Registration No. 333-24009
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 3 TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
(Exact name of registrant as specified in its charter)
NEW YORK
(State or other jurisdiction of incorporation or organization)
13-5570651
(I.R.S. Employer Identification No.)
1290 AVENUE OF THE AMERICAS, NEW YORK, NEW YORK 10104
(212) 554-1234
(Address, including zip code, and telephone number,
including area code, of registrant's
principal executive offices)
MARY P. BREEN, VICE PRESIDENT AND ASSOCIATE GENERAL COUNSEL
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
1290 AVENUE OF THE AMERICAS, NEW YORK, NEW YORK 10104
(212) 554-1234
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Please send copies of all communications to:
PETER E. PANARITES
FREEDMAN, LEVY, KROLL & SIMONDS
1050 CONNECTICUT AVENUE, N.W., SUITE 825
WASHINGTON, D.C. 20036
(202) 457-5100
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<PAGE>
SUPPLEMENT TO
EQUITABLE ACCUMULATORSM
(IRA, NQ AND QP)
PROSPECTUS DATED MAY 1, 1998
COMBINATION VARIABLE AND FIXED DEFERRED ANNUITY CERTIFICATES
Issued By:
The Equitable Life Assurance Society of the United States
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This prospectus supplement describes the baseBUILDERSM Combined Guaranteed
Minimum Income Benefit and Guaranteed Minimum Death Benefit offered to Annuitant
issue ages 76 or older under the Equitable Accumulator (IRA, NQ and QP)
Prospectus. Capitalized terms in this supplement have the same meaning as in the
prospectus.
A different version of the Combined Guaranteed Minimum Income Benefit and
Guaranteed Minimum Death Benefit than the versions discussed on page 26 of the
prospectus under "baseBUILDER Benefits" is available for Annuitant issue ages 76
or older. The charge for this benefit is still 0.30% of the Guaranteed Minimum
Income Benefit benefit base in effect on a Processing Date. The versions of the
baseBUILDER Benefits described in the prospectus are not available at these
Annuitant issue ages. The benefit for Annuitant issue ages 76 or older is as
discussed below:
The Guaranteed Minimum Income Benefit may be exercised only within 30
days following the 7th or later Contract Date anniversary, but in no
event later than the Annuitant's age 90.
The period certain will be 90 less the Annuitant's age at election.
The Guaranteed Minimum Death Benefit applicable to the combined benefit is as
follows:
4% Roll Up to Age 85 - On the Contract Date, the Guaranteed Minimum
Death Benefit is equal to the initial contribution. Thereafter, the
Guaranteed Minimum Death Benefit is credited with interest at 4% on
each Contract Date anniversary through the Annuitant's age 85 (or at
the Annuitant's death, if earlier), and 0% thereafter, and is adjusted
for any subsequent contributions and withdrawals.
The Guaranteed Minimum Income Benefit benefit base described on page 39 of the
prospectus is as follows:
The Guaranteed Minimum Income Benefit benefit base is equal to the
initial contribution on the Contract Date. Thereafter, the Guaranteed
Minimum Income Benefit benefit base is credited with interest at 4% on
each Contract Date anniversary through the Annuitant's age 85, and 0%
thereafter, and is adjusted for any subsequent contributions and
withdrawals. The Guaranteed Minimum Income Benefit benefit base will
also be reduced by any withdrawal charge remaining on the Transaction
Date that you exercise your Guaranteed Minimum Income Benefit.
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Copyright 1998 The Equitable Life Assurance Society of the United States
New York, New York 10104. Accumulator and baseBUILDER are service marks
of The Equitable Life Assurance Society of the United States.
SUPPLEMENT DATED MAY 1, 1998
<PAGE>
MAY 1, 1998
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
PROFILE OF THE EQUITABLE ACCUMULATOR(SM) (IRA, NQ AND QP)
COMBINATION VARIABLE AND FIXED DEFERRED ANNUITY CERTIFICATES
This Profile is a summary of some of the more important points that you should
know and consider before purchasing a Certificate. The Certificate is more fully
described in the prospectus which accompanies this Profile. Please read the
prospectus carefully.
1. THE ANNUITY CERTIFICATE. The Equitable Accumulator Certificate is a
combination variable and fixed deferred annuity issued by Equitable Life.
Certificates can be issued as individual retirement annuities (IRAS, which can
be either TRADITIONAL IRAS or ROTH IRAS) or as non-qualified annuities (NQ) for
after-tax contributions only. NQ Certificates may be used as an investment
vehicle for certain types of qualified plans (QP). The Equitable Accumulator
Certificate is designed to provide for the accumulation of retirement savings
and for income through the investment, during an accumulation phase, of (a)
rollover contributions, direct transfers from other individual retirement
arrangements and additional IRA contributions or (b) after-tax money.
Your Equitable Life agent can provide you with information about other annuity
products we offer and help you decide which one may best meet your needs.
You may allocate amounts to Investment Funds where your Certificate's value may
vary up or down depending upon investment performance. You may also allocate
amounts Guarantee Periods (also called GUARANTEED FIXED INTEREST ACCOUNTS) that
when held to maturity provide guaranteed interest rates that we have set and a
guarantee of principal. Also, the Special Dollar Cost Averaging Account (in
states where approved) which is part of our general account and pays interest at
guaranteed fixed interest rates, is available for our Special Dollar Cost
Averaging program discussed below. If you make any transfers or withdrawals, the
Guaranteed Fixed Interest Accounts' investment value may increase or decrease
until maturity due to interest rate changes. Earnings accumulate under your
Certificate on a tax-deferred basis until amounts are distributed. Amounts
distributed under the Equitable Accumulator Certificate may be subject to income
tax.
The Investment Funds offer the potential for better returns than the interest
rates guaranteed under the Guaranteed Fixed Interest Accounts or the Special
Dollar Cost Averaging Account, but the Investment Funds involve risk and you can
lose money. You may make transfers among the Investment Funds and Guaranteed
Fixed Interest Accounts. The value of Guaranteed Fixed Interest Accounts prior
to their maturity fluctuates and you can lose money on premature transfers or
---------------
Copyright 1998 The Equitable Life Assurance Society of the United States,
New York, New York 10104. Accumulator and baseBUILDER are service marks,
and Income Manager is a registered service mark of The Equitable Life
Assurance Society of the United States.
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<PAGE>
withdrawals. Any transfers (other than Dollar Cost Averaging transfers) or
withdrawals out of the Special Dollar Cost Averaging Account will cancel the
program.
The Certificate provides a number of distribution methods during the
accumulation phase and for converting to annuity income, which include the
ASSURED PAYMENT OPTION, APO PLUS and other annuity benefits.
The Assured Payment Option may also be elected if you desire to start receiving
a form of lifetime income immediately. When you elect the Assured Payment
Option, your Certificate's value will be reduced to provide for guaranteed
lifetime income. You may also elect APO Plus whereby a portion of your money is
allocated to the Assured Payment Option, and the remaining amount is allocated
to the Alliance Common Stock Fund or the Alliance Equity Index Fund, as you
select. Every three years during the fixed period, a portion of your money in
the selected Investment Fund is applied to increase the guaranteed payments, if
applicable, under the Assured Payment Option. The amount accumulated under your
Certificate during the accumulation phase will affect the amount of distribution
or annuity benefits you receive.
You can elect the baseBUILDER(SM) at issue of the Certificate for an additional
charge. The baseBUILDER provides a combined Guaranteed Minimum Income Benefit
and Guaranteed Minimum Death Benefit. The Guaranteed Minimum Income Benefit
provides a minimum amount of guaranteed lifetime income regardless of investment
performance when converting, at specific times, to the Income Manager(R) (Life
Annuity with a Period Certain) payout annuity certificate.
2. ANNUITY PAYMENTS. When you are ready to start receiving income, annuity
income is available by applying your Certificate's value to an Income Manager
payout annuity certificate. You can also have your IRA or NQ Certificate's value
applied to any of the following ANNUITY BENEFITS: (1) Life Annuity - payments
for your life, (2) Life Annuity - Period Certain - payments for your life, but
with payments continuing to the beneficiary for the balance of the 5, 10, 15 or
20 years (as you select) if you die before the end of the selected period; (3)
Life Annuity - Refund Certain - payments for your life, with payments continuing
to the beneficiary after your death until any remaining amount applied to this
option runs out; and (4) Period Certain Annuity - payments for a specified
period of time, usually 5, 10, 15 or 20 years, with no life contingencies.
Options (2) and (3) are also available as a Joint and Survivor Annuity -
payments for your life, and after your death, continuation of payments to the
survivor for life. Under QP Certificates the only Annuity Benefit available is
Option (2) as a Life Annuity with a 10 Year Period Certain, or a Joint and
Survivor Life Annuity with a 10 Year Period Certain. Annuity Benefits (other
than the Refund Certain which is only available on a fixed basis) are available
as a fixed annuity, or as a variable annuity, where the dollar amount of your
payments will depend upon the investment performance of the Investment Funds.
Once you begin receiving annuity payments, you cannot change your annuity
benefit.
3. PURCHASE. You can purchase an Equitable Accumulator IRA Certificate by
rolling over or transferring at least $5,000 or more from one or more individual
retirement arrangements. Under a Traditional IRA Certificate you may add
additional amounts of $1,000 or more at any time (subject to certain
restrictions). Additional amounts under a Traditional IRA Certificate are
limited to
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<PAGE>
$2,000 per year, but additional rollover or IRA transfer amounts are unlimited.
In certain cases, additional amounts may not be added to a Roth IRA Certificate.
An Equitable Accumulator NQ Certificate can be purchased with $5,000 or more.
Additional amounts of $1,000 or more can be made at any time (subject to certain
restrictions).
Certain restrictions apply to contributions under Equitable Accumulator QP
Certificates.
4. INVESTMENT OPTIONS. You may invest in any or all of the following Investment
Funds, which invest in shares of corresponding portfolios of The Hudson River
Trust (HR TRUST) and EQ Advisors Trust (EQ TRUST). The portfolios are described
in the prospectuses for HR Trust and EQ Trust.
<TABLE>
<CAPTION>
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EQUITY SERIES:
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<S> <C> <C>
DOMESTIC EQUITY INTERNATIONAL EQUITY AGGRESSIVE EQUITY
Alliance Common Stock Alliance Global Alliance Aggressive Stock
Alliance Growth & Income Alliance International Alliance Small Cap Growth
BT Equity 500 Index BT International Equity Index BT Small Company Index
EQ/Putnam Growth & Income Value Morgan Stanley Emerging Markets MFS Emerging Growth Companies
MFS Research Equity Warburg Pincus Small Company
Merrill Lynch Basic Value Equity T. Rowe Price International Value
T. Rowe Price Equity Income Stock
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<CAPTION>
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ASSET ALLOCATION SERIES FIXED INCOME SERIES
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<S> <C> <C>
Alliance Conservative Investors AGGRESSIVE FIXED INCOME DOMESTIC FIXED INCOME
Alliance Growth Investors Alliance High Yield Alliance Intermediate Government
EQ/Putnam Balanced Securities
Merrill Lynch World Strategy Alliance Money Market
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Alliance Equity Index (AVAILABLE ONLY UNDER APO PLUS)
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</TABLE>
You may also invest in one or more Guaranteed Fixed Interest Accounts currently
maturing in years 1999 through 2008. Under the Assured Payment Option and APO
Plus, Guaranteed Fixed Interest Accounts currently maturing in years 2009
through 2013 are also available. The Special Dollar Cost Averaging Account is
available for the Special Dollar Cost Averaging program, discussed below.
5. EXPENSES. The Certificates have expenses as follows: As a percentage of
assets in the Investment Funds, a daily charge is deducted for mortality and
expense risks (including the Guaranteed Minimum Death Benefit discussed below)
at an annual rate of 1.10%, and a daily charge is deducted for administration
expenses at an annual rate of 0.25%. If the baseBUILDER benefit with the 6% Roll
Up to Age 80 Guaranteed Minimum Death Benefit or the Annual Ratchet to Age 80
Guaranteed Minimum Death Benefit is elected, there is an annual charge of 0.30%
expressed as a percentage of the Guaranteed Minimum Income Benefit benefit base.
If the baseBUILDER benefit with the 6% Roll Up to Age 70 is elected, the annual
charge is 0.15% expressed as a percentage of the Guaranteed Minimum Income
Benefit benefit base.
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<PAGE>
The charges for the portfolios of HR Trust range from 0.62% to 1.38% of the
average daily net assets of HR Trust portfolios, depending upon HR Trust
portfolios selected. The charges for the portfolios of EQ Trust range from 0.55%
to 1.75% of the average daily net assets of EQ Trust portfolios, depending upon
the EQ Trust portfolios selected. The amounts for HR Trust are based on average
portfolio assets for the year ended December 31, 1997. The amounts shown for the
Alliance Small Cap Growth portfolio are annualized for 1997. The amounts for EQ
Trust are based on current expense caps. The 12b-1 fees for the portfolios of HR
Trust and EQ Trust are 0.25% of the average daily net assets of HR Trust and EQ
Trust, respectively. Charges for state premium and other applicable taxes may
also apply at the time you elect to start receiving annuity payments.
A withdrawal charge is imposed as a percentage of each contribution withdrawn in
excess of a free corridor amount, or if the Certificate is surrendered. The free
corridor amount for withdrawals is 15% of the Certificate's value at the
beginning of the year, except that under the Assured Payment Option and APO Plus
it is 10%. The withdrawal charge does not apply under certain of the
distribution methods available under the Equitable Accumulator IRA Certificates.
When applicable, the withdrawal charge is determined in accordance with the
table below, based on the year a contribution is withdrawn. The year in which we
receive your contribution is "Year 1."
