse,
payments must commence no later than the December 31 of the
calendar year following the one in which the death of the
Participant occurred. Such payments must be paid over the life of
the Beneficiary or over a period not exceeding the life
expectancy of the Beneficiary.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 310 3.2
<PAGE>
If:
(1) the Beneficiary does not elect a method of distribution and
(2) the Participant has not directed that a specific method of
distribution be provided for his Beneficiary,
then any death benefits becoming payable under the contract shall be paid
in a lump sum commencing no later than the December 31 of the calendar year
in which the fifth anniversary of the Participant's death occurs.
All death benefits pursuant to this section 3.2 shall be made at the time
and in the manner prescribed in Code Section 401(a)(9) and the Regulations
issued thereunder.
If annuity payments are to start at a future date, the Participant's
Account will be maintained for the Beneficiary in the same manner as for
the Participant. No contributions may be made to the Account after the
Participant's death.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract. The minimum
withdrawal to provide a transfer is $500, or the dollar value of his
Account if smaller. The transfer will normally be made within seven days of
receipt of a duly completed request for it. Section 3.1 does not apply to a
withdrawal for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However, in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 320 3.2-3.3
<PAGE>
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Account may be transferred to
an individual retirement account or individual retirement annuity
contract provided by another financial institution. The transfer may
be made directly to that institution or by a payment (or payments) to
the Participant who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be in full settlement of Prudential's liability for
the Participant's Account.
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made.
Each person who does not make this election will have his Account
retained under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date. A single liquidation
account will be established equal to the sum of the Withdrawal Values
expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
The Contract-Holder may notify Prudential that this section 3.4(b) is
to be inoperative.
This section may be changed as provided in section 5.1.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 330 3.4
<PAGE>
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by the Contract-Holder. He may
become employed by an employer to whom Prudential has issued a contract
similar to this contract. If so, that Participant may request a transfer to
that similar contract from this contract. The transfer will normally be
made within seven days of receipt of a duly completed request. The dollar
value of the Participant's Account will be the amount transferred. The
Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by the
Contract-Holder. The transferred amount will be treated as a contribution
paid for that person. However, in determining any withdrawal charge, any
part of the transferred amount which is investment income will not be
considered a contribution.
This section may be changed as provided in section 5.1.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 340 3.5
<PAGE>
Provision IV. DISTRIBUTIONS:
4.1 ANNUITY ELECTIONS:
A Participant may elect to receive a distribution of his Account under the
contract in any of the following forms:
(a) a lump sum;
(b) an annuity form described in section 4.4;
(c) any other settlement method to which Prudential consents; or
(d) a combination of all or any two of (a), (b) and (c) above.
Any portion of a Participant's Account which is paid to him as a lump sum
will be subject to section 3.1 relating to withdrawal charges.
Any payments becoming due to the Beneficiary of a Participant who began
receiving a distribution pursuant to paragraph (c) may, unless the
Participant has directed otherwise, be paid in any of the forms described
in this section 4.1, as elected by the Beneficiary, except for an annuity
which provides for payment after the death of the Annuitant to a Contingent
Annuitant.
Any payments becoming due to the Beneficiary of a Participant who began
receiving an annuity pursuant to paragraph (b) will, unless the Participant
has directed otherwise, be paid as provided in section 4.4.
Anything in the contract to the contrary notwithstanding, any payments made
to a Beneficiary in accordance with the two preceding paragraphs will meet
the requirements of Code Section 401(a)(9) and the Regulations issued
thereunder.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 REQUIRED DISTRIBUTION DATE:
Distributions are required to commence to the Participant as of his
Required Distribution Date. A Participant's Required Distribution Date is
the April 1 of the calendar following the one in which the Participant
attains age 70 1/2.
4.3 MINIMUM REQUIRED DISTRIBUTIONS:
Prudential will notify a Participant, prior to such Participant's Required
Distribution Date, as determined from the records of Prudential on the
basis of information furnished to Prudential, that he may be required to
receive a minimum distribution from his Account under the contract in
accordance with Code Section 401(a)(9) and the Regulations issued
thereunder. Such notice will include information so as to assist the
Participant in computing the amount of his required minimum distribution.
Following such notice, a Participant may request that the required minimum
distribution be paid to him from the contract by his Required Distribution
Date.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 400 4.1-4.3
<PAGE>
If the Participant does not request a distribution of any portion of his
Account under the contract pursuant to this section 4.3, Prudential shall
be under no obligation to make such distribution.
4.4 TERMS OF PAYMENT OF ANNUITIES:
If a Participant elects an Annuity pursuant to paragraph (b) of section
4.1, all or a portion of the dollar value of the Participant's Account, as
specified by the Participant, will be applied to purchase an annuity in
accordance with Schedule A. The monthly amount of annuity is determined
from the schedule of purchase rates for that annuity.
Life annuities and Payment Certain annuities are available under this
contract. A life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life-Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of each month thereafter throughout the Contingent
Annuitant's remaining lifetime. The last monthly payment is payable
for the month in which his death occurs. The amount of each monthly
Contingent Annuity payment will be a percentage of the monthly annuity
payment payable before the Annuitant's death. The percentage is
established when the annuity is purchased and may be 33 1/3%, 50%, 66
2/3% or 100%, or any other percentage accepted by Prudential. Under a
Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
GVA-1000 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 410 4.3-4.4
<PAGE>
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
All annuities purchased under this contract will meet the requirements of
Code Section 401(a)(9) and the Regulations issued thereunder.
4.5 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.4.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.6 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-1000/7327 (as modified by Group Annuity Amendment Form GAA-7793)
Serial 410 4.4-4.6
<PAGE>
Provision V CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge,
the minimum dollar contribution made on other than a periodic basis,
and
the terms and amounts, (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III
may be changed periodically on and after the fifth anniversary of the
Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency regulating Qualified Retirement
Contributions funding arrangements.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1000 (as modified by Form GAA-7472A)
Serial 500 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity payments are payable from this contract.
GVA/GAA-1000/7327
Serial 600 6.1-6.3
<PAGE>
11/89
Provision VII. GENERAL TERMS
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., Defined Contribution Programs, W.W. Scranton Office Park, 30
E.D. Preate Drive, Moosic, Pennsylvania 18507-1796, or at such other
address as it may communicate to the Contract-Holder. All communications to
any other person or organization dealing with Prudential will be addressed
to that person or organization at the last address of record.
7.3 PLACE OF PAYMENT - CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1000/7327 (as modified by Forms GAA-7472A/7472)
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
a form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to effect such annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant or
Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will
acknowledge the naming of a Beneficiary.
GVA/GAA-1000/7327 (as modified by Forms GAA-7472A/7472)
Serial 710 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brother or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1000/7327
Serial 720 7.6-7.10
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASES
Form of Payment Payable Applicable Schedule
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GAA-1000/7327 (as modified by Forms GAA-7472A/7472)
Serial A-100 Schedule A
<PAGE>
1/90
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1990 1991 1995 2000
- --- ---- ---- ------ ------
60 $52.53 $41.36 $40.58 $39.85
65 57.51 46.57 45.60 44.68
70 63.85 53.19 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in
--------------------------------------------------------------
Age 1990 1991 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $46.96 $35.91 $35.31 $34.78
65 50.70 39.88 39.10 38.39
70 56.00 45.36 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $49.99 $38.71 $38.00 $37.34
65 54.69 43.53 42.61 41.75
70 61.25 50.15 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain 1990 1991 1995 2000
- ---------------- ---- ---- ---- ----
60 $173.38 $165.62 $164.73 $164.73
120 97.22 88.83 88.45 88.45
180 72.32 63.48 63.20 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1000/7327
Serial S-100 Schedules B-D
THE PRUDENTIAL [Logo] December 31, 1989
AMENDMENT TO BE ATTACHED TO AND MADE A PART OF
GROUP ANNUITY CONTRACTS
(the "Contracts")
ISSUED TO THE CONTRACT-HOLDER
BY
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(the "Prudential")
The Group Annuity Contracts provide that the Contracts may be amended by
Prudential to satisfy the requirements of any law or regulation administered by
a governmental agency. Therefore, as a result of changes made to the Federal
Internal Revenue Code by the Tax Reform Act of 1986, the Contracts are hereby
amended in the following respects:
1. REGULAR CONTRIBUTIONS: Effective January 1, 1987, the contributions which
are payable under this contract for a Participant are the Qualified
Retirement Contributions described in Section 219(e) of the Federal
Internal Revenue Code of 1986, as amended (the "Code"), which the
Participant has directed for payment hereunder.
The contributions made for a Participant for any of his tax years are
subject to certain limits. They may not exceed the amounts specified in
Code Section 219(b)(1) for any tax year of the Participant.
A contribution may be made for a non-working spouse of a Participant.
However, the sum of the contributions made for the working and non-working
spouses may not exceed the amounts specified in Code Section 219(c)(2) for
any tax year of the Participant.
The contribution limits described in the two preceding paragraphs may be
reduced for certain Participants as provided in Code Section 219(g).
2. DEATH PAYMENTS: Effective January 1, 1987, death benefits payable under
the Contracts to a Participant's Beneficiary prior to the date (i) on which
an annuity has been purchased for the Participant or (ii) on which minimum
distributions have commenced to the Participant pursuant to Code Section
401(a)(9) will be paid as set forth in this item 2. Death benefits payable
under the Contracts to a Participant's Beneficiary on or after the date on
which an annuity has been purchased for the Participant or on which minimum
distributions have commenced to the Participant pursuant to Code Section
401(a)(9) will be paid as set forth in item 3. below.
GAA - 7793 19080
<PAGE>
The Beneficiary may elect payment in any of the following forms, unless the
Participant has directed otherwise:
(a) a lump sum;
(b) an annuity form described in the Contracts, other than one which
provides for payment after the death of the Annuitant to a Contingent
Annuitant;
(c) any other settlement method to which Prudential consents; or
(d) a combination of all or any two of (a), (b) and (c) above.
Any lump sum payment to a Beneficiary will be subject to the following:
- If the lump sum is payable to the Participant's spouse, payment of
such lump sum will be made no later than the later of (i) the December
31 of the calendar year following the one in which the Participant's
death occurred or (ii) the December 31 of the calendar year in which
the Participant would have attained age 70 1/2.
- If the lump sum is payable to a Beneficiary who is other than the
Participant's Spouse, payment of such lump sum will be made no later
than the December 31 of the calendar year in which the fifth
anniversary of the Participant's death occurs.
If payments are to be made to a Beneficiary in a form other than a lump
sum, such payments will be subject to the following:
- If the Beneficiary is the Participant's spouse, payments must commence
no later than the later of (i) the December 31 of the calendar year
following the one in which the Participant's death occurred or (ii)
the December 31 of the calendar year in which the Participant would
have attained age 70 1/2. Such payments must be paid over the life of
the spouse or over a period not exceeding the life expectancy of the
spouse.
- If the Beneficiary is other than the Participant's spouse, payments
must commence no later than the December 31 of the calendar year
following the one in which the death of the Participant occurred. Such
payments must be paid over the life of the Beneficiary or over a
period not exceeding the life expectancy of the Beneficiary.
If:
(1) the Beneficiary does not elect a method of distribution and
(2) the Participant has not directed that a specific method of
distribution be provided for his Beneficiary,
then any death benefits becoming payable under the Contracts shall be paid
in a lump sum commencing no later than the December 31 of the calendar year
in which the fifth anniversary of the Participant's death occurs.
GAA-7793 -2-
<PAGE>
All death benefits pursuant to this item 2. shall be made at the time and
in the manner prescribed in Code Section 401(a)(9) and the Regulations
issued thereunder.
3. DISTRIBUTIONS: Effective January 1, 1987, a Participant may elect to
receive a distribution of his Account(s) under the Contracts in any of the
following forms:
(a) a lump sum;
(b) any annuity form described in the Contracts;
(c) any other settlement method to which Prudential consents;
(d) a combination of all or any two of (a), (b) and (c) above.
Any portion of a Participant's Account(s) which is paid to him as a lump
sum will be subject to the withdrawal provisions under the Contracts.
Any payments becoming due to the Beneficiary of a Participant who began
receiving a distribution pursuant to paragraph (c) may, unless the
Participant has directed otherwise, be paid in any of the forms described
in this item 3., as elected by the Beneficiary, except for an annuity which
provides for payment after the death of the Annuitant to a Contingent
Annuitant.
Any payments becoming due to the Beneficiary of a Participant who began
receiving an annuity pursuant to paragraph (b) will, unless the Participant
has directed otherwise, be paid as provided under the terms of the annuity
as described in the Contracts.
Anything in the Contracts to the contrary notwithstanding, any payments
made to a Beneficiary in accordance with the two preceding paragraphs will
meet the requirements of Code Section 401(a)(9) and the Regulations issued
thereunder.
4. REQUIRED DISTRIBUTION DATE: Effective January 1, 1987, distributions are
required to commence to the Participant as of his Required Distribution
Date. A Participant's Required Distribution Date is the April 1 of the
calendar following the one in which the Participant attains age 70 1/2.
5. MINIMUM REQUIRED DISTRIBUTION: Effective January 1, 1987, Prudential will
notify a Participant, prior to such Participant's Required Distribution
Date, as determined from the records of Prudential on the basis of
information furnished to Prudential, that he may be required to receive a
minimum distribution from his Account(s) under the Contracts in accordance
with Code Section 401(a)(9) and the Regulations issued thereunder. Such
notice will include information so as to assist the Participant in
computing the amount of his required minimum distribution. Following such
notice, a Participant may request that the required minimum distribution be
paid to him from the Contracts by his Required Distribution Date.
GAA-7793 -3-
<PAGE>
If the Participant does not request a distribution of any portion of his
Account(s) under the Contracts pursuant to this item 5., Prudential shall
be under no obligation to make such distribution.
6. ANNUITIES: Effective January 1, 1987, all annuities purchased under the
Contracts will meet the requirements of Code Section 401(a)(9) and the
Regulations issued thereunder.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
George R. Molson
VICE PRESIDENT, CONTRACTS
GAA-7793 -4-
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
- -------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
---------------------------------------
Eligible Classification: Each person
employed by the Contract-Holder
- -------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- -------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
-----------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Isabelle L. Kirchner
------------------------
Attest
-------------------------
Date:
--------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED
IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-120-82
19081
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.2 Contributions. . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Account. . . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . . 110
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-11 (VCA-11). . . . . . . . . . . . . . . . 200
2.2 VCA-11 Unit Value. . . . . . . . . . . . . . . . . 200
2.3 VCA-11 Committee . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawal . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . 300
3.3 Transfers Between Related Contracts. . . . . . . . 310
3.4 Transfers to Another Funding Agent . . . . . . . . 310
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . . . . . 320
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . . . . 400
4.3 Small Annuities and Accounts . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . . . . 400
4.5 Payees . . . . . . . . . . . . . . . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . . . . . . 710
GVA-120-82
TC-100 (11)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Serial Page
Provision
7.7 Divisible Surplus. . . . . . . . . . . . . . 720
7.8 Limit on Assignment. . . . . . . . . . . . . 720
7.9 Certificates . . . . . . . . . . . . . . . . 720
7.10 Entire Contract -- Construction . . . . . . 720
SCHEDULES
Schedule A Forms of Annuity which May Be Purchased. . A-100
Schedule B Life - Payment Certain Annuity . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . S-100
GVA/GAA-120-82/2517-TD-82
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the payments made for him by his employer pursuant to
a Salary- Annuity Agreement and directed by the Participant for
payment hereunder. Contributions will be transmitted by the
Contract-Holder or the employer.
A Participant is a person for whom contributions have been paid under
this contract and whose Participant's Account (see section 1.2) has
not been cancelled.
A Salary-Annuity Agreement is an agreement between an employee in an
Eligible Classification and his employer. It is also an agreement
between a Participant who has ceased to be an employee in an Eligible
Classification and his new employer. Under the Agreement, the employer
agrees to pay at least $250 in each year to purchase an annuity for
the employee meeting the conditions of Section 403(b) of the Federal
Internal Revenue Code.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant. Prudential may
require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
GVA-120-82
Serial 100 1.1-1.2
<PAGE>
9/84
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
The Annual Account Charge is $20 for the first year it is withdrawn from a
Participant's Account. For every other year it is $15.
A Participant may have an Account for Salary-Annuity Agreement payments
under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed the amount shown above.
This charge will be shared among his Accounts as Prudential determines.
Also, no charge will be withdrawn from his Account under this contract when
it is cancelled unless no amounts remain in an Account for him under a
companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-120-82
Serial 110 (as modified by Form GAA-7470A) 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-120-82 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-82 (11)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in
VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-110-82 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result found
in (b) is divided by $1.00 increased at the effective annual rate of
0.75% for the number of calendar days in the period from the end of the
prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-110-82 (11)
Serial 210 2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account. The
minimum withdrawal is $500, or the dollar value of his Account if smaller.
Payment to the Participant will normally be made within seven days of
Prudential's receipt of his request for it. However, it may be paid at a
later day if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
----------------------------------- ---------------------------
First 24 months $0.07
Next 36 months 0.06
Next 60 months 0.04
Next 60 months 0.03
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
The withdrawal charge is also deducted from a Participant's Account if an
annuity is purchased for him under this contract during the first 36 months
from the day an Account was established for him. The earliest of the days
an Account was established for him under this contract, under a companion
contract or under a similar contract if section 3.5 applies will be used in
counting the 36 months.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). The
payment will be made in one sum unless the Participant has directed
Prudential to purchase an annuity for the Beneficiary. Instead of a one sum
payment, the Beneficiary may elect to have the dollar value of the
Participant's Account applied to purchase an annuity. Proof of the
Participant's death must be received by Prudential before any payment will
be made.
GVA-120-82
Serial 300 3.1-3.2
<PAGE>
The Beneficiary's annuity election must be made before the first
anniversary of the Participant's death or, if later, the day two months
after Prudential's receipt of proof of death. The annuity form may be any
of those described in section 4.4. If annuity payments are to start at a
future date, the Participant's Account will be maintained for the
Beneficiary in the same manner as for the Participant. The date for
payments to start must be on or before the Beneficiary's 70th birthday or,
if later, within two months after he elects the annuity. No contributions
may be made to the Account after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract. The minimum
withdrawal to provide a transfer is $500, or the dollar value of his
Account if smaller. The transfer will normally be made within seven days of
Prudential's receipt of his request for it. Section 3.1 does not apply to a
withdrawal for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Account may be transferred to
an annuity contract which meets the conditions of Section 403(b) of the
Federal Internal Revenue Code and is provided by another financial
institution. The transfer may be made directly to that institution or
by a payment (or payments) to the Participant who then makes payment to
the institution. The transfer will normally be made within seven days
after Prudential's receipt of the transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
GVA-120-82
Serial 310 3.3-3.4
<PAGE>
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments to
a funding agent named in the request. The transfer payment will be made
on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made.
Each person who does not make this election will have his Account
retained under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date. A single liquidation account
will be established equal to the sum of the Withdrawal Values expressed
in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make all
or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account described
in section 2.1.
The Contract-Holder may notify Prudential that this section 3.4(b) is
to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by an employer who pays
contributions under this contract. He may become employed by an employer to
whom Prudential has issued a contract similar to this contract. If so, that
Participant may request a transfer to that similar contract from this
contract. The transfer will normally be made within seven days of receipt
of the request. The dollar value of the Participant's Account will be the
amount transferred. The Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by an
employer who pays contributions under this contract. The transferred amount
will be treated as a contribution paid for that person. However, in
determining any withdrawal charge, any part of the transferred amount which
is investment income will not be considered a contribution.
This section may be changed as provided in section 5.1.
GVA-120-82
Serial 320 3.5
<PAGE>
9/84
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential, elect to have his
Participant's Account applied to purchase an annuity for him. The
Withdrawal Value of the Account will be applied if the purchase is made
during the first 36 months from the day an Account was established for him.
The earliest of the days an Account was established for him under this
contract, under a companion contract, or under a similar contract if
section 3.5 applies will be used in counting the 36 months. If the purchase
is made after the 36 months, the dollar value of the Account will be
applied. The schedule of annuity purchase rates that applies is determined
from Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
If the Participant's Account has not been cancelled before the month in
which he reaches age 75, a 120 monthly Payment Certain annuity will be
purchased for him at the beginning of that month (see section 4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
A Participant may elect that only a portion of his Participant's Account be
applied to purchase an annuity with the balance being paid in a single sum.
The first portion will be subject to section 4.1 and the balance to section
3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life-Contingent, or Life - Payment
Certain Contingent annuity. A Payment Certain form of annuity may be
payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-120-82
Serial 400 (as modified by Form GAA- M -7470A) 4.1-4.4
<PAGE>
9/84
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's remaining
lifetime. If the Annuitant dies before the number of annuity payments made
equals the number of Payments Certain applicable to him, monthly annuity
payments will be continued until the total number of payments is so equal.
These continued annuity payments will each be in the same amount as was
payable to the Annuitant. The number of Payments Certain is established
when the annuity is purchased and may be 60, 120, 180, 240 or any other
number accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on the
date the annuity is purchased. Monthly payments are payable on the first
day of each month thereafter throughout the Annuitant's remaining lifetime.
If the Annuitant dies before the death of his Contingent Annuitant, monthly
Contingent Annuity payments will become payable. The first payment of
Contingent Annuity will be payable on the first day of the month following
the month in which the Annuitant's death occurs. Monthly Contingent Annuity
payments are payable on the first day of each month thereafter throughout
the Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each monthly
Contingent Annuity payment will be a percentage of the monthly annuity
payment payable before the Annuitant's death. The percentage is established
when the annuity is purchased and may be 33 1/3%, 50%, 66 2/3% or 100%, or
any other percentage accepted by Prudential. Under a Life - Payment Certain
Contingent annuity, a percentage payment will not take effect until the end
of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on the
date the annuity is purchased. Monthly payments are payable on the first
day of each month thereafter until the total number of Payments Certain
specified when the annuity was purchased has been paid. The number of
Payments Certain may be 60, 120, 180, 240, or any other number accepted by
Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased which provides for payments:
(i) to a Beneficiary or a Contingent Annuitant who is not the Annuitant's
spouse if a present value calculation shows that the Annuitant's
expected payments will not be more than 50% of all the expected
annuity payments, or
(ii) to a Contingent Annuitant which are greater in monthly amount than the
payments to the Annuitant.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-120-82/2517TD-82
Serial 410 (as modified by Forms GAA M -7470A/7470) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-120-82
Serial 500 (as modified by Form GAA-7470A) 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its' terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-120-82/2517TD-82
Serial 600 6.1-6.2
<PAGE>
9/84
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential at its office located at 71 Hanover Road,
Florham Park, New Jersey 07932, or at such other address as it may
communicate to the Contract-Holder. All communications to any other person
or organization dealing with Prudential will be addressed to that person or
organization at the last address of record.
7.3 PLACE OF PAYMENT - CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-120-82/2517TD-82
Serial 700 (as modified by Forms GAA-7470A/7470) 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant or
Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA/GAA-120-82/2517TD-82
Serial 710 (as modified by Forms GAA-7470A/7470) 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each, payment Prudential makes in
reliance thereon will be a valid discharge of its obligation under this
contract as to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50. Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-120-82/2517TD-82
Serial 720 7.7-7.10
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
----------------------- -------------------
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GAA-120-87/2517TD-82
Serial A-100 Schedule A
<PAGE>
1/86
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1986 1987 1990 1995
- --- ---- ---- ---- ----
60 $57.38 $57.14 $45.67 $44.50
65 63.66 63.35 52.03 50.59
70 71.31 70.95 59.88 58.17
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is Purchased is in
--------------------------------------------------------------
Age 1986 1987 1990 1995
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.60 $47.44 $36.06 $33.31
65 51.52 51.31 40.07 39.10
70 57.11 56.83 45.62 44.32
If specified percentage to Contingent Annuitant is 50%:
60 $50.75 $50.56 $38.89 $38.00
65 55.67 55.42 43.77 42.61
70 62.59 62.25 50.47 48.92
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain 1986 1987 1990 1995
- ---------------- ---- ---- ---- ----
60 $178.03 $177.84 $165.62 $164.73
120 101.91 101.80 88.93 88.45
180 77.23 77.14 63.55 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-120-82/2517TD-82
Serial S-100 (as modified by Forms GAA-7470A/7470) Schedules B-D
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder: Plan:
- ---------------------------------------------------------------------------
Effective Date: Group Annuity Contract No.:
-----------------------------------
Eligible Classification:
- ---------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- ---------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
-----------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Isabelle L. Kirchner
---------------------------
Attest
---------------------------------
Date:
-----------------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE -- ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT,
WHEN BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT
DESCRIBED IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND
DOWN, AND ARE NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-120-87 (10/11) 19081
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.2 Contributions . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts. . . . . . . . . . . . . . . 100
1.3 Annual Account Charge . . . . . . . . . . . . . . . 110
1.4 Reports . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10) . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee. . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawals . . . . . . . . . . . . . 300
3.2 Death Payments. . . . . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts . . . . . . . . 310
3.4 Transfers to Another Financial Institution. . . . . 320
3.5 Transfers Involving a Similar Contract
of Another Employer . . . . . . . . . . . . . . . 330
IV. ANNUITIES
4.1 Annuity Elections . . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination. . . . . . 400
4.3 Small Annuities and Accounts. . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities . . . . . . . . . . . 400
4.5 Payees. . . . . . . . . . . . . . . . . . . . . . . 420
V. CHANGES
5.1 Changes by Prudential . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement. . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts. . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder . . . . . . . . . . . . . . . . . . 700
7.2 Communications. . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . 710
7.5 Misstatements . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary . . . . . . . . . . . . . . . . . . . . 710
GVA-120-87
TC-100 (10)
<PAGE>
TABLE OF CONTENTS
(Continued)
Serial Page
Provision
7.7 Plan Changes. . . . . . . . . . . . . . . . . . . . 720
7.8 Divisible Surplus . . . . . . . . . . . . . . . . . 720
7.9 Limit on Assignment . . . . . . . . . . . . . . . . 720
7.10 Certificates. . . . . . . . . . . . . . . . . . . . 730
7.11 Entire Contract -- Construction . . . . . . . . . . 730
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased . . . A-100
Schedule B Life - Payment Certain Annuity. . . . . . . . S-100
Schedule C Life - Contingent Annuity . . . . . . . . . . S-100
Schedule D Payment Certain Annuity . . . . . . . . . . . S-100
GVA-120-87 (10/11)
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the payments made for him by his employer pursuant to
a Salary-Annuity Agreement and any amounts contributed for him under
the Plan, if any, and directed by the Participant for payment
hereunder. For each Participant, total contributions (including those
made pursuant to a Salary Annuity Agreement) to this contract and any
companion contract must be made at the rate of at least $200 during
each twelve-month period. Contributions will be transmitted by the
Contract-Holder or the employer.
A Participant is a person for whom contributions have been paid under
this contract and whose Participant's Account (see section 1.2) has
not been cancelled.
A Salary-Annuity Agreement is an agreement between an employee in an
Eligible Classification and his employer. It is also an agreement
between a Participant who has ceased to be an employee in an Eligible
Classification and his new employer. Under the Agreement, the employer
agrees to pay amounts to purchase an annuity for the employee meeting
the conditions of Section 403(b) of the Federal Internal Revenue Code.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant. Prudential may
require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for
GVA-120-87 (10/11)
Serial 100 1.1-1.2
<PAGE>
withdrawal or, if applicable, the number determined by dividing the dollar
amount to be withdrawn by the Unit Value for the day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to Purchase an annuity for him
under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Salary-Annuity Agreement payments or
Plan payments, if any, under another group annuity contract issued to the
Contract-Holder by Prudential (a "companion contract"). If so, the total
Annual Account Charge that applies to all his Accounts will not exceed the
amount shown above. This charge will be shared among his Accounts as
Prudential determines. Also, no charge will be withdrawn from his Account
under this contract when it is cancelled unless no amounts remain in an
Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-120-87 (10/11)
Serial 110 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-120-87 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from
the end of the prior Business Day to the end of the current
Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
This section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-87 (10)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-11 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-120-87 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days from the end of the
prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
This section may be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-87 (11)
Serial 210 2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account but only
under the conditions permitted by the Plan, if any. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment to the
Participant will normally be made within seven days of Prudential's receipt
of a duly completed request for it. However, it may be paid at a later day
if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value."
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
-------------------------------- ---------------------------
First 24 months $0.07
Next 36 months 0.06
Next 60 months 0.04
Next 60 months 0.03
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement pursuant
to the terms of the Plan, if any.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). If the
Beneficiary is other than the Participant's spouse, the payment will be
made in one sum within 5 years of the Participant's death unless the
Participant has directed Prudential to purchase an annuity for the
Beneficiary. If the Participant's spouse is the Beneficiary, the payment
will be made in one sum no later than the latest date on which the spouse
is permitted to defer the distribution under law unless the
GVA-120-87 (10/11)
Serial 300 3.1-3.2
<PAGE>
Participant has directed Prudential to purchase an annuity for the spouse.
Instead of a one sum payment, the Beneficiary may elect to have the dollar
value of the Participant's Account applied to purchase an annuity. Proof of
the Participant's death must be received by Prudential before any payment
will be made. Any payment made pursuant to this section must be consistent
with the terms of the Plan, if any.
The Beneficiary's annuity election must be made before the Participant's
Account is distributed. The annuity form may be any of those described in
section 4.4. If annuity payments are to start at a future date, the
Participant's Account will be maintained for the Beneficiary in the same
manner as for the Participant. The date for payments to start must be on or
before the latest date on which the Beneficiary is permitted to defer the
distribution under law. No contributions may be made to the Account after
the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
Any annuity payments to a Beneficiary will be subject to the following:
(a) If an annuity is payable to the Participant's spouse, it must provide
for payment to be made over the life of the spouse (or over a period
not exceeding the life expectancy of the spouse), and
(b) If an annuity is payable to a Beneficiary who is other than the
Participant's spouse, it must provide for payment to be made over the
life of the Beneficiary (or over a period not exceeding the life
expectancy of the Beneficiary).
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract but only under the
conditions permitted by the Plan, if any. The minimum withdrawal to provide
a transfer is $500, or the dollar value of his Account if smaller. The
transfer will normally be made within seven days of Prudential's receipt of
a duly completed request for it. Section 3.1 does not apply to a withdrawal
for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
GVA-120-87 (10/11)
Serial 310 3.3
<PAGE>
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FINANCIAL INSTITUTION:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Accounts may be transferred to
another financial institution but only under the conditions permitted
by the Plan, if any. The transfer may be made directly to that
institution or by a payment (or payments) to the Participant who then
makes payment to the institution. The transfer will normally be made
within seven days after Prudential's receipt of a duly completed
transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to another financial institution named in the request. The transfer
payment will be made on the Transfer Date. The Transfer Date is the
later of the day specified in the request and the 90th day after its
receipt by Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made
but only under the conditions permitted by the Plan, if any. Each
person who does not make this election will have his Account retained
under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date and an amount equal to the
sum of the Withdrawal Values, expressed in Units of the cancelled
Accounts, times the Unit Value for the day of withdrawal will be
transferred within seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
GVA-120-87 (10/11)
Serial 320 3.4
<PAGE>
The Contract-Holder may notify Prudential that this section 3.4(b) is
to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by an employer who pays
contributions under this contract. He may become employed by an employer to
whom Prudential has issued a contract similar to this contract. If so, that
Participant may request a transfer to that similar contract from this
contract but only under the conditions permitted by the Plan, if any. The
transfer will normally be made within seven days of receipt of the request.