Year of Contribution Withdrawal
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 2 3 4 5 6 7 8+
---------------------------------------------------------------
Percentage of
Contribution 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0%
</TABLE>
The following chart is designed to help you understand the charges in the
Certificate. The "Total Annual Charges" column shows the combined total of the
Certificate charges deducted as a percentage of assets in the Investment Funds
and the portfolio charges, as shown in the first two columns. The last two
columns show you two examples of the charges, in dollars, that you would pay
under a Certificate, and include the 0.30% benefit based charge for the
baseBUILDER benefit. The examples assume that you invested $1,000 in a
Certificate which earns 5% annually and that you withdraw your money: (1) at the
end of year 1, and (2) at the end of year 10. For year 1, the Total Annual
Charges are assessed as well as the withdrawal charge. For year 10, the example
shows the aggregate of all the annual charges assessed for the 10 years, but
there is no withdrawal charge. No charges for state premium and other applicable
taxes are assumed in the examples.
<TABLE>
<CAPTION>
EXAMPLES
Total Annual
TOTAL ANNUAL TOTAL ANNUAL TOTAL Expenses at End of:
CERTIFICATE PORTFOLIO ANNUAL (1) (2)
INVESTMENT FUND CHARGES CHARGES CHARGES 1 Year 10 Years
<S> <C> <C> <C> <C> <C>
Alliance Conservative 1.35% 0.80% 2.15% $ $
Investors
Alliance Growth Investors 1.35% 0.82% 2.17% $ $
Alliance Growth & Income 1.35% 0.83% 2.18% $ $
Alliance Common Stock 1.35% 0.64% 1.99% $ $
Alliance Global 1.35% 0.97% 2.32% [to be inserted by amendment]
$ $
Alliance International 1.35% 1.38% 2.73% $ $
Alliance Aggressive Stock 1.35% 0.81% 2.16% $ $
Alliance Small Cap Growth 1.35% 1.15% 2.50% $ $
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
EXAMPLES
Total Annual
TOTAL ANNUAL TOTAL ANNUAL TOTAL Expenses at End of:
CERTIFICATE PORTFOLIO ANNUAL (1) (2)
INVESTMENT FUND CHARGES CHARGES CHARGES 1 Year 10 Years
<S> <C> <C> <C> <C> <C>
Alliance Money Market 1.35% 0.63% 1.98% $ $
Alliance Intermediate [to be inserted by amendment]
Government Securities 1.35% 0.81% 2.16% $ $
Alliance High Yield 1.35% 0.88% 2.23% $ $
UNDER APO PLUS
Alliance Common Stock 1.35% 0.64% 1.99% $ $
Alliance Equity Index 1.35% 0.62% 1.97% $ $
BT Equity 500 Index 1.35% 0.55% 1.90% $ $
BT Small Company Index 1.35% 0.60% 1.95% $ $
BT International Equity Index 1.35% 0.80% 2.15% $ $
MFS Emerging Growth Companies 1.35% 0.85% 2.20% $ $
MFS Research 1.35% 0.85% 2.20% $ $
Merrill Lynch Basic Value
Equity 1.35% 0.85% 2.20% $ $
Merrill Lynch World Strategy 1.35% 1.20% 2.55% $ $
Morgan Stanley Emerging [to be inserted by amendment]
Markets Equity 1.35% 1.75% 3.10% $ $
EQ/Putnam Balanced 1.35% 0.90% 2.25% $ $
EQ/Putnam Growth & Income
Value 1.35% 0.85% 2.20% $ $
T. Rowe Price Equity Income 1.35% 0.85% 2.20% $ $
T. Rowe Price International
Stock 1.35% 1.20% 2.55% $ $
Warburg Pincus Small Company
Value 1.35% 1.00% 2.35% $ $
</TABLE>
Total annual portfolio charges may vary from year to year. For Investment Funds
investing in portfolios with less than 10 years of operations, charges have been
estimated. The charges reflect any waiver or limitation. For more detailed
information, see the Fee Table in the prospectus.
We may also offer other Equitable Accumulator certificates which have other
features, benefits and charges. A current prospectus for these other Equitable
Accumulator certificates, if available, may be obtained from your agent.
6. TAXES. In most cases, your earnings are not taxed until distributions are
made from your Certificate. If you are younger than age 59 1/2 when you receive
any distributions, in addition to income tax you may be charged a 10% Federal
tax penalty on the taxable amount received. This tax discussion does not apply
to QP Certificates. Please consult your tax adviser.
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<PAGE>
7. ACCESS TO YOUR MONEY. During the accumulation phase, you may receive
distributions under a Certificate through the following WITHDRAWAL OPTIONS.
Under IRA, NQ and QP Certificates: (1) Lump Sum Withdrawals of at least $1,000
taken at any time; and (2) Systematic Withdrawals paid monthly, quarterly or
annually, subject to certain restrictions, including a maximum percentage of
your Certificate's value. Under both the Traditional IRA and Roth IRA
Certificates only: (1) Substantially Equal Payment Withdrawals (if you are less
than age 59 1/2), paid monthly, quarterly or annually based on life expectancy;
and under Traditional IRA Certificates only (2) Minimum Distribution Withdrawals
(after you are age 70 1/2), which pays the minimum amount necessary to meet
minimum distribution requirements in the Internal Revenue Code. You also have
access to your Certificate's value by surrendering the Certificate. All or a
portion of certain withdrawals may be subject to a withdrawal charge to the
extent that the withdrawal exceeds the free corridor amount. A free corridor
amount does not apply to a surrender. Withdrawals and surrenders may be subject
to income tax and a tax penalty. Withdrawals from Guaranteed Fixed Interest
Accounts prior to their maturity may result in a market value adjustment. A
request for withdrawal of amounts from the Special Dollar Cost Averaging
Account, will cancel the Dollar Cost Averaging program.
8. PERFORMANCE. During the accumulation phase, your Certificate's value in the
Investment Funds may vary up or down depending upon the investment performance
of the Investment Funds you have selected. Past performance is not a guarantee
of future results.
9. DEATH BENEFIT. If the annuitant dies before amounts are applied under an
annuity benefit, the named beneficiary will be paid a death benefit. The death
benefit is equal to your Certificate's value in (i) the Investment Funds, (ii)
the Guaranteed Fixed Interest Accounts and (iii) the Special Dollar Cost
Averaging Account, or if greater, the Guaranteed Minimum Death Benefit.
For Traditional IRA and Roth IRA Certificates if the annuitant is between the
ages of 20 through 79 at issue of the Certificate; for NQ Certificates for
annuitant ages 0 through 79 at issue of the Certificate; and for QP Certificates
for annuitant ages 20 through 70 at issue of the Certificate, you may choose one
of two types of Guaranteed Minimum Death Benefit available under the
Certificate: a "6% Roll Up to Age 80" and an "Annual Ratchet to Age 80." Both
types are described below. Both benefits are based on the amount you initially
put in and are adjusted for additional contributions and withdrawals. For NQ
Certificates, for annuitant ages 80 through 83 at issue of the Certificate, a
return of the money you have invested under the Certificate will be the
Guaranteed Minimum Death Benefit.
6% Roll Up to Age 80 (Not available in New York) -- We add interest to the
initial amount at 6% (4% for amounts in the Alliance Money Market and Alliance
Intermediate Government Securities Funds, and Guaranteed Fixed Interest
Accounts) through the annuitant's age 80 (or at the annuitant's death, if
earlier). The 6% interest rate will still apply for amounts in the Alliance
Money Market Fund under the Special Dollar Cost Averaging program discussed
below.
Annual Ratchet to Age 80 --The Guaranteed Minimum Death Benefit is reset each
year through the annuitant's age 80 to the Certificate's value, if it is higher
than the prior year's Guaranteed
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Minimum Death Benefit. In New York, the Guaranteed Minimum Death Benefit at the
death of the annuitant will never be less than the amounts in the Investment
Funds, plus amounts (not reflecting any increase due to interest rate changes)
in the Guaranteed Fixed Interest Accounts reflecting guaranteed interest.
10. OTHER INFORMATION.
QUALIFIED PLANS. If the QP Certificates will be purchased by certain types of
plans qualified under Section 401(a), or 401(k) of the Internal Revenue Code,
please consult your tax adviser first. Any discussion of taxes in this profile
does not apply.
BASEBUILDER BENEFIT. The baseBUILDER (available for annuitant ages 20 through 75
at issue of the Certificates) is an optional benefit that combines the
Guaranteed Minimum Income Benefit and the Guaranteed Minimum Death Benefit. A
baseBUILDER benefit (which is different than the one described below) may be
available for annuitant issue ages 76 and older. The baseBUILDER benefits are
currently not available in New York.
Income Benefit - The Guaranteed Minimum Income Benefit, as part of the
baseBUILDER, provides a minimum amount of guaranteed lifetime income
for your future. When you are ready to convert (at specified future
times) your Certificate's value to the Income Manager (Life Annuity
with a Period Certain) payout annuity certificate the amount of
lifetime income that will be provided will be the greater of (i) your
Guaranteed Minimum Income Benefit or (ii) your Certificate's current
value applied at current annuity purchase factors.
Death Benefit - As part of the baseBUILDER you have the choice, at
issue of the Certificate, of two Guaranteed Minimum Death Benefit
options: (i) the 6% Roll Up to Age 80 or, (ii) the Annual Ratchet to
Age 80. These options are described in "Death Benefit" above. For
annuitant ages 20 through 65 at issue of the Certificate, there is an
alternate baseBUILDER benefit with a Guaranteed Minimum Death Benefit
option which is a 6% Roll Up to Age 70.
6% Roll Up to Age 70 -- We add interest to the initial amount
at 6% (4% for amounts in the Alliance Money Market and
Alliance Intermediate Government Securities Funds, and
Guaranteed Fixed Interest Accounts) through the annuitant's
age 70 (or at the annuitant's death, if earlier). The 6%
interest rate will still apply for amounts in the Alliance
Money Market Fund under the Special Dollar Cost Averaging
program discussed below.
FREE LOOK. You can examine the Certificate for a period of 10 days after you
receive it, and return it to us for a refund. The free look period is longer in
some states.
Your refund will equal your Certificate's value, reflecting any investment gain
or loss, in the Investment Funds, any increase or decrease in the value of any
amounts held in the Guaranteed Fixed Interest Accounts, interest credited to
amounts in the Special Dollar Cost Averaging Account through the date we receive
your Certificate. Some states or Federal income tax regulations may require that
we calculate the refund differently. In the case of a complete conversion of an
existing Traditional IRA Certificate to a Roth IRA, you may cancel your Roth IRA
and return to a
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Traditional IRA by following the instructions in the request for full conversion
form available from the Processing Office or your agent.
AUTOMATIC INVESTMENT PROGRAM (AIP). AIP provides for a specified amount to be
automatically deducted from a bank checking account, bank money market account
or credit union checking account and to be applied as additional amounts under
NQ and Traditional IRA Certificates. AIP is not available for Roth IRA and QP
Certificates.
PRINCIPAL ASSURANCE. This option is designed to assure the return of your
original amount invested on a Guaranteed Fixed Interest Account maturity date,
by putting a portion of your money in a particular Guaranteed Fixed Interest
Account, and the balance in the Investment Funds in any way you choose. Assuming
that you make no transfers or withdrawals of the portion in the Guaranteed Fixed
Interest Account, such amount will grow to your original investment upon
maturity.
DOLLAR COST AVERAGING. Special Dollar Cost Averaging - You can elect when you
apply for your Certificate to allocate your initial contribution to the Special
Dollar Cost Averaging Account where it will be credited with interest at a
guaranteed fixed rate. Amounts will be transferred from the Special Dollar Cost
Averaging Account to the other Investment Funds on a monthly basis over the
first twelve months of your Certificate. Thereafter the Special Dollar Cost
Averaging will not be available for allocation under your Certificate. If you
request a transfer (other than the Dollar Cost Averaging transfers) or a
withdrawal from amounts in the Special Dollar Cost Averaging Account, the
Special Dollar Cost Averaging program will end. Any amounts remaining in the
Special Dollar Cost Averaging Account will be transferred to the other
Investment Options according to your previous allocation instructions we have on
file. The Special Dollar Cost Averaging Account may not currently be available
in your state. In states where it is currently not available, we offer a Special
Dollar Cost Averaging program from the Alliance Money Market Fund, during the
time amounts are in the Alliance Money Market Fund under this program, mortality
and expense risks and administration charges will not be deducted from the
Alliance Money Market Fund. General Dollar Cost Averaging -You can elect at any
time to put money into the Alliance Money Market Fund and have a dollar amount
or percentage transferred from the Alliance Money Market Fund into the other
Investment Funds on a periodic basis over a longer period of time, and all
applicable charges deducted from the Alliance Money Market Fund will apply.
Dollar cost averaging does not assure a profit or protect against a loss should
market prices decline.
REBALANCING. You can have your money automatically readjusted among the
Investment Funds quarterly, semiannually or annually in order to retain the
investment percentage allocations you select. The amounts you have in each
selected Investment Fund will grow or decline in value at different rates during
each time period. Rebalancing automatically readjusts the amounts in the chosen
Investments Funds at the end of each period to the specified allocation
percentages. Rebalancing is intended to transfer specified portions of the
amounts in the chosen Investment Funds that have increased in value to those
chosen Investment Funds that have declined in value. Rebalancing does not assure
a profit or protect against a loss should market prices decline and should be
reviewed periodically, as your needs may change.
REPORTS. We will provide you with an annual statement of your Certificate's
values as of the last day of each year, and three additional reports of your
Certificate's values each year. You also will
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be provided with written confirmations of each financial transaction, and copies
of annual and semiannual statements of HR Trust and EQ Trust.
You may call toll-free at 1-800-789-7771 for a recording of daily Investment
Fund values, guaranteed rates applicable to Guaranteed Fixed Interest Accounts,
as well as guaranteed fixed interest rates in the Special Dollar Cost Averaging
Account.
11. INQUIRIES. If you need more information, please contact your agent. You may
also contact us, at:
The Equitable Life Assurance Society of the United States
Income Management Group
P.O. Box 1547
Secaucus, NJ 07096-1547
Telephone 1-800-789-7771 and Fax 1-201-583-2224
<PAGE>
EQUITABLE ACCUMULATOR(SM)
(IRA, NQ AND QP)
PROSPECTUS DATED MAY 1, 1998
------------------
COMBINATION VARIABLE AND FIXED DEFERRED ANNUITY CERTIFICATES
Issued By: The Equitable Life Assurance Society of the United States
- --------------------------------------------------------------------------------
This prospectus describes certificates The Equitable Life Assurance Society of
the United States (EQUITABLE LIFE, WE, OUR and US) offers under a combination
variable and fixed deferred annuity contract issued on a group basis or as
individual contracts. Enrollment under a group contract is evidenced by issuance
of a certificate. Certificates and individual contracts are each referred to as
"Certificates." Certificates can be issued as individual retirement annuities
(IRAS, which can be either TRADITIONAL IRAS or ROTH IRAS), or non-qualified
annuities for after-tax contributions only (NQ). NQ Certificates may also be
used as an investment vehicle for a defined contribution plan or defined benefit
plan (QP). Under IRA Certificates we accept only initial contributions that are
rollover contributions or that are direct transfers from other individual
retirement arrangements, as described in this prospectus. Under QP Certificates
we will only accept employer contributions from a trust under a plan qualified
under Section 401(a) or 401(k) of the Code. A minimum initial contribution of
$5,000 is required to put a Certificate into effect.
The Certificates are designed to provide for the accumulation of retirement
savings and for income. Contributions accumulate on a tax-deferred basis and can
be distributed under a number of different methods which are designed to be
responsive to the owner's (CERTIFICATE OWNER, YOU and YOUR) objectives. The
distribution methods include the ASSURED PAYMENT OPTION, Assured Payment Option
Plus (APO PLUS), available for Certificates issued as Traditional IRAs and Roth
IRAs, and a variety of payout options including variable annuities and fixed
annuities. The Assured Payment Option and APO Plus are also available for
election in the application if you are interested in receiving distributions
rather than accumulating funds.
The Certificates offer investment options (INVESTMENT OPTIONS) that permit you
to create your own strategies. These Investment Options include 24 variable
investment funds (INVESTMENT FUNDS) and each GUARANTEE PERIOD in the GUARANTEED
PERIOD ACCOUNT. There is an additional Investment Fund which is available only
under APO Plus. Also, the Special Dollar Cost Averaging Account (in states where
approved) which is part of Equitable Life's general account and pays interest at
guaranteed fixed interest rates, is available for our Special Dollar Cost
Averaging program.
We invest each Investment Fund in Class IB shares of a corresponding portfolio
(PORTFOLIO) of The Hudson River Trust (HR TRUST), and EQ Advisors Trust (EQ
TRUST), mutual funds whose shares are purchased by separate accounts of
insurance companies. The prospectuses for HR Trust (in which the Alliance Funds
invest) and EQ Trust (in which the other Investment Funds invest), both of which
accompany this prospectus, describe the investment objectives, policies and
risks, of the Portfolios.
INVESTMENT FUNDS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
EQUITY SERIES
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
DOMESTIC EQUITY INTERNATIONAL EQUITY AGGRESSIVE EQUITY
Alliance Common Stock Alliance Global Alliance Aggressive Stock
Alliance Growth & Income Alliance International Alliance Small Cap Growth
BT Equity 500 Index BT International Equity Index BT Small Company Index
EQ/Putnam Growth & Income Value Morgan Stanley Emerging Markets MFS Emerging Growth Companies
MFS Research Equity Warburg Pincus Small Company Value
Merrill Lynch Basic Value Equity T. Rowe Price International Stock
T. Rowe Price Equity Income
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
ASSET ALLOCATION SERIES FIXED INCOME SERIES
- ----------------------------------------------------------------------------------------------------------------------------
Alliance Conservative Investors AGGRESSIVE FIXED INCOME DOMESTIC FIXED INCOME
Alliance Growth Investors Alliance High Yield Alliance Intermediate Government
EQ/Putnam Balanced Securities
Merrill Lynch World Strategy Alliance Money Market
- ----------------------------------------------------------------------------------------------------------------------------
Alliance Equity Index (AVAILABLE ONLY UNDER APO PLUS)
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
Amounts allocated to a Guarantee Period accumulate on a fixed basis and are
credited with interest at a rate we set (GUARANTEED RATE) for the entire period.
On each business day (BUSINESS DAY) we will determine the Guaranteed Rates
available for amounts newly allocated to Guarantee Periods. A market value
adjustment (positive or negative) will be made for withdrawals, transfers,
surrender and certain other transactions from a Guarantee Period before its
expiration date (EXPIRATION DATE). Each Guarantee Period has its own Guaranteed
Rates. The Guarantee Periods currently available have Expiration Dates of
February 15, in years 1999 through 2008 and 1999 through 2013 under the Assured
Payment Option and APO Plus.
- --------------------------------------------------------------------------------
Copyright 1998 The Equitable Life Assurance Society of the
United States, New York, New York 10104. All rights
reserved. Accumulator and baseBUILDER are service marks and
Income Manager is a registered service mark of The Equitable
Life Assurance Society of the United States.
<PAGE>
This prospectus provides information about IRA, NQ and QP Certificates that
prospective investors should know before investing. You should read it carefully
and retain it for future reference. The prospectus is not valid unless
accompanied by current prospectuses for HR Trust and EQ Trust, both of which you
should also read carefully.
Your Equitable Life agent can provide you with information about other annuity
products we offer and help you decide which one may best meet your needs.
Registration statements relating to Separate Account No. 45 (SEPARATE ACCOUNT)
and interests under the Guarantee Periods have been filed with the Securities
and Exchange Commission (SEC). The statement of additional information (SAI),
dated May 1, 1998, which is part of the registration statement for the Separate
Account, is available free of charge upon request by writing to our Processing
Office or calling 1-800-789-7771, our toll-free number. The SAI has been
incorporated by reference into this prospectus. The Table of Contents for the
SAI appears at the back of this prospectus.
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 CERTIFICATES ARE NOT INSURED BY THE FDIC OR ANY OTHER AGENCY. THEY ARE NOT
DEPOSITS OR OTHER OBLIGATIONS OF ANY BANK AND ARE NOT BANK GUARANTEED. THEY ARE
SUBJECT TO INVESTMENT RISKS AND POSSIBLE LOSS OF PRINCIPAL INVESTED.
2
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Equitable Life's Annual Report on Form 10-K for the year ended December
31, 1997 is incorporated herein by reference.
All documents or reports filed by Equitable Life pursuant to Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended
(EXCHANGE ACT) after the date hereof and prior to the termination of the
offering of the securities offered hereby shall be deemed to be incorporated by
reference in this prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained in a document incorporated or deemed to
be incorporated herein by reference shall be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
and superseded, to constitute a part of this prospectus. Equitable Life files
its Exchange Act documents and reports, including its annual and quarterly
reports on Form 10-K and Form 10-Q, electronically pursuant to EDGAR under CIK
No. 0000727920. The SEC maintains a web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the SEC. The address of the site is http://www.sec.gov.
Equitable Life will provide without charge to each person to whom this
prospectus is delivered, upon the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated herein by reference (other
than exhibits not specifically incorporated by reference into the text of such
documents). Requests for such documents should be directed to The Equitable Life
Assurance Society of the United States, 1290 Avenue of the Americas, New York,
New York 10104. Attention: Corporate Secretary (telephone: (212) 554-1234).
3
<PAGE>
- --------------------------------------------------------------------------------
PROSPECTUS TABLE OF CONTENTS
- --------------------------------------------------------------------------------
GENERAL TERMS PAGE 6
FEE TABLE PAGE 8
PART 1: EQUITABLE LIFE, THE SEPARATE
ACCOUNT AND THE
INVESTMENT FUNDS PAGE 13
Equitable Life 13
Separate Account No. 45 13
HR Trust 13
HR Trust's Manager and Adviser 14
EQ Trust 14
EQ Trust's Manager and Advisers 14
Investment Policies and Objectives of HR Trust's
Portfolios and EQ Trust's Portfolios 15
PART 2: THE GUARANTEED PERIOD
ACCOUNT PAGE 18
Guarantee Periods 18
Market Value Adjustment for Transfers,
Withdrawals or Surrender Prior to the
Expiration Date 19
Modal Payment Portion 20
Investments 20
PART 3: THE SPECIAL DOLLAR COST AVERAGING PAGE 21
ACCOUNT
PART 4: PROVISIONS OF THE
CERTIFICATES AND SERVICES
WE PROVIDE PAGE 22
What Is the Equitable Accumulator? 22
Joint Ownership 22
Contributions under the Certificates 22
Methods of Payment 23
Allocation of Contributions 23
Free Look Period 24
Annuity Account Value 24
Transfers among Investment Options 25
Dollar Cost Averaging 25
Rebalancing 26
baseBUILDER Benefits 26
Guaranteed Minimum Income Benefit 27
Death Benefit 28
How Death Benefit Payment Is Made 29
When an NQ Certificate Owner Dies
before the Annuitant 29
Cash Value 29
Surrendering the Certificates to
Receive the Cash Value 30
When Payments Are Made 30
Assignment 30
Services We Provide 30
Distribution of the Certificates 31
PART 5: DISTRIBUTION METHODS UNDER THE
CERTIFICATES PAGE 32
Assured Payment Option 32
APO Plus 35
Withdrawal Options 37
How Withdrawals Affect Your
Guaranteed Minimum Income Benefit
and Guaranteed Minimum Death Benefit 39
Annuity Benefits and Payout Annuity Options 40
PART 6: DEDUCTIONS AND CHARGES PAGE 42
Charges Deducted from the Annuity
Account Value 42
Charges Deducted from the Investment Funds 43
HR Trust Charges to Portfolios 43
EQ Trust Charges to Portfolios 43
Group or Sponsored Arrangements 44
Other Distribution Arrangements 44
PART 7: VOTING RIGHTS PAGE 45
HR Trust and EQ Trust Voting Rights 45
Voting Rights of Others 45
Separate Account Voting Rights 45
Changes in Applicable Law 45
PART 8: TAX ASPECTS
OF THE CERTIFICATES PAGE 46
Tax Changes 46
Taxation of Non-Qualified Annuities 46
Charitable Remainder Trusts 47
Special Rules for NQ Certificates Issued
in Puerto Rico 47
IRA Tax Information 47
Traditional Individual Retirement Annuities
(Traditional IRAs) 48
Roth Individual Retirement Annuities
(Roth IRAs) 53
Federal and State Income Tax Withholding 57
Other Withholding 58
Impact of Taxes to Equitable Life 58
Transfers among Investment Options 58
PART 9: INDEPENDENT ACCOUNTANTS PAGE 59
PART 10: INVESTMENT PERFORMANCE PAGE 60
Adjusted Historical Performance Data 60
Rate of Return Data for Investment Funds 62
Communicating Performance Data 65
Alliance Money Market Fund and
Alliance Intermediate Government Securities
Fund Yield Information 66
4
<PAGE>
APPENDIX I: MARKET VALUE
ADJUSTMENT EXAMPLE PAGE 67
APPENDIX II: PURCHASE CONSIDERATIONS
FOR QP CERTIFICATES PAGE 68
APPENDIX III: GUARANTEED MINIMUM
DEATH BENEFIT EXAMPLE PAGE 69
APPENDIX IV: EXAMPLE OF
PAYMENTS UNDER THE ASSURED
PAYMENT OPTION AND APO PLUS PAGE 70
STATEMENT OF ADDITIONAL
INFORMATION TABLE OF CONTENTS PAGE 71
5
<PAGE>
- --------------------------------------------------------------------------------
GENERAL TERMS
- --------------------------------------------------------------------------------
ACCUMULATION UNIT -- Contributions that are invested in an Investment Fund
purchase Accumulation Units in that Investment Fund.
ACCUMULATION UNIT VALUE -- The dollar value of each Accumulation Unit in an
Investment Fund on a given date.
ANNUITANT -- The individual who is the measuring life for determining benefits
under the Certificate. Under NQ Certificates, the Annuitant can be different
from the Certificate Owner; under both Traditional and Roth IRA Certificates,
the Annuitant and Certificate Owner must be the same individual. Under QP
Certificates, the Annuitant must be the Participant/Employee.
ANNUITY ACCOUNT VALUE -- The sum of the amounts in the Investment Options under
the Certificate. See "Annuity Account Value" in Part 4.
ANNUITY COMMENCEMENT DATE -- The date on which Annuity Benefit payments are to
commence.
ASSURED PAYMENT OPTION -- A distribution option under Traditional and Roth IRA
Certificates which provides guaranteed lifetime income. The Assured Payment
Option may be elected in the application or elected as a distribution option at
a later date. Under this option amounts are allocated to the Guaranteed Period
Account and the Life Contingent Annuity. No amounts may be allocated to the
Investment Funds or the Special Dollar Cost Averaging Account.
APO PLUS -- A distribution option under Traditional and Roth IRA Certificates
which provides guaranteed lifetime income. APO Plus may be elected in the
application or as a distribution option at a later date. Under this option
amounts are allocated to the Guaranteed Period Account, the Life Contingent
Annuity and to the Alliance Common Stock Fund or the Alliance Equity Index Fund.