The dollar value of the Participant's Account will be the amount
transferred. The Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by an
employer who pays contributions under this contract. The transferred amount
will be treated as a contribution paid for that person. However, in
determining any withdrawal charge, any part of the transferred amount which
is investment income will not be considered a contribution.
This section may be changed as provided in section 5.1.
GVA-120-87 (10/11)
Serial 330 3.5
<PAGE>
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential, elect to have his
Participant's Account applied to purchase an annuity for him but only under
the conditions permitted by the Plan, if any. The dollar value of the
Account will be applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
If the Participant's Account has not been cancelled before the month in
which he reaches the latest age at which he is permitted to defer his
distribution under law, a 120 monthly Payment Certain annuity will be
purchased for him at the beginning of that month (see section 4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION;
A Participant may elect that only a portion of his Participant's Accounts
be applied to purchase an annuity with the balance being paid in a single
sum. The portion used to purchase an annuity will be subject to section 4.1
and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES;
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
GVA-120-87 (10/11)
Serial 400 4.1-4.4
<PAGE>
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240 or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
GVA-120-87 (10/11)
Serial 410 4.4
<PAGE>
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased which provides for payments:
(i) to a Beneficiary or a Contingent Annuitant who is not the Annuitant's
spouse if a present value calculation shows that the Annuitant's
expected payments will not be more than 50% of all the expected
annuity payments, or
(ii) to a Contingent Annuitant which are greater in monthly amount than the
payments to the Annuitant.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA-120-87 (10/11)
Serial 420 4.5
<PAGE>
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENTS:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-120-87 (10/11)
Serial 500 5.1-5.4
<PAGE>
Provision VI DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) if the Plan, if any, terminates,
(c) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder,
or
(d) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give its consent (see section 7.7).
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA-120-87 (10/11)
Serial 600 6.1-6.3
<PAGE>
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATION:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT - CURRENCY:
All payments to Prudential under this contract will he payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA-120-87 (10/11)
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
a form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS;
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to a Beneficiary other than the person's
Contingent Annuitant, payment will be made to the Beneficiary the person
named. A person for whom an Account is held or an annuity is being paid
under this contract may name a Beneficiary to replace one previously named.
However, the Participant may instruct Prudential that his Contingent
Annuitant or Beneficiary is not to have this right to name Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA-120-87 (10/11)
Serial 710 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 PLAN CHANGES:
If the employer maintains a written Plan of benefits, the name of such Plan
is shown on the first page of this contract. This contract applies to the
terms of the Plan in effect on the Effective Date and to each Plan change
if Prudential consents. The Contract-Holder will furnish Prudential with a
copy of the Plan. While this contract is active, the Contract-Holder will
also furnish a copy of each Plan change.
7.8 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.9 LIMIT ON ASSIGNMENT;
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
GVA-120-87 (10/11)
Serial 720 7.7-7.9
<PAGE>
7.10 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.11 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA-120-87 (10/11)
Serial 730 7.10-7.11
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
----------------------- -------------------
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA-120-87 (10/11)
Serial A-100 Schedule A
<PAGE>
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age
- --- ---- ---- ---- ----
60
65
70
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
---------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in
--------------------------------------------------------------
Age
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60
65
70
If specified percentage to Contingent Annuitant is 50%:
60
65
70
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain
- ---------------- ---- ---- ---- ----
60
120
180
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA-120-87 (10/11)
Serial S-100 Schedules B-D
THE PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder: Plan:
- -------------------------------------------------------------------------------
Effective Date: Group Annuity Contract No.:
---------------------------------------
Eligible Classification:
- -------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- -------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
-------------------------
Title: President /s/
Date: Secretary /s/
----------------------
Attest
-----------------------
Date:
------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
19081-A
GVA-120-87 (10/11)
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . 110
1.4 Reports. . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawals. . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts. . . . . 310
3.4 Transfers to Another Financial Institution . 320
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . . 330
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . 400
4.3 Small Annuities and Accounts . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . 400
4.5 Payees . . . . . . . . . . . . . . . . . . . 420
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . 700
7.3 Place of Payment - Currency . . . . . . . . 700
7.4 Information - Records . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . . . 710
GVA-120-87
TC-100 (10)
<PAGE>
TABLE OF CONTENTS
(Continued)
Provision Serial Page
7.7 Plan Changes . . . . . . . . . . . . . . . . 720
7.8 Divisible Surplus. . . . . . . . . . . . . . 720
7.9 Limit on Assignment. . . . . . . . . . . . . 720
7.10 Certificates . . . . . . . . . . . . . . . . 730
7.11 Entire Contract - Construction . . . . . . . 730
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased. . A-100
Schedule B Life - Payment Certain Annuity . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . S-100
GVA-120-87 (10/11)
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the payments made for him by his employer pursuant to
a Salary-Annuity Agreement and any amounts contributed for him under
the Plan, if any, and directed by the Participant for payment
hereunder. For each Participant, total contributions (including those
made pursuant to a Salary-Annuity Agreement) to this contract and any
companion contract must be made at the rate of at least $200 during
each twelve-month period. Contributions will be transmitted by the
Contract-Holder or the employer.
A Participant is a person for whom contributions have been paid under
this contract and whose Participant's Account (see section 1.2) has
not been cancelled.
A Salary-Annuity Agreement is an agreement between an employee in an
Eligible Classification and his employer. It is also an agreement
between a Participant who has ceased to be an employee in an Eligible
Classification and his new employer. Under the Agreement, the employer
agrees to pay amounts to purchase an annuity for the employee meeting
the conditions of Section 403(b) of the Federal Internal Revenue Code.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant. Prudential may
require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number
GVA-120-87 (10/11)
Serial 100 1.1-1.2
<PAGE>
requested for withdrawal or, if applicable, the number determined by
dividing the dollar amount to be withdrawn by the Unit Value for the day of
withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Salary-Annuity Agreement payments or
Plan payments, if any, under another group annuity contract issued to the
Contract-Holder by Prudential (a "companion contract"). If so, the total
Annual Account Charge that applies to all his Accounts will not exceed the
amount shown above. This charge will be shared among his Accounts as
Prudential determines. Also, no charge will be withdrawn from his Account
under this contract when it is cancelled unless no amounts remain in an
Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-120-87 (10/11)
Serial 110 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect
the investment results of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-1O Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-120-87 (1O)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will notify
the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-lO will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-87 (1O) (as modified by GAA-7662)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-11 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-120-87 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-11 Account. Prudential will notify
the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-87 (11) (as modified by GAA-7662)
Serial 210 2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account but only
under the conditions permitted by the Plan, if any. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment to the
Participant will normally be made within seven days of Prudential's receipt
of a duly completed request for it. However, it may be paid at a later day
if permitted under the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
"Account Charge if it applies. The amount payable is also referred to as the
Withdrawal Value."
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
estalished* being withdrawn.**
-------------------------------- ---------------------------
First 24 months $0.07
Next 36 months 0.06
Next 60 months 0.04
Next 60 months 0.03
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement pursuant
to the terms of the Plan, if any.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). If the
Beneficiary is other than the Participant's spouse, the payment will be
made in one sum within 5 years of the Participant's death unless the
Participant has directed Prudential to purchase an annuity for the
Beneficiary. If the Participant's spouse is the Beneficiary, the payment
will be made in one sum no later than the latest date on which the spouse
is permitted to defer the distribution under law unless the
GVA-120-87 (10/11)
Serial 300 3.1-3.2
<PAGE>
Participant has directed Prudential to purchase an annuity for the spouse.
Instead of a one sum payment, the Beneficiary may elect to have the dollar
value of the Participant's Account applied to purchase an annuity. Proof of
the Participant's death must be received by Prudential before any payment
will be made. Any payment made pursuant to this section must be consistent
with the terms of the Plan, if any.
The Beneficiary's annuity election must be made before the Participant's
Account is distributed. The annuity form may be any of those described in
section 4.4. If annuity payments are to start at a future date, the
Participant's Account will be maintained for the Beneficiary in the same
manner as for the Participant. The date for payments to start must be on or
before the latest date on which the Beneficiary is permitted to defer the
distribution under law. No contributions may be made to the Account after
the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
Any annuity payments to a Beneficiary will be subject to the following:
(a) If an annuity is payable to the Participant's spouse, it must provide
for payment to be made over the life of the spouse (or over a period
not exceeding the life expectancy of the spouse), and
(b) If an annuity is payable to a Beneficiary who is other than the
Participant's spouse, it must provide for payment to be made over the
life of the Beneficiary (or over a period not exceeding the life
expectancy of the Beneficiary).
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract but only under the
conditions permitted by the Plan, if any. The minimum withdrawal to provide
a transfer is $500, or the dollar value of his Account if smaller. The
transfer will normally be made within seven days of Prudential's receipt of
a duly completed request for it. Section 3.1 does not apply to a withdrawal
for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
GVA-120-87 (10/11)
Serial 310 3.3
<PAGE>
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FINANCIAL INSTITUTION:
(a) At the Request of a Participant:
The Withdrawal Value of a Participant's Accounts may be transferred to
another financial institution but only under the conditions permitted
by the Plan, if any. The transfer may be made directly to that
institution or by a payment (or payments) to the Participant who then
makes payment to the institution. The transfer will normally be made
within seven days after Prudential's receipt of a duly completed
transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to another financial institution named in the request. The transfer
payment will be made on the Transfer Date. The Transfer Date is the
later of the day specified in the request and the 90th day after its
receipt by Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made
but only under the conditions permitted by the Plan, if any. Each
person who does not make this election will have his Account retained
under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the
election will be cancelled as of the Transfer Date and an amount
equal to the sum of the Withdrawal Values, expressed in Units of
the cancelled Accounts, times the Unit Value for the day of
withdrawal will be transferred within seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
GVA-120-87 (10/11)
Serial 320 3.4
<PAGE>
The Contract-Holder may notify Prudential that this section 3.4(b) is
to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by an employer who pays
contributions under this contract. He may become employed by an employer to
whom Prudential has issued a contract similar to this contract. If so, that
Participant may request a transfer to that similar contract from this
contract but only under the conditions permitted by the Plan, if any. The
transfer will normally be made within seven days of receipt of the request.
The dollar value of the Participant's Account will be the amount
transferred. The Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by an
employer who pays contributions under this contract. The transferred amount
will be treated as a contribution paid for that person. However, in
determining any withdrawal charge, any part of the transferred amount which
is investment income will not be considered a contribution.
This section may be changed as provided in section 5.1.
GVA-120-87 (10/11)
Serial 330 3.5
<PAGE>
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential, elect to have his
Participant's Account applied to purchase an annuity for him but only under
the conditions permitted by the Plan, if any. The dollar value of the
Account will be applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
If the Participant's Account has not been cancelled before the month in
which he reaches the latest age at which he is permitted to defer his
distribution under law, a 120 monthly Payment Certain annuity will be
purchased for him at the beginning of that month (see section 4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
A Participant may elect that only a portion of his Participant's Accounts
be applied to purchase an annuity with the balance being paid in a single
sum. The portion used to purchase an annuity will be subject to section 4.1
and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
GVA-120-87 (10/11)
Serial 400 4.1-4.4
<PAGE>
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240 or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
GVA-120-87 (10/11)
Serial 410 4.4
<PAGE>
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased which provides for payments:
(i) to a Beneficiary or a Contingent Annuitant who is not the Annuitant's
spouse if a present value calculation shows that the Annuitant's
expected payments will not be more than 50% of all the expected
annuity payments, or
(ii) to a Contingent Annuitant which are greater in monthly amount than the
payments to the Annuitant.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA-120-87 (10/11)
Serial 420 4.5
<PAGE>
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENTS:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or hind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-120-87 (10/11)
Serial 500 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) if the Plan, if any, terminates,
(c) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder,
or
(d) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give its consent (see section 7.7).
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA-120-87 (10/11)
Serial 600 6.1-6.3
<PAGE>
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2.COMMUNICATION:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT - CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA-120-87 (10/11)
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION - RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
a form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to a Beneficiary other than the person's
Contingent Annuitant, payment will be made to the Beneficiary the person
named. A person for whom an Account is held or an annuity is being paid
under this contract may name a Beneficiary to replace one previously named.
However, the Participant may instruct Prudential that his Contingent
Annuitant or Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA-120-87 (10/11)
Serial 710 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 PLAN CHANGES:
If the employer maintains a written Plan of benefits, the name of such Plan
is shown on the first page of this contract. This contract applies to the
terms of the Plan in effect on the Effective Date and to each Plan change
if Prudential consents. The Contract-Holder will furnish Prudential with a
copy of the Plan. While this contract is active, the Contract-Holder will
also furnish a copy of each Plan change.
7.8 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.9 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
GVA-120-87 (10/11)
Serial 720 7.7-7.9
<PAGE>
7.10 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been
effected. A certificate will be descriptive of the Participant's or
Annuitant's rights and duties under the contract
7.11 ENTIRE CONTRACT - CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the
jurisdiction set forth on the first page.
GVA-120-87 (10/11)
Serial 730 7.10-7.11
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
----------------------- -------------------
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA-120-87 (10/11)
Serial A-100 Schedule A
<PAGE>
1/88
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
60 $52.94 $41.56 $40.58 $39.85
65 58.01 46.81 45.60 44.68
70 64.46 53.48 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is Purchased is in
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.28 $36.06 $35.31 $34.78
65 51.11 40.07 39.10 38.39
70 56.56 45.62 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $50.36 $38.89 $38.00 $37.34
65 55.18 43.77 42.61 41.75
70 61.91 50.47 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain 1988 1990 1995 2000
- ---------------- ---- ---- ---- ----
60 $173.76 $165.62 $164.73 $164.73
120 97.43 88.93 88.45 88.45
180 72.47 63.55 63.20 63.20
* * * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA-120-87 (10/11)
Serial S-100 Schedules B-D
THE PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY OF
AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder: Plan:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract No.:
----------------------------------------
Eligible Classification:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
-------------------------
Title: President /s/
Date: Secretary /s/
------------------------
Attest
------------------------------
Date:
---------------------------------
Group Annuity Contract providing for contributions on account of
Participants. Annual determination of participation in divisible surplus.
All subject to the provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT. ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
GVA-120-87 (10/11)
19081
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . . . . . . . . 110
1.3 Annual Account Charge. . . . . . . . . . . . . . . . . 120
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . . . 120
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Participant's Withdrawals. . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . . . 310
3.3 Transfers between Related Contracts. . . . . . . . . . 330
3.4 Transfers to Another Financial Institution . . . . . . 330
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . . . . . . . . . 350
IV. DISTRIBUTIONS
4.1 Distributions. . . . . . . . . . . . . . . . . . . . . 400
4.2 Required Distribution Date . . . . . . . . . . . . . . 400
4.3 Minimum Required Distributions . . . . . . . . . . . . 410
4.4 Terms of Payment of Annuities. . . . . . . . . . . . . 420
4.5 Small Annuities and Accounts . . . . . . . . . . . . . 430
4.6 Payees . . . . . . . . . . . . . . . . . . . . . . . . 430
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment - Currency. . . . . . . . . . . . . . 700
7.4 Information - Records. . . . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . . . . . . . . 710
GVA-120-87 (as modified by Group Annuity Amendment Form GAA-7764)
TC-100 (10)
<PAGE>
TABLE OF CONTENTS
(Continued)
Provision Serial Page
7.7 Plan Changes . . . . . . . . . . . . . . . . . . . . . 720
7.8 Divisible Surplus. . . . . . . . . . . . . . . . . . . 720
7.9 Limit on Assignment. . . . . . . . . . . . . . . . . . 720
7.10 Certificates . . . . . . . . . . . . . . . . . . . . . 730
7.11 Entire Contract - Construction . . . . . . . . . . . . 730
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased. . . . . A-100
Schedule B Life - Payment Certain Annuity . . . . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . . . . S-100
GVA-120-87 (10/11)
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the payments made for him by his employer pursuant to
a Salary-Annuity Agreement and any amounts contributed for him under
the Plan, if any, and directed by the Participant for payment
hereunder. For each Participant, total contributions (including those
made pursuant to a Salary-Annuity Agreement) to this contract and any
companion contract must be made at the rate of at least $200 annually
during each twelve-month period. Contributions will be transmitted by
the Contract-Holder or the employer.
A Participant is a person for whom contributions have been paid under
this contract and whose Participant's Account (see section 1.2) has
not been cancelled.
A Salary-Annuity Agreement is an agreement between an employee in an
Eligible Classification and his employer. It is also an agreement
between a Participant who has ceased to be an employee in an Eligible
Classification and his new employer. Under the Agreement, the employer
agrees to pay amounts to purchase an annuity for the employee meeting
the conditions of Section 403(b) of the Federal Internal Revenue Code
of 1986, as amended (the "Code" ).
Contributions made pursuant to a Salary-Annuity Agreement may not
exceed $9,500 for the taxable year of the Participant or such other
amount as prescribed by the Internal Revenue Service under Section
402(g)(4) of the Code. This limitation shall not preclude any special
increases applicable under Section 402(g)(8) of the Code. If the
limitation described in this paragraph is exceeded in any taxable
year, the Participant may, not later than the March 1 following the
close of such taxable year, notify the Prudential, in writing, of such
excess and request that all or a portion of such excess and the income
or loss allocable thereto, be paid to him from the contract before the
April 15 following the close of the Participant's taxable year. Income
or loss allocable to a Participant's excess contributions shall be
determined in accordance with any applicable Regulations issued by the
Internal Revenue Service. Any distribution made pursuant to this
paragraph shall be made without regard to any restrictions or charges
otherwise applicable to withdrawals under section 3.1 of the contract.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 100 1.1
<PAGE>
(b) Transfer Contributions:
The following amounts may be transferred to and paid as contribution under
the contract for a Participant:
(1) an amount which qualifies as a rollover contribution pursuant to the
Code;
(2) an amount which arises from an exchange of annuity contracts pursuant
to the Code;
(3) an amount which arises from a Participant's interest in a Code Section
403(b)(7) custodial account; or
(4) an amount which arises from a Participant's interest in another Group
Annuity Contract issued to the Contract-Holder by Prudential.
Any amounts transferred to the contract pursuant to paragraph (b) of this
section 1.1. will be treated as a Salary-Annuity Agreement contribution
made after December 31, 1988 for purposes of the limitations on withdrawals
under section 3.1. of the contract. However, if any portion of such
transferred amount was not subject to the limitations of Code Section
403(b)(11) or Code Section 403(b)(7)(A)(ii) prior to transfer, then such
portion will be treated as a contribution made prior to December 31, 1988
for withdrawal purposes, if the following conditions are met:
(1) a record of the amount of contributions, and any income thereon, which
was not subject to the limitations of Code Section 403(b)(11) or Code
Section 403(b)(7)(A)(ii) prior to transfer must be furnished to
Prudential in a form satisfactory to it at the time such transfer is
made, and
(2) evidence that such amount was not subject to the limitations of Code
Section 403(b)(ii) or Code Section 403(b)(7)(A)(ii) prior to transfer
must be furnished to Prudential in a form satisfactory to it at the
time such transfer is made.
The Prudential may require proof that all amounts transferred to the
contract meet the requirements of the Code and any applicable Rulings or
Regulations issued by the Internal Revenue Service.
1.2 PARTICIPANT'S ACCOUNTS:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section on 2.1
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 110 1.1-1.2
<PAGE>
requested for withdrawal or, if applicable, the number determined by
dividing the dollar amount to be withdrawn by the Unit Value for the day of
withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
A Participant has a non-forfeitable interest in his Account. The Account is
subject to charges described later.
1.3 Annual Account Charge:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
The Annual Account Charge is $20.
A Participant may have an Account for Salary-Annuity Agreement payments or
Plan payments, if any, under another group annuity contract issued to the
Contract-Holder by Prudential (a "companion contract"). If so, the total
Annual Account Charge that applies to all his Accounts will not exceed the
amount shown above. This charge will be shared among his Accounts as
Prudential determines. Also, no charge will be withdrawn from his Account
under this contract when it is cancelled unless no amounts remain in an
Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 120 1.2-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-lO Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-lO Unit Change
Factor for that Business Day by the VCA-lO Unit Value for the immediately
preceding Business Day. The VCA-lO Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-1O Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-120-87 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will notify
the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-87 (10) (as modified by GAA-7662)
Serial 210 2.2-2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established
pursuant to a resolution adopted by its Board of Directors. The
resolution provides that this account is to be used for contracts which
state that certain payments and values under them will vary to reflect
the investment results of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-11 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-11. The amount, if any, by which the total value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-11 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one VCA-
11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is
determined as of the end of that Business Day by multiplying the VCA-11
Unit Change Factor for that Business Day by the VCA-11 Unit Value for the
immediately preceding Business Day. The VCA-11 Unit Value for any day
which is not a Business Day is equal to the VCA-11 Unit Value for the next
Business Day. The VCA-11 Unit Value will go up or down in accordance with
the VCA-11 Unit Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment
Management Fee per $1.00 at the effective annual rate of 0.25% for the
number of calendar days in the period from the end of the prior
Business Day to the end of the current Business Day. The aggregate
amount by which VCA-11 is reduced in each year by the Investment
Management Fee will be deducted from investment income to the extent
possible; any balance will be deducted from principal.
GVA-120-87 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-11 Account. Prudential will notify
the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-120-87 (11) (as modified by GAA-7662)
Serial 210 2.2-2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS--DEATH PAYMENTS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may make withdrawals from his Participant's Account subject
to any conditions specified in the Plan, if any.
However, withdrawals attributable to (i) Salary-Annuity Agreement
contributions made on or after January 1, 1989 and (ii) income credited on
or after January l, 1989 to any Salary-Annuity Agreement contributions, may
not be made prior to the Participant's attainment of age 59 1/2, except
upon the occurrence of one of the following events:
. separation from service with the employer sponsoring the Plan or
Salary-Annuity Agreement arrangement under the contract;
. Disability Retirement, in accordance with Code Section 72(m)(7) or in
accordance with the terms of the Plan, if any; or
. Financial Hardship, in accordance with the terms of the Plan, if any
or on a basis mutually agreed upon between the Contract-Holder and
Prudential which will be uniformly applicable to all Participants
similarly situated.
Prudential may require proof, in a form satisfactory to it, that one of the
preceding events has occurred before honoring any request for a withdrawal
described in the preceding paragraph.
Withdrawals attributable to Salary-Annuity Agreement contributions made on
or before December 31, 1988 and any income credited to such contributions
as of December 31, 1988, will not be subject to the provisions of the
preceding two paragraphs.
Income attributable to Salary-Annuity Agreement contributions made on and
after January 1, 1989 may not be withdrawn in the case of Financial
Hardship.
The minimum withdrawal is $500, or the dollar value of the Participant's
Account if smaller. Payment to the Participant will normally be made within
seven days of Prudential's receipt of a duly completed request for it.
However, it may be paid at a later date if permitted under the Investment
Company Act of 1940.
The amount paid to the Participant will be the dollar value of the amount
withdrawn less the withdrawal charge determined from the following table
and the Annual Account Charge if it applies. The amount payable is also
referred to as the "Withdrawal Value."
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 300 3.1
<PAGE>
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ---------------------------
First 24 months $0.07
Next 36 months 0.06
Next 60 months 0.04
Next 60 months 0.03
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies)
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6.). Proof
of the Participant's death must be received by Prudential before any
payment will be made. Death benefits payable under the contract to a
Participant's Beneficiary prior to the date (i) on which an annuity has
been purchased for the Participant or (ii) on which minimum distributions
have commenced to the Participant pursuant to Code Section 401(a)(9) will
be paid as set forth in this section 3.2. Death benefits payable under the
contract to a Participant's Beneficiary after the date on which an annuity
has been purchased or on which minimum distributions have commenced to the
Participant pursuant to Code section 401(a) (9) will be paid as set forth
in section 4.1. of the contract.
The Beneficiary may elect payment in any of the following forms, unless the
Participant has directed otherwise or unless the Plan, if any, provides
otherwise:
(a) a lump sum;
(b) an annuity form described in section 4.4. of the contract, other than
one which provides for payment after the death of the Annuitant to a
Contingent Annuitant;
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan, if any; or
(d) a combination of all or any two of (a), (b) and (c) above.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 310 3.1-3.2
<PAGE>
Any lump sum payment to a Beneficiary will be subject to the following:
- If the lump sum is payable to the Participant's spouse, payment of
such lump sum will be made no later than the later of the (i) the
December 31 of the calendar year following the one in which the
Participant's death occurred or (ii) the December 31 of the calendar
year in which the Participant would have attained age 70 1/2.
- If the lump sum is payable to a Beneficiary who is other than the
Participant's Spouse, payment of such lump sum will be made no later
than the December 31 of the calendar year in which the fifth
anniversary of the Participant's death occurs.
If a lump sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
If payments are to be made to a Beneficiary in a form other than a lump
sum, such payments will be subject to the following:
- If the Beneficiary is the Participant's spouse, payments must commence
no later than the later of (i) the December 31 of the calendar year
following the one in which the Participant's death occurred or (ii)
the December 31 of the calendar year in which the Participant would
have attained age 70 1/2. Such payments must be paid over the life of
the spouse or over a period not exceeding the life expectancy of the
spouse.
- If the Beneficiary is other than the Participant's spouse, payments
must commence no later than the December 31 of the calendar year
following the one in which the death of the Participant occurred. Such
payments must be paid over the life of the Beneficiary or over a
period not exceeding the life expectancy of the Beneficiary.
If:
(1) the Beneficiary does not elect a method of distribution,
(2) the Participant has not directed that a specific method of
distribution be provided for his Beneficiary, and
(3) the Plan, if any, does not provide for an automatic method of
distribution,
then any death benefits becoming payable under the contract shall be paid
in a lump sum commencing no later than the December 31 of the calendar year
in which the fifth anniversary of the Participant's death occurs.
Anything herein to the contrary notwithstanding, if any portion of the
Participant's Account, which becomes payable to a Beneficiary, consists of
(i) contributions made under the contract by or on behalf of the
Participant on or before December 31, 1986 and (ii) income credited to such
contributions as of December 31, 1986, then distribution of such portion
may be deferred until the Beneficiary attains age 70, if the Beneficiary so
elects and provided such election does not contravene any prior direction
from the Participant or any provision of the Plan, if any.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 320 3.2
<PAGE>
All death benefits pursuant to this section 3.2. shall be made at the time
and in the manner prescribed in Code Section 401(a)(9) and the Regulations
issued thereunder.
If payments to a Beneficiary are to start at a future date, all or an
appropriate portion of the Participant's Account will be maintained in
accordance with the Beneficiary's election in the same manner as for the
Participant. No contributions may be made to an Account hereunder after the
Participant's death.
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract but only under the
conditions permitted by the Plan, if any. The minimum withdrawal to provide
a transfer is $500, or the dollar value of his Account if smaller. The
transfer will normally be made within seven days of Prudential's receipt of
a duly completed request for it. Section 3.1 does not apply to a withdrawal
for this purpose. Transfers are deemed to be made first from the
contributions paid for the Participant. Investment income is transferred
when there are no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FINANCIAL INSTITUTION:
(a) Total transfers at the Request of a Participant:
The Withdrawal Value of a Participant's Accounts may be transferred to
another financial institution but only under the conditions permitted
by the Plan, if any. The transfer may be made directly to that
institution or by a payment (or payments) to the Participant who then
makes payment to the institution. The transfer will normally be made
within seven days after Prudential's receipt of a duly completed
transfer request.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 330 3.2-3.4
<PAGE>
The transfer will be a full settlement of Prudential's liability for the
Participant's Account.
(b) Partial Transfers at the Request of Participants:
A Participant may elect to have a portion of his Account transferred
to another financial institution if permitted by the terms of the
Plan, if any. The minimum withdrawal to provide a transfer is $500, or
the dollar value of the Participant's Account, if smaller.
The transfer will normally be made within seven days of Prudential's
receipt of a duly completed request for it.
Prudential may, upon notice to the Contract-Holder and Participants
limit the frequency of transfers. This action will take effect on the
date of the notice.
Any transfer amount will be subject to the provisions of section 3.1.
relating to withdrawal charges.
(c) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to another financial institution named in the request. The transfer
payment will be made on the Transfer Date. The Transfer Date is the
later of the day specified in the request and the 9Oth day after its
receipt by Prudential.
Prudential will promptly notify each Participant, and each Beneficiary
of a deceased Participant whose Account has not been cancelled, that
the request has been received. Each notified person may elect, within
30 days following his receipt of the notice from Prudential, to have
his Account cancelled and included in the transfer payment to be made
but only under the conditions permitted by the Plan, if any. Each
person who does not make this election will have his Account retained
under this contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make the election
will be cancelled as of the Transfer Date and an amount equal to the
sum of the Withdrawal Values, expressed in Units of the cancelled
Accounts, times the Unit Value for the day of withdrawal will be
transferred within seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
The Contract-Holder may notify Prudential that this section 3.4(c) is
to be inoperative.
This section may be changed as provided in section 5.1.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 340 3.4
<PAGE>
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by an employer who pays
contributions under this contract. He may become employed by an employer to
whom Prudential has issued a contract similar to this contract. If so, that
Participant may request a transfer to that similar contract from this
contract but only under the conditions permitted by the Plan, if any. The
transfer will normally be made within seven days of receipt of the request.
The dollar value of the Participant's Account will be the amount
transferred. The Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by an
employer who pays contributions under this contract. The transferred amount
will be treated as a contribution paid for that person. However, in
determining any withdrawal charge, any part of the transferred amount which
is investment income will not be considered a contribution.
This section may be changed as provided in section 5.1.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 350 3.5
<PAGE>
Provision IV. DISTRIBUTIONS
4.1 DISTRIBUTIONS:
A Participant may, subject to section 3.1 and in accordance with the terms
of the Plan, if any, elect to receive a distribution of the dollar value of
his Account under the contract in any of the following forms:
(a) a lump sum;
(b) an annuity form described in section 4.4;
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan, if any; or
(d) a combination of all or any two of (a), (b) and (c) above.
Any portion of a Participant's Account which is paid to him as a lump sum
will be subject to the provisions of section 3.1 relating to withdrawal
charges.
Any payments becoming due to the Beneficiary of a Participant who began
receiving a distribution pursuant to paragraph (c) may, unless the
Participant has directed otherwise or the Plan, if any, provides otherwise,
be paid in any of the forms described in this section 4.1. as elected by
the Beneficiary, except for an annuity which provides for payment after the
death of the Annuitant to a Contingent Annuitant.
Any payments becoming due to the Beneficiary of a Participant who began
receiving an annuity pursuant to paragraph (b) will, unless the Participant
has directed otherwise, be paid as provided in section 4.4.