The amount in the selected Fund is then systematically converted to increase the
guaranteed lifetime income. No amounts may be allocated to the Special Dollar
Cost Averaging Account.
BASEBUILDER(SM) -- Optional protection benefit, consisting of the Guaranteed
Minimum Income Benefit and the Guaranteed Minimum Death Benefit.
BUSINESS DAY -- Generally, any day on which the New York Stock Exchange is open
for trading. For the purpose of determining the Transaction Date, our Business
Day ends at 4:00 p.m. Eastern Time or the closing of the New York Stock
Exchange, if earlier.
CASH VALUE -- The Annuity Account Value minus any applicable charges.
CERTIFICATE -- The Certificate issued under the terms of a group annuity
contract and any individual contract, including any endorsements.
CERTIFICATE OWNER -- The person who owns a Certificate and has the right to
exercise all rights under the Certificate. Under NQ Certificates, the
Certificate Owner can be different from the Annuitant; under both Traditional
and Roth IRA Certificates, the Certificate Owner must be the same individual as
the Annuitant. Under QP Certificates, the Certificate Owner must be the trustee
of a trust for a qualified plan maintained by an employer.
CODE -- The Internal Revenue Code of 1986, as amended.
CONTRACT DATE -- The effective date of the Certificates. This is usually the
Business Day we receive the initial contribution at our Processing Office.
CONTRACT YEAR -- The 12-month period beginning on your Contract Date and each
anniversary of that date.
EQ TRUST -- EQ Advisors Trust, a mutual fund in which the assets of separate
accounts of insurance companies are invested. EQ Financial Consultants, Inc. (EQ
FINANCIAL) is the manager of EQ Trust and has appointed advisers for each of the
Portfolios.
EXPIRATION DATE -- The date on which a Guarantee Period ends.
GUARANTEED MINIMUM DEATH BENEFIT -- The minimum amount payable upon death of the
Annuitant.
GUARANTEED MINIMUM INCOME BENEFIT -- The minimum amount of future guaranteed
lifetime income.
GUARANTEE PERIOD -- Any of the periods of time ending on an Expiration Date that
are available for investment under the Certificates. Guarantee Periods may also
be referred to as Guaranteed Fixed Interest Accounts.
GUARANTEED PERIOD ACCOUNT -- The Account that contains the Guarantee Periods.
6
<PAGE>
GUARANTEED RATE -- The annual interest rate established for each allocation to a
Guarantee Period.
HR TRUST -- The Hudson River Trust, a mutual fund in which the assets of
separate accounts of insurance companies are invested. Alliance Capital
Management L.P. (ALLIANCE) is the manager and adviser to HR Trust.
INVESTMENT FUNDS -- The funds of the Separate Account that are available under
the Certificates. The Alliance Equity Index Fund is only available under APO
Plus.
INVESTMENT OPTIONS -- The choices for investment: the Investment Funds, each
available Guarantee Period, and the Special Dollar Cost Averaging Account
(available only during the first Contract Year).
IRA -- An individual retirement annuity, as defined in Section 408(b) of the
Code. There are two types of IRAs, a Traditional IRA and a Roth IRA. A Roth IRA
must also meet the requirements of Section 408A of the Code.
JOINT OWNERS -- Two individuals who own undivided interests in the entire
Certificate. If Joint Owners are named, reference to "Certificate Owner," "you"
or "your" will apply to both Joint Owners or either of them. Joint Owners may be
selected only for NQ Certificates.
LIFE CONTINGENT ANNUITY -- Provides guaranteed lifetime income beginning at a
future date. Amounts may only be applied under the Life Contingent Annuity
through election of the Assured Payment Option and APO Plus.
MODAL PAYMENT PORTION -- Under the Assured Payment Option and APO Plus, the
portion of the Guaranteed Period Account from which payments, other than
payments due on an Expiration Date, are made.
MATURITY VALUE -- The amount in a Guarantee Period on its Expiration Date.
NQ -- An annuity contract which may be purchased only with after-tax
contributions, but is not a Roth IRA.
PARTICIPANT/EMPLOYEE -- An individual who participates in an employer's plan
funded by an Equitable Accumulator QP Certificate.
PORTFOLIOS -- The portfolios of HR Trust and EQ Trust that correspond to the
Investment Funds of the Separate Account.
PROCESSING DATE -- The day when we deduct certain charges from the Annuity
Account Value. If the Processing Date is not a Business Day, it will be on the
next succeeding Business Day. The Processing Date will be once each year on each
anniversary of the Contract Date.
PROCESSING OFFICE -- The address to which all contributions, written requests
(e.g., transfers, withdrawals, etc.) or other written communications must be
sent. See "Services We Provide" in Part 4.
QP -- When issued with the appropriate endorsement, an NQ Certificate which is
used as an investment vehicle for a defined contribution or a defined benefit
plan within the meaning of Section 401(a) of the Code.
ROTH IRA -- An IRA which must be funded on an after-tax basis, the distributions
from which may be tax free under specified circumstances.
SAI -- The statement of additional information for the Separate Account under
the Certificates.
SEPARATE ACCOUNT -- Equitable Life's Separate Account No. 45.
SPECIAL DOLLAR COST AVERAGING ACCOUNT -- The Investment Option that pays
interest at guaranteed fixed rates and is part of our general account. This
Account is available only for Dollar Cost Averaging of your initial Contribution
during the first Contract Year. The Special Dollar Cost Averaging Account is
referred to as the Guaranteed Interest Account in the Certificates.
TRADITIONAL IRA -- An IRA which is generally purchased with pretax
contributions, the distributions from which are treated as taxable.
TRANSACTION DATE -- The Business Day we receive a contribution or a transaction
request providing all the information we need at our Processing Office. If your
contribution or request reaches our Processing Office on a non-Business Day, or
after the close of the Business Day, the Transaction Date will be the next
following Business Day. Transaction requests must be made in a form acceptable
to us.
VALUATION PERIOD -- Each Business Day together with any preceding non-business
days.
7
<PAGE>
- --------------------------------------------------------------------------------
FEE TABLE
- --------------------------------------------------------------------------------
The purpose of this fee table is to assist you in understanding the various
costs and expenses you may bear directly or indirectly under the Certificates so
that you may compare them with other similar products. The table reflects both
the charges of the Separate Account and the expenses of HR Trust and EQ Trust.
Charges for applicable taxes such as state or local premium taxes may also
apply. For a complete description of the charges under the Certificates, see
"Part 6: Deductions and Charges." For a complete description of each trust's
charges and expenses, see the prospectuses for HR Trust and EQ Trust.
As explained in Part 2 and 3, the Guarantee Periods and the Special Dollar Cost
Averaging Account are not a part of the Separate Account and are not covered by
the fee table and examples. The only charge shown in the Table that will be
deducted from amounts allocated to the Guarantee Periods and the Special Dollar
Cost Averaging Account is the withdrawal charge. A market value adjustment
(either positive or negative) also may be applicable as a result of a
withdrawal, transfer or surrender of amounts from a Guarantee Period. See "Part
2: The Guaranteed Period Account."
OWNER TRANSACTION EXPENSES (DEDUCTED FROM ANNUITY ACCOUNT VALUE)
- ----------------------------------------------------------------
<TABLE>
<S> <C> <C>
WITHDRAWAL CHARGE AS A PERCENTAGE OF CONTRIBUTIONS (deducted upon surrender or for CONTRACT
certain withdrawals. The applicable withdrawal charge percentage is determined by YEAR
the Contract Year in which the withdrawal is made or the Certificate is surrendered ----
beginning with Contract Year 1 with respect to each contribution withdrawn or 1.......................7.00%
surrendered. For each contribution, the Contract Year in which we receive that 2.......................6.00
contribution is "Contract Year 1").(1) 3.......................5.00
4.......................4.00
5.......................3.00
6.......................2.00
7.......................1.00
8+......................0.00
SEPARATE ACCOUNT ANNUAL EXPENSES (AS A PERCENTAGE OF ASSETS IN EACH INVESTMENT FUND)
- ------------------------------------------------------------------------------------
<S> <C>
MORTALITY AND EXPENSE RISKS(2).............................................................................. 1.10%
ADMINISTRATION(3)........................................................................................... 0.25%
=====
TOTAL SEPARATE ACCOUNT ANNUAL EXPENSES................................................................... 1.35%
=====
OPTIONAL BENEFIT EXPENSE (DEDUCTED FROM ANNUITY ACCOUNT VALUE)
- --------------------------------------------------------------
BASEBUILDER BENEFIT EXPENSE (calculated as a percentage of the Guaranteed Minimum Income
Benefit benefit base)(4)................................................................................. 0.30%
</TABLE>
- -------------------
See footnotes on next page.
8
<PAGE>
HR TRUST AND EQ TRUST ANNUAL EXPENSES (AS A PERCENTAGE OF AVERAGE DAILY NET
ASSETS IN EACH PORTFOLIO)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
INVESTMENT PORTFOLIOS
-----------------------------------------------------------------------------------
ALLIANCE ALLIANCE ALLIANCE ALLIANCE
CONSERVATIVE GROWTH GROWTH & COMMON ALLIANCE ALLIANCE
HR TRUST INVESTORS INVESTORS INCOME STOCK GLOBAL INTERNATIONAL
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment Management and Advisory Fee 0.48% 0.52% 0.55% 0.36% 0.63% 0.90%
12b-1 Fee(5) 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Other Expenses 0.07% 0.05% 0.03% 0.03% 0.09% 0.23%
===============================================================================================================================
TOTAL HR TRUST ANNUAL EXPENSES(6) 0.80% 0.82% 0.83% 0.64% 0.97% 1.38%
===============================================================================================================================
<CAPTION>
ALLIANCE
ALLIANCE ALLIANCE ALLIANCE INTERMEDIATE ALLIANCE ALLIANCE
AGGRESSIVE SMALL CAP MONEY GOVT. HIGH EQUITY
HR TRUST STOCK GROWTH MARKET SECURITIES YIELD INDEX
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment Management and Advisory Fee 0.53% 0.90% 0.35% 0.50% 0.60% 0.33%
12b-1 Fee(5) 0.25% 0.21%(8) 0.25% 0.25% 0.25% 0.25%
Other Expenses 0.03% 0.04% 0.03% 0.06% 0.03% 0.04%
===============================================================================================================================
TOTAL HR TRUST ANNUAL EXPENSES(6) 0.81% 1.15%(8) 0.63% 0.81% 0.88% 0.62%
===============================================================================================================================
<CAPTION>
BT MFS MERRILL
BT BT INTERNATIONAL EMERGING LYNCH
EQUITY 500 SMALL COMPANY EQUITY GROWTH MFS BASIC VALUE
EQ TRUST INDEX INDEX INDEX COMPANIES RESEARCH EQUITY
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment Management and Advisory Fee 0.25% 0.25% 0.35% 0.55% 0.55% 0.55%
12b-1 Fee(5) 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Other Expenses 0.05% 0.10% 0.20% 0.05% 0.05% 0.05%
===============================================================================================================================
TOTAL EQ TRUST ANNUAL EXPENSES(7) 0.55% 0.60% 0.80% 0.85% 0.85% 0.85%
===============================================================================================================================
<CAPTION>
MORGAN T. ROWE WARBURG
MERRILL STANLEY EQ/PUTNAM PRICE PINCUS
LYNCH EMERGING GROWTH & T. ROWE INTER- SMALL
WORLD MARKETS EQ/PUTNAM INCOME PRICE EQUITY NATIONAL COMPANY
EQ TRUST STRATEGY EQUITY BALANCED VALUE INCOME STOCK VALUE
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Management and Advisory Fee 0.70% 1.15% 0.55% 0.55% 0.55% 0.75% 0.65%
12b-1 Fee(5) 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Other Expenses 0.25% 0.35% 0.10% 0.05% 0.05% 0.20% 0.10%
===============================================================================================================================
TOTAL EQ TRUST ANNUAL EXPENSES(7) 1.20% 1.75% 0.90% 0.85% 0.85% 1.20% 1.00%
===============================================================================================================================
</TABLE>
- -------------------
Notes:
(1) Deducted upon a withdrawal with respect to amounts in excess of the 15%
(10% under the Assured Payment Option and APO Plus) free corridor amount,
and upon surrender of a Certificate. See "Withdrawal Charge" in Part 6.
(2) A portion of this charge is for providing the Guaranteed Minimum Death
Benefit. See "Mortality and Expense Risks Charge" in Part 6.
(3) We reserve the right to increase this charge to an annual rate of 0.35%,
the maximum permitted under the Certificates.
(4) The 0.30% charge is for the baseBUILDER benefit with the "6% Roll Up to Age
80" Guaranteed Minimum Death Benefit and the "Annual Ratchet to Age 80"
Guaranteed Minimum Death Benefit. The charge for the baseBUILDER benefit
with the "6% Roll Up to Age 70" Guaranteed Minimum Death Benefit, available
under only Traditional IRA Certificates, is 0.15%. See "baseBUILDER
Benefits" in Part 4. If a baseBUILDER Benefit is elected, this charge is
deducted annually on each Processing Date. See "baseBUILDER Benefit Charge"
in Part 6. For the description of the Guaranteed Minimum Income Benefit
benefit base, see "Guaranteed Minimum Income Benefit Benefit Base" in Part
5.
(5) The Class IB shares of HR Trust and EQ Trust are subject to fees imposed
under distribution plans (herein, the "Rule 12b-1 Plans" ) adopted by HR
Trust and EQ Trust pursuant to Rule 12b-1 under the Investment Company Act
of 1940, as amended. The Rule 12b-1 Plans provide that HR Trust and EQ
Trust, on behalf of each Portfolio (other than the Alliance Small Cap
Growth Portfolio of HR Trust), may pay annually up to 0.25% of the average
daily net assets of a Portfolio attributable to its Class IB shares in
respect of activities primarily intended to result in the sale of the Class
IB shares. The 12b-1 fee will not be increased for the life of the
Certificates. The Rule 12b-1 Plan for the Alliance Small Cap Growth
Portfolio of HR Trust provides that Equitable Distributers Inc. (EDI) will
receive an annual fee not to exceed the lesser of (a) 0.25% of the average
daily net assets of the Portfolio attributable to Class IB shares and (b)
an amount that, when added to certain other expenses of the Class IB
shares, would result in the ratio of expenses to average daily net assets
attributable to Class IB shares equalling 1.20%.
(6) The amounts shown for the Portfolios of HR Trust are based on average daily
net assets for the year ended December 31, 1997. The amounts shown for the
Alliance Conservative Investors, Alliance Growth & Income, Alliance
International, Alliance Small Cap Growth, Alliance Intermediate Government
Securities and Alliance Equity Index Portfolios are annualized for 1997 as
these Portfolios commenced operations on May 1, 1997 (see footnote 8). The
investment management and advisory fees for each Portfolio may vary from
year to year depending upon the average daily net assets of the respective
Portfolio of HR Trust. The maximum investment management and advisory fees,
however, cannot be increased without a vote of that Portfolio's
shareholders. The other direct operating expenses will also fluctuate from
year to year depending on actual expenses. See "HR Trust Charges to
Portfolios" in Part 6.
(7) The EQ Trust Portfolios had no operations prior to May 1, 1997. The MFS
Emerging Growth Companies, MFS Research, Merrill Lynch Basic Value Equity,
Merrill Lynch World Strategy, EQ/Putnam Balanced, EQ/Putnam Growth & Income
Value, T. Rowe Price Equity Income, T. Rowe Price International Stock and
Warburg Pincus Small Company Value Portfolios of EQ Trust commenced
operations on May 1, 1997. The Morgan Stanley Emerging Markets Equity
Portfolio commenced operations on August 20, 1997. The BT Equity 500 Index,
BT Small Company Index, and BT International Equity Index Portfolios
commenced operations on December 31, 1997. The maximum investment
management and advisory fees for each EQ Trust Portfolio cannot be
increased without a vote of that Portfolio's shareholders. The amounts
shown as "Other Expenses" will fluctuate from year to year depending on
actual expenses, but pursuant to agreement, cannot together with other fees
exceed
9
<PAGE>
total annual expense limitations (which are the respective amounts shown in
"Total Annual Expenses"). Absent the expense limitation, the "Other
Expenses" for 1997 on an annualized basis for each of the following
Portfolios were as follows: 1.02% for MFS Emerging Growth Companies; 0.98%
for MFS Research; 1.09% for Merrill Lynch Basic Value Equity; 2.10% for
Merrill Lynch World Strategy; 1.21% for Morgan Stanley Emerging Markets
Equity; 1.75% for EQ/Putnam Balanced; 0.95% for EQ/Putnam Growth & Income
Value; 0.94% for T. Rowe Price Equity Income; 1.56% for T. Rowe Price
International Stock; and 0.80% for Warburg Pincus Small Company Value.
Because the BT Equity 500 Index, BT Small Company Index and the BT
International Equity Index Portfolios commenced operations on December 31,
1997 the "Other Expenses" are estimated for 1998 absent the expense
limitation and are 0.29%, 0.23% and 0.47%, respectively. See "EQ Trust
Charges to Portfolios" in Part 6.
(8) Prior to October 8, 1997, EDI waived the 0.25% 12b-1 fee to the extent
necessary to limit annual expenses for the Alliance Small Cap Growth
Portfolio to 1.20% of the average daily net assets of that Portfolio as set
forth above. Absent the fee waiver, the annualized expenses for 1997 for
the Alliance Small Cap Growth Portfolio would have been 1.19%.
We may also offer Equitable Accumulator certificates, which have other features,
benefits and charges. A current prospectus for these other Equitable Accumulator
certificates, if available, may be obtained from your agent.
10
<PAGE>
EXAMPLES
- ---------------
The examples below show the expenses that a hypothetical Certificate Owner (who
has (i) elected the baseBUILDER benefit with a 6% Roll Up to Age 80 Guaranteed
Minimum Death Benefit or an Annual Ratchet to Age 80 Guaranteed Minimum Death
Benefit and (ii) has elected APO Plus) would pay in the two situations noted
below assuming a $1,000 contribution invested in one of the Investment Funds
listed, and a 5% annual return on assets.(1)
These examples should not be considered a representation of past or future
expenses for each Investment Fund or Portfolio. Actual expenses may be greater
or less than those shown. Similarly, the annual rate of return assumed in the
examples is not an estimate or guarantee of future investment performance.
EXPENSES REFLECTING BASEBUILDER BENEFIT ELECTION
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
IF YOU SURRENDER YOUR CERTIFICATE AT THE IF YOU DO NOT SURRENDER YOUR CERTIFICATE AT
END OF EACH PERIOD SHOWN, THE EXPENSES THE END OF EACH PERIOD SHOWN, THE EXPENSES
WOULD BE: WOULD BE:
1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
HR TRUST
- --------
Alliance Conservative
Investors
Alliance Growth Investors
Alliance Growth & Income
Alliance Common Stock
Alliance Global
Alliance International
Alliance Aggressive Stock
Alliance Small Cap Growth
Alliance Money Market
[TO BE INSERTED BY AMENDMENT]
Alliance Intermediate Gov't
Securities
Alliance High Yield
EQ TRUST
- --------
BT Equity 500 Index
BT Small Company Index
BT International Equity Index
MFS Emerging
Growth Companies
MFS Research
Merrill Lynch Basic Value
Equity
Merrill Lynch World Strategy
Morgan Stanley Emerging
Markets Equity
EQ/Putnam Balanced
EQ/Putnam Growth & Income
Value
T. Rowe Price Equity Income
T. Rowe Price
International Stock
Warburg Pincus
Small Company Value
</TABLE>
- -------------------
See footnote on next page.
11
<PAGE>
EXPENSES REFLECTING APO PLUS ELECTION
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
IF YOU SURRENDER YOUR CERTIFICATE AT THE IF YOU DO NOT SURRENDER YOUR CERTIFICATE AT
END OF EACH PERIOD SHOWN, THE EXPENSES THE END OF EACH PERIOD SHOWN, THE EXPENSES
WOULD BE: WOULD BE:
1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
HR TRUST
- --------
Alliance Common Stock [TO BE INSERTED BY AMENDMENT]
Alliance Equity Index
</TABLE>
- -------------------
Note:
(1)The amount accumulated from the $1,000 contribution could not be paid in the
form of an annuity at the end of any of the periods shown in the examples. If
the amount applied to purchase an annuity is less than $2,000, or the initial
payment is less than $20, we may pay the amount to the payee in a single sum
instead of as payments under an annuity form. See "Annuity Benefits and
Payout Annuity Options" in Part 5. The examples do not reflect charges for
applicable taxes such as state or local premium taxes that may also be
deducted in certain jurisdictions.
12
<PAGE>
- --------------------------------------------------------------------------------
PART 1: EQUITABLE LIFE, THE SEPARATE ACCOUNT
AND THE INVESTMENT FUNDS
- --------------------------------------------------------------------------------
EQUITABLE LIFE
Equitable Life is a New York stock life insurance company that has been in
business since 1859. For more than 100 years we have been among the largest life
insurance companies in the United States. Our home office is located at 1290
Avenue of the Americas, New York, New York 10104. We are authorized to sell life
insurance and annuities in all fifty states, the District of Columbia, Puerto
Rico and the Virgin Islands. We maintain local offices throughout the United
States.
Equitable Life is a wholly owned subsidiary of The Equitable Companies
Incorporated (THE HOLDING COMPANY). The largest shareholder of the Holding
Company is AXA-UAP (AXA). As of December 31, 1997, AXA beneficially owned
approximately 59.0% of the outstanding common stock of the Holding Company.
Under its investment arrangements with Equitable Life and the Holding Company,
AXA is able to exercise significant influence over the operations and capital
structure of the Holding Company and its subsidiaries, including Equitable Life.
AXA, a French company, is the holding company for an international group of
insurance and related financial service companies.
Equitable Life, the Holding Company and their subsidiaries managed approximately
$274.1 billion of assets as of December 31, 1997.
SEPARATE ACCOUNT NO. 45
Separate Account No. 45 is organized as a unit investment trust, a type of
investment company, and is registered with the SEC under the Investment Company
Act of 1940, as amended (1940 ACT). This registration does not involve any
supervision by the SEC of the management or investment policies of the Separate
Account. The Separate Account has several Investment Funds, each of which
invests in shares of a corresponding Portfolio of HR Trust and EQ Trust. Because
amounts allocated to the Investment Funds are invested in a mutual fund,
investment return and principal will fluctuate and the Certificate Owner's
Accumulation Units may be worth more or less than the original cost when
redeemed.
Under the New York Insurance Law, the portion of the Separate Account's assets
equal to the reserves and other liabilities relating to the Certificates are not
chargeable with liabilities arising out of any other business we may conduct.
Income, gains or losses, whether or not realized, from assets of the Separate
Account are credited to or charged against the Separate Account without regard
to our other income gains or losses. We are the issuer of the Certificates, and
the obligations set forth in the Certificates (other than those of Annuitants or
Certificate Owners) are our obligations.
In addition to contributions made under the Certificates, we may allocate to the
Separate Account monies received under other contracts, certificates, or
agreements. Owners of all such contracts, certificates or agreements will
participate in the Separate Account in proportion to the amounts they have in
the Investment Funds that relate to their contracts, certificates or agreements.
We may retain in the Separate Account assets that are in excess of the reserves
and other liabilities relating to the Certificates or to other contracts,
certificates or agreements, or we may transfer the excess to our General
Account.
We reserve the right, subject to compliance with applicable law: (1) to add
Investment Funds (or sub-funds of Investment Funds) to, or to remove Investment
Funds (or sub-funds) from, the Separate Account, or to add other separate
accounts; (2) to combine any two or more Investment Funds or sub-funds thereof;
(3) to transfer the assets we determine to be the share of the class of
contracts to which the Certificates belong from any Investment Fund to another
Investment Fund; (4) to operate the Separate Account or any Investment Fund as a
management investment company under the 1940 Act, in which case charges and
expenses that otherwise would be assessed against an underlying mutual fund
would be assessed against the Separate Account; (5) to deregister the Separate
Account under the 1940 Act, provided that such action conforms with the
requirements of applicable law; (6) to restrict or eliminate any voting rights
as to the Separate Account; and (7) to cause one or more Investment Funds to
invest some or all of their assets in one or more other trusts or investment
companies. If any changes are made that result in a material change in the
underlying investment policy of an Investment Fund, you will be notified as
required by law.
HR TRUST
HR Trust is an open-end, diversified management investment company, more
commonly called a mutual fund. As a "series" type of mutual fund, it issues
several different series of stock, each of which relates to a different
Portfolio of HR Trust. HR Trust commenced operations in January 1976 with a
predecessor of its
13
<PAGE>
Alliance Common Stock Portfolio. HR Trust does not impose a sales charge or
"load" for buying and selling its shares. All dividend distributions to HR Trust
are reinvested in full and fractional shares of the Portfolio to which they
relate. Investment Funds that invest in Portfolios of HR Trust purchase Class IB
shares of a corresponding Portfolio of HR Trust. More detailed information about
HR Trust, its investment objectives, policies, restrictions, risks, expenses,
the Rule 12b-1 Plan relating to the Class IB shares, and all other aspects of
its operations appears in the HR Trust prospectus which accompanies this
prospectus or in the HR Trust statement of additional information.
HR TRUST'S MANAGER AND ADVISER
HR Trust is managed and advised by Alliance Capital Management L.P. (ALLIANCE),
which is registered with the SEC as an investment adviser under the Investment
Advisers Act of 1940 (ADVISERS ACT). Alliance, a publicly traded limited
partnership, is indirectly majority-owned by Equitable Life. On December 31,
1997, Alliance was managing approximately $218.7 billion in assets. Alliance
acts as an investment adviser to various separate accounts and general accounts
of Equitable Life and other affiliated insurance companies. Alliance also
provides management and consulting services to mutual funds, endowment funds,
insurance companies, foreign entities, qualified and non-tax qualified corporate
funds, public and private pension and profit-sharing plans, foundations and
tax-exempt organizations.
Alliance's main office is located at 1345 Avenue of the Americas, New York, New
York 10105.
EQ TRUST
EQ Trust is an open-end management investment company. As a "series type" of
mutual fund, EQ Trust issues different series of stock, each of which relates to
a different Portfolio of EQ Trust. EQ Trust commenced operations on May 1, 1997.
EQ Trust does not impose a sales charge or "load" for buying and selling its
shares. All dividend distributions to EQ Trust are reinvested in full and
fractional shares of the Portfolio to which they relate. Investment Funds that
invest in Portfolios of EQ Trust purchase Class IB shares of a corresponding
Portfolio of EQ Trust. More detailed information about EQ Trust, its investment
objectives, policies and restrictions, risks, expenses, the Rule 12b-1 Plan
relating to the Class IB shares, and all other aspects of its operations appears
in the EQ Trust prospectus which accompanies this prospectus or in the EQ Trust
statement of additional information.