Anything in the contract to the contrary notwithstanding, any payments made
to a Beneficiary in accordance with the two preceding paragraphs will meet
the requirements of Code Section 401(a)(9) and the Regulations issued
thereunder.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 REQUIRED DISTRIBUTION DATE:
Distributions are required to commence to the Participant as of his
Required Distribution Date. A Participant's Distribution Date is defined
below:
(a) with respect to the portion of a Participant's Account under the
contract consisting of (i) contributions made by or on behalf of such
Participant on or before December 31, 1986 and (ii) income credited to
such contributions as of December 31, 1986, a Participant's Required
Distribution Date is the last day of the year in which the Participant
attains age 75, regardless of whether or not such Participant has
terminated his employment with the employer sponsoring the Plan or
Salary-Annuity Agreement arrangement under the contract
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GPA-7764)
Serial 400 4.1-4.2
<PAGE>
(b) with respect to the remaining portion of a Participant's Account under the
contract, a Participant's Required Distribution Date is:
(i) with respect to any Participant who attained age 70 1/2 before January
1, 1988, the April 1 of the calendar year following the one in which
the later of (A) the Participant's termination of employment with the
employer sponsoring the Plan or Salary-Annuity Agreement arrangement
under the contract or (B) the Participant's attainment of age 70 1/2
occurs;
(ii) with respect to any Participant who attained age 70 1/2
during 1988 and who had not terminated employment with the
employer sponsoring the Plan or Salary-Annuity Agreement
arrangement under the contract as of January 1, 1989, April
1, 1990: and
(iii) with respect to all other Participants, the April 1 of the
calendar year following the one in which the Participant
attains age 70 1/2 regardless of whether or not such
Participant has terminated his employment with the employer
sponsoring the Plan or Salary-Annuity Agreement arrangement
under the contract.
If the plan funded under the contract is a church or governmental plan, as
defined in the Code, the Required Distribution Date for a Participant
covered under such plan with respect to the portion of his Account defined
in paragraph (b) above is the Required Distribution Date set forth in
subparagraph (b)(i) above.
If the Participant's Account includes a transfer contribution made pursuant
to paragraph (b) of section 1.1, the Required Distribution Date applicable
to such transfer contribution will be determined in accordance with
paragraph (b) above, except as provided in the following paragraph.
If any portion of the Participant's transfer contribution consists of (i)
contributions made by or behalf of the Participant on or before December
31, 1986 and (ii) income credited to such contributions as of December 31,
1986, the Required Distribution Date applicable to such portion will be the
Required Distribution Date applicable under the 403(b) program from which
such transfer was made, if the following conditions are met:
(1) a record of the amount of contributions made on or before December 31,
1986 and income credited to such contributions as of December 31,
1986, must be furnished to Prudential in a form satisfactory to it at
the time such transfer is made, and
(2) evidence of the Required Distribution Date under the 403(b) program
from which the transfer was made must be furnished to Prudential in a
form satisfactory to it at the time such transfer is made.
4.3 MINIMUM REQUIRED DISTRIBUTION:
Prior to a Participant's Required Distribution Date, as determined from the
records of Prudential on the basis of information furnished to it,
Prudential will notify such Participant that he may be required to
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 410 4.2-4.3
<PAGE>
receive a minimum distribution from his Account under the contract in
accordance with Code Section 401(a)(9) and the Regulations issued
thereunder. Such notice will include information so as to assist the
Participant in computing the amount of his required distribution. Following
such notice, a Participant may request that the required minimum
distribution be paid to him from the contract before his Required
Distribution Date.
If the Participant does not request a distribution of any portion of his
Account pursuant to this section 4.3, Prudential shall be under no
obligation to make such distribution.
4.4 TERMS OF PAYMENT OF ANNUITIES:
If a Participant elects an annuity pursuant to paragraph (b) of section
4.1, all or a portion of the dollar value of the Participant's Account, as
specified by the Participant, will be applied to purchase an annuity in
accordance with Schedule A. The monthly amount of annuity is determined
from the schedule of purchase rates for that annuity.
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240 or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 420 4.3-4.4
<PAGE>
thereafter throughout the Contingent Annuitant's remaining lifetime.
The last monthly payment is payable for the month in which his death
occurs. The amount of each monthly Contingent Annuity payment will be
a percentage of the monthly annuity payment payable before the
Annuitant's death. The percentage is established when the annuity is
purchased and may be 33 1/3%, 50%, 66 2/3% or 100%, or any other
percentage accepted by Prudential. Under a Life - Payment Certain
Contingent annuity, a percentage payment will not take effect until
the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
All annuities purchased under the contract will meet the requirements of
Code Section 401(a)(9) and, to the extent applicable, Code Sections
401(a)(11) and 417, and the Regulations issued thereunder.
4.5 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.4.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Participant unless he directs payment to a
named financial institution. The Annual Account Charge will be made only if
no Account remains for him under a companion contract.
4.6 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 430 4.4-4.6
<PAGE>
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENTS:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-120-87 (10/11)
Serial 500 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) if the Plan, if any, terminates,
(c) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder,
or
(d) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give its consent (see section 7.7).
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA-120-87 (10/11)
Serial 600 6.1-6.3
<PAGE>
11/89
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2. COMMUNICATION:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., Defined Contribution Programs, W.W. Scranton Office Park, 30
E.D. Preate Drive, Moosic, Pennsylvania 18507-1796, or at such other
address as it may communicate to the Contract-Holder. All communications to
any other person or organization dealing with Prudential will be addressed
to that person or organization at the last address of record.
7.3 PLACE OF PAYMENT - CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA-120-87 (10/11)
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION - RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information, Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
a form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. Any
spousal consent requirements of applicable Federal law (as it relates to
employee benefit plans) will apply in designating a Beneficiary. A person
for whom an Account is held or an annuity is being paid under this contract
may name a Beneficiary to replace one previously named provided the change
complies with any applicable Federal law (as it relates to employee benefit
plans). However, the Participant may instruct Prudential that his
Contingent Annuitant or Beneficiary is not to have this right to name a
Beneficiary.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 710 7.4-7.6
<PAGE>
A Beneficiary may be named by filing a request with Prudential on a
form acceptable to it. It will become effective when entered on
Prudential's records. It will apply to any amounts payable after the
request was received by Prudential, except any withdrawals and
payments made before the request was entered on Prudential's records.
Prudential will acknowledge the naming of a Beneficiary.
The interest of any Beneficiary who dies before the Participant ceases
upon that Beneficiary's death. If there is no named Beneficiary when
an amount is payable to one, payment will be made to the estate of the
last to die of the Participant or Annuitant, his Contingent Annuitant,
and his Beneficiary. If a payment would be made to the estate of a
Participant or Annuitant, Prudential may make the payment to any one
or jointly to any number of his surviving relatives: spouse, children,
parents, brothers or sisters.
Prudential, in determining whether a person is a relative of a
Participant or Annuitant or is a Beneficiary entitled to payment, may
rely solely on any evidence it deems acceptable. Each payment
Prudential makes in reliance thereon will be a valid discharge of its
obligation under this contract as to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one
sum. Also, if the payee is not a natural person and a series of
payments is payable, Prudential may choose to make a payment in one
sum. The one sum payment will be equal to the value of the series of
payments discounted at interest from each payment due date to the date
of the one sum payment. The discount interest rate will be the
interest rate in the schedule of annuity purchase rates used to
establish the series of payments.
7.7 PLAN CHANGES:
If the employer maintains a written Plan of benefits, the name of such Plan
is shown on the first page of this contract. This contract applies to the
terms of the Plan in effect on the Effective Date and to each Plan change
if Prudential consents. The Contract-Holder will furnish Prudential with a
copy of the Plan. While this contract is active, the Contract-Holder will
also furnish a copy of each Plan change.
7.8 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.9 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 720 7.6-7.9
<PAGE>
creditor. For this purpose, compliance with the terms of a Qualified
Domestic Relations Order as defined in Code Section 414(p) will not be
considered an assignment of benefits.
7.10 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.11 ENTIRE CONTRACT - CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA-120-87 (10/11) (as modified by Group Annuity Amendment Form GAA-7764)
Serial 730 7.9-7.11
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA-120-87 (10/11)
Serial A-100 Schedule A
<PAGE>
1/90
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1990 1991 1995 2000
- --- ---- ---- ---- ----
60 $52.53 $41.36 $40.58 $39.85
65 57.51 46.57 45.60 44.68
70 63.85 53.19 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is Purchased is in:
Age 1990 1991 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $46.96 $35.91 $35.31 $34.78
65 50.70 39.88 39.10 38.39
70 56.00 45.36 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $49.99 $38.71 $38.00 $37.34
65 54.69 43.53 42.61 41.75
70 61.25 50.15 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
---------------
Number of If date the annuity is purchased is in:
Payments Certain 1990 1991 1995 2000
- ------------------- ---- ---- ---- ----
60 $173.38 $165.44 $164.73 $164.73
120 97.22 88.83 88.45 88.45
180 72.32 63.48 63.20 63.20
* * * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA-120-87 (10/11)
Serial S-100 Schedules B-D
THE PRUDENTIAL December 31, 1989
AMENDMENT TO BE ATTACHED TO AND MADE A PART OF
GROUP ANNUITY CONTRACTS
(the "Contracts")
ISSUED TO THE CONTRACT-HOLDER
BY
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(the "Prudential")
The Group Annuity Contracts provide that the Contracts may be amended by
Prudential to satisfy the requirements of any law or regulation administered
by a governmental agency. Therefore, as a result of changes made to the
Federal Internal Revenue Code by the Tax Reform Act of 1986, the Contracts
are hereby amended in the following respects:
1. REGULAR CONTRIBUTIONS: Effective January 1, 1987, contributions made
pursuant to a Salary-Annuity Agreement may not exceed $9,500 for the
taxable year of the Participant or such other amount as prescribed by the
Internal Revenue Service under Section 402(g)(4) of the Internal Revenue
Code of 1986, as amended (the "Code"). This limitation shall not preclude
any special increases applicable under section 402(g)(8) of the Code. If
the limitation described in this paragraph is exceeded in any taxable
year, the Participant may, not later than the March 1 following the close
of such taxable year, notify the Prudential, in writing, of such excess
and request that all or a portion of such excess and the income or loss
allocable thereto, be paid to him from the Contracts before the April 15
following the close of the Participant's taxable year. Income or loss
allocable to a Participant's excess contributions shall be determined in
accordance with any applicable Regulations issued by the Internal Revenue
Service. Any distribution made pursuant to this paragraph shall be made
without regard to any restrictions or charges otherwise applicable to
withdrawals under the Contracts.
2. TRANSFER CONTRIBUTIONS: Effective December 31, 1989, the following
amounts may be transferred to and paid as a contribution under the
Contracts for a Participant:
(a) an amount which qualifies as a rollover contribution pursuant to the
Code;
(b) an amount which arises from an exchange of annuity contracts pursuant
to the Code;
GAA-7764
19080
<PAGE>
(c) an amount which arises from a Participant's interest in a Code
Section 403(b)(7) custodial account, or
(d) an amount which arises from a Participant's interest in another Group
Annuity Contract issued to the Contract-Holder by Prudential.
Any amount transferred to the Contracts pursuant to this item 2. will be
treated as a Salary-Annuity Agreement contribution made after December
31, 1988 for purposes of the limitations on withdrawals under the
Contracts. However, if any portion of such transferred amount was not
subject to the limitations of Code Section 403(b)(11) or Code Section
403(b)(7)(A)(ii) prior to transfer, then such portion will be treated as
a contribution made prior to December 31, 1988 for withdrawal purposes,
if the following conditions are met:
(1) a record of the amount of contributions, and any income thereon,
which was not subject to the limitations of Code Section 403(b)(11)
or Code Section 403(b)(7)(A)(ii) prior to transfer must be furnished
to Prudential in a form satisfactory to it at the time such transfer
is made, and
(2) evidence that such amount was not subject to the limitations of Code
Section 403(b)(ii) or Code Section 403(b)(7)(A)(ii) prior to transfer
must be furnished to Prudential in a form satisfactory to it at the
time such transfer is made.
The Prudential may require proof that all amounts transferred to the
Contracts meet the requirements of the Code and any applicable Rulings or
Regulations issued by the Internal Revenue Service.
3. WITHDRAWALS: Effective January 1, 1989, withdrawals attributable to (i)
Salary-Annuity Agreement contributions made on or after January 1, 1989,
and (ii) income credited on or after January 1, 1989 to any
Salary-Annuity Agreement contributions, may not be made prior to the
Participant's attainment of age 59 1/2, except upon the occurrence of one
of the following events:
. separation from service with the employer sponsoring the Plan or
Salary-Annuity Agreement arrangement under the Contracts;
. Disability Retirement, in accordance with Code Section 72(m)(7) or in
accordance with the terms of the Plan, if any; or
. Financial Hardship, in accordance with the terms of the Plan, if any,
or on a basis mutually agreed upon between the Contract-Holder and
Prudential which will be uniformly applicable to all Participants
similarly situated.
Prudential may require proof, in a form satisfactory to it, that one of
the preceding events has occurred before honoring any request for a
withdrawal described in the preceding paragraph.
Withdrawals attributable to Salary-Annuity Agreement contributions made
on or before December 31, 1988 and any income credited to such
contributions as of December 31, 1988, will not be subject to the
provisions of the preceding two paragraphs.
GAA - 7764 -2-
<PAGE>
Effective January 1, 1989, income attributable to Salary-Annuity
Agreement contributions made on and after January 1, 1989 may not be
withdrawn in the case of Financial Hardship.
4. DEATH PAYMENTS: Effective January 1, 1987, death benefits payable under
the Contracts to a Participant's Beneficiary prior to the date (i) on
which an annuity has been purchased for the Participant or (ii) on which
minimum distributions have commenced to the Participant pursuant to Code
Section 401(a)(9) will be paid as set forth in this item 4. Death
benefits payable under the Contracts to a Participant's Beneficiary on or
after the date on which an annuity has been purchased for the Participant
or on which minimum distributions have commenced to the Participant
pursuant to Code Section 401(a)(9) will be paid as set forth in item 6.
below.
The Beneficiary may elect payment in any of the following forms, unless
the Participant has directed otherwise or unless the Plan, if any,
provides otherwise:
(a) a lump sum;
(b) an annuity form described in the Contracts, other than one which
provides for payment after the death of the Annuitant to a Contingent
Annuitant;
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan, if any; or
(d) a combination of all or any two of (a), (b) and (c) above.
Any lump sum payment to a Beneficiary will be subject to the following:
- If the lump sum is payable to the Participant's spouse, payment of
such lump sum will be made no later than the later of (i) the
December 31 of the calendar year following the one in which the
Participant's death occurred or (ii) the December 31 of the calendar
year in which the Participant would have attained age 70 1/2.
- If the lump sum is payable to a Beneficiary who is other than the
Participant's Spouse, payment of such lump sum will be made no later
than the December 31 of the calendar year in which the fifth
anniversary of the Participant's death occurs.
If payments are to be made to a Beneficiary in a form other than a lump
sum, such payments will be subject to the following:
- If the Beneficiary is the Participant's spouse, payments must
commence no later than the later of (i) the December 31 of the
calendar year following the one in which the Participant's death
occurred or (ii) the December 31 of the calendar year in which the
Participant would have attained age 70 l/2. Such payments must be
paid over the life of the spouse or over a period not exceeding the
life expectancy of the spouse.
GAA-7764 -3-
<PAGE>
- If the Beneficiary is other than the Participant's spouse, payments
must commence no later than the December 31 of the calendar year
following the one in which the death of the Participant occurred.
Such payments must be paid over the life of the Beneficiary or over a
period not exceeding the life expectancy of the Beneficiary.
If:
(1) the Beneficiary does not elect a method of distribution; and
(2) the Participant has not directed that a specific method of
distribution be provided for his Beneficiary; and
(3) the Plan, if any, does not provide for an automatic method of
distribution,
then any death benefits becoming payable under the Contracts shall be
paid in a lump sum commencing no later than the December 31 of the
calendar year in which the fifth anniversary of the Participant's death
occurs.
Anything herein to the contrary notwithstanding, if any portion of the
Participant's Account(s), which become payable to a Beneficiary, consists
of (i) contributions made under the Contracts by or on behalf of the
Participant on or before December 31, 1986 and (ii) income credited to
such contributions as of December 31, 1986, then distribution of such
portion may be deferred until the Beneficiary attains age 70, if the
Beneficiary so elects and provided such election does not contravene any
prior direction from the Participant or any provision of the Plan, if
any.
All death benefits pursuant to this item 4. shall be made at the time and
in the manner prescribed in Code Section 401(a)(9) and the Regulations
issued thereunder.
5. TRANSFERS TO ANOTHER FINANCIAL INSTITUTION: Effective December 31, 1989,
a Participant may elect to have a portion of his Account(s) transferred
to another financial institution if such transfer is permitted by the
terms of the Plan, if any. Such transfer will be permitted on the same
basis as partial transfers are permitted between Related Contracts (i.e.,
companion contracts) under the Contracts, except that any charges
otherwise applicable to withdrawals under the Contracts will apply to the
amount elected for transfer.
6. DISTRIBUTIONS: Effective January 1, 1987, a Participant may, subject to
the provisions of item 3. above, and in accordance with the terms of the
Plan, if any, elect to receive a distribution of his Account(s) under the
Contracts in any of the following forms:
(a) a lump sum;
(b) any annuity form described in the Contracts;
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan, if any; or
GAA-7764 -4-
<PAGE>
(d) a combination of all or any two of (a), (b) and (c) above.
Any portion of a Participant's Account(s) which is paid to him as a lump
sum will be subject to the withdrawal provisions under the Contracts.
Any payments becoming due to the Beneficiary of a Participant who began
receiving a distribution pursuant to paragraph (c) may, unless the
Participant has directed otherwise or the Plan, if any, provides
otherwise, be paid in any of the forms described in this item 6., as
elected by the Beneficiary, except for an annuity which provides for
payment after the death of the Annuitant to a Contingent Annuitant.
Any payments becoming due to the Beneficiary of a Participant who began
receiving an annuity pursuant to paragraph (b) will, unless the
Participant has directed otherwise, be paid as provided under the terms
of the annuity as described in the Contracts.
Anything in the Contracts to the contrary notwithstanding, any payments
made to a Beneficiary in accordance with the two preceding paragraphs
will meet the requirements of Code Section 401(a)(9) and the Regulations
issued thereunder.
7. REQUIRED DISTRIBUTION DATE: Effective January 1, 1987 distributions are
required to commence to the Participant as of his Required Distribution
Date. A Participant's Required Distribution Date is defined below:
(a) with respect to the portion of a Participant's Account(s) under the
Contracts consisting of (i) contributions made by or on behalf of the
Participant on or before December 31, 1986 and (ii) income credited
to such contributions as of December 31, 1986, a Participant's
Required Distribution Date is the last day of the year in which the
Participant attains age 75, regardless of whether or not such
Participant has terminated his employment with the employer
sponsoring the Plan or Salary-Annuity Agreement arrangement under the
Contracts.
(b) with respect to the remaining portion of a Participant's Account(s)
under the Contracts, a Participant's Required Distribution Date is:
(i) with respect to any Participant who attained age 70 1/2 before
January 1, 1988, the April 1 of the calendar year following the
one in which the later of (A) the Participant's termination of
employment with the employer sponsoring the Plan or
Salary-Annuity Agreement arrangement under the Contracts or (B)
the Participant's attainment of age 70 1/2 occurs;
(ii) with respect to any Participant who attained age 70 1/2 during
1988 and who had not terminated his employment with the employer
sponsoring the Plan or Salary-Annuity Agreement arrangement under
the Contracts as of January 1, 1989, April 1, 1990; and
GAA-7764 -5-
<PAGE>
(iii) with respect to all other Participants, April 1 of the calendar
year following the one in which the Participant attains age 70
1/2 regardless of whether or not such Participant has terminated
his employment with the employer sponsoring the Plan or
Salary-Annuity Agreement arrangement under the Contracts.
If the Plan funded under the Contracts is a church or governmental plan
as defined in the Code, the Required Distribution Date for a Participant
covered under such plan with respect to the portion of his Account(s)
defined in paragraph (b) above is the Required Distribution Date set
forth in subparagraph (b)(i).
If the Participant's Account includes a transfer contribution made
pursuant to item 2. above, the Required Distribution Date applicable to
such transfer contribution will be determined in accordance with
paragraph (b) above, except as provided in the following paragraph.
If any portion of the Participant's transfer contribution consists of (i)
contributions made by or on behalf of the Participant on or before
December 31, 1986 and (ii) income credited to such contributions as of
December 31, 1986, the Required Distribution Date applicable to such
portion will be the Required Distribution Date applicable under the
403(b) program from which such transfer was made, if the following
conditions are met:
(1) a record of the amount of contributions made on or before December
31, 1986 and income credited to such contributions as of December 31,
1986, must be furnished to Prudential in a form satisfactory to it at
the time such transfer is made, and
(2) evidence of the Required Distribution Date under the 403(b) program
from which the transfer was made must be furnished to Prudential in a
form satisfactory to it at the time such transfer is made.
8. MINIMUM REQUIRED DISTRIBUTION: Effective January 1, 1987, Prudential will
notify a Participant, prior to such Participant's Required Distribution
Date, as determined from the records of Prudential on the basis of
information furnished to Prudential, that he may be required to receive a
minimum distribution from his Account(s) under the Contracts in
accordance with Code Section 401(a)(9) and the Regulations issued
thereunder. Such notice will include information so as to assist the
Participant in computing the amount of his required minimum distribution.
Following such notice, a Participant may request that the required
minimum distribution be paid to him from the Contracts by his Required
Distribution Date.
If the Participant does not request a distribution of any portion of his
Account(s) under the Contracts pursuant to this item 8., Prudential shall
be under no obligation to make such distribution.
9. ANNUITIES: Effective January 1, 1987, all annuities purchased under the
Contracts will meet the requirements of Code Section 401(a)(9) and, to
the extent applicable, Code Sections 401(a)(11)and 417, and the
Regulations issued thereunder.
GAA-7764 -6-
<PAGE>
10. BENEFICIARY: Effective as of the Effective Date of the Contracts, any
spousal consent requirements of applicable Federal law (as it relates to
employee benefit plans) will apply in designating a Beneficiary and to
any changes made to a previous Beneficiary designation.
11. LIMIT ON ASSIGNMENT: Effective as of the Effective Date of the Contracts,
to the extent applicable law requires, the interests in and payments from
the Contracts are not assignable or subject to the claims of any
creditor. For this purpose, compliance with the terms of a Qualified
Domestic Relations Order as defined in Code Section 414(p) will not be
considered an assignment of benefits.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
George R. Molson
VICE PRESIDENT, CONTRACTS
GAA-7764 -7-
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder: Plan:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
---------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Isabelle L. Kirchner
-------------------------
Attest
--------------------------
Date:
---------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED
IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1010 19081
<PAGE>
TABLE OF CONTENTS
9/84
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.2 Contributions. . . . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . . . . . 100
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Withdrawals. . . . . . . . . . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . . . . 300
3.3 Transfers Between Related Contracts. . . . . . . . . . . 310
3.4 Transfers to Another Funding Agent . . . . . . . . . . . 310
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . . . . . . . 400
4.3 Small Annuities and Accounts . . . . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . . . . . . . 400
4.5 Contract-Holder as Payee - Prudential as Agent . . . . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . . . . 500
5.3 Persons Empowered to Act for Prudential. . . . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . . . . 710
7.6 Plan Changes . . . . . . . . . . . . . . . . . . . . . . 710
7.7 Divisible Surplus. . . . . . . . . . . . . . . . . . . . 720
7.8 Entire Contract -- Construction . . . . . . . . . . . . 720
GVA-1010
TC-100 (10)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Serial Page
SCHEDULES
SCHEDULE A Forms of Annuity which May be Purchased . . . . . A-100
SCHEDULE B Life - Payment Certain Annuity. . . . . . . . . . S-100
SCHEDULE C Life - Contingent Annuity . . . . . . . . . . . . S-100
Schedule D Payment Certain Annuity . . . . . . . . . . . . . S-100
GVA/GAA-1010/7211-82
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the amounts of his compensation deferred pursuant to
the Plan and directed for payment hereunder. Contributions will be
transmitted by the Contract-Holder. A Participant is a person for whom
contributions have been paid under this contract and whose
Participant's Account (see section 1.2) has not been cancelled.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution by the Contract-Holder on a
Participant's behalf if permitted by the Plan. Prudential may require
proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. (The term "Participant's
Account" is not meant to confer on the Participant any rights to his
Account except as specifically provided in the Plan.) This Account is
expressed in Units of the separate investment account described in section
2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
The Account is subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
GVA-1010
Serial 100 1.1-1.3
<PAGE>
9/84
The Annual Account Charge is $12.
An Account may be established for the Participant in connection with the
Plan under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $12. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
withdrawal from the Participant's Account (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1010
Serial 110 (as modified by Form GAA-7471A) 1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all-times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective
annual rate of 0.75%, against the assets of VCA-10. To do so, the
result found in (b) is divided by $1.00 increased at the effective
annual rate of 0.75% for the number of calendar days in the period
from the end of the prior Business Day to the end of the current
Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
This section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (10)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant to a
resolution adopted by its Board of Directors. The resolution provides that this
account is to be used for contracts which state that certain payments and values
under them will vary to reflect the investment results of this account.
The investments held in VCA-11 are intended to be composed of high-grade money
market instruments. Prudential will invest and reinvest the assets held in
VCA-11 in accordance with the investment objectives and policies established for
it
The total value of the assets held in VCA-11 at all times will be at least equal
to the total reserve liability required by law for all payments or values which
vary in dollar amount to reflect the investment results of VCA-11. Assets held
in VCA-11 equal in value to that reserve liability will be held for the sole
benefit of all contracts which participate in VCA-11. The amount, if any, by
which the total value exceeds the total reserve liability will be subject to the
exclusive control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-11 and its other investment accounts as, in its judgment,
experience warrants. A transfer will not affect Prudential's contractual
liabilities under this contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one VCA-11
Unit for that Business Day. ("Business Day" means a day the New York Stock
Exchange is open for trading.) The initial VCA-11 Unit Value was $1.00. The
VCA-11 Unit Value for any subsequent Business Day is determined as of the end of
that Business Day by multiplying the VCA-11 Unit Change Factor for that Business
Day by the VCA-11 Unit Value for the immediately preceding Business Day. The
VCA-11 Unit Value for any day which is not a Business Day is equal to the VCA-11
Unit Value for the next Business Day. The VCA-11 Unit Value will go up or down
in accordance with the VCA-11 Unit Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential will
proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to contracts
of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management Fee
per $1.00 at the effective annual rate of 0.25% for the number of calendar
days in the period from the end of the prior Business Day to the end of the
current Business Day. The aggregate amount by which VCA-11 is reduced in
each year by the Investment Management Fee will be deducted from investment
income to the extent possible; any balance will be deducted from principal.
GVA-1010 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual rate
of 0.75%, against the assets of VCA-11. To do so, the result found in (b)
is divided by $1.00 increased at the effective annual rate of 0.75% for the
number of calendar days in the period from the end of the prior Business
Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business Day.
Prudential may, upon notice to the Contract-Holder, change the basis for
determining the Unit Value. The changed basis would be one designed to maintain
a constant Unit Value, with investment results being reflected through the
number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11 Committee
(the "Committee"). The initial Committee members will be appointed by
Prudential. Thereafter, members will be elected by vote in which the
Contract-Holder will participate.
GVA-1010 (11)
Serial 210 2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
The Contract-Holder will notify Prudential when a withdrawal is to be made
from a Participant's Account pursuant to the Plan. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment will
normally be made within seven days of Prudential's receipt of the request
for it. However, it may be paid at a later day if permitted under the
Investment Company Act of 1940.
The amount paid to the Contract-Holder will be the dollar amount withdrawn
less the withdrawal charge determined from the following table and the
Annual Account Charge if it applies. The amount payable is also referred to
as the "Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
---------------------------------- ----------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an account was established for him under a
companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
The withdrawal charge is also deducted from a Participant's Account if an
annuity is purchased for him under this contract during the first 36 months
from the day an Account was established for him. The earlier of the days an
Account was established for him under this contract or under a companion
contract will be used in counting the 36 months.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to the Contract-Holder. The payment will be
made in one sum unless the Contract-Holder directs Prudential to purchase
an annuity for the Participant's beneficiary pursuant to the Plan. However,
the Contract-Holder will retain all rights with respect to the annuity.
Proof of the Participant's death must be received by Prudential before any
payment will be made.
GVA-1010
Serial 300 3.1-3.2
<PAGE>
9/84
The annuity form may be any of those described in section 4.4. No
contributions may be made to the Account after the Participant's death.
If a one sum payment is made on the plan beneficiary's behalf within one
year of the Participant's death, it will be at least equal to the
contributions made for him under this contract less any withdrawals and
transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
The Contract-Holder may transfer, pursuant to the Plan, an amount from a
Participant's Account to an Account maintained for him under a companion
contract. The minimum withdrawal to provide a transfer is $500, or the
dollar value of his Account if smaller. The transfer will normally be made
within seven days of Prudential's receipt of the request for it. Section
3.1 does not apply to a withdrawal for this purpose. Transfers are deemed
to be made first from the contributions paid for the Participant.
Investment income is transferred when there are no longer any contributions
in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any portion of the amount transferred
which is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder, limit the frequency of
transfers. This action will take effect on the date of the notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Contract-Holder may transfer, pursuant to the request of a Participant,
the Withdrawal Value of the Participant's Account to an annuity contract
issued to the Contract-Holder which meets the conditions of Section 457 of
the Federal Internal Revenue Code and is provided by another financial
institution. The transfer may be made directly to that institution or by a
payment (or payments) to the Contract-Holder who then makes payment to the
institution. The transfer will normally be made within seven days after
Prudential's receipt of the transfer request.
The transfer will be a full settlement of Prudential's liability for the
Participant's Account.
GVA-1010
Serial 310 (as modified by Form GAA-7471A) 3.3-3.4
<PAGE>
9/84
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
All Participants' Accounts will be cancelled as of the Transfer Date.
A single liquidation account will be established equal to the sum of
the Withdrawal Values expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
(c) Upon Notice by Prudential:
If contributions are discontinued for all Participants pursuant to
section 6.2, Prudential may notify the Contract-Holder that transfer
payments will be made to the Contract-Holder or to a funding agent
named by the Contract-Holder. Prudential would do this if the
contributions are discontinued due to certain circumstances, such as a
change in any law or regulation, which in Prudential's judgment would
have an adverse effect on Prudential in fulfilling the terms of this
contract. In that case,
a Transfer Date will be established,
Participants' Accounts will be cancelled and a liquidation
account established, and
the transfer will be made in the same manner as described in
section 3.4(b).
This section may be changed as provided in section 5.1.