EQ TRUST'S MANAGER AND ADVISERS
EQ Trust is managed by EQ Financial Consultants, Inc. (EQ FINANCIAL) which,
subject to supervision and direction of the Trustees of EQ Trust, has overall
responsibility for the general management and administration of EQ Trust. EQ
Financial is an investment adviser registered under the Advisers Act, and a
broker-dealer registered under the Exchange Act. EQ Financial is a Delaware
corporation and an indirect, wholly owned subsidiary of Equitable Life.
EQ Financial's main office is located at 1290 Avenue of the Americas, New York,
New York 10104.
EQ Financial has entered into investment advisory agreements with Bankers Trust
Company, who serves as adviser to the BT Equity 500 Index, BT Small Company
Index, and BT International Equity Index Portfolios; Massachusetts Financial
Services Company, adviser to the MFS Emerging Growth Companies and MFS Research
Portfolios; Merrill Lynch Asset Management Inc., adviser to the Merrill Lynch
Basic Value Equity and Merrill Lynch World Strategy Portfolios; Putnam
Investments, adviser to the EQ/Putnam Balanced and EQ/Putnam Growth & Income
Value Portfolios; Morgan Stanley Asset Management Inc., adviser to the Morgan
Stanley Emerging Markets Equity Portfolio; T. Rowe Price Associates, Inc. and
Rowe Price-Fleming International, Inc., adviser to the T. Rowe Price Equity
Income and T. Rowe Price International Stock Portfolios; and Warburg Pincus
Asset Management, Inc., adviser to the Warburg Pincus Small Company Value
Portfolio.
14
<PAGE>
INVESTMENT POLICIES AND OBJECTIVES OF HR TRUST'S PORTFOLIOS AND EQ TRUST'S
PORTFOLIOS
Each Portfolio has a different investment objective which it tries to achieve by
following separate investment policies. The policies and objectives of each
Portfolio will affect its return and its risks. There is no guarantee that these
objectives will be achieved. Set forth below is a summary of the investment
policies and objectives of each Portfolio. This summary is qualified in its
entirety by reference to the prospectuses for HR Trust and EQ Trust, both of
which accompany this prospectus. Please read the prospectuses for each of the
trusts carefully before investing.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
HR TRUST PORTFOLIO INVESTMENT POLICY OBJECTIVE
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Alliance Conservative Diversified mix of publicly traded equity and High total return without, in the
Investors debt securities. adviser's opinion, undue risk to
principal
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Growth Investors Diversified mix of publicly traded equity and High total return consistent with
fixed-income securities, including at times the adviser's determination of
common stocks issued by intermediate- and reasonable risk
small-sized companies and at times
lower-quality fixed-income securities commonly
known as "junk bonds."
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Growth & Income Primarily income producing common stocks and High total return through a
securities convertible into common stocks. combination of current income and
capital appreciation
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Common Stock Primarily common stock and other equity-type Long-term growth of capital and
instruments. increasing income
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Global Primarily equity securities of non-United Long-term growth of capital
States as well as United States companies.
- -------------------------------------------------------------------------------------------------------------------------------
Alliance International Primarily equity securities selected Long-term growth of capital
principally to permit participation in
non-United States companies with prospects for
growth.
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Aggressive Stock Primarily common stocks and other equity-type Long-term growth of capital
securities issued by quality small- and
intermediate-sized companies with strong growth
prospects and in covered options on those
securities.
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Small Cap Growth Primarily U.S. common stocks and other Long-term growth of capital
equity-type securities issued by smaller
companies that, in the opinion of the adviser,
have favorable growth prospects.
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Money Market Primarily high-quality U.S. dollar-denominated High level of current income
money market instruments. while preserving assets and
maintaining liquidity
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Intermediate Primarily debt securities issued or guaranteed High current income consistent
Government Securities as to principal and interest by the U.S. with relative stability of
government or any of its agencies or principal
instrumentalities. Each investment will have a
final maturity of not more than 10 years or a
duration not exceeding that of a 10-year
Treasury note.
- -------------------------------------------------------------------------------------------------------------------------------
Alliance High Yield Primarily a diversified mix of high-yield, High return by maximizing current
fixed-income securities which generally involve income and, to the extent
greater volatility of price and risk of consistent with that objective,
principal and income than higher-quality capital appreciation
fixed-income securities. Lower-quality debt
securities are commonly known as "junk bonds."
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
HR TRUST PORTFOLIO
AVAILABLE UNDER APO PLUS INVESTMENT POLICY OBJECTIVE
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Alliance Equity Index Selected securities in the Standard & Poor's Total return (before trust and
500 Composite Stock Price Index ("S&P 500") separate account expenses) that
which the adviser believes will, in the approximates the total return
aggregate, approximate the performance results of the Index (including reinvestment
of the Index. of dividends) at risk level
consistent with that of the Index
- -------------------------------------------------------------------------------------------------------------------------------
EQ TRUST PORTFOLIO INVESTMENT POLICY OBJECTIVE
- -------------------------------------------------------------------------------------------------------------------------------
BT Equity 500 Index Invest in a statistically selected sample of Replicate as closely as possible
the 500 stocks included in the S&P 500. (before the deduction of
Portfolio expenses) the total
return of the S&P 500
- -------------------------------------------------------------------------------------------------------------------------------
BT Small Company Index Invest in a statistically selected sample of Replicate as closely as possible
the 2,000 stocks included in the Russell 2000 (before the deduction of
Small Stock Index ("Russell 2000"). Portfolio expenses) the total
return of the Russell 2000
- -------------------------------------------------------------------------------------------------------------------------------
BT International Equity Index Invest in a statistically selected sample of Replicate as closely as possible
the securities of companies included in the (before the deduction of
Morgan Stanley Capital International Europe, Portfolio expenses) the total
Australia, Far East Index ("EAFE"), although return of the EAFE
not all companies within a country will be
represented in the Portfolio at the same time.
- -------------------------------------------------------------------------------------------------------------------------------
MFS Emerging Growth Primarily (i.e., at least 80% of its assets Long-term growth of capital
Companies under normal circumstances) in common stocks of
emerging growth companies that the adviser
believes are early in their life cycle
but which have the potential to become major
enterprises.
- -------------------------------------------------------------------------------------------------------------------------------
MFS Research A substantial portion of assets invested in Long-term growth of capital and
common stock or securities convertible future income
into common stock of companies believed
by the adviser to possess better than
average prospects for long-term growth.
- -------------------------------------------------------------------------------------------------------------------------------
Merrill Lynch Basic Value Equity Investment in securities, primarily equities, Capital appreciation and,
that the adviser believes are undervalued secondarily, income
and therefore represent basic investment value.
- -------------------------------------------------------------------------------------------------------------------------------
Merrill Lynch World Strategy Investment primarily in a portfolio of equity High total investment return
and fixed-income securities, including
convertible securities, of U.S. and foreign
issuers.
- -------------------------------------------------------------------------------------------------------------------------------
Morgan Stanley Emerging Markets Primarily equity securities of emerging market Long-term capital appreciation
Equity country issuers with a focus on those in which
the adviser believes the economies are
developing strongly and in which the markets
are becoming more sophisticated.
- -------------------------------------------------------------------------------------------------------------------------------
EQ/Putnam Balanced A well-diversified portfolio of stocks and Balanced investment
bonds that will produce both capital growth
and current income.
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
EQ TRUST PORTFOLIO (CONTINUED) INVESTMENT POLICY OBJECTIVE
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
EQ/Putnam Growth Primarily common stocks that offer potential Capital growth and, secondarily,
& Income Value for capital growth and may, consistent with the current income
Portfolio's investment objective, invest in
common stocks that offer potential for current
income.
- -------------------------------------------------------------------------------------------------------------------------------
T. Rowe Price Equity Income Primarily dividend paying common stocks of Substantial dividend income and
established companies. also capital appreciation
- -------------------------------------------------------------------------------------------------------------------------------
T. Rowe Price International Stock Primarily common stocks of established Long-term growth of capital
non-United States companies.
- -------------------------------------------------------------------------------------------------------------------------------
Warburg Pincus Small Primarily in a portfolio of equity securities Long-term capital appreciation
Company Value of small capitalization companies (i.e.,
companies having market capitalizations of
$1 billion or less at the time of initial
purchase) that the adviser considers to be
relatively undervalued.
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
- --------------------------------------------------------------------------------
PART 2: THE GUARANTEED PERIOD ACCOUNT
- --------------------------------------------------------------------------------
GUARANTEE PERIODS
Each amount allocated to a Guarantee Period and held to the Period's Expiration
Date accumulates interest at a Guaranteed Rate. The Guaranteed Rate for each
allocation is the annual interest rate applicable to new allocations to that
Guarantee Period, which was in effect on the Transaction Date for the
allocation. We may establish different Guaranteed Rates under other classes of
Certificates. We use the term GUARANTEED PERIOD AMOUNT to refer to the amount
allocated to and accumulated in each Guarantee Period. The Guaranteed Period
Amount is reduced or increased by any market value adjustment as a result of
withdrawals, transfers or charges (see below).
Your Guaranteed Period Account contains the Guarantee Periods to which you have
allocated Annuity Account Value. On the Expiration Date of a Guarantee Period,
its Guaranteed Period Amount and its value in the Guaranteed Period Account are
equal. We call the Guaranteed Period Amount on an Expiration Date the Guarantee
Period's Maturity Value. We report the Annuity Account Value in your Guaranteed
Period Account to reflect any market value adjustment that would apply if all
Guaranteed Period Amounts were withdrawn as of the calculation date. The Annuity
Account Value in the Guaranteed Period Account with respect to the Guarantee
Periods on any Business Day, therefore, will be the sum of the present value of
the Maturity Value in each Guarantee Period, using the Guaranteed Rate in effect
for new allocations to each such Guarantee Period on such date.
Guarantee Periods and Expiration Dates
We currently offer Guarantee Periods ending on February 15th for each of the
maturity years 1999 through 2008. Not all of these Guarantee Periods will be
available for Annuitant ages 76 and above. See "Allocation of Contributions" in
Part 4. Also, the Guarantee Periods are not available for investment in the
state of Maryland. As Guarantee Periods expire we expect to add maturity years
so that generally 10 are available at any time.
Under the Assured Payment Option and APO Plus, in addition to the Guarantee
Periods above, Guarantee Periods ending on February 15th for each of the
maturity years 2009 through 2013 are available.
We will not accept allocations to a Guarantee Period if, on the Transaction
Date:
o Such Transaction Date and the Expiration Date for such Guarantee Period fall
within the same calendar year.
o The Guaranteed Rate is 3%.
o The Guarantee Period has an Expiration Date beyond the February 15th
immediately following the Annuity Commencement Date.
Guaranteed Rates and Price Per $100 of Maturity Value
Because the Maturity Value of a contribution allocated to a Guarantee Period can
be determined at the time it is made, you can determine the amount required to
be allocated to a Guarantee Period in order to produce a target Maturity Value
(assuming no transfers or withdrawals are made and no charges are allocated to
the Guarantee Period). The required amount is the present value of that Maturity
Value at the Guaranteed Rate on the Transaction Date for the contribution, which
may also be expressed as the price per $100 of Maturity Value on such
Transaction Date.
Guaranteed Rates for new allocations as of February 13, 1998 and the related
price per $100 of Maturity Value for each currently available Guarantee Period
were as follows:
- -------------------------------------------------------------
GUARANTEE
PERIODS WITH GUARANTEED
EXPIRATION DATE RATE AS OF PRICE
FEBRUARY 15TH OF FEBRUARY 13, PER $100 OF
MATURITY YEAR 1998 MATURITY VALUE
- -------------------------------------------------------------
1999 4.42% $95.74
2000 4.45 91.64
2001 4.47 87.67
2002 4.53 83.73
2003 4.61 79.79
2004 4.70 75.89
2005 4.73 72.32
2006 4.76 68.90
2007 4.80 65.54
2008 4.82 62.42
- -------------------------------------------------------------
Available under the Assured Payment Option and APO Plus
- -------------------------------------------------------------
2009 4.71% $60.24
2010 4.71 57.53
2011 4.71 54.94
2012 4.71 52.47
2013 4.71 50.10
- -------------------------------------------------------------
Allocation among Guarantee Periods
The same approach as described above may also be used to determine the amount
which you would need to allocate to each Guarantee Period in order to
18
<PAGE>
create a series of constant Maturity Values for two or more years.
For example, if you wish to have $100 mature on February 15th of each of years
1999 through 2003, then according to the above table the lump sum contribution
you would have to make as of February 13, 1998 would be $438.57 (the sum of the
prices per $100 of Maturity Value for each maturity year from 1999 through
2003).
The above example is provided to illustrate the use of present value
calculations. It does not take into account the potential for charges to be
deducted, withdrawals or transfers to be made from Guarantee Periods or for the
market value adjustment that would apply to such transactions. Actual
calculations will be based on Guaranteed Rates on each actual Transaction Date,
which may differ.
Options at Expiration Date
We will notify you on or before December 31st prior to the Expiration Date of
each Guarantee Period in which you have any Guaranteed Period Amount. You may
elect one of the following options to be effective at the Expiration Date,
subject to the restrictions set forth on the prior page and under "Allocation of
Contributions" in Part 4:
(a) to transfer the Maturity Value into any Guarantee Period we are then
offering, or into any of our Investment Funds; or
(b) to withdraw the Maturity Value (subject to any withdrawal charges which
may apply).
If we have not received your election as of the Expiration Date, the Maturity
Value in the expired Guarantee Period will be transferred into the Guarantee
Period with the earliest Expiration Date.
MARKET VALUE ADJUSTMENT FOR TRANSFERS, WITHDRAWALS OR SURRENDER PRIOR TO THE
EXPIRATION DATE
Any withdrawal (including transfers, surrender and deductions) from a Guarantee
Period prior to its Expiration Date will cause any remaining Guaranteed Period
Amount for that Guarantee Period to be increased or decreased by a market value
adjustment. The amount of the adjustment will depend on two factors: (a) the
difference between the Guaranteed Rate applicable to the amount being withdrawn
and the Guaranteed Rate on the Transaction Date for new allocations to a
Guarantee Period with the same Expiration Date, and (b) the length of time
remaining until the Expiration Date. In general, if interest rates have risen
between the time when an amount was originally allocated to a Guarantee Period
and the time it is withdrawn, the market value adjustment will be negative, and
vice versa; and the longer the period of time remaining until the Expiration
Date, the greater the impact of the interest rate difference. Therefore, it is
possible that a significant rise in interest rates could result in a substantial
reduction in your Annuity Account Value in the Guaranteed Period Account related
to longer-term Guarantee Periods.
The market value adjustment (positive or negative) resulting from a withdrawal
of all funds from a Guarantee Period will be determined for each contribution
allocated to that Period as follows:
(1) We determine the present value of the Maturity Value on the Transaction Date
as follows:
(a) We determine the Guaranteed Period Amount that would be payable on the
Expiration Date, using the applicable Guaranteed Rate.
(b) We determine the period remaining in your Guarantee Period (based on
the Transaction Date) and convert it to fractional years based on a
365-day year. For example, three years and 12 days becomes 3.0329.
(c) We determine the current Guaranteed Rate which applies on the
Transaction Date to new allocations to the same Guarantee Period.
(d) We determine the present value of the Guaranteed Period Amount payable
at the Expiration Date, using the period determined in (b) and the rate
determined in (c).
(2) We determine the Guaranteed Period Amount as of the current date.
(3) We subtract (2) from the result in (1)(d). The result is the market value
adjustment applicable to such Guarantee Period, which may be positive or
negative.
The market value adjustment (positive or negative) resulting from a withdrawal
(including any withdrawal charges) of a portion of the amount in a Guarantee
Period will be a percentage of the market value adjustment that would be
applicable upon a withdrawal of all funds from a Guarantee Period. This
percentage is determined by (i) dividing the amount of the withdrawal or
transfer from the Guarantee Period by (ii) the Annuity Account Value in such
Guarantee Period prior to the withdrawal or transfer. See Appendix I for an
example.
The Guaranteed Rate for new allocations to a Guarantee Period is the rate we
have in effect for this purpose even if new allocations to that Guarantee Period
would not be accepted at the time. This rate will not be less than 3%. If we do
not have a Guaranteed Rate in effect for a Guarantee Period to which the
"current Guaranteed Rate" in (1)(c) would apply, we will use the rate at the
next closest Expiration Date. If we are no longer offering new Guarantee
Periods, the "current Guaranteed Rate" will be determined in accordance with our
19
<PAGE>
procedures then in effect. For purposes of calculating the market value
adjustment only, we reserve the right to add up to 0.25% to the current rate in
(1)(c) above.
MODAL PAYMENT PORTION
(Applicable Only for the Assured Payment Option and APO Plus)
Under the Assured Payment Option and APO Plus, a portion of your contributions
or Annuity Account Value is allocated to the Modal Payment Portion of the
Guaranteed Period Account for payments to be made prior to the Expiration Date
of the earliest Guarantee Period we then offer. Such amount will accumulate
interest beginning on the Transaction Date at an interest rate we set. Interest
will be credited daily. Such rate will not be less than 3%.
Upon the expiration of a Guarantee Period, the Guaranteed Period Amount will be
held in the Modal Payment Portion of the Guaranteed Period Account. Amounts from
an expired Guarantee Period held in the Modal Payment Portion of the Guaranteed
Period Account will be credited with interest at a rate equal to the Guaranteed
Rate applicable to the expired Guarantee Period, beginning on the Expiration
Date of such Guarantee Period.
There is no market value adjustment with respect to amounts held in the Modal
Payment Portion of the Guaranteed Period Account.
INVESTMENTS
Amounts allocated to Guarantee Periods (or the Modal Payment Portion of the
Guaranteed Period Account under Traditional IRA and Roth IRA Certificates) will
be held in a "nonunitized" separate account established by Equitable Life under
the laws of New York. This separate account provides an additional measure of
assurance that full payment of amounts due under the Guarantee Periods (or the
Modal Payment Portion of the Guaranteed Period Account under Traditional IRA and
Roth IRA Certificates) will be made. Under the New York Insurance Law, the
portion of the separate account's assets equal to the reserves and other
contract liabilities relating to the Certificates are not chargeable with
liabilities arising out of any other business we may conduct.
Investments purchased with amounts allocated to the Guaranteed Period Account
(and any earnings on those amounts) are the property of Equitable Life. Any
favorable investment performance on the assets held in the separate account
accrues solely to Equitable Life's benefit. Certificate Owners do not
participate in the performance of the assets held in this separate account.
Equitable Life may, subject to applicable state law, transfer all assets
allocated to the separate account to its general account. Regardless of whether
assets supporting Guaranteed Period Accounts are held in a separate account or
our general account, all benefits relating to the Annuity Account Value in the
Guaranteed Period Account are guaranteed by Equitable Life.
Equitable Life has no specific formula for establishing the Guaranteed Rates for
the Guarantee Periods. Equitable Life expects the rates to be influenced by, but
not necessarily correspond to, among other things, the yields on the
fixed-income securities to be acquired with amounts that are allocated to the
Guarantee Periods at the time that the Guaranteed Rates are established. Our
current plans are to invest such amounts in fixed-income obligations, including
corporate bonds, mortgage-backed and asset-backed securities and government and
agency issues having durations in the aggregate consistent with those of the
Guarantee Periods.
Although the foregoing generally describes Equitable Life's plans for investing
the assets supporting Equitable Life's obligations under the fixed portion of
the Certificates, Equitable Life is not obligated to invest those assets
according to any particular plan except as may be required by state insurance
laws, nor will the Guaranteed Rates Equitable Life establishes be determined by
the performance of the nonunitized separate account.
General Account
Our general account supports all of our policy and contract guarantees,
including those applicable to the Guaranteed Period Account and the Special
Dollar Cost Averaging Account, as well as our general obligations. Amounts
applied under the Life Contingent Annuity become part of the general account.
See "Assured Payment Option," "Life Contingent Annuity," in Part 5.
The general account is subject to regulation and supervision by the Insurance
Department of the State of New York and to the insurance laws and regulations of
all jurisdictions where we are authorized to do business. Because of applicable
exemptions and exclusionary provisions, interests in the general account have
not been registered under the Securities Act of 1933, as amended (1933 ACT), nor
is the general account an investment company under the 1940 Act. Accordingly,
neither the general account nor the Life Contingent Annuity is subject to
regulation under the 1933 Act or the 1940 Act. However, the market value
adjustment interests under the Certificates are registered under the 1933 Act.
We have been advised that the staff of the SEC has not made a review of the
disclosure that is included in the prospectus for your information that relates
to the general account (other than market value adjustment interests) and the
Life Contingent Annuity. The disclosure, 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.
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PART 3: THE SPECIAL DOLLAR COST AVERAGING ACCOUNT
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The Special Dollar Cost Averaging Account is part of our general account and
pays interest at guaranteed rates. The general account supports all of our
policy and contract guarantees, as well as our general obligations. See,
"General Account" under "Investments" in "Part 2: The Guaranteed Period Account"
for a discussion of our general account.
The Special Dollar Cost Averaging Account is only available for Dollar Cost
Averaging of your initial contribution and may not currently be available in
your state. The Special Dollar Cost Averaging Account will not be available as
an Investment Option under your Certificate after the first Contract Year. See
"Dollar Cost Averaging" in Part 4. Contributions to the Special Dollar Cost
Averaging Account, less transfers under the Special Dollar Cost Averaging
program are guaranteed by Equitable Life.
Interest is credited to the Special Dollar Cost Averaging Account every day at
the current interest rate. Current interest rates are set periodically by
Equitable Life, at its discretion, according to procedures that Equitable Life
reserves the right to change. All interest rates are effective annual rates, but
before deduction of applicable withdrawal charges.
An interest rate is assigned to each allocation of an initial contribution to
the Special Dollar Cost Averaging Account and the rate is guaranteed for a
Contract Year.
The guaranteed interest rate applicable under the Special Dollar Cost Averaging
program is set forth in your Certificate and will never be less than 3%. See
"Dollar Cost Averaging" in Part 4 for the rules and restrictions applicable to
the Special Dollar Cost Averaging Account.
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PART 4: PROVISIONS OF THE CERTIFICATES AND SERVICES WE PROVIDE
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THE PROVISIONS DISCUSSED IN THIS PART 4 APPLY WHEN YOUR CERTIFICATE IS OPERATING
PRIMARILY TO ACCUMULATE ANNUITY ACCOUNT VALUE. UNDER TRADITIONAL IRA AND ROTH
IRA CERTIFICATES, DIFFERENT RULES MAY APPLY WHEN YOU ELECT THE ASSURED PAYMENT
OPTION OR APO PLUS IN THE APPLICATION OR AS LATER ELECTED AS A DISTRIBUTION
OPTION UNDER YOUR TRADITIONAL IRA OR ROTH IRA CERTIFICATE AS DISCUSSED IN PART
5.
WHAT IS THE EQUITABLE ACCUMULATOR?
The Equitable Accumulator is a deferred annuity designed to provide for the
accumulation of retirement savings, and for income at a future date. Investment
Options available are Investment Funds providing variable returns and Guarantee
Periods providing guaranteed interest when held to maturity and the Special
Dollar Cost Averaging Account (available only for Dollar Cost Averaging of your
intitial contribution during the first Contract Year). Equitable Accumulator
Certificates can be issued as two different types of individual retirement
annuities (IRAS), TRADITIONAL IRAS and ROTH IRAS, or non-qualified annuities
(NQ). NQ Certificates may also be used as an investment vehicle for qualified
plans (QP). The provisions of your Certificate may be restricted by applicable
laws or regulations. Roth IRA Certificates may not currently be available in
your state. Your agent can provide information about state availability, or you
may contact our Processing Office.
Earnings generally accumulate on a tax-deferred basis until withdrawn or when
distributions become payable. Withdrawals made prior to 59 1/2 may also be
subject to tax penalty.
IRA CERTIFICATES
IRA Certificates are available for Annuitant issue ages 20 through 78. IRA
Certificates are not available in Puerto Rico.
NQ CERTIFICATES
NQ Certificates are available for Annuitant issue ages 0 through 83.
QP CERTIFICATES
When issued with the appropriate endorsement, an NQ Certificate may be purchased
by a plan qualified under Section 401(a) or 401(k) of the Code. Such purchases
may not be available in all states. QP Certificates are available for Annuitant
issue ages 20 through 70. Plan fiduciaries considering purchase of a Certificate
should read the important information in "Appendix II: Purchase Considerations
for QP Certificates."
JOINT OWNERSHIP
If a Joint Owner is named under an NQ Certificate, both Owners must be of legal
age, and joint ownership with non-natural persons is not permitted. Unless
otherwise provided in writing, the exercise of any ownership right in the
Certificate must be in a written form satisfactory to us and signed by both
Owners. A Joint Owner designation supersedes any beneficiary designation (see
"Death Benefit" below). This feature may not currently be available in your
state. Your agent can provide information about state availability, or you may
contact our Processing Office.
CONTRIBUTIONS UNDER THE CERTIFICATES
The minimum initial contribution under all Certificates is $5,000. We may refuse
to accept any contribution if the sum of all contributions under all
accumulation Certificates with the same Annuitant would then total more than
$1,500,000. We reserve the right to limit aggregate contributions made after the
first Contract Year to 150% of first-year contributions. We may also refuse to
accept any contribution if the sum of all contributions under all Equitable Life
annuity accumulation certificates/contracts that you own would then total more
than $2,500,000.
Contributions are credited as of the Transaction Date.
IRA CERTIFICATES
Under Traditional IRA Certificates, we will only accept initial contributions
which are either rollover contributions under Sections 402(c), 403(a)(4),
403(b)(8), or 408(d)(3) of the Code, or direct custodian-to-custodian transfers
from other traditional individual retirement arrangements. Under Roth IRA
Certificates, we will only accept rollover contributions from Traditional IRAs,
or Roth IRAs, or direct custodian-to-custodian transfers from other Roth IRAs.
See "Part 8: Tax Aspects of the Certificates."
Under Traditional IRA Certificates, your subsequent contributions of at least
$1,000 may be made at any time until you attain age 79. Subsequent Traditional
IRA Certificate contributions may be "regular" IRA contributions (limited to a
maximum of $2,000 a year),
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or rollover contributions or direct transfers as described above.
"Regular" contributions to Traditional IRAs may not be made for the taxable year
in which you attain age 70 1/2 or thereafter. Rollover and direct transfer
contributions may be made until you attain age 79. However, under the Code, any
amount contributed after you attain age 70 1/2 must be net of your required
minimum distribution for the year in which the rollover or direct transfer
contribution is made. See "Traditional Individual Retirement Annuities
(Traditional IRAs)" in Part 8. For the consequences of making a "regular" IRA
contribution to your IRA Certificate, also see Part 8.
We will not accept "regular" IRA contributions to Roth IRAs. Rollover and direct
custodian-to-custodian transfer contributions can be made any time during your
lifetime provided you meet certain requirements. See "Roth Individual Retirement
Annuities (Roth IRAs)" in Part 8.
NQ CERTIFICATES
Under NQ Certificates, you may make subsequent contributions of at least $1,000
at any time until the Annuitant attains age 84.