GVA-1010
Serial 320 (as modified by Form GAA-7471A) 3.4
<PAGE>
9/84
Provision IV. ANNUITIES:
4.1 ANNUITIES:
Whenever a benefit with respect to a Participant's Account is payable in a
series of payments pursuant to the Plan, with the dollar amount of each
payment being determined as of the date payments begin, the Contract-Holder
will notify Prudential to have the Participant's Account applied to
purchase an annuity for him. However, the Contract-Holder will retain all
rights with respect to the annuity. The Withdrawal Value of the Account
will be applied if the purchase is made during the first 36 months from the
day an Account was established for him. The earlier of the days an Account
was established for him under this contract or under a companion contract
will be used in counting the 36 months. If the purchase is made after the
36 months, the dollar value of the Account will be applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
The Contract-Holder may notify Prudential that only a portion of the
Participant's Account is to be applied to purchase an annuity with the
balance to be paid in a single sum. The first portion will be subject to
section 4.1 and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Contract-Holder. The Annual Account Charge
will be made only if no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life Contingent, or Life - Payment
Certain Contingent annuity. A Payment Certain form of annuity may be
payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-1010
Serial 400 (as modified by Form GAA-7471A) 4.1-4.4
<PAGE>
9/84
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
4.5 CONTRACT-HOLDER AS PAYEE - PRUDENTIAL AS AGENT:
Every payment with respect to any annuity will be paid to the
Contract-Holder. The Contract-Holder will notify Prudential forthwith of
the death of any Annuitant and Contingent Annuitant. The Contract-Holder
will reimburse Prudential for any payments made by Prudential which are in
excess of those provided by the annuity for the Annuitant.
However, the Contract-Holder may request Prudential to act as its agent for
the purpose of making payments to Annuitants, Contingent Annuitants, and
their beneficiaries. If Prudential assents to the request, it will make
payments to the persons rather than to the Contract-Holder. The
Contract-Holder may terminate this agency relationship at any time upon 45
days' advance notice to Prudential. Thereafter payments will be made to
the Contract-Holder.
GVA/GAA-1010/7211-82
Serial 410 (as modified by Forms GAA-7471A/7471) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1010
Serial 500 (as modified by Form GAA-7471A) 5.1-5.3
<PAGE>
9/84
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) when the Plan terminates,
(c) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give effect under this contract (see section
7.6), or
(d) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts. (This includes the
initiation of transfer payments as described in section 3.4(c)).
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-1010/7211-82
Serial 600 (as modified by Forms GAA-7471A/7471) 6.1-6.3
<PAGE>
9/84
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential at its office located at 71 Hanover Road,
Florham Park, New Jersey 07932, or at such other address as it may
communicate to the Contract-Holder. All communications to any other person
or organization dealing with Prudential will be addressed to that person or
organization at the last address of record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1010/7211-82
Serial 700 (as modified by Forms GAA-7471A/7471) 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 PLAN CHANGES:
This contract applies to the terms of the Plan in effect on the Effective
Date and to each Plan change. However, Prudential may, within 60 days after
its receipt of a copy of any Plan change, notify the Contract-Holder that
Prudential is unable or unwilling to give effect under this contract to the
change. Prudential would do this if the change might have an adverse effect
on Prudential in fulfilling the terms of the contract. This would be
determined based on Prudential's underwriting principles then in effect.
The Contract-Holder will furnish Prudential a copy of the Plan and, while
this contract is active, a copy of each Plan change at least 60 days before
it is to become effective.
GVA/GAA-1010/7211-82
Serial 710 (as modified by Forms GAA-7471A/7471) 7.4-7.6
<PAGE>
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1010/7211-82
Serial 720 7.7-7.8
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
----------------------- -------------------
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown
in the following schedules for annuities purchased during any period
specified by Prudential. Annuity purchase rates for other forms of annuity
consented to by Prudential will be furnished on request. The following
schedules may be changed as provided in section 5.1.
GVA/GAA-1010/7211-82
Serial A-100 (as modified by Forms GAA-7471A/7471) Schedule A
<PAGE>
1/86
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1986 1987 1990 1995
- --- ---- ---- ---- ----
60 $57.38 $57.14 $45.67 $44.50
65 63.66 63.35 52.03 50.59
70 71.31 70.95 59.88 58.17
SCHEDULE C - Life - Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
--------------------------------------------------------------
Age 1986 1987 1990 1995
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.60 $47.44 $36.06 $35.31
65 51.52 51.31 40.07 39.10
70 57.11 56.83 45.62 44.32
If specified percentage to Contingent Annuitant is 50%:
60 $50.75 $50.56 $38.89 $38.00
65 55.67 55.42 43.77 42.10
70 62.59 62.25 50.47 48.92
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments certain 1986 1987 1990 1995
- ---------------- ---- ---- ---- ----
60 $178.03 $177.84 $165.62 $164.73
120 101.91 101.80 88.93 88.45
180 77.23 77.14 63.55 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1010/7211-82
Serial S-100 (as modified by Forms GAA-7471A/7471) Schedules B-D
VCA-11
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder: Plan:
- -------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- -------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- -------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: President /s/ Joseph J. Melone
----------------------------
Title:
Date: Secretary /s/ Isabelle L. Kirchner
--------------------------
Attest
-------------------
Date:
--------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED
IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1010
19081
<PAGE>
9/84
TABLE OF CONTENTS
Serial Page
Provision
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.2 Contributions. . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . 100
1.4 Reports. . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-11 (VCA-11). . . . . . . . . . . . . . 200
2.2 VCA-11 Unit Value. . . . . . . . . . . . . . . . 200
2.3 VCA-11 Committee . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Withdrawals. . . . . . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . 300
3.3 Transfers Between Related Contracts. . . . . . . 310
3.4 Transfers to Another Funding Agent . . . . . . . 310
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . . . 400
4.3 Small Annuities and Accounts . . . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . . . 400
4.5 Contract-Holder as Payee - Prudential as Agent . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . 500
5.3 Persons Empowered to Act for Prudential. . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under this
Contract . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . 710
7.6 Plan Changes . . . . . . . . . . . . . . . . . . 710
7.7 Divisible Surplus. . . . . . . . . . . . . . . . 720
7.8 Entire Contract -- Construction . . . . . . . . 720
GVA-1010
TC-100 (11)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Serial Page
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased. . A-100
Schedule B Life - Payment Certain Annuity . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . S-100
GVA/GAA-1010/7211-82
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the amounts of his compensation deferred pursuant to
the Plan and directed for payment hereunder. Contributions will be
transmitted by the Contract-Holder. A Participant is a person for whom
contributions have been paid under this contract and whose
Participant's Account (see section 1.2) has not been cancelled.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution by the Contract-Holder on a
Participant's behalf if permitted by the Plan. Prudential may require
proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. (The term "Participant's
Account" is not meant to confer on the Participant any rights to his
Account except as specifically provided in the Plan.) This Account is
expressed in Units of the separate investment account described in section
2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
The Account is subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
GVA-1010
Serial 100 1.1-1.3
<PAGE>
5/87
The Annual Account Charge is $20.
An Account may be established for the Participant in connection with the
Plan under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
withdrawal from the Participant's Account (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1010
Serial 110 (as modified by Form GAA-7471A) 1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
This section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (10)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
The Contract-Holder will notify Prudential when a withdrawal is to be made
from a Participant's Account pursuant to the Plan. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment will
normally be made within seven days of Prudential's receipt of a duly
completed request for it. However, it may be paid at a later day if
permitted under the Investment Company Act of 1940.
The amount paid to the Contract-Holder will be the dollar amount withdrawn
less the withdrawal charge determined from the following table and the
Annual Account Charge if it applies. The amount payable is also referred to
as the "Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
Companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement pursuant
to the terms of the Plan.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts have been
cancelled, the dollar value will be paid to the Contract-Holder. The
payment will be made in one sum unless the Contract-Holder directs
Prudential to purchase an annuity for the Participant's beneficiary
pursuant to the Plan. However, the Contract-Holder will retain all rights
with respect to the annuity. Proof of the Participant's death must be
received by Prudential before any payment will be made.
GVA-1010
Serial 300 3.1-3.2
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder, change the basis for
determining the Unit Value. The changed basis would be one designed to
maintain a constant Unit Value, with investment results being reflected
through the number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (11)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
The Contract-Holder will notify Prudential when a withdrawal is to be made
from a Participant's Account pursuant to the Plan. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment will
normally be made within seven days of Prudential's receipt of a duly
completed request for it. However, it may be paid at a later day if
permitted under the Investment Company Act of 1940.
The amount paid to the Contract-Holder will be the dollar amount withdrawn
less the withdrawal charge determined from the following table and the
Annual Account Charge if it applies. The amount payable is also referred to
as the "Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement pursuant
to the terms of the Plan.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts have been
cancelled, the dollar value will be paid to the Contract-Holder. The
payment will be made in one sum unless the Contract-Holder directs
Prudential to purchase an annuity for the Participant's beneficiary
pursuant to the Plan. However, the Contract-Holder will retain all rights
with respect to the annuity. Proof of the Participant's death must be
received by Prudential before any payment will be made.
GVA-1010
Serial 300 3.1-3.2
<PAGE>
5/87
The annuity form may be any of those described in section 4.4. No
contributions may be made to the Account after the Participant's death.
If a one sum payment is made on the Plan beneficiary's behalf within one
year of the Participant's death, it will be at least equal to the
contributions made for him under this contract less any withdrawals and
transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
The Contract-Holder may transfer, pursuant to the Plan, an amount from a
Participant's Account to an Account maintained for him under a companion
contract. The minimum withdrawal to provide a transfer is $500, or the
dollar value of his Account if smaller. The transfer will normally be made
within seven days of Prudential's receipt of a duly completed request for
it. Section 3.1 does not apply to a withdrawal for this purpose. Transfers
are deemed to be made first from the contributions paid for the
Participant. Investment income is transferred when there are no longer any
contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any portion of the amount transferred
which is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder, limit the frequency of
transfers. This action will take effect on the date of the notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Contract-Holder may transfer, pursuant to the request of a
Participant, the Withdrawal Value of the Participant's Account to an
annuity contract issued to the Contract-Holder which meets the
conditions of Section 457 of the Federal Internal Revenue Code and is
provided by another financial institution. The transfer may be made
directly to that institution or by a payment (or payments) to the
Contract-Holder who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
GVA-1010
Serial 310 (as modified by Form GAA-7471A) 3.3-3.4
<PAGE>
9/84
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
All Participants' Accounts will be cancelled as of the Transfer Date.
A single liquidation account will be established equal to the sum of
the Withdrawal Values expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
(c) Upon Notice by Prudential:
If contributions are discontinued for all Participants pursuant to
section 6.2, Prudential may notify the Contract-Holder that transfer
payments will be made to the Contract-Holder or to a funding agent
named by the Contract-Holder. Prudential would do this if the
contributions are discontinued due to certain circumstances, such as a
change in any law or regulation, which in Prudential's judgment would
have an adverse effect on Prudential in fulfilling the terms of this
contract. In that case,
a Transfer Date will be established,
Participants' Accounts will be cancelled and a liquidation
account established, and
the transfer will be made
in the same manner as described in section 3.4(b).
This section may be changed as provided in section 5.1.
GVA-1010
Serial 320 (as modified by Form GAA-7471A) 3.4
<PAGE>
5/87
Provision IV. ANNUITIES:
4.1 ANNUITIES:
Whenever a benefit with respect to a Participant's Account is Payable in a
series of payments pursuant to the Plan, with the dollar amount each
payment being determined as of the date payments begin, the Contract-Holder
will notify Prudential to have the Participant's Account applied to
purchase an annuity for him. However, the Contract-Holder will retain all
rights with respect to the annuity. The dollar value of the Account will be
applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of any annuity is determined from the
schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION;
The Contract-Holder may notify Prudential that only a portion of the
Participant's Account is to be applied to purchase an annuity with the
balance to be paid in a single sum. The first portion will be subject to
section 4.1 and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Contract-Holder. The Annual Account Charge
will be made only if no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES;
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or
Life - Payment Certain Contingent annuity. A Payment Certain form of
annuity may be payable for a period less than the lifetime of the person
for whom the annuity was purchased. The terms of payment of each form of
annuity are described below.
GVA-1010
Serial 400 (as modified by Form GAA-7471A) 4.1.-4.4
<PAGE>
9/84
(a) Life Form of Annuity:
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
4.5 CONTRACT-HOLDER AS PAYEE - PRUDENTIAL AS AGENT:
Every payment with respect to any annuity will be paid to the
Contract-Holder. The Contract-Holder will notify Prudential forthwith of
the death of any Annuitant and Contingent Annuitant. The Contract-Holder
will reimburse Prudential for any payments made by Prudential which are in
excess of those provided by the annuity for the Annuitant.
However, the Contract-Holder may request Prudential to act as its agent for
the purpose of making payments to Annuitants, Contingent Annuitants, and
their beneficiaries. If Prudential assents to the request, it will make
payments to the persons rather than to the Contract-Holder. The
Contract-Holder may terminate this agency relationship at any time upon 45
days' advance notice to Prudential. Thereafter payments will be made to
the Contract-Holder.
GVA/GAA-1010/7211-82
Serial 410 (as modified by Forms GAA-7471A/7471) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will
apply only to amounts added to Participants' Accounts on and after the
date the change takes effect. Any other change will apply to amounts
in Participants' Accounts whether added before or on and after the
date the change takes effect. Any change in the schedules of annuity
purchase rates will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving
notice to the Contract-Holder at least 90 days before the date on
which the change is to take effect.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1010
Serial 500 (as modified by Form GAA-7471A) 5.1-5.3
<PAGE>
9/84
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) when the Plan terminates,
(c) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give effect under this contract (see section
7.6), or
(d) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts. (This includes the
initiation of transfer payments as described in section 3.4(c)).
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-1010/7211-82
Serial 600 (as modified by Forms GAA-7471A/7471) 6.1-6.3
<PAGE>
5/87
Provision VII. GENERAL TERMS:
7.1 CONTRACT HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1010/7211-82
Serial 700 (as modified by Forms GAA-7471A/7471 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 PLAN CHANGES:
This contract applies to the terms of the Plan in effect on the Effective
Date and to each Plan change. However, Prudential may, within 60 days after
its receipt of a copy of any Plan change, notify the Contract-Holder that
Prudential is unable or unwilling to give effect under this contract to the
change. Prudential would do this if the change might have an adverse effect
on Prudential in fulfilling the terms of the contract. This would be
determined based on Prudential's underwriting principles then in effect.
The Contract-Holder will furnish Prudential a copy of the Plan and, while
this contract is active, a copy of each Plan change at least 60 days before
it is to become effective.
GVA/GAA-1010/7211-82
Serial 710 (as modified by Forms GAA-7471A/7471) 7.4-7.6
<PAGE>
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA - 1010/7211-82
Serial 720 7.7-7.8
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
FORM OF PAYMENT PAYABLE APPLICABLE SCHEDULE
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for al allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GAA-1010/7211-82
Serial A-100 (as modified by Forms GAA-7471A/7471) Schedule A
<PAGE>
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age
- --- --- --- ---
60
65
70
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is Purchased is in
Age
- --- --- --- --- ---
If specified percentage to Contingent Annuitant is 100%:
60
65
70
If specified percentage to Contingent Annuitant is 50%:
60
65
70
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain
- ---------------- --- --- --- ---
60
120
180
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1010/7211-82
Serial S-100 (as modified by Forms GAA-7471A/7471) Schedules B-D
THE PRUDENTIAL [Logo] THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with
and subject to its terms.
Contract-Holder: Plan:
- -------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- -------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- -------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
-----------------------------
Title: President /s/
Date: Secretary /s/
---------------------------
Attest
--------------------
Date:
---------------
Group Annuity Contract providing for contributions on account of
Participants. Annual determination of participation in divisible surplus.
All subject to the provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
19081-A
GVA-1010
<PAGE>
9/84
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.2 Contributions. . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . . . . . . 100
1.4 Reports. . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Withdrawals. . . . . . . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts. . . . . . . . 310
3.4 Transfers to Another Funding Agent . . . . . . . . 310
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination . . . . . 400
4.3 Small Annuities and Accounts . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . . . . . . 400
4.5 Contract-Holder as Payee - Prudential as Agent . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under this
Contract . . . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . . . . . . 710
7.6 Plan Changes . . . . . . . . . . . . . . . . . . . 710
7.7 Divisible Surplus. . . . . . . . . . . . . . . . . 720
7.8 Entire Contract -- Construction . . . . . . . . . 720
GVA-1010
TC-100 (10)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
SCHEDULES Serial Page
Schedule A Forms of Annuity Which May Be Purchased. . . A-100
Schedule B Life - Payment Certain Annuity . . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . . S-100
GVA/GAA-1010/7211-82
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the amounts of his compensation deferred pursuant to
the Plan and directed for payment hereunder. Contributions will be
transmitted by the Contract-Holder. A Participant is a person for whom
contributions have been paid under this contract and whose
Participant's Account (see section 1.2) has not been cancelled.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution by the Contract-Holder on a
Participant's behalf if permitted by the Plan. Prudential may require
proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. (The term "Participant's
Account" is not meant to confer on the Participant any rights to his
Account except as specifically provided in the Plan.) This Account is
expressed in Units of the separate investment account described in section
2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
The Account is subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
GVA-1010
Serial 100 1.1-1.3
<PAGE>
5/87
The Annual Account Charge is $20.
An Account may be established for the Participant in connection with the
Plan under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
withdrawal from the Participant's Account (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1010
Serial 110 (as modified by Form GAA-7471A) 1.4
<PAGE>
Provisions II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will notify
the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (10) (as modified by GAA-7664)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the annual rate of
0.75%, against the assets of VCA-ll. To do so, the result found in (b)
is divided by $1.00 increased at the effective annual rate of 0.75%
for the number of calendar days in the period from the end of the
prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-ll Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder, change the basis for
determining the Unit Value. The changed basis would be one designed to
maintain a constant Unit Value, with investment results being reflected
through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-ll Account. Prudential will notify
the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1.
2.3 VCA-ll COMMITTEE:
The operation of VCA-ll will be supervised by The Prudential VCA-ll
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (11) (as modified by GAA-7664)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
The Contract-Holder will notify Prudential when a withdrawal is to be made
from a Participant's Account pursuant to the Plan. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment will
normally be made within seven days of Prudential's receipt of a duly
completed request for it. However, it may be paid at a later day if
permitted under the Investment Company Act of 1940.
The amount paid to the Contract-Holder will be the dollar amount withdrawn
less the withdrawal charge determined from the following table and the
Annual Account Charge if it applies. The amount payable is also referred to
as the "Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement pursuant
to the terms of the Plan.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts have been
cancelled, the dollar value will be paid to the Contract-Holder. The
payment will be made in one sum unless the Contract-Holder directs
Prudential to purchase an annuity for the Participant's beneficiary
pursuant to the Plan. However, the Contract-Holder will retain all rights
with respect to the annuity. Proof of the Participant's death must be
received by Prudential before any payment will be made.
GVA-1010
Serial 300 3.1-3.2
<PAGE>
5/87
The annuity form may be any of those described in section 4.4. No
contributions may be made to the Account after the Participant's death.
If a one sum payment is made on the Plan beneficiary's behalf within one
year of the Participant's death, it will be at least equal to the
contributions made for him under this contract less any withdrawals and
transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
The Contract-Holder may transfer, pursuant to the Plan, an amount from a
Participant's Account to an Account maintained for him under a companion
contract. The minimum withdrawal to provide a transfer is $500, or the
dollar value of his Account if smaller. The transfer will normally be made
within seven days of Prudential's receipt of a duly completed request for
it. Section 3.1 does not apply to a withdrawal for this purpose. Transfers
are deemed to be made first from the contributions paid for the
Participant. Investment income is transferred when there are no longer any
contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any portion of the amount transferred
which is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder, limit the frequency of
transfers. This action will take effect on the date of the notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Contract-Holder may transfer, pursuant to the request of a
Participant, the Withdrawal Value of the Participant's Account to an
annuity contract issued to the Contract-Holder which meets the _
conditions of Section 457 of the Federal Internal Revenue Code and is
provided by another financial institution. The transfer may be made
directly to that institution or by a payment (or payments) to the
Contract-Holder who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
GVA-1010
Serial 310 (as modified by Form GAA-7471A) 3.3-3.4
<PAGE>
9/84
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
All Participant's Accounts will be cancelled as of the Transfer Date.
A single liquidation account will be established equal to the sum of
the Withdrawal Values expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
(c) Upon Notice by Prudential:
If contributions are discontinued for all Participants pursuant to
section 6.2, Prudential may notify the Contract-Holder that transfer
payments will be made to the Contract-Holder or to a funding agent
named by the Contract-Holder. Prudential would do this if the
contributions are discontinued due to certain circumstances, such as a
change in any law or regulation, which in Prudential's judgment would
have an adverse effect on Prudential in fulfilling the terms of this
contract. In that case,
a Transfer Date will be established,
Participants' Accounts will be cancelled and a liquidation
account established, and
the transfer will be made
in the same manner as described in section 3.4(b).
This section may be changed as provided in section 5.1.
GVA-1010
Serial 320 (as modified by Form GAA-7471A) 3.4
<PAGE>
5/87
Provision IV. ANNUITIES:
4.1 ANNUITIES:
Whenever a benefit with respect to a Participant's Account is payable in a
series of payments pursuant to the Plan, with the dollar amount of each
payment being determined as of the date payments begin, the Contract-Holder
will notify Prudential to have the Participant's Account applied to
purchase an annuity for him. However, the Contract-Holder will retain all
rights with respect to the annuity. The dollar value of the Account will be
applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of annuity is determined from the schedule
of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
The Contract-Holder may notify Prudential that only a portion of the
Participant's Account is to be applied to purchase an annuity with the
balance to be paid in a single sum. The first portion will be subject to
section 4.1 and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Contract-Holder. The Annual Account Charge
will be made only if no Account remains for him under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life Payment Certain, Life - Contingent, or Life - Payment
Certain Contingent annuity. A Payment Certain form of annuity may be
payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-1010
Serial 400 (as modified by Form GAA-7471A) 4.1-4.4
<PAGE>
9/84
(a) Life Form of Annuity
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annutiant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
4.5 CONTRACT-HOLDER AS PAYEE - PRUDENTIAL AS AGENT:
Every payment with respect to any annuity will be paid to the Contract-
Holder. The Contract-Holder will notify Prudential forthwith of the death
of any Annuitant and Contingent Annuitant. The Contract-Holder will
reimburse Prudential for any payments made by Prudential which are in
excess of those provided by the annuity for the Annuitant.
However, the Contract-Holder may request Prudential to act as its agent for
the purpose of making payments to Annuitants, Contingent Annuitants, and
their beneficiaries. If Prudential assents to the request, it will make
payments to the persons rather than to the Contract-Holder. The
Contract-Holder may terminate this agency relationship at any time upon 45
days' advance notice to Prudential. Thereafter payments will be made to
the Contract-Holder.
GVA/GAA-1010/7211-82
Serial 410 (as modified by Forms GAA-7471A/7471) 4.5
<PAGE>
9/84
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1010
Serial 500 (as modified by Form GAA-7471A) 5.1-5.3
<PAGE>
9/84
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) when the Plan terminates,
(c) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give effect under this contract (see section
7.6), or
(d) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts. (This includes the
initiation of transfer payments as described in section 3.4(c)).
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-1010/7211-82
Serial 600 (as modified by Forms GAA-7471A/7471) 6.1-6.3
<PAGE>
5/87
Provision VII. GENERAL TERMS:
7.1 CONTRACT HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at such
other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with Prudential
will be addressed to that person or organization at the last address of
record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1010/7211-82
Serial 700 (as modified by Forms GAA-7471A/7471) 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any other relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 PLAN CHANGES:
This contract applies to the terms of the Plan in effect on the Effective
Date and to each Plan change. However, Prudential may, within 60 days after
its receipt of a copy of any Plan change, notify the Contract-Holder that
Prudential is unable or unwilling to give effect under this contract to the
change. Prudential would do this if the change might have an adverse effect
on Prudential in fulfilling the terms of the contract. This would be
determined based on Prudential's underwriting principles then in effect.
The Contract-Holder will furnish Prudential a copy of the Plan and, while
this contract is active, a copy of each Plan change at least 60 days before
it is to become effective.
GVA/GAA-1010/7211-82
Serial 710 (as modified by Forms GAA-7471A/7471) 7.4-7.6
<PAGE>
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1010/7211-82
Serial 720 7.7-7.8
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
FORM OF PAYMENT PAYABLE APPLICABLE SCHEDULE
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown
in the following schedules for annuities purchased during any period
specified by Prudential. Annuity purchase rates for other forms of annuity
consented to by Prudential will be furnished on request. The following
schedules may be changed as provided in section 5.1.
GVA/GAA-1010/7211-82
Serial A-100 (as modified by Forms GAA-7471A/7471) Schedule A
<PAGE>
1/88
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
60 $52.94 $41.56 $40.58 $39.85
65 58.01 46.81 45.60 44.68
70 64.46 53.48 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.28 $36.06 $35.31 $34.78
65 51.11 40.07 39.10 38.39
70 56.56 45.62 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $50.36 $38.89 $38.00 $37.34
65 55.18 43.77 42.61 41.75
70 61.91 50.47 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain 1988 1990 1995 2000
- ---------------- ---- ---- ---- ----
60 $173.76 $165.62 $164.73 $164.73
120 97.43 88.93 88.45 88.45
180 72.47 63.55 63.20 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1010/7211-82
Serial S-100 Schedules B-D
THE PRUDENTIAL [Logo] THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with
and subject to its terms.
Contract-Holder: Plan:
- ----------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- ----------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- ----------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
----------------------------
Title: President /s/
Date: Secretary /s/
--------------------------
Attest
----------------------
Date:
----------------------
Group Annuity Contract providing for contributions on account of
Participants. Annual determination of participation in divisible surplus.
All subject to the provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
GVA-1010
19081
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts. . . . . . . . . . . . . . . 100
1.3 Annual Account Charge . . . . . . . . . . . . . . . 100
1.4 Reports . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10) . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee. . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Withdrawals . . . . . . . . . . . . . . . . . . . . 300
3.2 Death Payments. . . . . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts . . . . . . . . 310
3.4 Transfers to Another Funding Agent. . . . . . . . . 320
IV. DISTRIBUTIONS
4.1 Distributions . . . . . . . . . . . . . . . . . . . 400
4.2 Small Annuities and Accounts. . . . . . . . . . . . 400
4.3 Terms of Payment of Annuities . . . . . . . . . . . 410
4.4 Contract-Holder as Payee - Prudential as Agent. . . 420
V. CHANGES
5.1 Changes by Prudential . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement. . . . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts. . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract . . . . . . . . . . . . . . . . . . 600
6.3 Termination of Contract . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder . . . . . . . . . . . . . . . . . . 700
7.2 Communications. . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . 700
7.4 Information -- Records. . . . . . . . . . . . . . . 710
7.5 Misstatements . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary . . . . . . . . . . . . . . . . . . . . 710
7.7 Divisible Surplus . . . . . . . . . . . . . . . . . 720
7.8 Entire Contract -- Construction . . . . . . . . . . 720
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
TC-100 (10)
<PAGE>
TABLE OF CONTENTS
(Continued)
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased. . . . . . A-100
Schedule B Life - Payment Certain Annuity . . . . . . . . . . S-100
Schedule C Life - Contingent Annuity. . . . . . . . . . . . . S-100
Schedule D Payment Certain Annuity. . . . . . . . . . . . . . S-100
GVA/GAA-1010/7211-82
TC-110
<PAGE>
Provision I CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the amounts of his compensation deferred pursuant to
the Plan and directed for payment hereunder. Contributions will be
transmitted by the Contract-Holder. A Participant is a person for whom
contributions have been paid under this contract and whose
Participant's Account (see section 1.2) has not been cancelled.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Transfer Contributions:
The following amounts may be transferred to and paid as a contribution
under the contract for a Participant:
(1) an amount which qualifies at a rollover contribution pursuant to
the Internal Revenue Code of 1986, as amended (the "Code"); or
(2) an amount which arises from a Participant's interest in another
eligible deferred compensation plan pursuant to Code Section
457(d)(10).
The Prudential may require proof that all amounts transferred to the
contract meet the requirements of the Code and any applicable Rulings
or Regulations issued by the Internal Revenue Service.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. (The term "Participant's
Account" is not meant to confer on the Participant any rights to his
Account except as specifically provided in the Plan.) This Account is
expressed in Units of the separate investment account described in section
2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
The Account is subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if the Participant's
Account is being cancelled on a January 1 to purchase an annuity for him
under this contract.
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 100 1.1-1.3
<PAGE>
The Annual Account Charge is $20.
An Account may be established for the Participant in connection with the
Plan under another group annuity contract issued to the Contract-Holder by
Prudential (a "companion contract"). If so, the total Annual Account Charge
that applies to all his Accounts will not exceed $20. This charge will be
shared among his Accounts as Prudential determines. Also, no charge will be
withdrawn from his Account under this contract when it is cancelled unless
no amounts remain in an Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
withdrawal from the Participant's Account (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1010 (as modified by Form GAA-7471A)
Serial 110 1.3-1.4
<PAGE>
Provisions II INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at effective annual rate
of 0.75%, against the assets of VCA-10. To do so, the result found in
(b) is divided by $1.00 increased at effective annual rate of 0.75%
for the number of calendar days in the period from the end of the
prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will notify
the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (10) (as modified by GAA-7664)
Serial 210 2.2-2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 The Prudential Variable Contract Account - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-1010 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at effective annual rate of
0.75% for the number of calendar days in the period from the end of
the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder, change the basis for
determining the Unit Value. The changed basis would be one designed to
maintain a constant Unit Value, with investment results being reflected
through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-11 Account. Prudential will notify
the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (11) (as modified by GAA-7664)
Serial 210 2.2-2.3
<PAGE>
Provision III WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
The Contract-Holder will notify Prudential when a withdrawal is to be made
from a Participant's Account pursuant to the Plan. The minimum withdrawal
is $500, or the dollar value of his Account if smaller. Payment will
normally be made within seven days of Prudential's receipt of a duly
completed request for it. However, it may be paid at a later day if
permitted under the Investment Company Act of 1940.
The amount paid to the Contract-Holder will be the dollar amount withdrawn
less the withdrawal charge determined from the following table and the
Annual Account Charge if it applies. The amount payable is also referred to
as the "Withdrawal Value."
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
-------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the withdrawal
is made for reasons of Financial Hardship or Disability Retirement pursuant
to the terms of the Plan.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to the Contract-Holder on behalf of the
Participant's Beneficiary. Proof of the Participant's death must be
received by Prudential before any payment will be made. Death benefits
payable under the contract on behalf of the Participant's Beneficiary prior
to the date on which distributions have commenced for the Participant
pursuant to section 4.1 of the contract, will be paid as
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 300 3.1-3.2
<PAGE>
set forth in this Section 3.2. Death benefits payable under the contract on
behalf of the Participant's Beneficiary on or after distributions have
commenced for the Participant pursuant to section 4.1 will be paid as set
forth in section 4.1.
The Beneficiary may elect payment in any of the following forms, unless the
Participant has directed otherwise or unless the Plan provides otherwise:
(a) a lump sum;
(b) an annuity form described in section 4.3, other than one which
provides for payment after the death of the Annuitant to a Contingent
Annuitant;
(c) Any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan; or
(d) a combination of all or any two of (a), (b) and (c) above.
All payments made pursuant to this section 3.2 will be made to the
Contract-Holder, except as otherwise provided in section 4.4 of the
contract. In addition, the Contract-Holder shall retain all rights with
respect to any annuity purchased on behalf of a Beneficiary.
If a lump sum payment is made on the Beneficiary's behalf within one year
of the Participant's death, it will be at least equal to the contributions
made for the Participant under this contact less any withdrawals and
transfers.
Any form of distribution paid pursuant to his section 3.2 will meet the
requirements of Code Sections 401(a)(9) and 457(d) and the Regulations
issued thereunder.
If payments on behalf of a Participant's Beneficiary are to start at a
future date, all or an appropriate portion of the Participant's Account
will be maintained in accordance with the Beneficiary's election in the
same manner as for the Participant. No contributions will be made to an
Account hereunder after the Participant's death.
As of the first day no amounts remain in the Participant's Account or in an
Account with respect to the Participant under a companion contract, the
Participant's Account is cancelled Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
The Contract-Holder may transfer, pursuant to the Plan, an amount from a
Participant's Account to an Account maintained for him under a companion
contract. The minimum withdrawal to provide a transfer is $500, or the
dollar value of his Account if smaller. The transfer will normally be
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 310 3.2-3.3
<PAGE>
made within seven days of Prudential's receipt of a duly completed request
for it. Section 3.1 does not apply to a withdrawal for this purpose.
Transfers are deemed to be made first from the contributions paid for the
Participant. Investment income is transferred when there are no longer any
contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any portion of the amount transferred
which is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder, limit the frequency of
transfers. This action will take effect on the date of the notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) Total Transfers at the Request of a Participant:
The Contract-Holder may transfer, pursuant to the request of a
Participant, the Withdrawal Value of the Participant's Account to an
annuity contract issued to the Contract-Holder which meets the
conditions of Section 457 of the Federal Internal Revenue Code and is
provided by another financial institution. The transfer may be made
directly to that institution or by a payment (or payments) to the
Contract-Holder who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
(b) Partial Transfers at the Request of a Participant:
The Contract-Holder may transfer, pursuant to the request of a
Participant, a portion of the Participant's Account to another
financial institution, if such transfer is permitted by the terms of
the Plan. The minimum withdrawal to provide a transfer is $500, or the
dollar value of the Participant's Account, if smaller.
The transfer will normally be made within seven days of a duly
completed request for it.
Prudential may, upon notice to the Contract-Holder and Participants
limit the frequency of transfers. This action will take effect on the
date of the notice.
Any transfer amount will be subject to the provisions of section 3.1
relating to withdrawal charges.
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 320 3.3-3.4
<PAGE>
(c) Total Transfers at the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
All Participant's Accounts will be cancelled as of the Transfer Date.
A single liquidation account will be established equal to the sum of
the Withdrawal Values expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
(d) Upon Notice by Prudential:
If contributions are discontinued for all Participants pursuant to
section 6.2, Prudential may notify the Contract-Holder that transfer
payments will be made to the Contract-Holder or to a funding agent
named by the Contract-Holder. Prudential would do this if the
contributions are discontinued due to certain circumstances, such as a
change in any law or regulation, which in Prudential's judgment would
have an adverse effect on Prudential in fulfilling the terms of this
contract. In that case,
a Transfer Date will be established,
Participants' Accounts will be cancelled and a liquidation
account established, and
the transfer will be made
in the same manner as described in section 3.4(c).
This section may be changed as provided in section 5.1.
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 330 3.4
<PAGE>
Provision IV. DISTRIBUTIONS:
4.1 ANNUITIES:
A Participant may, in accordance with the terms of the Plan, elect to
receive a distribution of the dollar value of his Account under the
contract in any of the following forms:
(a) a lump sum;
(b) an annuity form described in section 4.3;
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan; or
(d) a combination of all or any two of (a), (b) and (c) above.
Any portion of a Participant's Account which is payable as a lump sum will
be subject to the provisions of section 3.1 relating to withdrawal charges.
Payment becoming due to the Beneficiary of a Participant for whom a
distribution commenced pursuant to paragraph (c) will continue to be made
on behalf of the Beneficiary in the same amount and frequency as such
payments were made for the Participant until the Participant's Account is
exhausted, unless the Beneficiary elects a lump sum of the remaining
portion of the Participant's Account.
Payments becoming due to the Beneficiary of a Participant for whom an
annuity commenced pursuant to paragraph (b) will, unless the Participant
has directed otherwise, be paid as provided in section 4.3.
All payments made pursuant to this section 4.1 will be made to the
Contract-Holder, except as otherwise provided in section 4.4. In addition,
the Contract-Holder will retain all rights with respect to any annuity
purchased on behalf of a Participant.
Anything in the contract to the contrary notwithstanding, any payments made
on behalf of a Participant or Beneficiary in accordance with this section
4.1 will meet the requirements of Code Sections 401(a)(9) and 457(d) and
the Regulations issued thereunder.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.3.
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 400 4.1-4.2
<PAGE>
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Contract-Holder. The Annual Account Charge
will be made only if no Account remains for him under a companion contract.
4.3 TERMS OF PAYMENT OF ANNUITIES:
If a Participant elects an annuity pursuant to paragraph (b) of section
4.1, all or a portion of the dollar value of the Participant's Account, as
specified by the Participant, will be applied to purchase an annuity in
accordance with Schedule A. The monthly amount of annuity is determined
from the schedule of purchase rates for that annuity.
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other number
accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage
is established when the annuity is purchased and may be 33 1/3%, 50%,
66 2/3% or 100%, or any other percentage accepted by Prudential. Under
a Life - Payment Certain Contingent annuity, a percentage payment will
not take effect until the end of the selected Payment Certain period.
GVA-1010 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 410 4.2-4.3
<PAGE>
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
All annuities purchased under this contract will meet the requirements of
Code Sections 401(a)(9) and 457(d) and the Regulations issued thereunder.
4.4 CONTRACT-HOLDER AS PAYEE - PRUDENTIAL AS AGENT:
Every payment with respect to any annuity will be paid to the
Contract-Holder. The Contract-Holder will notify Prudential forthwith of
the death of any Annuitant and Contingent Annuitant. The Contract-Holder
will reimburse Prudential for any payments made by Prudential which are in
excess of those provided by the annuity for the Annuitant.
However, the Contract-Holder may request Prudential to act as its agent for
the purpose of making payments to Annuitants, Contingent Annuitants, and
their beneficiaries. If Prudential assents to the request, it will make
payments to the persons rather than to the Contract-Holder. The
Contract-Holder may terminate this agency relationship at any time upon 45
days' advance notice to Prudential. Thereafter payments will be made to the
Contract-Holder.
GVA/GAA-1010/7211-82 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 420 4.3-4.4
<PAGE>
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1010 (as modified by Form GAA-7471A)
Serial 500 5.1-5.3
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) when the Plan terminates,
(c) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give effect under this contract (see section
7.6), or
(d) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts. (This includes the
initiation of transfer payments as described in section 3.4(d).
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-1010/7211-82 (as modified by Group Annuity Amendment Form GAA-7792)
Serial 600 6.1-6.3
<PAGE>
11/89
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., Defined Contribution Programs, W.W. Scranton Office Park, 30
E.D. Preate Drive, Moosic, Pennsylvania 18507-1796, or at such other
address as it may communicate to the Contract-Holder. All communications to
any other person or organization dealing with Prudential will be addressed
to that person or organization at the last address of record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the--United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-1010/7211-82 (as modified by Forms GAA-7471A/7471)
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If any other relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 PLAN CHANGES:
This contract applies to the terms of the Plan in effect on the Effective
Date and to each Plan change. However, Prudential may, within 60 days after
its receipt of a copy of any Plan change, notify the Contract-Holder that
Prudential is unable or unwilling to give effect under this contract to the
change. Prudential would do this if the change might have an adverse effect
on Prudential in fulfilling the terms of the contract. This would be
determined based on Prudential's underwriting principles then in effect.
The Contract-Holder will furnish Prudential a copy of the Plan and, while
this contract is active, a copy of each Plan change at least 60 days before
it is to become effective.
GVA/GAA-1010/7211-82 (as modified by Forms GAA-7471A/7471)
Serial 710 7.4-7.6
<PAGE>
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA -1010/7211-82
Serial 720 7.7-7.8
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
----------------------- -------------------
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 2. Use Schedule C for allocation.
3. Payment Certain Annuity. 3. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GAA-1010/7211-82 (as modified by Forms GAA-7471A/7471)
Serial A-100 Schedule A
<PAGE>
1/90
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1990 1991 1995 2000
- --- ---- ---- ---- ----
60 $52.94 $41.36 $40.58 $39.85
65 57.51 46.57 45.60 44.68
70 63.85 53.19 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is Purchased is in:
--------------------------------------------------------------
Age 1990 1991 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $46.96 $35.91 $35.31 $34.78
65 50.70 39.88 39.10 38.39
70 56.00 45.36 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $49.99 $38.71 $38.00 $37.34
65 54.69 43.53 42.61 41.75
70 61.25 50.15 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
If date the annuity is purchased is in:
Number of
Payments Certain 1990 1991 1995 2000
- ---------------- ---- ---- ---- ----
60 $173.38 $165.44 $164.73 $164.73
120 97.22 88.83 88.45 88.45
180 72.32 63.48 63.20 63.20
* * * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1010/7211-82
Serial S-100 Schedules B-D
THE PRUDENTIAL [Logo] December 31, 1989
AMENDMENT TO BE ATTACHED TO AND MADE A PART OF
GROUP ANNUITY CONTRACTS
(the "Contracts")
ISSUED TO THE CONTRACT-HOLDER
BY
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(the "Prudential")
The Group Annuity Contracts provide that the Contracts may be amended by
agreement between the Contract-Holder and Prudential. Therefore, by mutual
agreement between the signatories below, the contract is hereby amended in the
following respects:
1. TRANSFER CONTRIBUTIONS: Effective January 1, 1987, the following amounts
may be transferred to and paid as a contribution under the Contracts for a
Participant:
(a) an amount which qualifies as a rollover contribution pursuant to the
Internal Revenue Code of 1986, as amended (the "Code"); or
(b) an amount which arises from a Participant's interest in another
eligible deferred compensation plan pursuant to Code Section
457(d)(10).
The Prudential may require proof that all amounts transferred to the
Contracts meet the requirements of the Code and any applicable Rulings or
Regulations issued by the Internal Revenue Service.
2. DEATH PAYMENTS: Effective January 1, 1987, death benefits payable under the
Contracts on behalf of the Participant's Beneficiary prior to the date on
which distributions have commenced for the Participant pursuant to item 4.
below, will be paid as set forth in this item 2. Death benefits payable
under the Contracts on behalf of the Participant's Beneficiary on or after
the date on which distributions have commenced for the Participant pursuant
to item 4. below will be paid as set forth in item 4. below.
The Beneficiary may elect payment in any of the following forms, unless the
Participant has directed otherwise or unless the Plan provides otherwise:
(a) a lump sum;
(b) an annuity form described in the Contracts, other than one which
provides for payment after the death of the Annuitant to a Contingent
Annuitant;
GAA-7792
19080
<PAGE>
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan; or
(d) a combination of all or any two of (a), (b) and (c) above.
All payments made pursuant to this item 2. will be made to the
Contract-Holder, except as otherwise provided in the Contracts. In
addition, the Contract-Holder shall retain all rights with respect to any
annuity purchased on behalf of the Beneficiary.
Any form of distribution paid pursuant to this item 2. will meet the
requirements of Code Sections 401(a)(9) and 457(d) and the Regulations
issued thereunder.
3. TRANSFERS TO ANOTHER FINANCIAL INSTITUTION: Effective January 1, 1987, the
Contract-Holder may transfer, pursuant to the request of a Participant, a
portion of such Participant's Account(s) to another financial institution,
if such transfer is permitted by the terms of the Plan. Such transfer will
be permitted on the same basis as partial transfers are permitted between
Related Contracts (i.e., companion contracts) under the Contracts, except
that any charges otherwise applicable to withdrawals under the Contracts
will apply to the amount elected for transfer.
4. DISTRIBUTIONS: Effective January 1, 1987, a Participant may, in accordance
with the terms of the Plan, elect to receive a distribution of his
Account(s) under the Contracts in any of the following forms:
(a) a lump sum;
(b) any annuity form described in the Contracts;
(c) any other settlement method to which Prudential consents and which is
not contrary to the terms of the Plan; or
(d) a combination of all or any two of (a), (b) and (c) above.
Any portion of a Participant's Account(s) which is payable as a lump sum
will be subject to the withdrawal provisions under the Contracts.
Payments becoming due to the Beneficiary of a Participant for whom a
distribution commenced pursuant to paragraph (c) will continue to be made
on behalf of the Beneficiary in the same amount and frequency as such
payments were being made for the Participant until the Participant's
Account is exhausted, unless the Beneficiary elects a lump sum payment of
the remaining portion of the Participant's Account.
Payments becoming due to the Beneficiary of a Participant for whom an
annuity commenced pursuant to paragraph (b) will, unless the Participant
has directed otherwise, be paid as provided under the terms of the annuity
as described in the Contracts.
GAA-7792 -2
<PAGE>
All payments made pursuant to this item 4. will be made to the
Contract-Holder, except as otherwise provided in the Contracts. In
addition, the Contract-Holder will retain all rights with respect to any
annuity purchased on behalf of a Participant.
Anything in the Contracts to the contrary notwithstanding, any payments
made on behalf of a Participant or Beneficiary in accordance with this item
4. will meet the requirements of Code Sections 401(a)(9) and 457(d) and the
Regulations issued thereunder.
5. ANNUITIES: Effective January 1, 1987, all annuities purchased under the
Contracts will meet the requirements of Code Sections 401(a)(9) and 457(d)
and the Regulations issued thereunder.
The purpose of this amendment is to meet the requirements of the federal
Internal Revenue Code as amended by the Tax Reform Act of 1986.
CONTRACT-HOLDER
Dated:________________________ By:___________________________________
Title:
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
Dated:________________________ By:____________________________________
Title:
VICE PRESIDENT, CONTRACTS
GAA - 7792 -3-
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
- ---------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- ---------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- ---------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
--------------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Isabelle L. Kirchner
------------------------------
Attest
-----------------------------
Date:
------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED
IN THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
GVA-110-82
19081
<PAGE>
TABLE OF CONTENTS
Provision Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions . . . . . . . . . . . . . . . . . . . 100
1.2 Participant's Accounts. . . . . . . . . . . . . . . 100
1.3 Annual Account Charge . . . . . . . . . . . . . . . 110
1.4 Reports . . . . . . . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10) . . . . . . . . . . . . . . . 200
2.2 VCA-10 Unit Value . . . . . . . . . . . . . . . . . 200
2.3 VCA-10 Committee. . . . . . . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Withdrawals . . . . . . . . . . . . . . . . . . . . 300
3.2 Death Payments. . . . . . . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts . . . . . . . . 310
3.4 Transfers to Another Funding Agent. . . . . . . . . 310
IV. ANNUITIES
4.1 Annuity Elections . . . . . . . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination. . . . . . 400
4.3 Small Annuities and Accounts. . . . . . . . . . . . 400
4.4 Terms of Payment of Annuities . . . . . . . . . . . 400
4.5 Payees. . . . . . . . . . . . . . . . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential . . . . . . . . . . . . . . . 500
5.2 Changes by Agreement. . . . . . . . . . . . . . . . 500
5.3 Changes to Conform to Law . . . . . . . . . . . . . 500
5.4 Persons Empowered to Act for Prudential . . . . . . 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts. . . . . . . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under this
Contract. . . . . . . . . . . . . . . . . . . . . 600
6.3 Discontinuance of Contributions for an
Employer. . . . . . . . . . . . . . . . . . . . . 600
6.4 Termination of Contract . . . . . . . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder . . . . . . . . . . . . . . . . . . 700
7.2 Communications. . . . . . . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . . . . . . 700
7.4 Information -- Records . . . . . . . . . . . . . . 710
7.5 Misstatements . . . . . . . . . . . . . . . . . . . 710
7.6 Beneficiary . . . . . . . . . . . . . . . . . . . . 710
GVA-110-82
TC-100 (10)
<PAGE>
TABLE OF CONTENTS
(Continued)
Provision Serial Page
7.7 Divisible Surplus . . . . . . . . . . . . . . . . . 720
7.8 Limit on Assignment . . . . . . . . . . . . . . . . 720
7.9 Certificates. . . . . . . . . . . . . . . . . . . . 720
7.10 Plan Changes. . . . . . . . . . . . . . . . . . . . 720
7.11 Entire Contract -- Construction . . . . . . . . . . 720
SCHEDULES
Schedule A Forms of Annuity Which May Be Purchased. . . . . . A-100
Schedule B Life Annuity . . . . . . . . . . . . . . . . . . S-100
Schedule C Life - Payment Certain Annuity . . . . . . . . . . S-100
Schedule D Life - Contingent Annuity. . . . . . . . . . . . . S-100
Schedule E Payment Certain Annuity. . . . . . . . . . . . . . S-100
GVA/GAA-110-82/2517-OE-82
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are the amounts contributed by or for him under the Plan.
Contributions will be transmitted by the Contract-Holder or the
employer. A Participant is a person for whom contributions have been
paid under this contract and whose Participant's Account (see section
1.2) has not been cancelled.
The "Plan" is the plan which is
(1) adopted by the Participant's employer,
(2) in the form of the Contract-Holder's Retirement Plan, and
(3) qualified under Section 401(a) of the Federal Internal Revenue
Code.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under
this contract as a contribution for a Participant if permitted by the
Plan. Prudential may require proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is expressed
in Units of the separate investment account described in section 2.1.
A number of Units will be added to the Participant's Account on each day a
contribution is received by Prudential for the Participant. This number is
determined by dividing the dollar amount of the contribution by the Unit
Value for the day the contribution is received (see section 2.2 for a
description of the Unit Value). A number of Units will be subtracted from
the Participant's Account on each day on which a withdrawal is made from
his Account. This number is equal to the number requested for withdrawal
or, if applicable, the number determined by dividing the dollar amount to
be withdrawn by the Unit Value for the day of withdrawal.
GVA-110-82
Serial 100 1.1-1.2
<PAGE>
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his Account
at the close of business on that day and the Unit Value for that day.
The Account is subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an amount
will be withdrawn from each Participant's Account equal to the Annual
Account Charge. Also, on any other day on which a Participant's Account is
cancelled, an amount will be withdrawn from his Account equal to the Annual
Account Charge. However, no Charge will be withdrawn if
(a) the Participant's Account is being cancelled on a January 1 to
purchase an annuity for him under this contract, or
(b) the Participant's employer pays amounts to cover the Charge for each
Participant covered under the Plan.
The Annual Account Charge is $12.
A Participant may have an Account for Plan contributions under another
group annuity contract issued to the Contract-Holder by Prudential (a
"companion contract"). If so, the total Annual Account Charge that applies
to all his Accounts will not exceed $12. This Charge will be shared among
his Accounts as Prudential determines. Also, no Charge will be withdrawn
from his Account under this contract when it is cancelled unless no amounts
remain in an Account for him under a companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential annually will furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-110-82
Serial 110 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be at
least equal to the total reserve liability required by law for all payments
or values which vary in dollar amount to reflect the investment results of
VCA-10. Assets held in VCA-10 equal in market value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-10. The amount, if any, by which the total market value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-10 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-10 Unit Value was
$1.00. The VCA-10 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-10 Unit Change
Factor for that Business Day by the VCA-10 Unit Value for the immediately
preceding Business Day. The VCA-10 Unit Value for any day which is not a
Business Day is equal to the VCA-10 Unit Value for the next Business Day.
The VCA-10 Unit Value will go up or down in accordance with the VCA-10 Unit
Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for that
Business Day, taking into account investment income and market value
changes after provision for any taxes applicable to contracts of this
class arising from the operation of VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-10 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-110-82 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-10. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that Business
Day.
This section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-110-82 (10)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established pursuant
to a resolution adopted by its Board of Directors. The resolution provides
that this account is to be used for contracts which state that certain
payments and values under them will vary to reflect the investment results
of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at least
equal to the total reserve liability required by law for all payments or
values which vary in dollar amount to reflect the investment results of
VCA-11. Assets held in VCA-11 equal in value to that reserve liability will
be held for the sole benefit of all contracts which participate in VCA-11.
The amount, if any, by which the total value exceeds the total reserve
liability will be subject to the exclusive control of Prudential. Thus,
Prudential may from time to time make transfers between VCA-11 and its
other investment accounts as, in its judgment, experience warrants. A
transfer will not affect Prudential's contractual liabilities under this
contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New York
Stock Exchange is open for trading.) The initial VCA-11 Unit Value was
$1.00. The VCA-11 Unit Value for any subsequent Business Day is determined
as of the end of that Business Day by multiplying the VCA-11 Unit Change
Factor for that Business Day by the VCA-11 Unit Value for the immediately
preceding Business Day. The VCA-11 Unit Value for any day which is not a
Business Day is equal to the VCA-11 Unit Value for the next Business Day.
The VCA-11 Unit Value will go up or down in accordance with the VCA-11 Unit
Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day, Prudential
will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for that
Business Day, taking into account investment income and changes in the
value of investments after provision for any taxes applicable to
contracts of this class arising from the operation of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment Management
Fee per $1.00 at the effective annual rate of 0.25% for the number of
calendar days in the period from the end of the prior Business Day to
the end of the current Business Day. The aggregate amount by which
VCA-11 is reduced in each year by the Investment Management Fee will
be deducted from investment income to the extent possible; any balance
will be deducted from principal.
GVA-110-82 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective annual
rate of 0.75%, against the assets of VCA-11. To do so, the result
found in (b) is divided by $1.00 increased at the effective annual
rate of 0.75% for the number of calendar days in the period from the
end of the prior Business Day to the end of the current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that Business
Day.
Prudential may, upon notice to the Contract-Holder and Participants, change
the basis for determining the Unit Value. The changed basis would be one
designed to maintain a constant Unit Value, with investment results being
reflected through the number of Units in Participants' Accounts.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-110-82 (11)
Serial 210 2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
Prudential may be notified when a withdrawal is to be made from a
Participant's Account pursuant to the Plan. The minimum withdrawal is $500,
or the dollar value of his Account if smaller. Payment to the Participant
will normally be made within seven days of Prudential's receipt of the
request for it. However, it may be paid at a later day if permitted under
the Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn less
the withdrawal charge determined from the following table and the Annual
Account Charge if it applies. The amount payable is also referred to as the
"Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
-------------------------------- ---------------------------
First 24 months $0.07
Next 36 months 0.06
Next 60 months 0.04
Next 60 months 0.03
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
The withdrawal charge is also deducted from a Participant's Account if an
annuity is purchased for him under this contract during the first 36 months
from the day an Account was established for him. The earlier of the days an
Account was established for him under this contract or under a companion
contract will be used in counting the 36 months.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Account has been cancelled,
the dollar value will be paid to his Beneficiary (see section 7.6). The
payment will be made in one sum unless the Participant has directed that an
annuity be purchased for the Beneficiary. Instead of a one sum payment, the
Beneficiary may elect to have the dollar value of the Participant's Account
applied to purchase an annuity. This election is subject to the terms of
the Plan. Proof of the Participant's death must be received by Prudential
before any payment will be made.
GVA-110-82
Serial 300 3.1-3.2
<PAGE>
The annuity form may be any of those described in section 4.4. If annuity
payments are to start at a future date, the Participant's Account will be
maintained for the Beneficiary in the same manner as for the Participant.
No contributions may be made to the Account after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
Prudential may be notified that a transfer permitted by the Plan is to be
made from a Participant's Account to an Account maintained for him under a
companion contract. The minimum withdrawal to provide a transfer is $500,
or the dollar value of his Account if smaller. The transfer will normally
be made within seven days of Prudential's receipt of his request for it.
Section 3.1 does not apply to a withdrawal for this purpose. Transfers are
deemed to be made first from the contributions paid for the Participant.
Investment income is transferred when there are no longer any contributions
in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any portion of the amount transferred
which is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder, limit the frequency of
transfers. This action will take effect on the date of the notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
All Participants' Accounts will be cancelled as of the Transfer Date.
A single liquidation account will be established equal to the sum of
the Withdrawal Values expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
GVA-110-82
Serial 310 3.3-3.4
<PAGE>
Instead of making the transfer payment in cash, Prudential may make
all or a part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
(b) For an Employer:
If contributions are discontinued for an employer's Participants, the
Contract-Holder may direct Prudential to make transfer payments to
another funding agent. Section 3.4(a) would then become operative for
those Participants as if they were the only ones covered under this
contract.
This section may be changed as provided in section 5.1.
GVA-110-82
Serial 320 3.4
<PAGE>
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
Prudential may be notified that a Participant has elected to have his
Participant's Account applied to purchase an annuity for him pursuant to
the Plan. The Withdrawal Value of the Account will be applied if the
purchase is made during the first 36 months from the day an Account was
established for him. The earlier of the days an Account was established for
him under this contract or under a companion contract will be used in
counting the 36 months. If the purchase is made after the 36 months, the
dollar value of the Account will be applied. The schedule of annuity
purchase rates that applies is determined from Schedule A. The monthly
amount of any annuity is determined from the schedule of purchase rates for
that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
If permitted by the Plan, a Participant may elect that only a portion of
his Participant's Account be applied to purchase an annuity with the
balance being paid in a single sum. The first portion will be subject to
section 4.1 and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid on the Participant's behalf to the
Contract-Holder unless it directs payment to a named financial institution.
The Annual Account Charge will be made only if no Account remains for him
under a companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity may also be any of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity:
The first monthly payment of ANY Life form of annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter throughout the Annuitant's
remaining lifetime. The last monthly payment is payable for the month
in which his death occurs.
GVA-110-82
Serial 400 4.1-4.4
<PAGE>
If the LIFE - PAYMENT CERTAIN form of annuity is payable, then, if the
Annuitant dies before the number of annuity payments made equals the
number of Payments Certain applicable to him, monthly annuity payments
will be continued until the total number of payments is so equal.
These continued annuity payments will each be in the same amount as
was payable to the Annuitant. The number of Payments Certain is
established when the annuity is purchased and may be 60, 120, 180,
240, or any other number accepted by Prudential.
If the LIFE - CONTINGENT ANNUITY form of annuity is payable, then, if
the Annuitant dies before the death of his Contingent Annuitant,
monthly Contingent Annuity payments will become payable. The first
payment of Contingent Annuity will be payable on the first day of the
month following the month in which the Annuitant's death occurs.
Monthly Contingent Annuity payments are payable on the first day of
each month thereafter throughout the Contingent Annuitant's remaining
lifetime. The last monthly payment is payable for the month in which
his death occurs. The amount of each monthly Contingent Annuity
payment will be a percentage of the monthly annuity payment payable
before the Annuitant's death. The percentage is established when the
annuity is purchased and may be 33 1/3%, 50%, 66 2/3% or 100%, or any
other percentage accepted by Prudential. Under a Life - Payment
Certain Contingent annuity, a percentage payment will not take effect
until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on the
first day of each month thereafter until the total number of Payments
Certain specified when the annuity was purchased has been paid. The
number of Payments Certain may be 60, 120, 180, 240, or any other
number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-110-82/2517-OE-82
Serial 410 4.5
<PAGE>
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule E will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-110-82
Serial 500 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than 90 days after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 DISCONTINUANCE OF CONTRIBUTIONS FOR AN EMPLOYER:
Contributions under this contract for those Participants covered under an
employer's Plan will be discontinued:
(a) when the Plan terminates,
(b) when the Plan ceases to be qualified (see section 1.1),
(c) when the delegation of powers to the Contract-Holder pursuant to the
Plan is withdrawn, or
(d) at any time after receipt by Prudential of notice from the
Contract-Holder that the employer no longer participates in the
applicable trust.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants under the Plan.
6.4 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-110-82/2517-OE-82
Serial 600 6.1-6.4
<PAGE>
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential at its Group Pension Office, Hanover Road,
Florham Park, New Jersey 07932, or at such other address as it may
communicate to the Contract-Holder. All communications to any other person
or organization dealing with Prudential will be addressed to that person or
organization at the last address of record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its Group
Pension Office or at an address or to a representative as may be specified
by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-110-82/2517-OE-82
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If the age, sex, or any other relevant fact relating to any person is found
to have been misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made in
accordance with this section will be conclusive upon any other person
affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant or
Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA/GAA-110-82/2517-OE-82
Serial 710 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 PLAN CHANGES:
This contract applies to the terms of the Plan in effect on the Effective
Date and to each Plan change if Prudential consents. The Contract-Holder
will furnish Prudential a copy of its Retirement Plan. While this contract
is active, the Contract-Holder will also furnish a copy of each change in
the Retirement Plan and each Plan change adopted by an employer which is
not a change in the Retirement Plan.
7.11 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-110-82/2517-OE-82
Serial 720 7.7-7.11
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
----------------------- -------------------
1. Life Annuity. 1. Use Schedule B for allocation.
2. Life - Payment Certain Annuity. 2. Use Schedule C for allocation.
3. Life - Contingent Annuity. 3. Use Schedule D for allocation.
4. Payment Certain Annuity. 4. Use Schedule E for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GVA-110-82/2517-OE-82
Serial A-100 Schedule A
<PAGE>
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life Annuity
Monthly Amount
--------------
If date the annuity is purchased is in:
Age
- --- ---- ---- ---- ----
60
65
70
SCHEDULE C - Life Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age
- --- ---- ---- ---- ----
60
65
70
SCHEDULE D - Life - Contingent Annuity
Monthly Amount
---------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
--------------------------------------------------------------
Age
- ---
If specified percentage to Contingent Annuitant is 100%:
60
65
70
If specified percentage to Contingent Annuitant is 50%:
60
65
70
SCHEDULE E - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain
- ---------------- ---- ---- ---- ----
60
120
180
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-110-82/2517-OE-82
Serial S-100 Schedules B-E
PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder:
In connection with the Optional Retirement Program of the
Contract-Holder or another employer (Program)
- -------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
--------------------------------------------
Eligible Classification: Each person
employed by the Contract-Holder eligible
under the Program
- -------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
Provision I, II, III, IV, V, VI, VII
and VIII
Schedules A,B,C,D and E Texas
- -------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
----------------------------
Title: President /s/
Date: Secretary /s/ Isabelle L. Kirchner
--------------------------
Attest
-----------------------
Date:
------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
19081
GVA-7454
<PAGE>
TABLE OF CONTENTS
PROVISION Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . 110
1.4 Reports. . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-11 (VCA-11). . . . . . . . . . . 200
2.2 VCA-11 Unit Value. . . . . . . . . . . . 200
2.3 VCA-11 Committee . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
FORFEITURES -- CREDITS
3.1 Participant's Withdrawals. . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts. . . 310
3.4 Transfers to Another Funding Agent . . . 310
3.5 Transfers Involving a Similar Contract
of Another Employer. . . . . . . . . . 320
3.6 Forfeiture of Employer Contributions . . 330
3.7 Credit to the Contract-Holder. . . . . . 330
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment Combination 400
4.3 Small Annuities and Accounts . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . 400
4.5 Payees . . . . . . . . . . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . 500
5.3 Changes to Conform to Law. . . . . . . . 500
5.4 Persons Empowered to Act for Prudential. 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing Participants'
Accounts . . . . . . . . . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . 700
7.4 Information -- Records . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . 710
7.6 Beneficiary. . . . . . . . . . . . . . . 710
GVA-7454
TC-100 (11)
<PAGE>
TABLE OF CONTENTS
(Continued)
Provisions Serial Page
7.7 Divisible Surplus . . . . . . . . . . . . 720
7.8 Limit on Assignment . . . . . . . . . . . 720
7.9 Certificates. . . . . . . . . . . . . . . 720
7.10 Entire Contract -- Construction . . . . . 720
VIII. SPECIAL MODIFICATIONS FOR TEXAS CONTRACTS 800
SCHEDULES
Schedule A. Forms of Annuity which may be Purchased A-100
Schedule B. Life Annuity . . . . . . . . . . S-100
Schedule C. Life - Payment Certain Annuity . S-100
Schedule D. Life - Contingent Annuity. . . . S-100
Schedule E. Payment Certain Annuity. . . . . S-100
GVA-7454
TC-110 (TX)
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
(a) Regular Contributions:
The contributions which are payable under this contract for a
Participant are 1) "Salary Contributions", the payments made for him by
his employer pursuant to a Salary-Annuity Agreement and 2) "Employer
Contributions", the payments made for him by the Employer under the
Program in addition to the Salary Contributions, and directed by the
Participant for payment hereunder. Contributions will be transmitted by
the Contract-Holder or the employer.
A Participant is a person for whom contributions have been paid under
this contract and whose Participant's Account (see section 1.2) has not
been cancelled.
A Salary-Annuity Agreement is an agreement between an employee in an
Eligible Classification and his employer. It is also an agreement
between a Participant who has ceased to be an employee in an Eligible
Classification and his new employer. Under the Agreement, the employer
agrees to pay amounts in each year to purchase an annuity for the
employee meeting the conditions of Section 403(b) of the Federal
Internal Revenue Code.
(To save words, male pronouns are used in this contract to refer to
both men and women.)
(b) Rollover Contributions:
An amount which qualifies as a rollover contribution pursuant to the
Federal Internal Revenue Code may be transferred to and paid under this
contract as a contribution for a Participant. Prudential may require
proof that the amount paid so qualifies.
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. This Account is
expressed in Units of the separate investment account described in
section 2.1.
A number of Units will be added to the Participant's Account on each
day a contribution is received by Prudential for the Participant. This
number is determined by dividing the dollar amount of the contribution
by the Unit Value for the day the contribution is received (see section
2.2 for a description of the Unit Value). A number of Units will be
subtracted from the Participant's Account on each day on which a
withdrawal is made from his Account. This number is equal to the number
requested for withdrawal or, if applicable, the number determined by
dividing the dollar amount to be withdrawn by the Unit Value for the
day of withdrawal.
A Participant's Account is the sum of the Units added to it, less the
sum of the Units subtracted from it. The dollar value of a
Participant's Account as of any day is the product of the number of
Units in his Account at the close of business on that day and the Unit
Value for that day.
A Participant has a non-forfeitable interest in the Salary
Contributions in his Account. A Participant has a non-forfeitable
interest in the Employer Contributions in his Account as of the start
of the second consecutive year of participation in the Program. The
Account is subject to charges described later.
GVA-7454
Serial 100 1.1-1.2
<PAGE>
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an
amount will be withdrawn from each Participant's Account equal to the
Annual Account Charge. Also, on any other day on which a Participant's
Account is cancelled, an amount will be withdrawn from his Account equal
to the Annual Account Charge. However, no Charge will be withdrawn if the
Participant's Account is being cancelled on a January 1 to purchase an
annuity for him under this contract.
The Annual Account Charge is $20 for the first year it is withdrawn from
a Participant's Account. For every other year it is $15.
A Participant may have an Account for Program payments under another
group annuity contract issued to the Contract-Holder by Prudential (a
"companion contract"). If so, the total Annual Account Charge that
applies to all his Accounts will not exceed the amount shown above. This
charge will be shared among his Accounts as Prudential determines. Also,
no charge will be withdrawn from his Account under this contract when it
is cancelled unless no amounts remain in an Account for him under a
companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
Participant's withdrawal (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential annually will furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-7454
Serial 110 1.3-1.4
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established
pursuant to a resolution adopted by its Board of Directors. The
resolution provides that this account is to be used for contracts which
state that certain payments and values under them will vary to reflect
the investment results of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be
at least equal to the total reserve liability required by law for all
payments or values which vary in dollar amount to reflect the investment
results of VCA-11. Assets held in VCA-11 equal in market value to that
reserve liability will be held for the sole benefit of all contracts
which participate in VCA-11. The amount, if any, by which the total
market value exceeds the total reserve liability will be subject to the
exclusive control of Prudential. Thus, Prudential may from time to time
make transfers between VCA-11 and its other investment accounts as, in
its judgment, experience warrants. A transfer will not affect
Prudential's contractual liabilities under this contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New
York Stock Exchange is open for trading.) The initial VCA-11 Unit Value
was $1.00. The VCA-11 Unit Value for any subsequent Business Day is
determined as of the end of that Business Day by multiplying the VCA-11
Unit Change Factor for that Business Day by the VCA-11 Unit Value for the
immediately preceding Business Day. The VCA-11 Unit Value for any day
which is not a Business Day is equal to the VCA-11 Unit Value for the
next Business Day. The VCA-11 Unit Value will go up or down in accordance
with the VCA-11 Unit Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day,
Prudential will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for
that Business Day, taking into account investment income and
changes in the value of investments after provision for taxes
applicable to contracts of this class arising from the operation
of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment
Management Fee per 1.00 at the effective annual rate of 0.25% for
the number of calendar days in the period from the end of the
prior Business Day to the end of the current Business Day. The
aggregate amount by which VCA-11 is reduced in each year by the
Investment Management Fee will be deducted from investment income
to the extent possible; any balance will be deducted from
principal.
GVA-7454 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective
annual rate of 0.75%, against the assets of VCA-11. To do so, the
result found in (b) is divided by 1.00 increased at the effective
annual rate of 0.75% for the number of calendar days in the
period from the end of the prior Business Day to the end of the
current Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that
Business Day.
Prudential may, upon notice to the Contract-Holder and Participants,
change the basis for determining the Unit Value. The changed basis would
be one designed to maintain a constant Unit Value, with investment
results being reflected through the number of Units in Participants'
accounts.
This section may be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by the
Participants.
GVA-7454 (11)
Serial 210 2.3
<PAGE>
Provision III. WITHDRAWALS AND TRANSFERS-DEATH PAYMENTS-FORFEITURES-CREDITS:
3.1 PARTICIPANT'S WITHDRAWAL:
A Participant may, subject to written authorization from the Contract-
Holder, make withdrawals from the non-forfeitable part his
Participant's Account. The minimum withdrawal is $500, or the dollar
value of the non-forfeitable part of his Account if smaller. Payment
to the Participant will normally be made within seven days of
Prudential's receipt of the Contract-Holder's authorizations for it.
However, it may be paid at a later day if permitted under the
Investment Company Act of 1940.
The amount paid to the Participant will be the dollar amount withdrawn
less the withdrawal charge determined from the following table and the
Annual Account Charge if it applies. The amount payable is also
referred to as the "Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
--------------------------------- ---------------------------
First 24 months $0.07
Next 36 months 0.06
Next 60 months 0.04
Next 60 months 0.03
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract (or under a similar contract if section 3.5 applies).
**No charge is made after the amount withdrawn equals the contributions
made for the Participant.
The withdrawal charge is also deducted from a Participant's Account if an
annuity is purchased for him under this contract during the first 36 months
from the day an Account was established for him. The earliest of the days
an Account was established for him under this contract, under a companion
contract or under a similar contract if section 3.5 applies will be used in
counting the 36 months.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts has been cancelled,
the dollar value of the non-forfeitable part of his Account will be paid to
his Beneficiary (see section 7.6). The payment will be made in one sum
unless the Participant has directed Prudential to purchase an annuity for
the Beneficiary. Instead of a one sum payment, the Beneficiary may elect to
have the dollar value of the Participant's Account applied to purchase an
annuity. Written authorization from the Contract-Holder and proof of the
Participant's death must be received from Prudential before any payment
will be made.
GVA-7454
Serial 300 3.1-3.2
<PAGE>
The Beneficiary's annuity election must be made before the first
anniversary for the Participant's death or, if later, the day two months
after Prudential's receipt of both written authorization from the Contract-
Holder and proof of death. The annuity form may be any of those described
in section 4.4. If annuity payments are to start at a future date, the
Participant's Account will be maintained for the Beneficiary in the same
manner as for the Participant. The date for payments to start must be on or
before the Beneficiary's 70th birthday or, if later, within two months
after he elects the annuity. No contributions may be made to the Account
after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of the
Participant's death, it will be at least equal to the contributions made
for him under this contract less any withdrawals and transfers.
As of the first day no amounts remain in the Participant's Account or in an
Account for the Beneficiary under a companion contract, the Participant's
Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
A Participant may transfer an amount from his Participant's Account to an
Account maintained for him under a companion contract. The minimum
withdrawal to provide a transfer is $500, or the dollar value of his
Account if smaller. The transfer will normally be made within seven days of
Prudential's receipt of his request for it. Section 3.1 does not apply to
a withdrawal for this purpose. Transfers are deemed to be made first from
the contributions paid for the Participant. Investment income is
transferred when there are no longer any contributions in the
Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any part of the amount transferred which
is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder and Participants, limit
the frequency of transfers. This action will take effect on the date of the
notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant and subject to written authorization
from the Contract-Holder:
The Withdrawal Value of a Participant's Account may be transferred to
an annuity contract which meets the conditions of Section 403(b) of
the Federal Internal Revenue Code and is provided by another financial
institution. The transfer may be made directly to that institution or
by a payment (or payments) to the Participant who then makes payment
to the institution. The transfer will normally be made within seven
days after Prudential's receipt of both the transfer request and
written authorization from the Contract-Holder.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
GVA-7454
Serial 310 3.3-3.4
<PAGE>
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer
payments to a funding Agent named in the request. The
transfer payment will be made on the Transfer Date. The Transfer
Date is the later of the day specified in the request and the
90th day after its receipt by Prudential.
Prudential will promptly notify each Participant, and each
Beneficiary of a deceased Participant whose Account has not been
cancelled, that the request has been received. Each notified
person may elect, within 30 days following his receipt of the
notice from Prudential, to have his Account cancelled and
included in the transfer payment to be made. Each person who does
not make this election will have his Account retained under this
contract pursuant to its terms.
All Accounts of Participants and Beneficiaries who make
the election will be cancelled as of the Transfer Date.
A single liquidation account will be established equal
to the sum of the Withdrawal Values expressed in Units
of the cancelled Accounts. (For this purpose, the
Withdrawal Values are determined as if the entire
Account of each Participant is non-forfeitable.)
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units
withdrawn and the Unit Value for the day of withdrawal will be
transferred within seven days thereafter.
Instead of making the transfer payment in cash, Prudential may
make all or a part of it in the form of securities representing a
uniform percentage of each holding of the separate investment
account described in section 2.1.
The Contract-Holder may notify Prudential that this section
3.4(b) is to be inoperative.
This section may be changed as provided in section 5.1.
3.5 TRANSFERS INVOLVING A SIMILAR CONTRACT OF ANOTHER EMPLOYER:
A Participant may cease to be employed by an employer who pays
contributions under this contract. He may become employed by an employer to
whom Prudential has issued a contract similar to this contract. If so, that
Participant may, subject to written authorization from the
Contract-Holder, request a transfer to that similar contract from this
contract. The transfer will normally be made within seven days of both
receipt of the request and authorization. The dollar value of the
non-forfeitable part of the of the Participant's Account will be the
amount transferred. The Account will be cancelled.
Also, this contract will accept a transfer from a contract similar to this
contract for a person covered thereunder who becomes employed by an
employer who pays contributions under this contract. The transferred amount
will be treated as a contribution paid for that person. However, (a) in
determining any withdrawal charge, any part of the transferred amount which
is investment income will not be considered a contribution, and (b) the
transfer is subject to written authorization from the Contract-Holder.
This section may be changed as provided in section 5.1.
GVA-7454
Serial 320 3.5
<PAGE>
3.6 FORFEITURE OF EMPLOYER CONTRIBUTIONS
If Prudential receives notice from the Contract-Holder that a Participant
is to forfeit the portion of his Participant's Account attributable to
Employer Contributions, Prudential will reduce the Participant's Account by
the number of Units attributable to Employer Contributions.
3.7 CREDIT TO THE CONTRACT-HOLDER:
The dollar amount of the Employer Contributions made under this contract,
if a forfeiture occurs as provided in section 3.6, will be returned
to the Contract-Holder within 15 days of receipt of the notice of
forfeiture.
GVA-7454
Serial 330 3.6 3.7
<PAGE>
Provision IV. ANNUITIES:
4.1 ANNUITY ELECTIONS:
A Participant may, upon notice to Prudential and subject to written
authorization from the Contract-Holder, elect to have the non-forfeitable
part of his Participant's Account applied to purchase an annuity for him.
The Withdrawal Value of the Account will be applied if the purchase is made
during the first 36 months from the day an Account was established for him.
The earliest of the days an Account was established for him under this
contract, under a companion contract or under a similar contract if section
3.5 applies will be used in counting the 36 months. If the purchase is
made after the 36 months, the dollar value of the non-forfeitable part of
his Account will be applied. The schedule of annuity purchase rates that
applies is determined from Schedule A. The monthly amount of any annuity is
determined from the schedule of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
If the Participant's Account has not been cancelled before the month in
which he reaches age 75, a 120 monthly Payment Certain annuity will be
purchased for him at the beginning of that month (see section 4.4).
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
A Participant may, subject to written authorization from the Contract-
Holder, elect that only a portion of his Participant's Accounts be applied
to purchase an annuity with the balance being paid in a single sum. The
first portion will be subject to section 4.1 and the balance to section
3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts is
less than $50, Prudential may, in lieu of an annuity under this contract,
make payment in a single sum. The single sum will be equal to the amount
that would otherwise be applied to purchase an annuity as described in
section an 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, the
dollar value of its non-forfeitable part will be paid to the Participant
unless he directs payment to a named financial institution. The Annual
Account Charge will be made only if no Account remains for him under a
companion contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity may also be any one of the
following forms: Life - Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
(a) Life Form of Annuity:
The first monthly payment of any Life form of annuity is payable on
the date the annuity is purchased. Monthly payments are payable on
the first day of each month thereafter throughout the Annuitant's
remaining lifetime. The last monthly payment is payable for the
month in which his death occurs.
GVA-7454 4.1-4.4
Serial 400
<PAGE>
If the LIFE - PAYMENT CERTAIN form of annuity is payable, then, if the
Annuitant dies before the number of annuity payments made equals the number
of Payments Certain applicable to him, monthly annuity payments will be
continued until the total number of payments is so equal. These continued
annuity payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the annuity
is purchased and may be 60, 120, 180, 240, or any other number accepted by
Prudential.
If the LIFE - CONTINGENT ANNUITY form of annuity is payable, then, if the
Annuitant dies before the death of his Contingent Annuitant, monthly
Contingent Annuity payments will become payable. The first payment of the
Contingent Annuity will be payable on the first day of month following the
month in which the Annuitant's death occurs. Monthly Contingent Annuity
payments are payable on the first day of each month thereafter throughout
the Contingent Annuitant's remaining lifetime. The last monthly payment is
payable for the month in which his death occurs. The amount of each
monthly Contingent Annuity payment will be a percentage of the monthly
annuity payment payable before the Annuitant's death. The percentage is
established when the annuity is purchased and may be 33 1/3%, 50%, 66 2/3%,
or 100%, or any other percentage accepted by Prudential. Under a Life -
Payment Certain Contingent annuity, a percentage payment will not take
effect until the end of the selected Payment Certain period.
(b) Payment Certain Annuity:
The-first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on
the first day of each month thereafter until the total number of
Payments Certain specified when the annuity was purchased has been
paid. The number of Payments Certain may be 60, 120, 180, 240, or
any other number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
No form of annuity will be purchased which provides for payments:
(i) to a Beneficiary or a Contingent Annuitant who is not the
Annuitant's spouse if a present value calculation shows that the
Annuitant's expected payments will not be more than 50% of all
the expected annuity payments, or
(ii) to a Contingent Annuitant which are greater in monthly amount
than the payments to the Annuitant.
4.5 PAYEES:
Each annuity payment will be made to the Annuitant, Contingent Annuitant or
Beneficiary entitled to receive it.
GVA/GAA-7454/7453
Serial 410 4.5
<PAGE>
Provision V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and the
terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective Date.
(c) The schedules of annuity purchase rates may be changed periodically on
and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule E will apply
only to amounts added to Participants' Accounts on and after the date the
change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase rates
will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice to
the Contract-Holder at least 90 days before the date on which the change is
to take effect. Notice of changes, other than in the schedules of purchase
rates, will also be given to Participants.
5.2 CHANGES BY AGREEMENTS:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 CHANGES TO CONFORM TO LAW:
Prudential may change this contract as, in its discretion, it deems
appropriate to satisfy the requirements of any law or regulation
administered by a governmental agency.
5.4 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of Prudential
may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-7454
Serial 500 5.1-5.4
<PAGE>
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this contract.
The specified date may not be earlier than [90 days] after the date of the
notice. Thereafter, only contributions for persons who are Participants on
the specified date will be accepted hereunder. In all other respects this
contract will continue to operate in accordance with its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to all
Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts.
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-7454/7453
Serial 600 6.1-6.3
<PAGE>
Provision VII. GENERAL TERMS:
7.1 CONTRACT-HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in some
cases the contract calls for dealing with another. Prudential will be
entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with the
agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with respect
thereto in the same manner as if dealing with the Contract-Holder. If any
agency fails or refuses to act with respect thereto, then the delegation
will be void for the purposes of this contract. Thereafter, Prudential will
deal only with the Contract-Holder. The Contract-Holder may give notice to
Prudential of delegation to another agency of specified powers and
responsibilities.
7.2. COMMUNICATION:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential. They
will be addressed to Prudential at its Group Pension Office, Hanover Road,
Florham Park, New Jersey 07932, or at such other address as it may
communicate to the Contract-Holder. All communications to any other person
or organization dealing with Prudential will be addressed to that person or
organization at the last address of record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
Group Pension Office or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United States
currency.
GVA/GAA-7454/7453
Serial 700 7.1-7.3
<PAGE>
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information, Prudential
may request the person concerned to furnish the information. Prudential
will not be liable for the fulfillment of any obligations in any way
dependent upon information unless and until it receives the information in
a form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to Prudential
and will constitute evidence as to the truth of the information in the
records.
7.5 MISSTATEMENTS:
If the age, sex, or any other relevant fact relating to any person is found
to have been misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made
in accordance with this section will be conclusive upon any other
person affected by it.
(b) The amount of any underpayment by Prudential will be paid in full with
the next payment due. The amount of any overpayment by Prudential will
be deducted to the extent possible from amounts payable thereafter.
7.6 BENEFICIARY:
If, as to any person, this contract provides for the payment of an amount
or amounts after the person dies to other than the person's Contingent
Annuitant, payment will be made to the Beneficiary the person named. A
person for whom an Account is held or an annuity is being paid under this
contract may name a Beneficiary to replace one previously named. However,
the Participant may instruct Prudential that his Contingent Annuitant or
Beneficiary is not to have this right to name a Beneficiary.
A Beneficiary may be named by filing a request with Prudential on a form
acceptable to it. It will become effective when entered on Prudential's
records. It will apply to any amounts payable after the request was
received by Prudential, except any withdrawals and payments made before the
request was entered on Prudential's records. Prudential will acknowledge
the naming of a Beneficiary.
GVA/GAA-7454/7453
Serial 710 7.4-7.6
<PAGE>
The interest of any Beneficiary who dies before the Participant ceases upon
that Beneficiary's death. If there is no named Beneficiary when an amount
is payable to one, payment will be made to the estate of the last to die of
the Participant or Annuitant, his Contingent Annuitant, and his
Beneficiary. If a payment would be made to the estate of a Participant or
Annuitant, Prudential may make the payment to any one or jointly to any
number of his surviving relatives: spouse, children, parents, brothers or
sisters.
Prudential, in determining whether a person is a relative of a Participant
or Annuitant or is a Beneficiary entitled to payment, may rely solely on
any evidence it deems acceptable. Each payment Prudential makes in reliance
thereon will be a valid discharge of its obligation under this contract as
to that payment.
If a series of payments becomes payable to a Beneficiary and the first
payment is less than $50, Prudential may choose to make payment in one sum.
Also, if the payee is not a natural person and a series of payments is
payable, Prudential may choose to make a payment in one sum. The one sum
payment will be equal to the value of the series of payments discounted at
interest from each payment due date to the date of the one sum payment. The
discount interest rate will be the interest rate in the schedule of annuity
purchase rates used to establish the series of payments.
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 LIMIT ON ASSIGNMENT:
To the extent applicable law requires, the interests in and payments from
this contract are not assignable or subject to the claims of any creditor.
7.9 CERTIFICATES:
Prudential will issue a certificate for each annuity which is effected
under this contract. If any law requires, Prudential will issue a
certificate to a Participant for whom an annuity has not yet been effected.
A certificate will be descriptive of the Participant's or Annuitant's
rights and duties under the contract.
7.10 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-7454/7453
Serial 720 7.7-7.10
<PAGE>
Provision VIII. SPECIAL MODIFICATIONS FOR TEXAS CONTRACTS:
Anything in this contract to the contrary notwithstanding, the following items
numbered 1 through 8 shall govern, and any portion of this contract in conflict
with any such items is hereby modified.
1. This contract is issued subject to the laws of the State of Texas and is
also subject to the rules and regulations of the State Board of Insurance,
including the application of such laws and regulations and requirements to
the contract and to the interpretation of its provisions; except, however,
in the circumstance and only to the extent the application of this
provision to any persons or circumstance is expressly contrary to and
excluded by superior law or valid statute having and determined to have
supremacy in the circumstance.
2. The Prudential may from time to time transfer cash between any separate
account identified with this contract and any of its other investment
accounts for the purpose of making adjustments necessitated by this
contract, including adjustment for any surplus or deficit which may arise
in such separate account, or which may be required by governmental
authorities having jurisdiction over the Prudential. Transfers may be made
between any separate account identified with this contract and any of
Prudential's other investment accounts, if such transfers satisfy the
requirements of the Texas Rules and Regulations that relate to intra-
company transactions.
3. Any separate account identified with this contract is divisible for various
purposes in respect of regulation and compliance with law, including
divisibility as it is applicable to any functions arising from the
provisions of this contract or provisions of law and regulation.
4. This contract is subject to endorsement from time to time as may be
necessary to comply with valid and appropriate rules and regulations
adopted by regulatory authorities, or as a court of final jurisdiction
shall determined, and is executed subject to that condition.
5. No transfer shall be made between any separate account identified with this
contract and any of Prudential's other investment accounts if such transfer
would result in an impairment of the statutory reserves of the Prudential.
6. Contractual payments or values under this contract which are funded from
the assets of any separate account identified with this contract shall have
no claim against any other assets of Prudential.
7. Variations in charges for expenses and taxes will be made to meet the
requirements of law or regulation.
8. The Prudential will mail to the Contract-Holder such reports and
information periodically as the law and regulation of Texas shall require
(irrespective of any provision of this contract which may be contrary to
such law or regulation).
GVA-7454
<PAGE>
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
Form of Payment Payable Applicable Schedule
- ---------------------------------- ----------------------------------
1. Life Annuity. 1. Use Schedule B for allocation.
2. Life - Payment Certain Annuity. 2. Use Schedule C for allocation.
3. Life - Contingent Annuity. 3. Use Schedule D for allocation.
4. Payment Certain Annuity. 4. Use Schedule E for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GAA-7454/7453
Serial A-100 Schedule A
<PAGE>
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life Annuity
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1984 1985 1990 1995
- --- ---- ---- ---- ----
60 $59.74 $59.44 $46.86 $45.55
65 68.02 67.62 54.57 52.81
70 80.12 79.56 65.63 63.14
SCHEDULE C - Life Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1984 1985 1990 1995
- --- ---- ---- ---- ----
60 $57.88 $57.63 $45.67 $44.50
65 64.27 63.97 52.03 50.59
70 72.00 71.66 59.88 58.17
SCHEDULE D - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of
birth. If the date the annuity is Purchased is in:
Age 1984 1985 1990 1995
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.94 $47.76 $36.03 $35.28
65 51.96 51.75 40.03 39.06
70 58.58 58.28 46.43 45.08
If specified percentage to Contingent Annuitant is 50%:
60 $53.19 $52.97 $40.74 $39.76
65 58.91 58.63 46.19 44.91
70 67.68 67.28 54.38 52.61
SCHEDULE E - Payment Certain Annuity
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1984 1985 1990 1995
- --- ---- ---- ---- ----
60 $178.42 $178.23 $165.62 $164.73
120 102.13 102.02 88.93 88.45
180 77.39 77.31 63.55 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-7454/7453
Serial S-100 Schedules B-E
THE PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
AMENDMENT TO BE ATTACHED TO AND MADE A PART OF GROUP
ANNUITY CONTRACT NO.________
Section 5.3 of the contract provides that Prudential has the right to change the
contract as, in its discretion, it deems appropriate to satisfy the requirements
of any law or regulation administered by a governmental agency. Pursuant to such
right, the contract is hereby amended as of the Effective Date of the contract,
to comply with federal regulations pertaining to death benefits and annuity
distributions. Consequently, this amendment is effectuated as follows:
1. Section 3.2 of the contract, as constituted immediately prior to the
execution of this amendment, is hereby replaced with the following:
"3.2 Death Payments:
If a Participant dies before his Participant's Account has been
cancelled, the dollar value of the non-forfeitable part of his
Account will be paid to his Beneficiary (see section 7.6). If the
Beneficiary is other than the Participant's spouse, the payment
will be made in one sum within 5 years of the Participant's death
unless the Participant has directed Prudential to purchase an
annuity for the Beneficiary. If the Participant's spouse is the
Beneficiary, the payment will be made in one sum no later than the
latest date on which the spouse is permitted to defer the
distribution under law unless the Participant has directed
Prudential to purchase an annuity for the spouse. Instead of a one
sum payment, the Beneficiary may elect to have the dollar value of
the Participant's Account applied to purchase an annuity. Written
authorization from the Contract-Holder and proof of the
Participant's death must be received by Prudential before any
payment will be made. Any payment made pursuant to this section
must be consistent with the terms of the Plan, if any.
The Beneficiary's annuity election must be made before the
Participant's Account is distributed. The annuity form may be any
of those described in section 4.4. If annuity payments are to
start at a future date, the Participant's Account will be
maintained for the Beneficiary in the same manner as for the
Participant. The date for payments to start must be on or before
the latest date on which the Beneficiary is permitted to defer the
distribution under law. No contributions may be made to the
Account after the Participant's death.
If a one sum payment is made to the Beneficiary within one year of
the Participant's death, it will be at least equal to the
GAA-7611 -T
19080
<PAGE>
contributions made for him under this contract less any
withdrawals and transfers.
Any annuity payments to a Beneficiary will be subject to the
following:
(a) If an annuity is payable to the Participant's spouse, it
must provide for payment to be made over the life of the
spouse (or over a period not exceeding the life expectancy
of the spouse), and
(b) If an annuity is payable to a Beneficiary who is other than
the Participant's spouse, it must provide for payment to be
made over the Life of the Beneficiary (or over a period not
exceeding the life expectancy of the Beneficiary).
As of the first day no amounts remain in the Participant's Account
or in an Account with respect to the Participant under a companion
contract, the Participant's Account is cancelled. Section 3.1 does
not apply."
2. The last paragraph of section 4.1 of the contract, as constituted
immediately prior to the execution of this amendment is hereby replaced with
the paragraph following:
"If the Participant's Account has not been cancelled before the month in
which he reaches the latest age at which he is permitted to defer his
distribution under law, a 120 monthly Payment Certain annuity will be
purchased for him at the beginning of that month (see section 4.4)."
The Prudential has caused this amendment to be executed and duly attested as of
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
Attest:_________________ /s/ Isabelle L. Kirchner
Florham Park. New Jersey Secretary
GAA-7611 -T
The PRUDENTIAL THE PRUDENTIAL
INSURANCE COMPANY
OF AMERICA
agrees to pay the benefits provided under this contract in accordance with and
subject to its terms.
Contract-Holder: Plan:
- --------------------------------------------------------------------------------
Effective Date: Group Annuity Contract Number:
- --------------------------------------------------------------------------------
Provisions and Schedules Jurisdiction:
attached:
- --------------------------------------------------------------------------------
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By:
--------------------------------
Title: President /s/ Joseph J. Melone
Date: Secretary /s/ Dorothy K. Light
------------------------------
Attest
-------------------------
Date:
---------------------------
Group Annuity Contract providing for contributions on account of Participants.
Annual determination of participation in divisible surplus. All subject to the
provisions of this contract.
NOTICE - ALL CONTRACTUAL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT RESULTS OF A PRUDENTIAL SEPARATE ACCOUNT DESCRIBED IN
THIS CONTRACT, ARE VARIABLE, SUBJECT TO CHANGE BOTH UP AND DOWN, AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
DEFERRED COMPENSATION
(NON-QUALIFIED)
GVA-1010 19081-A
<PAGE>
9/84
TABLE OF CONTENTS
-----------------
Provision Serial Page
I. CONTRIBUTIONS - ACCOUNTS - CHARGES
1.1 Contributions. . . . . . . . . . . . . . 100
1.2 Participant's Accounts . . . . . . . . . 100
1.3 Annual Account Charge. . . . . . . . . . 100
1.4 Reports. . . . . . . . . . . . . . . . . 110
II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE
2.1 The Prudential Variable Contract
Account-10 (VCA-10). . . . . . . . . . 200
2.2 VCA-10 Unit Value. . . . . . . . . . . . 200
2.3 VCA-10 Committee . . . . . . . . . . . . 210
III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS
3.1 Withdrawals. . . . . . . . . . . . . . . 300
3.2 Death Payments . . . . . . . . . . . . . 300
3.3 Transfers between Related Contracts. . . 310
3.4 Transfers to Another Funding Agent . . . 310
IV. ANNUITIES
4.1 Annuity Elections. . . . . . . . . . . . 400
4.2 Annuity - Single Sum Payment
Combination. . . . . . . . . . . . . 400
4.3 Small Annuities and Accounts . . . . . . 400
4.4 Terms of Payment of Annuities. . . . . . 400
4.5 Contract-Holder as Payee -
Prudential as Agent. . . . . . . . . 410
V. CHANGES
5.1 Changes by Prudential. . . . . . . . . . 500
5.2 Changes by Agreement . . . . . . . . . . 500
5.3 Persons Empowered to Act for Prudential. 500
VI. DISCONTINUANCE - TERMINATION OF CONTRACT
6.1 Discontinuance of Establishing
Participants' Accounts . . . . . . . 600
6.2 Discontinuance of Contributions under
this Contract. . . . . . . . . . . . 600
6.3 Termination of Contract. . . . . . . . . 600
VII. GENERAL TERMS
7.1 Contract-Holder. . . . . . . . . . . . . 700
7.2 Communications . . . . . . . . . . . . . 700
7.3 Place of Payment -- Currency . . . . . . 700
7.4 Information -- Records . . . . . . . . . 710
7.5 Misstatements. . . . . . . . . . . . . . 710
7.6 Plan Changes . . . . . . . . . . . . . . 710
7.7 Divisible Surplus. . . . . . . . . . . . 720
7.8 Entire Contract -- Construction . . . . 720
GVA-1010
TC-100 (10)
<PAGE>
9/84
TABLE OF CONTENTS
(Continued)
Serial Page
SCHEDULES
Schedule A Forms of Annuity Which May Be
Purchased . . . . . . . . . . . A-100
Schedule B Life - Payment Certain Annuity. . S-100
Schedule C Life - Contingent Annuity . . . . S-100
Schedule D Payment Certain Annuity . . . . . S-100
GVA/GAA-1010/7211-82
TC-110
<PAGE>
Provision I. CONTRIBUTIONS - ACCOUNTS - CHARGES:
1.1 CONTRIBUTIONS:
The contributions which are payable under this contract for a Participant
are the amounts of his compensation deferred pursuant to the Plan and any
other amounts contributed by him or on his behalf pursuant to the Plan
and directed for payment hereunder. Contributions will be transmitted by
the Contract-Holder. A Participant is a person for whom contributions
have been paid under this contract and whose Participant's Account (see
section 1.2) has not been cancelled.
(To save words, male pronouns are used in this contract to refer to both
men and women.)
1.2 PARTICIPANT'S ACCOUNT:
Prudential will establish a "Participant's Account" for each person for
whom a contribution is paid under this contract. (The term "Participant's
Account" is not meant to confer on the Participant any rights to his
Account except as specifically provided in the Plan.) This Account is
expressed in Units of the separate investment account described in
section 2.1.
A number of Units will be added to the Participant's Account on each day
a contribution is received by Prudential for the Participant. This number
is determined by dividing the dollar amount of the contribution by the
Unit Value for the day the contribution is received (see section 2.2 for
a description of the Unit Value). A number of Units will be subtracted
from the Participant's Account on each day on which a withdrawal is made
from his Account. This number is equal to the number requested for
withdrawal or, if applicable, the number determined by dividing the
dollar amount to be withdrawn by the Unit Value for the day of
withdrawal.
A Participant's Account is the sum of the Units added to it, less the sum
of the Units subtracted from it. The dollar value of a Participant's
Account as of any day is the product of the number of Units in his
Account at the close of business on that day and the Unit Value for that
day.
The Account is subject to charges described later.
1.3 ANNUAL ACCOUNT CHARGE:
On the last business day (see section 2.2) of each calendar year an
amount will be withdrawn from each Participant's Account equal to the
Annual Account Charge. Also, on any other day on which a Participant's
Account is cancelled, an amount will be withdrawn from his Account equal
to the Annual Account Charge. However, no Charge will be withdrawn if the
Participant's Account is being cancelled on a January 1 to purchase an
annuity for him under this contract.
GVA-1010
Serial 100 1.1-1.3
<PAGE>
5/87
The Annual Account Charge is $20.
An Account may be established for the Participant in connection with the
Plan under another group annuity contract issued to the Contract-Holder
by Prudential (a "companion contract"). If so, the total Annual Account
Charge that applies to all his Accounts will not exceed $20. This charge
will be shared among his Accounts as Prudential determines. Also, no
charge will be withdrawn from his Account under this contract when it is
cancelled unless no amounts remain in an Account for him under a
companion contract.
In addition to the Annual Account Charge, a charge may be made upon a
withdrawal from the Participant's Account (see section 3.1).
The Charge may be changed as provided in section 5.1.
1.4 REPORTS:
Prudential will periodically furnish a report with respect to each
Participant's Account which has not been cancelled. The report will show
the status of each Account as of the date of the report.
GVA-1010
Serial 110 (as modified by Form GAA-7471A) 1.4
<PAGE>
Provisions II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 10 (VCA-10):
VCA-10 is a separate investment account of Prudential established
pursuant to a resolution adopted by its Board of Directors. The
resolution provides that this account is to be used for contracts which
state that certain payments and values under them will vary to reflect
the investment results of this account.
The investments held in VCA-10 are intended to be composed primarily of
common stocks. Prudential will invest and reinvest the assets held in
VCA-10 in accordance with the investment objectives and policies
established for it.
The total market value of the assets held in VCA-10 at all times will be
at least equal to the total reserve liability required by law for all
payments or values which vary in dollar amount to reflect the investment
results of VCA-10. Assets held in VCA-10 equal in market value to that
reserve liability will be held for the sole benefit of all contracts
which participate in VCA-10. The amount, if any, by which the total
market value exceeds the total reserve liability will be subject to the
exclusive control of Prudential. Thus, Prudential may from time to time
make transfers between VCA-10 and its other investment accounts as, in
its judgment, experience warrants. A transfer will not affect
Prudential's contractual liabilities under this contract.
2.2 VCA-10 UNIT VALUE:
The VCA-10 Unit Value for any Business Day is the dollar value of one
VCA-10 Unit for that Business Day. ("Business Day" means a day the New
York Stock Exchange is open for trading.) The initial VCA-10 Unit Value
was $1.00. The VCA-10 Unit Value for any subsequent Business Day is
determined as of the end of that Business Day by multiplying the VCA-10
Unit Change Factor for that Business Day by the VCA-10 Unit Value for the
immediately preceding Business Day. The VCA-10 Unit Value for any day
which is not a Business Day is equal to the VCA-10 Unit Value for the
next Business Day. The VCA-10 Unit Value will go up or down in accordance
with the VCA-10 Unit Change Factor described below.
To determine the VCA-10 Unit Change Factor for any Business Day,
Prudential will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-10 for
that Business Day, taking into account investment income and
market value changes after provision for any taxes applicable
to contracts of this class arising from the operation of
VCA-10.
(b) Subtract from the result found in (a) the VCA-10 Investment
Management Fee per $1.00 at the effective annual rate of 0.25%
for the number of calendar days in the period from the end of
the prior Business Day to the end of the current Business Day.
The aggregate amount by which VCA-10 is reduced in each year by
the Investment Management Fee will be deducted from investment
income to the extent possible; any balance will be deducted
from principal.
GVA-1010 (10)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective
annual rate of 0.75%, against the assets of VCA-10. To do so,
the result found in (b) is divided by $1.00 increased at the
effective annual rate of 0.75% for the number of calendar days
in the period from the end of the prior Business Day to the end
of the current Business Day.
The result found in (c) is the VCA-10 Unit Change Factor for that
Business Day.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-10 Account. Prudential will
notify the Contract-Holder of any such change.
In addition, this section may be changed as provided in section 5.1.
2.3 VCA-10 COMMITTEE:
The operation of VCA-10 will be supervised by The Prudential VCA-10
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (10) (as modified by GAA-7664)
Serial 210 2.3
<PAGE>
Provision II. INVESTMENT ACCOUNT - UNIT VALUES - COMMITTEE:
2.1 THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - 11 (VCA-11):
VCA-11 is a separate investment account of Prudential established
pursuant to a resolution adopted by its Board of Directors. The
resolution provides that this account is to be used for contracts which
state that certain payments and values under them will vary to reflect
the investment results of this account.
The investments held in VCA-11 are intended to be composed of high-grade
money market instruments. Prudential will invest and reinvest the assets
held in VCA-11 in accordance with the investment objectives and policies
established for it.
The total value of the assets held in VCA-11 at all times will be at
least equal to the total reserve liability required by law for all
payments or values which vary in dollar amount to reflect the investment
results of VCA-11. Assets held in VCA-11 equal in value to that reserve
liability will be held for the sole benefit of all contracts which
participate in VCA-11. The amount, if any, by which the total value
exceeds the total reserve liability will be subject to the exclusive
control of Prudential. Thus, Prudential may from time to time make
transfers between VCA-11 and its other investment accounts as, in its
judgment, experience warrants. A transfer will not affect Prudential's
contractual liabilities under this contract.
2.2 VCA-11 UNIT VALUE:
The VCA-11 Unit Value for any Business Day is the dollar value of one
VCA-11 Unit for that Business Day. ("Business Day" means a day the New
York Stock Exchange is open for trading.) The initial VCA-11 Unit Value
was $1.00. The VCA-11 Unit Value for any subsequent Business Day is
determined as of the end of that Business Day by multiplying the VCA-11
Unit Change Factor for that Business Day by the VCA-11 Unit Value for the
immediately preceding Business Day. The VCA-11 Unit Value for any day
which is not a Business Day is equal to the VCA-11 Unit Value for the
next Business Day. The VCA-11 Unit Value will go up or down in accordance
with the VCA-11 Unit Change Factor described below.
To determine the VCA-11 Unit Change Factor for any Business Day,
Prudential will proceed as follows:
(a) Increase $1.00 by the rate of investment results of VCA-11 for
that Business Day, taking into account investment income and
changes in the value of investments after provision for any taxes
applicable to contracts of this class arising from the operation
of VCA-11.
(b) Subtract from the result found in (a) the VCA-11 Investment
Management Fee per $1.00 at the effective annual rate of 0.25% for
the number of calendar days in the period from the end of the
prior Business Day to the end of the current Business Day. The
aggregate amount by which VCA-11 is reduced in each year by the
Investment Management Fee will be deducted from investment income
to the extent possible; any balance will be deducted from
principal.
GVA-1010 (11)
Serial 200 2.1-2.2
<PAGE>
(c) Provide for the Administrative Expense Charge at the effective
annual rate of 0.75%, against the assets of VCA-11. To do so, the
result found in (b) is divided by $1.00 increased at the effective
annual rate of 0.75% for the number of calendar days in the period
from the end of the prior Business Day to the end of the current
Business Day.
The result found in (c) is the VCA-11 Unit Change Factor for that
Business Day.
Prudential may, upon notice to the Contract-Holder, change the basis for
determining the Unit Value. The changed basis would be one designed to
maintain a constant Unit Value, with investment results being reflected
through the number of Units in Participants' Accounts.
The Investment Management Fee specified in item (b) above may be changed
from time to time pursuant to a change in the investment management
agreement between Prudential and the VCA-11 Account. Prudential will
notify the Contract-Holder of any such change.
This section may also be changed as provided in section 5.1.
2.3 VCA-11 COMMITTEE:
The operation of VCA-11 will be supervised by The Prudential VCA-11
Committee (the "Committee"). The initial Committee members will be
appointed by Prudential. Thereafter, members will be elected by vote in
which the Contract-Holder will participate.
GVA-1010 (11) (as modified by GAA-7664)
Serial 210 2.3
<PAGE>
5/87
Provision III. WITHDRAWALS AND TRANSFERS - DEATH PAYMENTS:
3.1 WITHDRAWALS:
The Contract-Holder will notify Prudential when a withdrawal is to be
made from a Participant's Account pursuant to the Plan. The minimum
withdrawal is $500, or the dollar value of his Account if smaller.
Payment will normally be made within seven days of Prudential's receipt
of a duly completed request for it. However, it may be paid at a later
day if permitted under the Investment Company Act of 1940.
The amount paid to the Contract-Holder will be the dollar amount
withdrawn less the withdrawal charge determined from the following table
and the Annual Account Charge if it applies. The amount payable is also
referred to as the "Withdrawal Value".
TABLE
Withdrawals made in the months
indicated, counting from the day
the Participant's Account was Withdrawal Charge per $1.00
established* being withdrawn.**
---------------------------------- ---------------------------
First 24 months $0.06
Next 36 months 0.05
Next 60 months 0.03
Next 60 months 0.02
Thereafter 0.00
*Or, if earlier, the day an Account was established for him under a
companion contract.
**No charge is made after the amount withdrawn equals the contributions
made for the Participant. In addition, no charge is made if the
withdrawal is made for reasons of Financial Hardship or Disability
Retirement pursuant to the terms of the Plan.
As of the first day no amounts remain in a Participant's Account or in an
Account for him under a companion contract, his Account is cancelled.
This section may be changed as provided in section 5.1.
3.2 DEATH PAYMENTS:
If a Participant dies before his Participant's Accounts have been
cancelled, the dollar value will be paid to the Contract-Holder. The
payment will be made in one sum unless the Contract-Holder directs
Prudential to purchase an annuity for the Participant's beneficiary
pursuant to the Plan. However, the Contract-Holder will retain all rights
with respect to the annuity. Proof of the Participant's death must be
received by Prudential before any payment will be made.
GVA-1010
Serial 300 3.1-3.2
<PAGE>
5/87
The annuity form may be any of those described in section 4.4. No
contributions may be made to the Account after the Participant's death.
If a one sum payment is made on the Plan beneficiary's behalf within one
year of the Participant's death, it will be at least equal to the
contributions made for him under this contract less any withdrawals and
transfers.
As of the first day no amounts remain in the Participant's Account or in
an Account with respect to the Participant under a companion contract,
the Participant's Account is cancelled. Section 3.1 does not apply.
3.3 TRANSFERS BETWEEN RELATED CONTRACTS:
The Contract-Holder may transfer, pursuant to the Plan, an amount from a
Participant's Account to an Account maintained for him under a companion
contract. The minimum withdrawal to provide a transfer is $500, or the
dollar value of his Account if smaller. The transfer will normally be
made within seven days of Prudential's receipt of a duly completed
request for it. Section 3.1 does not apply to a withdrawal for this
purpose. Transfers are deemed to be made first from the contributions
paid for the Participant. Investment income is transferred when there are
no longer any contributions in the Participant's Account.
Amounts may be transferred to this contract from a companion contract. An
amount transferred to this contract for a Participant will be treated as
though it were a contribution made for him (see section 1.2). However in
determining any withdrawal charge, any portion of the amount transferred
which is investment income will not be considered as a contribution.
Prudential may, upon notice to the Contract-Holder, limit the frequency
of transfers. This action will take effect on the date of the notice.
This section may be changed as provided in section 5.1.
3.4 TRANSFERS TO ANOTHER FUNDING AGENT:
(a) At the Request of a Participant:
The Contract-Holder may transfer, pursuant to the request of a
Participant, the Withdrawal Value of the Participant's Account to an
annuity contract issued to the Contract-Holder which meets the
conditions of Section 457 of the Federal Internal Revenue Code and is
provided by another financial institution. The transfer may be made
directly to that institution or by a payment (or payments) to the
Contract-Holder who then makes payment to the institution. The
transfer will normally be made within seven days after Prudential's
receipt of a duly completed transfer request.
The transfer will be a full settlement of Prudential's liability for
the Participant's Account.
GVA-1010
Serial 310 (as modified by Form GAA-7471A) 3.3-3.4
<PAGE>
9/84
(b) At the Contract-Holder's Request:
The Contract-Holder may request Prudential to make transfer payments
to a funding agent named in the request. The transfer payment will be
made on the Transfer Date. The Transfer Date is the later of the day
specified in the request and the 90th day after its receipt by
Prudential.
All Participant's Accounts will be cancelled as of the Transfer Date.
A single liquidation account will be established equal to the sum of
the Withdrawal Values expressed in Units of the cancelled Accounts.
On the Transfer Date Prudential will withdraw the Units from the
liquidation account. The product of the number of Units withdrawn and
the Unit Value for the day of withdrawal will be transferred within
seven days thereafter.
Instead of making the transfer payment in cash, Prudential may make
all or part of it in the form of securities representing a uniform
percentage of each holding of the separate investment account
described in section 2.1.
(c) Upon Notice by Prudential:
If contributions are discontinued for all Participants pursuant to
section 6.2, Prudential may notify the Contract-Holder that transfer
payments will be made to the Contract-Holder or to a funding agent
named by the Contract-Holder. Prudential would do this if the
contributions are discontinued due to certain circumstances, such as
a change in any law or regulation, which in Prudential's judgment
would have an adverse effect on Prudential in fulfilling the terms of
this contract. In that case,
a Transfer Date will be established,
Participants' Accounts will be cancelled and a liquidation account
established, and
the transfer will be made
in the same manner as described in section 3.4(b).
This section may be changed as provided in section 5.1.
GVA-1010
Serial 320 (as modified by Form GAA-7471A) 3.4
<PAGE>
5/87
Provision IV. ANNUITIES:
4.1 ANNUITIES:
Whenever a benefit with respect to a Participant's Account is payable in
a series of payments pursuant to the Plan, with the dollar amount of each
payment being determined as of the date payments begin, the
Contract-Holder will notify Prudential to have the Participant's Account
applied to purchase an annuity for him. However, the Contract-Holder will
retain all rights with respect to the annuity. The dollar value of the
Account will be applied.
The schedule of annuity purchase rates that applies is determined from
Schedule A. The monthly amount of annuity is determined from the schedule
of purchase rates for that annuity.
As of the first day no amounts remain in the Participant's Account or in
an Account for him under a companion contract, his Account is cancelled.
4.2 ANNUITY - SINGLE SUM PAYMENT COMBINATION:
The Contract-Holder may notify Prudential that only a portion of the
Participant's Account is to be applied to purchase an annuity with the
balance to be paid in a single sum. The first portion will be subject to
section 4.1 and the balance to section 3.1.
4.3 SMALL ANNUITIES AND ACCOUNTS:
If the total monthly amount of annuity which would otherwise be purchased
on behalf of any person under this contract and the companion contracts
is less than $50,Prudential may, in lieu of an annuity under this
contract, make payment in a single sum. The single sum will be equal to
the amount that would otherwise be applied to purchase an annuity as
described in section 4.1.
If no contributions have been made under this contract or any companion
contract for a Participant for a period of 24 months and the dollar value
of his Accounts under all the contracts is $1,000 or less, Prudential may
cancel his Account under this contract. If the Account is cancelled, its
dollar value will be paid to the Contract-Holder. The Annual Account
Charge will be made only if no Account remains for him under a companion
contract.
4.4 TERMS OF PAYMENT OF ANNUITIES:
Life annuities and Payment Certain annuities are available under this
contract. A Life form of annuity is one payable at least during the
lifetime of the person (referred to as the "Annuitant") for whom it was
purchased. Depending upon the existence and nature of any payment payable
after the death of the Annuitant, a Life annuity will be one of the
following forms: Life-Payment Certain, Life - Contingent, or Life -
Payment Certain Contingent annuity. A Payment Certain form of annuity may
be payable for a period less than the lifetime of the person for whom the
annuity was purchased. The terms of payment of each form of annuity are
described below.
GVA-1010
Serial 400 (as modified by Form GAA-7471A) 4.1-4.4
<PAGE>
Left Margin 05
9/84
(a) Life Form of Annuity
The first monthly payment of a Life - Payment Certain annuity is
payable on the date the annuity is purchased. Monthly payments are
payable on the first day of each month thereafter throughout the
Annuitant's remaining lifetime. If the Annuitant dies before the
number of annuity payments made equals the number of Payments Certain
applicable to him, monthly annuity payments will be continued until
the total number of payments is so equal. These continued annuity
payments will each be in the same amount as was payable to the
Annuitant. The number of Payments Certain is established when the
annuity is purchased and may be 60, 120, 180, 240, or any other
number accepted by Prudential.
The first monthly payment of a Life - Contingent annuity is payable
on the date the annuity is purchased. Monthly payments are payable on
the first day of each month thereafter throughout the Annutiant's
remaining lifetime. If the Annuitant dies before the death of his
Contingent Annuitant, monthly Contingent Annuity payments will become
payable. The first payment of Contingent Annuity will be payable on
the first day of the month following the month in which the
Annuitant's death occurs. Monthly Contingent Annuity payments are
payable on the first day of each month thereafter throughout the
Contingent Annuitant's remaining lifetime. The last monthly payment
is payable for the month in which his death occurs. The amount of
each monthly Contingent Annuity payment will be a percentage of the
monthly annuity payment payable before the Annuitant's death. The
percentage is established when the annuity is purchased and may be 33
1/3%, 50%, 66 2/3% or 100%, or any other percentage accepted by
Prudential. Under a Life - Payment Certain Contingent annuity, a
percentage payment will not take effect until the end of the selected
Payment Certain period.
(b) Payment Certain Annuity:
The first monthly payment of a Payment Certain annuity is payable on
the date the annuity is purchased. Monthly payments are payable on
the first day of each month thereafter until the total number of
Payments Certain specified when the annuity was purchased has been
paid. The number of Payments Certain may be 60, 120, 180, 240, or any
other number accepted by Prudential.
Other forms of annuity payments may be provided with the consent of
Prudential.
4.5 CONTRACT-HOLDER AS PAYEE - PRUDENTIAL AS AGENT:
Every payment with respect to any annuity will be paid to the Contract-
Holder. The Contract-Holder will notify Prudential forthwith of the death
of any Annuitant and Contingent Annuitant. The Contract-Holder will
reimburse Prudential for any payments made by Prudential which are in
excess of those provided by the annuity for the Annuitant.
However, the Contract-Holder may request Prudential to act as its agent
for the purpose of making payments to Annuitants, Contingent Annuitants,
and their beneficiaries. If Prudential assents to the request, it will
make payments to the persons rather than to the Contract-Holder. The
Contract-Holder may terminate this agency relationship at any time upon
45 days' advance notice to Prudential. Thereafter payments will be made
to the Contract-Holder.
GVA/GAA-1010/7211-82
Serial 410 (as modified by Forms GAA-7471A/7471) 4.5
<PAGE>
9/84
Provision. V. CHANGES:
5.1 CHANGES BY PRUDENTIAL:
Prudential may make changes in this contract as follows:
(a) The Annual Account Charge and the table of withdrawal charges may be
changed periodically on and after the second anniversary of the
Effective Date.
(b) The effective annual rate of the Administrative Expense Charge and
the terms and amounts (excluding the withdrawal charge table) of
withdrawals and transfers pursuant to Provision III may be changed
periodically on and after the fifth anniversary of the Effective
Date.
(c) The schedules of annuity purchase rates may be changed periodically
on and after the tenth anniversary of the Effective Date.
Any change in the table of withdrawal charges and in Schedule D will
apply only to amounts added to Participants' Accounts on and after the
date the change takes effect. Any other change will apply to amounts in
Participants' Accounts whether added before or on and after the date the
change takes effect. Any change in the schedules of annuity purchase
rates will remain in effect for at least ten years.
Any change in accordance with this section will be made by giving notice
to the Contract-Holder at least 90 days before the date on which the
change is to take effect.
5.2 CHANGES BY AGREEMENT:
This contract may also be changed in any respect at any time or times by
agreement between the Contract-Holder and Prudential.
5.3 PERSONS EMPOWERED TO ACT FOR PRUDENTIAL:
No agent or other person except one of the following officers of
Prudential may change this contract or bind Prudential.
Chairman and Chief Executive Officer Associate Actuary
President Secretary
Vice President Assistant Secretary
Actuary
GVA-1010
Serial 500 (as modified by Form GAA-7471A) 5.1-5.3
<PAGE>
9/84
Provision VI. DISCONTINUANCE - TERMINATION OF CONTRACT:
6.1 DISCONTINUANCE OF ESTABLISHING PARTICIPANTS' ACCOUNTS:
Prudential may notify the Contract-Holder that on and after a specified
date no new Participants' Accounts will be established under this
contract. The specified date may not be earlier than 90 days after the
date of the notice. Thereafter, only contributions for persons who are
Participants on the specified date will be accepted hereunder. In all
other respects this contract will continue to operate in accordance with
its terms.
6.2 DISCONTINUANCE OF CONTRIBUTIONS UNDER THIS CONTRACT:
Contributions under this contract will be discontinued with respect to
all Participants:
(a) at any time after receipt by Prudential of notice thereof from the
Contract-Holder,
(b) when the Plan terminates,
(c) as of the effective date of any Plan change to which Prudential is
unable or unwilling to give effect under this contract (see section
7.6), or
(d) as of a date at least 90 days after notice to the Contract-Holder by
Prudential that no further contributions will be accepted hereunder.
After discontinuance the contract will continue to operate in accordance
with its terms with respect to Participants' Accounts. (This includes the
initiation of transfer payments as described in section 3.4(c)).
6.3 TERMINATION OF CONTRACT:
This contract will terminate when all the following have occurred:
(a) no further contributions may be paid under this contract;
(b) no Participant's Account remains uncancelled; and
(c) no further annuity or transfer payments are payable from this
contract.
GVA/GAA-1010/7211-82
Serial 600 (as modified by Forms GAA-7471A/7471) 6.1-6.3
<PAGE>
5/87
Provision VII. GENERAL TERMS:
7.1 CONTRACT HOLDER:
Prudential will normally deal only with the Contract-Holder. However,
Prudential and the Contract-Holder may agree to do otherwise. Also, in
some cases the contract calls for dealing with another. Prudential will
be entitled to rely on any action taken or omitted by the Contract-Holder
pursuant to the terms of this contract.
The Contract-Holder may, from time to time, delegate to an agency certain
administrative powers and responsibilities which this contract assigns to
the Contract-Holder. Prudential is not bound to recognize any delegation
until it has received notice of it. The notice must specify those powers
and responsibilities and include evidence of acceptance by the agency. On
and after the date of receipt of the notice, Prudential will deal with
the agency with respect to those powers and responsibilities and will be
entitled to rely on any action taken or omitted by the agency with
respect thereto in the same manner as if dealing with the
Contract-Holder. If any agency fails or refuses to act with respect
thereto, then the delegation will be void for the purposes of this
contract. Thereafter, Prudential will deal only with the Contract-Holder.
The Contract-Holder may give notice to Prudential of delegation to
another agency of specified powers and responsibilities.
7.2 COMMUNICATIONS:
All communications to the Contract-Holder or to Prudential will be in
writing. They will be addressed to the Contract-Holder at its principal
office, or at such other address as it may communicate to Prudential.
They will be addressed to Prudential, c/o The Prudential Asset Management
Company, Inc., 71 Hanover Road, Florham Park, New Jersey 07932, or at
such other address as it may communicate to the Contract-Holder. All
communications to any other person or organization dealing with
Prudential will be addressed to that person or organization at the last
address of record.
7.3 PLACE OF PAYMENT -- CURRENCY:
All payments to Prudential under this contract will be payable at its
office described above or at an address or to a representative as may be
specified by Prudential by notice to the Contract-Holder.
All payments under this contract, whether to or by Prudential, will be in
lawful money of the United States of America. Dollars and cents, as
specified in this contract, means lawful dollars and cents of United
States currency.
GVA/GAA-1010/7211-82
Serial 700 (as modified by Forms GAA-7471A/7471) 7.1-7.3
<PAGE>
9/84
7.4 INFORMATION -- RECORDS:
The Contract-Holder will furnish all information which Prudential may
reasonably require for the administration of this contract. If the
Contract-Holder cannot furnish any required item of information,
Prudential may request the person concerned to furnish the information.
Prudential will not be liable for the fulfillment of any obligations in
any way dependent upon information unless and until it receives the
information in form satisfactory to it.
Information furnished to Prudential may be corrected for demonstrated
errors in it unless Prudential has already acted to its prejudice by
relying on the information. Except for the corrections, information
furnished to Prudential will be regarded as conclusive. Prudential will
maintain the records necessary for its administration of this contract.
These records will be prepared from the information furnished to
Prudential and will constitute evidence as to the truth of the
information in the records.
7.5 MISSTATEMENTS:
If any other relevant fact relating to any person is found to have been
misstated, the following will apply:
(a) The amount of annuity payable by Prudential will be that which would
be provided by the amount allocated to purchase the annuity on the
basis of the correct information, without changing the date of first
payment of the annuity.
Any adjustment by Prudential of the amount or terms of payment made
in accordance with this section will be conclusive upon any other
person affected by it.
(b) The amount of any underpayment by Prudential will be paid in full
with the next payment due. The amount of any overpayment by
Prudential will be deducted to the extent possible from amounts
payable thereafter.
7.6 PLAN CHANGES:
This contract applies to the terms of the Plan in effect on the Effective
Date and to each Plan change. However, Prudential may, within 60 days
after its receipt of a copy of any Plan change, notify the
Contract-Holder that Prudential is unable or unwilling to give effect
under this contract to the change. Prudential would do this if the change
might have an adverse effect on Prudential in fulfilling the terms of the
contract. This would be determined based on Prudential's underwriting
principles then in effect. The Contract-Holder will furnish Prudential a
copy of the Plan and, while this contract is active, a copy of each Plan
change at least 60 days before it is to become effective.
GVA/GAA-1010/7211-82
Serial 710 (as modified by Forms GAA-7471A/7471) 7.4-7.6
<PAGE>
7.7 DIVISIBLE SURPLUS:
The portion, if any, of the divisible surplus of Prudential accruing upon
this contract will be determined annually by the Board of Directors of
Prudential and credited to Participants' Accounts as determined by the
Board. (It is unlikely any divisible surplus will accrue upon this
contract.)
No annuity under this contract will be taken into account in the
determination of any divisible surplus to be credited to this contract.
7.8 ENTIRE CONTRACT -- CONSTRUCTION:
This document constitutes the entire contract.
This contract will be construed according to the laws of the jurisdiction
set forth on the first page.
GVA/GAA-1010/7211-82
Serial 720 7.7-7.8
<PAGE>
9/84
SCHEDULE A
FORMS OF ANNUITY WHICH MAY BE PURCHASED
FORM OF PAYMENT PAYABLE APPLICABLE SCHEDULE
1. Life - Payment Certain Annuity. 1. Use Schedule B for allocation.
2. Life - Contingent Annuity. 3. Use Schedule C for allocation.
3. Payment Certain Annuity. 4. Use Schedule D for allocation.
Prudential may provide monthly amounts of annuity larger than those shown in the
following schedules for annuities purchased during any period specified by
Prudential. Annuity purchase rates for other forms of annuity consented to by
Prudential will be furnished on request. The following schedules may be changed
as provided in section 5.1.
GVA/GAA-1010/7211-82
Serial A-100 (as modified by Forms GAA-7471A/7471) Schedule A
<PAGE>
1/88
SCHEDULES
Monthly amount of annuity purchased per $10,000 of a Participant's Account,
after deduction from it of any taxes on annuity considerations that apply.
SCHEDULE B - Life-Payment Certain Annuity (120 Payments Certain)
Monthly Amount
--------------
If date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
60 $52.94 $41.56 $40.58 $39.85
65 58.01 46.81 45.60 44.68
70 64.46 53.48 51.98 50.82
SCHEDULE C - Life-Contingent Annuity
Monthly Amount
--------------
If Annuitant and Contingent Annuitant have same date of birth.
If the date the annuity is purchased is in:
Age 1988 1990 1995 2000
- --- ---- ---- ---- ----
If specified percentage to Contingent Annuitant is 100%:
60 $47.28 $36.06 $35.31 $34.78
65 51.11 40.07 39.10 38.39
70 56.56 45.62 44.32 43.32
If specified percentage to Contingent Annuitant is 50%:
60 $50.36 $38.89 $38.00 $37.34
65 55.18 43.77 42.61 41.75
70 61.91 50.47 48.92 47.71
SCHEDULE D - Payment Certain Annuity
Monthly Amount
--------------
Number of If date the annuity is purchased is in:
Payments Certain 1988 1990 1995 2000
- ---------------- ---- ---- ---- ----
60 $173.76 $165.62 $164.73 $164.73
120 97.43 88.93 88.45 88.45
180 72.47 63.55 63.20 63.20
* * * *
The rates in these Schedules are to be used without adjustment only when the
facts that apply to the Participant and his annuity are as shown. Rates for
other facts will be furnished upon request.
GVA/GAA-1010/7211-82
Serial S-100 Schedules B-D
Request for Enrollment in The MEDLEY[Registration Mark] Program
Return all copies to Prudential
Program: / / TDA Type of Contribution: / / Employee Elective
/ / DCP / / Employer
/ / IRA / / After Tax
/ / Rollover
Please print
GA / / / / / / / __________________________ / / / / / / /
Group Annuity Contract No. Employer's Name Employer No.(s)
1. PARTICIPANT DATA Participant's Social Security No.
- ---------------------------------------------- / / / / / / / / / / / /
First M.I. Last
Name Participant's Date
- ---------------------------------------------- of Birth Sex
Number & Street / / / / / / / / / / / / /
Mo. Day Yr. M F
Address
- ----------------------------------------------
Use this line if more space is needed
Date Employed:
- ---------------------------------------------- / / / / / / / / /
Mo. Day Yr.
City State Zip Code
- ----------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2. CONTRIBUTION DATA INVESTMENT DIRECTIONS
Until further notice, my contributions should
be invested as follows:
Guaranteed Interest Account / / / / %
Amount Per Pay Period Capital Growth Account (VCA-10) / / / / %
/ / / / / / / / / / Money Market Account (VCA-11) / / / / %
dollars cents Stock Index Portfolio (VCA-24) / / / / %
Common Stock Portfolio (VCA-24) / / / / %
Beginning Date Bond Portfolio (VCA-24) / / / / %
/ / / / / / / / / Aggressively Managed Flexible
Mo. Day Yr. Portfolio (VCA-24) / / / / %
Conservatively Managed Flexible
Rollover Contribution Portfolio (VCA-24) / / / / %
/ / / / / / / / / / Government Securities Portfolio
dollars cents (VCA-24) / / / / %
Global Equity Portfolio (VCA-24) / / / / %
Use whole numbers only -- Total Must Equal 100%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
YOU MAY DECLINE TO FURNISH ANY OR ALL OF THE PERSONAL AND FINANCIAL DATA
REQUESTED
3. PERSONAL AND FINANCIAL DATA
Marital Status ______ Last Years Household Income ________ Total Debt ______
No. of Dependents _________ Savings _____________________
Age of Dependents _________ Life Insurance ______________
_________ Security Holdings____________
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
4. Beneficiary Designation - Please refer to the attached Beneficiary
Designation form which must be completed.
- -------------------------------------------------------------------------------
I authorize Prudential to establish an account for me under The Prudential
contract(s) issued in connection with my employer's retirement program. I affirm
that this Request for Enrollment was accompanied by a prospectus describing the
available variable investment accounts (including information about sales
expenses and other charges), unless my employer's retirement program limits my
participation in the MEDLEY Program to investments in the Guaranteed Interest
Account. Unless I subsequently elect an earlier settlement date and/or form of
settlement, The Prudential is to apply my account(s) on the last distribution
date allowed under federal law to provide for me an immediate Fixed Dollar Life
Annuity with 120 Payments certain.
Signature of Participant ______________________________ Date __________________
DO NOT WRITE BELOW THIS LINE
- -------------------------------------------------------------------------------
Enrolling Representative ______________________________________________________
Please Print Number Signature of Date
(Initials and Enrolling
last name) Representative
Program Representative ______________________________________________________
Please Print Number Signature of Date
(Initials and Program
last name) Representative
Signature of Home Office
Representative _________________________ Date of Enrollment _________
Beneficiary Code ___________
<PAGE>
Request for Enrollment in The MEDLEY[Registration Mark]
Tax Deferred Annuity Program
Return all copies to Prudential
Type of Contribution: / / Employee Elective
/ / Employer
/ / After Tax
/ / Rollover
Please print
GA / / / / / / / __________________________ / / / / / / /
Group Annuity Contract No. Employer's Name Employer No.(s)
1. PARTICIPANT DATA Participant's Social Security No.
- ---------------------------------------------- / / / / / / / / / / / /
First M.I. Last
Name Participant's Date
- ---------------------------------------------- of Birth Sex
Number & Street / / / / / / / / / / / / /
Mo. Day Yr. M F
Address
- ----------------------------------------------
Use this line if more space is needed
Date Employed:
- ---------------------------------------------- / / / / / / / / /
Mo. Day Yr.
City State Zip Code
- ----------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2. CONTRIBUTION DATA INVESTMENT DIRECTIONS
Until further notice, my contributions should
be invested as follows:
Guaranteed Interest Account / / / / %
Amount Per Pay Period Capital Growth Account (VCA-10) / / / / %
/ / / / / / / / / / Money Market Account (VCA-11) / / / / %
dollars cents Stock Index Portfolio (VCA-24) / / / / %
Common Stock Portfolio (VCA-24) / / / / %
Beginning Date Bond Portfolio (VCA-24) / / / / %
/ / / / / / / / / Aggressively Managed Flexible
Mo. Day Yr. Portfolio (VCA-24) / / / / %
Conservatively Managed Flexible
Rollover Contribution Portfolio (VCA-24) / / / / %
/ / / / / / / / / / Government Securities Portfolio
dollars cents (VCA-24) / / / / %
Global Equity Portfolio (VCA-24) / / / / %
Use whole numbers only -- Total Must Equal 100%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
3. Beneficiary Designation - Please refer to the attached Beneficiary
Designation form which must be completed.
- -------------------------------------------------------------------------------
I authorize Prudential to establish an account for me under The Prudential
contract(s) issued in connection with my employer's retirement program. I affirm
that this Request for Enrollment was accompanied by a prospectus describing the
available variable investment accounts (including information about sales
expenses and other charges), unless my employer's retirement program limits my
participation in the MEDLEY Program to investments in the Guaranteed Interest
Account. I acknowledge that I have read and understand the Internal Revenue Code
Section 403(b)(11) withdrawal restrictions which are outlined in the withdrawal
of contributions section of the prospectus. I understand that these withdrawal
restrictions do not hinder my ability to make transfers among the available
MEDLEY investment options or to other accounts permitted under the Code. Unless
I subsequently elect an earlier settlement date and/or form of settlement, The
Prudential is to apply my account(s) on the last distribution date allowed under
federal law to provide for me an immediate Fixed Dollar Life Annuity with 120
Payments certain provided that I do not have a spouse at the time of
distribution or, if I have a spouse at the time, he/she has consented in writing
in accordance with the requirements of the Internal Revenue Code to such a form
of settlement. If I have a spouse at distribution time who has not previously
duly waived his/her rights, The Prudential will provide for me and my spouse a
50% Joint and Survivor Fixed Dollar Annuity at distribution.
Signature of Participant ______________________________ Date _________________
DO NOT WRITE BELOW THIS LINE
- -------------------------------------------------------------------------------
Enrolling Representative ______________________________________________________
Please Print Number Signature of Date
(Initials and Enrolling
last name) Representative
Program Representative ______________________________________________________
Please Print Number Signature of Date
(Initials and Program
last name) Representative
Signature of Home Office
Representative _________________________ Date of Enrollment _________
Beneficiary Code ___________
CERTIFICATE OF ADOPTION OF
AMENDMENTS TO AMENDED CHARTER
OF
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
AND OF
THE ADOPTION AND RATIFICATION OF A NEW
AMENDED CHARTER OF SUCH CORPORATION
The Prudential Insurance Corporation of America, a mutual insurance company
incorporated in the State of New Jersey, by Robert C. Winters, Chairman and
Chief Executive Officer, by Joseph J. Melone, President, and by Dorothy K.
Light, Secretary, does hereby certify:
1. That the said The Prudential Insurance Company of America is a mutual
life insurance corporation of the State of New Jersey.
2. That the Board of Directors of said corporation at a meeting duly
called, convened and held in accordance with the Amended Charter and By-Laws of
such corporation on the 12th day of January, 1988, which date was not less than
30 nor more than 90 days after Notice of Intention to present proposed
amendments to the Amended Charter for adoption or rejection by such Board had
been given to all of such directors and to the Commissioner of Insurance of the
State of New Jersey pursuant to the provisions of Subtitle 3 of Title 17B of the
New Jersey Statutes, by a unanimous vote of the Directors present at such
meeting, adopted the following resolutions:
"IT IS HEREBY RESOLVED that a new Article Ten be added to the Charter of
The Prudential Insurance Company of America, subject to approval by the
<PAGE>
New Jersey Insurance Commissioner and filing of the amended Charter with the
Department of Insurance, as follows:
10. No Director or officer of the corporation shall be personally liable
to the corporation or its policyholders for damages for breach of any
duty owed to the corporation or its policyholders, except that this
provision shall not relieve any such Director or officer of liability
for any act or omission for which such relief cannot be granted under
the laws of the State of New Jersey, as they exist on the date hereof
or as they may hereafter be amended. Neither the amendment or repeal
of this Article nor the adoption of any provision of this Amended
Charter which is inconsistent with this Article shall apply to or have
any effect on the liability or alleged liability of any Director or
officer of the corporation for or with respect to any act or omission
of such Director or officer occurring prior to such amendment, repeal
or adoption."
"IT IS FURTHER HEREBY RESOLVED that Article Two of the Charter shall be
amended by substituting `Dorothy K. Light' for `Isabelle L. Kirchner' as agent
for service of process."
"IT IS FURTHER HEREBY RESOLVED that the Chairman of the Board and Chief
Executive Officer, The President, and either the Secretary or any
Assistant Secretary, are authorized to make and execute a Certificate of
- 2 -
<PAGE>
Adoption of such amendments to the Amended Charter of the Company, to affix the
corporate seal thereto, and to take such action as is required by Subtitle 3 of
Title 17B of the New Jersey Statutes in order to cause such amendments to the
Amended Charter to become effective."
"IT IS FURTHER HEREBY RESOLVED that a new Amended Charter of the Company in the
following form, restating the present Amended Charter with all amendments
thereto, including those set forth in the preceding resolutions, and making
appropriate conforming changes in the prefatory paragraph, be and hereby is
adopted and ratified as the Amended Charter of the Company setting forth fully
and completely all of the terms and conditions under which the Company shall
hereafter transact business.
'CHARTER
OF
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
The Prudential Insurance Company of America, a corporation created as a stock
life insurance corporation by Chapter 521 of the Private Laws of the year 1873
of the State of New Jersey, the charter of which thereby granted was amended by
Chapter 40 of the Private Laws of the year 1875 and from time to time further
amended by action of directors and stockholders as authorized by the general
laws of the State of New Jersey, which corporation became a mutual life
insurance corporation by virtue of the provisions of Article Eight of Chapter
Thirty-four of Title 17 of the Revised Statutes and did adopt, pursuant to the
provisions of Chapter 14 of the Laws of New Jersey of the year
- 3 -
<PAGE>
1943, an amended charter, does hereby adopt, pursuant to the provisions of
Subtitle 3 of Title 17B, of the New Jersey Statutes, this Amended Charter
setting forth fully and completely all of the terms and conditions of the
Charter under which the corporation shall hereafter transact business:
1. The name of the corporation shall continue to be 'The Prudential Insurance
Company of America.'
2. The principal office of the corporation in the State of New Jersey
shall be located at 745 Broad Street in the City of Newark, County of
Essex, and the name of the agent in and in charge of such principal
office upon whom process against the corporation may be served is
Dorothy K. Light.
3. The business of the corporation shall be that of a mutual life
insurance corporation, with all of the rights, privileges and powers
conferred upon such corporation by the general laws of New Jersey, and
such as may from time to time be conferred by law upon such
corporations. The kinds of insurance, reinsurance and annuities to be
written by the corporation shall be 'Life insurance' as defined in
Section 17B:17-3 of Subtitle 3 of Title 17B of the New Jersey
Statutes, 'Health insurance' as defined in Section 17B:17-4 of said
Subtitle 3, 'Annuity' as defined in Section 17B:17-5 of said Subtitle
3, 'Legal services insurance' as defined in and authorized by Section
17:46C-1 of Title 17 of the New Jersey Statutes, 'Reinsurance' as
defined in and authorized by Sections 17B:18-62 and
- 4 -
<PAGE>
17B:18-63 of said Subtitle 3, "Extended reinsurance" as defined in and
authorized by Section 17B:18-65 of said Subtitle 3, and such other
insurance and reinsurance as may be permitted under the laws of the
State of New Jersey to be written by an insurer authorized to do the
kinds of business described in Sections 17B:17-3, 17B:17-4 and
17B:17-5 of said Subtitle 3. Independently of any insurance or annuity
contract, the corporation may provide services of the kinds authorized
for a domestic life insurance corporation by Section 17B:18-43 of said
Subtitle 3, subject to the provisions of said Section, and such as may
from time to time be authorized for a domestic life insurance
corporation by the laws of New Jersey.
4. The corporation shall continue to be a mutual life insurance
corporation.
5. The duration of the life of the corporation shall be unlimited.
6. The Board of Directors shall exercise all of the corporate powers of
the corporation except as otherwise provided by law and shall manage
all of the property, business and affairs of the corporation.
7. The Board of Directors shall be of the number and shall be chosen in
the manner set forth in Sections 17B:18-19 to 17B:18-28, inclusive, of
Subtitle 3 of Title 17B, of the New Jersey Statutes.
- 5 -
<PAGE>
8. Any vacancy in the Board of Directors shall be filled in the manner
provided in Sections 17B:18-19 to 17B:18-28, inclusive of Subtitle 3
of Title 17B, of the New Jersey Statutes.
9. The Board of Directors shall have full power from time to time to
make, alter, amend and rescind by-laws, rules and regulations for the
conduct of the business and affairs of the corporation in conformity
with the provisions of this Amended Charter, and to employ such
officers and agents as the Board of Directors in its discretion may
determine for the conduct of such business and affairs.
10. No Director or officer of the corporation shall be personally liable
to the corporation or its policyholders for damages for breach of any
duty owed to the corporation or its policyholders, except that this
provision shall not relieve any such Director or officer of liability
for any act or omission for which such relief cannot be granted under
the laws of the State of New Jersey, as they exist on the date hereof
or as they may hereafter be amended. Neither the amendment or repeal
of this Article nor the adoption of any provision of this Amended
Charter which is inconsistent with this Article shall apply to or have
any effect on the liability or alleged liability of any Director or
officer of the corporation for or with respect to any act or omission
of such Director or officer occurring prior to such amendment, repeal
or adoption.'"
- 6 -
<PAGE>
IN WITNESS WHEREOF, the said The Prudential Insurance Company of America
has caused this Certificate to be signed by its Chairman of the Board and Chief
Executive Officer, its President and its Secretary, and its corporate seal to be
affixed hereto this 13th day of January, 1988.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
BY /s/ Robert C. Winters
----------------------------
Robert C. Winters
Chairman of the Board and
Chief Executive Officer
By /s/ Joseph J. Melone
----------------------------
Joseph J. Melone
President
By /s/ Dorothy K. Light
---------------------------
Dorothy K. Light
Secretary
ATTEST
/s/ Dorothy K. Light
- ---------------------------
Dorothy K. Light, Secretary
- 7 -
<PAGE>
STATE OF NEW JERSEY :
: SS.:
COUNTY OF ESSEX :
BE IT REMEMBERED that on this 13th day of January, 1988, before me, the
Subscriber, a Notary Public of the State of New Jersey, personally appeared
DOROTHY K. LIGHT who, being by me duly sworn on her oath, deposes and makes
proof to my satisfaction, that she is the Secretary of the Corporation named in
the foregoing Certificate; that Robert C. Winters is the Chairman of the Board
and Chief Executive Officer of said Corporation; that Joseph J. Melone is the
President of said Corporation; that the execution, as well as the making of this
Certificate, has been duly authorized by a proper resolution of the Board of
Directors of said Corporation; that deponent well knows the corporate seal of
said Corporation; and that the seal affixed to said Certificate is such
corporate seal and was affixed thereto and said Certificate signed and delivered
by said Chairman of the Board and Chief Executive Officer, President, and
Secretary as and for the voluntary act and deed of said Corporation, in presence
of deponent, who thereupon subscribed her name thereto as attesting witness.
/s/ Dorothy K Light
-------------------
Sworn and subscribed to before
me on the date aforesaid.
/s/ Flora B. Lynn
- -------------------------
Notary Public
My Commission expires:
Flora Lynn
NOTARY PUBLIC OF NEW JERSEY
My Commission Expires May 1999
- 8 -
<PAGE>
CERTIFICATE OF COMMISSIONER OF INSURANCE
I. KENNETH D. MERIN, Commissioner of Insurance of the State of New Jersey,
hereby certify that the foregoing Certificate of Adoption of Amendments to
Amended Charter of The Prudential Insurance Company of America and of the
Adoption and Ratification of a new Amended Charter for such corporation has been
submitted to and examined by me, and I find that such Amendments to Amended
Charter and such new Amended Charter are in accordance with the provisions of
Subtitle 3 of Title 17B of the New Jersey Statutes, are in conformity with law,
are not inconsistent with the Constitution and Laws of this State, and do not
unreasonable affect the interests of the policyholders of such insurer, and I
hereby endorse on the foregoing Certificate my approval of such Amendments to
Amended Charter and such new Amended Charter.
DATED : February 19, 1988
Commissioner of Insurance
FILED
Department of Insurance
FEB 26 1988
COMMISSIONER
SERVICE AGREEMENT
This Agreement made as of the 31st day of December, 1984, by and between
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA ("Prudential"), a New Jersey
corporation and THE PRUDENTIAL INVESTMENT CORPORATION (the "Company"), a New
Jersey corporation,
WITNESSETH
In consideration of the mutual promises of the parties hereto as
hereinafter set forth, the parties hereby agree as follows:
1. The Company shall furnish to Prudential such services as Prudential
may require in connection with Prudential's performance of its
obligations under its advisory or subadvisory agreements relating to
its clients which are registered investment companies ("Clients").
2. Prudential will continue to have responsibility for all investment
advisory services under its advisory or subadvisory agreements with
respect to its Clients.
3. Prudential shall reimburse the Company for costs and expenses incurred
by the Company, determined in a manner acceptable to Prudential, in
furnishing the services described in paragraph 1 above.
4. This Agreement may be terminated by either party at any time upon not
less than thirty (30) days prior written notice to the other party,
but will terminate automatically in the event of its assignment. No
such termination will affect the terms of the
<PAGE>
- 2 -
advisory or subadvisory agreement relating to any Client. In the event
of the assignment or termination of Prudential's advisory or
subadvisory contract with respect to a particular Client, this
Agreement will terminate automatically as to such Client.
5. This Agreement shall continue in effect as to a particular Client for
a period of more than two years from its execution only so long as
such continuance is specifically approved at least annually in
accordance with the requirements of the Investment Company Act of 1940
applicable to continuation of advisory contracts.
IN WITNESS WHEREOF, the parties hereto have caused these presents to be
signed by their duly authorized officers and attested by their respective
secretaries or assistant secretaries under their respective seals, all as of the
date first written above.
(SEAL) (SEAL)
THE PRUDENTIAL INSURANCE THE PRUDENTIAL INVESTMENT
COMPANY OF AMERICA CORPORATION
By /s/ William M. Bethke By /s/ Garnett L. Keith
---------------------- -------------------------
Attest: Attest:
By /s/ Arthur J. Dunn By /s/ Kenneth E. Giles
---------------------- -------------------------
Asst. Secretary Asst. Secretary
POWER OF ATTORNEY
Know all men by these presents:
That I, W. Scott McDonald, Jr., Member of the Committee of The
Prudential Variable Contract Account-2 and The Prudential Variable Contract
Account-11, do hereby make, constitute and appoint as my true and lawful
attorneys in fact Rosanne J. Baruh, Mary L. Cavanaugh, Timothy P. Harris,
James F. Isherwood, Neil N. Jasey, Colleen P. Kelly, Paul Lowenstein, Mark
S. Johnson, Bernard V. Peterson, Christine Pham Jackel, Michele Range,
George S. Shively, Ransom C. Wilson and Robin S. Yonis or any of them
severally for me and in my name, place and stead to sign registration
statements on the appropriate forms prescribed by the Securities and
Exchange Commission for the registration under the Investment Company Act
of 1940 and the Securities Act of 1933, as applicable, and any and all
amendments thereto that may be filed with the Securities and Exchange
Commission, of the following:
The Prudential Variable Contract Account-2 and group variable annuity
contracts, to the extent they represent participating interests in said
Account;
The Prudential Variable Contract Account-11 and group annuity contracts, to
the extent they represent participating interests in said Account;
IN WITNESS WHEREOF, I have hereunto set my hand this 6th day of December, 1991.
/s/ W. SCOTT McDONALD JR
---------------------------------
Signature
State of New Jersey )
)SS
County of Essex )
On this 6 day of December, 1991, before me personally appeared W. Scott
McDonald Jr., to me known and known to me to be the person mentioned and
described in and who executed the foregoing instrument and duly acknowledged to
me that he executed same.
My commission expires:
ANN L. WELLBROCK
NOTARY PUBLIC OF NEW JERSEY /s/ ANN L. WELLBROCK
My Commission Expires July 26, 1994 --------------------
Notary Public
AW2/A:72.doc
<PAGE>
POWER OF ATTORNEY
Know all men by these presents:
That I, James H. Scott, Jr., Member of the Committee of The Prudential
Variable Contract Account-2, The Prudential Variable Contract Account-10,
and The Prudential Variable Contract Account-11, do hereby make, constitute
and appoint as my true and lawful attorneys in fact Rosanne J. Baruh, Mary
L. Cavanaugh, Timothy P. Harris, James F. Isherwood, Neil N. Jasey, Colleen
P. Kelly, Paul Lowenstein, Mark S. Johnson, Bernard V. Peterson, Christine
Pham Jackel, Michele Range, George S. Shively, Ransom C. Wilson and Robin
S. Yonis or any of them severally for me and in my name, place and stead to
sign registration statements on the appropriate forms prescribed by the
Securities and Exchange Commission for the registration under the
Investment Company Act of 1940 and the Securities Act of 1933, as
applicable, and any and all amendments thereto that may be filed with the
Securities and Exchange Commission, of the following:
The Prudential Variable Contract Account-2 and group variable annuity
contracts, to the extent they represent participating interests in said
Account;
The Prudential Variable Contract Account-10 and group annuity contracts, to
the extent they represent participating interests in said Account;
The Prudential Variable Contract Account-11 and group annuity contracts, to
the extent they represent participating interests in said Account;
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day of December, 1991.
/s/ JAMES SCOTT
---------------------------------
Signature
State of New Jersey )
)SS
County of Essex )
On this 4th day of December, 1991, before me personally appeared James Scott to
me known and known to me to be the person mentioned and described in and who
executed the foregoing instrument and duly acknowledged to me that he executed
same.
My commission expires: /s/ BARBARA Y. WEINSTEIN
------------------------
Notary Public
AW2/A:72.doc
BARBARA Y. WEINSTEIN
NOTARY PUBLIC of NEW JERSEY
My Commission Expires April 20, 1994
<PAGE>
POWER OF ATTORNEY
Know all men by these presents:
That I, Joseph Weber, Member of the Committee of The Prudential
Variable Contract Account-2, The Prudential Variable Contract Account-10,
and The Prudential Variable Contract Account-11, do hereby make, constitute
and appoint as my true and lawful attorneys in fact Rosanne J. Baruh, Mary
L. Cavanaugh, Timothy P. Harris, James F. Isherwood, Neil N. Jasey, Colleen
P. Kelly, Paul Lowenstein, Mark S. Johnson, Bernard V. Peterson, Christine
Pham Jackel, Michele Range, George S. Shively, Ransom C. Wilson and Robin
S. Yonis or any of them severally for me and in my name, place and stead to
sign registration statements on the appropriate forms prescribed by the
Securities and Exchange Commission for the registration under the
Investment Company Act of 1940 and the Securities Act of 1933, as
applicable, and any and all amendments thereto that may be filed with the
Securities and Exchange Commission, of the following:
The Prudential Variable Contract Account-2 and group variable annuity
contracts, to the extent they represent participating interests in said
Account;
The Prudential Variable Contract Account-10 and group annuity contracts, to
the extent they represent participating interests in said Account;
The Prudential Variable Contract Account-11 and group annuity contracts, to
the extent they represent participating interests in said Account;
IN WITNESS WHEREOF, I have hereunto set my hand this 3rd day of December, 1991.
/s/ JOSEPH WEBER
-----------------------------
Signature
State of New Jersey )
)SS
County of Essex )
On this 3rd day of December, 1991, before me personally appeared Joseph Weber,
to me known and known to me to be the person mentioned and described in and who
executed the foregoing instrument and duly acknowledged to me that he executed
same.
My commission expires:
ANN L. WELLBROCK
NOTARY PUBLIC OF NEW JERSEY /s/ ANN L. WELLBROCK
My Commission Expires July 26, 1994 --------------------
Notary Public
AW2/A:72.doc
<PAGE>
POWER OF ATTORNEY
Know all men by these presents:
That I, Mary C. Gencher, Member of the Committee of The Prudential
Variable Contract Account-10 and The Prudential Variable Contract
Account-11, do hereby make, constitute and appoint as my true and lawful
attorneys in fact Rosanne J. Baruh, Mary L. Cavanaugh, Timothy P. Harris,
James F. Isherwood, Neil N. Jasey, Colleen P. Kelly, Paul Lowenstein, Mark
S. Johnson, Bernard V. Peterson, Christine Pham Jackel, Michele Range,
George S. Shively, Ransom C. Wilson and Robin S. Yonis or any of them
severally for me and in my name, place and stead to sign registration
statements on the appropriate forms prescribed by the Securities and
Exchange Commission for the registration under the Investment Company Act
of 1940 and the Securities Act of 1933, as applicable, and any and all
amendments thereto that may be filed with the Securities and Exchange
Commission, of the following:
The Prudential Variable Contract Account-10 and group annuity contracts, to
the extent they represent participating interests in said Account;
The Prudential Variable Contract Account-11 and group annuity contracts, to
the extent they represent participating interests in said Account;
IN WITNESS WHEREOF, I have hereunto set my hand this 6th day of December, 1991.
/s/ MARY C. GENCHER
---------------------------------
Signature
State of New Jersey )
)SS
County of Essex )
On this 6th day of December, 1991, before me personally appeared Mary C.
Gencher, to me known and known to me to be the person mentioned and described in
and who executed the foregoing instrument and duly acknowledged to me that he
executed same.
My commission expires:
ANN L. WELLBR0CK /s/ ANN L. WELLBROCK
NOTARY PUBLIC OF NEW JERSEY --------------------
My Commission Expires July 26, 1994 Notary Public
AW2/A:72.doc
<PAGE>
POWER OF ATTORNEY
Know all men by these presents:
That I, Mark R. Fetting, Chairman of the Committee of The Prudential
Variable Contract Account-2, The Prudential Variable Contract Account-10,
and The Prudential Variable Contract Account-11, do hereby make, constitute
and appoint as my true and lawful attorneys in fact Rosanne J. Baruh, Mary
L. Cavanaugh, Timothy P. Harris, Neil N. Jasey, Colleen P. Kelly, Mark S.
Johnson, Bernard V. Peterson, Christine Pham Jackel, Michele Range, George
S. Shively, and Ransom C. Wilson or any of them severally for me and in my
name, place and stead to sign registration statements on the appropriate
forms prescribed by the Securities and Exchange Commission for the
registration under the Investment Company Act of 1940 and the Securities
Act of 1933, as applicable, and any and all amendments thereto that may be
filed with the Securities and Exchange Commission, of the following:
The Prudential Variable Contract Account-2 and group variable annuity
contracts, to the extent they represent participating interests in said
Account;
The Prudential Variable Contract Account-10 and group annuity contracts, to
the extent they represent participating interests in said Account;
The Prudential Variable Contract Account-11 and group annuity contracts, to
the extent they represent participating interests in said Account;
IN WITNESS WHEREOF, I have hereunto set my hand this 18th day of February, 1994.
/s/ MARK R. FETTING
---------------------------------
Signature
State of New Jersey )
)SS
County of Essex )
On this 18th day of February , 1994, before me personally appeared Mark R.
Fetting, to me known and known to me to be the person mentioned and described in
and who executed the foregoing instrument and duly acknowledged to me that he
executed same.
My commission expires:
ANN L. WELLBROCK /s/ ANN L. WELLBROCK
NOTARY PUBLIC OF NEW JERSEY --------------------
My Commission Expires July 26, 1994 Notary Public
AW2/A:72.doc
<PAGE>
POWER OF ATTORNEY
Know all men by these presents:
That I, Saul K. Fenster, Member of the Committee of The Prudential
Variable Contract Account-2 and The Prudential Variable Contract
Account-10, do hereby make, constitute and appoint as my true and lawful
attorneys in fact Rosanne J. Baruh, Mary L. Cavanaugh, Timothy P. Harris,
James F. Isherwood, Neil N. Jasey, Colleen P. Kelly, Paul Lowenstein, Mark
S. Johnson, Bernard V. Peterson, Christine Pham Jackel, Michele Range,
George S. Shively, Ransom C. Wilson and Robin S. Yonis or any of them
severally for me and in my name, place and stead to sign registration
statements on the appropriate forms prescribed by the Securities and
Exchange Commission for the registration under the Investment Company Act
of 1940 and the Securities Act of 1933, as applicable, and any and all
amendments thereto that may be filed with the Securities and Exchange
Commission, of the following:
The Prudential Variable Contract Account-2 and group annuity contracts, to
the extent they represent participating interests in said Account;
The Prudential Variable Contract Account-10 and group annuity contracts, to
the extent they represent participating interests in said Account;
IN WITNESS WHEREOF, I have hereunto set my hand this 5th day of December, 1991.
/s/ SAUL K. FENSTER
---------------------------------
Signature
State of New Jersey )
)SS
County of Essex )
On this 5th day of December, 1991, before me personally appeared Saul K.
Fenster, to me known and known to me to be the person mentioned and described in
and who executed the foregoing instrument and duly acknowledged to me that he
executed same.
My commission expires:
ANN L. WELLBROCK /s/ ANN L. WELLBROCK
NOTARY PUBLIC OF NEW JERSEY --------------------
My Commission Expires July 26, 1994 Notary Public
AW2/A:72.doc