QP CERTIFICATES
Under QP Certificates, we will only accept contributions which are employer
contributions from a trust under a plan qualified under Section 401(a) of the
Code. If a defined contribution plan is qualified under Section 401(k) of the
Code, contributions may include employee pretax and employer matching
contributions, but not employee after-tax contributions to the plan. For defined
benefit plans, contributions may not be made by employees. The employer shall
contribute to the Certificates such amounts as shall be determined by the plan
trustee.
Under QP Certificates, you may make subsequent contributions of at least $1,000
at any time until the Annuitant attains age 71.
METHODS OF PAYMENT
Except as indicated below, acceptable forms of payment for all contributions are
as follows:
o Checks must be made payable to Equitable Life.
o One person and business checks are strongly preferred forms of payment.
o If a cash equivalent is used for payment, single cash equivalent (money
order, bank draft, cashier's check) is the strongly preferred form of
payment; under certain circumstances Equitable Life may be required to report
to the Internal Revenue Service the receipt of cash equivalents as payment.
o All payments must be in U.S. dollars drawn on a U.S. financial institution
clearing through the Federal Reserve System; payments in foreign currency are
not acceptable forms of payment and will be returned.
o A traveler's check is not an acceptable form of payment.
o Third party checks endorsed by the payee to Equitable Life are not
acceptable, except as follows:
- a rollover from a qualified plan or 1035 transfer
- a trustee check that involves no refund
Equitable Life reserves the right to reject a payment if an unacceptable form
of payment is received.
All checks are accepted subject to collection. Contributions must be sent to
Equitable Life at our Processing Office address designated for contributions.
Your initial contribution must be accompanied by a completed application which
is acceptable to us. In the event the application information is incomplete or
the application is otherwise not acceptable, we may retain your contribution for
a period not exceeding five Business Days while an attempt is made to obtain the
required information. If the required information cannot be obtained within
those five Business Days, the Processing Office will inform the agent, on behalf
of the applicant, of the reasons for the delay or non-acceptability and return
the contribution immediately to the applicant, unless the applicant specifically
consents to our retaining the contribution until the required information is
received by the Processing Office.
Section 1035 Exchanges
You may apply the values of an existing NQ life insurance or deferred annuity
contract to purchase an Equitable Accumulator NQ Certificate in a tax-deferred
exchange, if you follow certain procedures. For further information, consult
your tax adviser. See also "Taxation of Non-Qualified Annuities: Withdrawals" in
Part 8. In the case of joint ownership, 1035 exchanges will not be permitted
unless both owners authorize the exchange.
Automatic Investment Program
Our Automatic Investment Program (AIP) provides for a specified amount to be
automatically deducted from a bank checking account, bank money market account
or credit union checking account and to be contributed as a subsequent
contribution into an NQ or a Traditional IRA Certificate on a monthly or
quarterly basis. AIP is not available for Roth IRA and QP Certificates.
The minimum amount that will be deducted is $100 monthly and $300 quarterly
(subject to the maximum $2,000 annually for Traditional IRAs). AIP subsequent
contributions may be made to any of the Investment Funds and available Guarantee
Periods, but not the Special Dollar Cost Averaging Account. You may elect AIP by
properly completing the appropriate form, which is available from your agent,
and returning it to our Processing Office. You elect which day of the month
(other than the 29th, 30th, or 31st) you wish to have your account debited. That
date, or the next Business Day if that day is a non-Business Day, will be the
Transaction Date.
You may cancel AIP at any time by notifying our Processing Office in writing at
least two business days prior to the next scheduled transaction. Equitable Life
is not responsible for any debits made to your account prior to the time written
notice of revocation is received at our Processing Office.
ALLOCATION OF CONTRIBUTIONS
You may choose Self-Directed, Principal Assurance or Dollar Cost Averaging
allocations.
A contribution allocated to an Investment Fund purchases Accumulation Units in
that Investment Fund based on the Accumulation Unit Value for that Investment
Fund computed for the Transaction Date. A contribution allocated to the
Guaranteed Period Account will have the Guaranteed Rate for the specified
Guarantee Period offered on the Transaction Date. An initial contribution
allocated to the Special Dollar Cost Averaging Account will receive the
guaranteed interest rate in effect on the Transaction Date.
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Self-Directed Allocation
You allocate your contributions to one or up to all of the available Investment
Funds and Guarantee Periods. The Special Dollar Cost Averaging Account is not
available under Self-Directed Allocations. Allocations among the available
Investment Options must be in whole percentages. Allocation percentages can be
changed at any time by writing to our Processing Office, or by telephone. The
change will be effective on the Transaction Date and will remain in effect for
future contributions unless another change is requested.
At Annuitant ages 76 and above, allocations to Guarantee Periods must be limited
to those with maturities of five years or less and with maturity dates no later
than the February 15th immediately following the Annuity Commencement Date.
Principal Assurance Allocation
This option (for Annuitant issue ages up through 75) assures that your Maturity
Value in a specified Guarantee Period will equal your initial contribution on
the Guarantee Period's Expiration Date, while at the same time allowing you to
invest in the Investment Funds. It may be elected only at issue of your
Certificate and assumes no withdrawals or transfers from the Guarantee Period.
The maturity year generally may not be later than 10 years nor earlier than
seven years from the Contract Date. In order to accomplish this strategy, we
will allocate a portion of your initial contribution to the selected Guarantee
Period. See "Guaranteed Rates and Price Per $100 of Maturity Value" in Part 2.
The balance of your initial contribution and all subsequent contributions must
be allocated under "Self-Directed Allocation" as described above.
If you are applying for a Traditional IRA Certificate, before you select a
maturity year that would extend beyond the year in which you will attain age 70
1/2, you should consider your ability to take minimum distributions from other
Traditional IRA funds that you may have or from the Investment Funds to the
extent possible. See "Traditional Individual Retirement Annuities (Traditional
IRAs): Required Minimum Distributions" in Part 8.
Dollar Cost Averaging Allocation
A Special Dollar Cost Averaging program is available for allocation of your
initial contribution. Also, a General Dollar Cost Averaging program is available
for allocation of your initial contribution, or if elected at a later date, your
Annuity Account Value. Both programs are more fully described later in this Part
4 under "Dollar Cost Averaging."
FREE LOOK PERIOD
You have the right to examine your Certificate for a period of 10 days after you
receive it, and to return it to us for a refund. You cancel it by sending it to
our Processing Office. The free look period is extended if your state requires a
refund period of longer than 10 days.
Your refund will equal the Annuity Account Value reflecting any investment gain
or loss, any positive or negative market value adjustment, and any guaranteed
interest through the date we receive your Certificate at our Processing Office.
Some states or Federal income tax regulations may require that we calculate the
refund differently. If the Assured Payment Option or APO Plus is elected in the
application for the Certificate, your refund will include any amount applied
under the Life Contingent Annuity. If you cancel your Certificate during the
free look period, we may require that you wait six months before you may apply
for a Certificate with us again.
We follow these same procedures if you change your mind before you receive your
Certificate, but after a contribution has been made. See "Part 8: Tax Aspects of
the Certificates" for possible consequences of cancelling your Certificate
during the free look period.
In the case of a complete conversion of an existing Equitable Accumulator
Traditional IRA Certificate to an Equitable Accumulator Roth IRA Certificate,
you may cancel your Equitable Accumulator Roth IRA Certificate and return to an
Equitable Accumulator Traditional IRA Certificate by following the instructions
in the request for full conversion form available from our Processing Office or
your agent.
ANNUITY ACCOUNT VALUE
Your Annuity Account Value is the sum of the amounts in the Investment Options.
Annuity Account Value in Investment Funds
The Annuity Account Value in an Investment Fund on any Business Day is equal to
the number of Accumulation Units in that Investment Fund times the Accumulation
Unit Value for the Investment Fund for that date. The number of Accumulation
Units in an Investment Fund at any time is equal to the sum of Accumulation
Units purchased by contributions and transfers less the sum of Accumulation
Units redeemed for withdrawals, transfers or deductions for charges.
The number of Accumulation Units purchased or sold in any Investment Fund equals
the dollar amount of the transaction divided by the Accumulation Unit Value for
that Investment Fund for the applicable Transaction Date.
The number of Accumulation Units will not vary because of any later change in
the Accumulation Unit Value. The Accumulation Unit Value varies with the
investment performance of the corresponding Portfolios of each respective trust,
which in turn reflects the investment income and realized and unrealized capital
gains and losses of the Portfolios, as well as each respective trust's fees and
expenses. The Accumulation
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Unit Value is also stated after deduction of the Separate Account asset charges
relating to the Certificates. A description of the computation of the
Accumulation Unit Value is found in the SAI.
Annuity Account Value in Guaranteed Period Account
The Annuity Account Value in the Guaranteed Period Account on any Business Day
will be the sum of the present value of the Maturity Value in each Guarantee
Period, using the Guaranteed Rate in effect for new allocations to such
Guarantee Period on such date. (This is equivalent to the Guaranteed Period
Amount increased or decreased by the full market value adjustment.) The Annuity
Account Value, therefore, may be higher or lower than the contributions (less
withdrawals) accumulated at the Guaranteed Rate. At the Expiration Date the
Annuity Account Value in the Guaranteed Period Account will equal the Maturity
Value. While the Assured Payment Option or APO Plus is in effect, the Annuity
Account Value will include any amount in the Modal Payment Portion of the
Guaranteed Period Account. However, amounts held in the Modal Payment Portion of
the Guaranteed Period Account are not subject to a market value adjustment. See
"Part 2: The Guaranteed Period Account."
Annuity Account Value in Special Dollar Cost Averaging Account
The amount that you have in the Special Dollar Cost Averaging Account at any
time is equal to your initial contribution allocated to the Special Dollar Cost
Averaging Account on your behalf plus interest, less the sum of all amounts that
have been Dollar Cost Averaged out. See Part 3: The Special Dollar Cost
Averaging Account.
TRANSFERS AMONG INVESTMENT OPTIONS
At any time prior to the Annuity Commencement Date, you may transfer all or
portions of your Annuity Account Value among the Investment Options, subject to
the following:
o You may not transfer any amounts to the Special Dollar Cost Averaging
Account. The Special Dollar Cost Averaging Account is available only for
allocation of your initial contribution during the first Contract Year under
the Special Dollar Cost Averaging program. A request by you to transfer
amounts out of the Special Dollar Cost Averaging Account will cancel the
Special Dollar Cost Averaging program. In such case, all amounts will be
transferred out of the Special Dollar Cost Averaging Account. See "Dollar
Cost Averaging" below.
o Transfers out of a Guarantee Period other than at the Expiration Date will
result in a market value adjustment. See "Part 2: The Guaranteed Period
Account."
o At Annuitant age 76 and above, transfers to Guarantee Periods must be limited
to those with maturities of five years or less and with maturity dates no
later than the February 15th immediately following the Annuity Commencement
Date.
o Transfers may not be made to a Guarantee Period with an Expiration Date in
the current calendar year, or if the Guaranteed Rate is 3%.
Transfer requests must be made directly to our Processing Office. Your request
for a transfer should specify your Certificate number, the amounts or
percentages to be transferred and the Investment Options to and from which the
amounts are to be transferred. Your transfer request may be in writing or by
telephone.
For telephone transfer requests, procedures have been established by Equitable
Life that are considered to be reasonable and are designed to confirm that
instructions communicated by telephone are genuine. Such procedures include
requiring certain personal identification information prior to acting on
telephone instructions and providing written confirmation. In light of the
procedures established, Equitable Life will not be liable for following
telephone instructions that it reasonably believes to be genuine.
We may restrict, in our sole discretion, the use of an agent acting under a
power of attorney, such as a market timer, on behalf of more than one
Certificate Owner to effect transfers. Any agreements to use market timing
services to effect transfers are subject to our rules then in effect and must be
on a form satisfactory to us.
A transfer request will be effective on the Transaction Date and the transfer to
or from Investment Funds will be made at the Accumulation Unit Value next
computed after the Transaction Date. All transfers will be confirmed in writing.
DOLLAR COST AVERAGING
We offer two programs for Dollar Cost Averaging as described below. The main
objective of Dollar Cost Averaging is to attempt to shield your investment from
short-term price fluctuations. Since approximately the same dollar amounts are
transferred from the specified Investment Option to the Investment Funds
periodically, more Accumulation Units are purchased in an Investment Fund if the
value per Accumulation Unit is low and fewer Accumulation Units are purchased if
the value per Accumulation Unit is high. Therefore, a lower average value per
Accumulation Unit may be achieved over the long term. This plan of investing
allows you to take advantage of market fluctuations but does not assure a profit
or protect against a loss in declining markets.
You elect a Dollar Cost Averaging program by completing the proper form and
sending it to our Processing Office. The transfer date will be the same calendar
day of the month as the Contract Date (other than the 29th, 30th or 31st).
Dollar Cost Averaging may not be elected while the rebalancing program
(discussed below) or the Systematic Withdrawal option (described under
"Withdrawal Options" in Part 5) is in effect.
Special Dollar Cost Averaging
For Certificate Owners who at issue of the Certificate want to dollar cost
average their entire initial contribution from the Special Dollar Cost Averaging
Account into the Investment Funds monthly over a period of twelve months, we
offer
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a Special Dollar Cost Averaging program. Under this program your entire initial
contribution must be allocated to the Special Dollar Cost Averaging Account and
it will be credited with interest at the guaranteed interest rate in effect on
the Transaction Date. We will transfer amounts out of the Special Dollar Cost
Averaging Account into the Investment Funds according to your instructions. All
amounts will be transferred out by the end of the first Contract Year.
Thereafter, no other amounts may be allocated to the Special Dollar Cost
Averaging Account under your Certificate. A request by you to transfer or
withdraw any amounts from the Special Dollar Cost Averaging Account will cancel
this program. Or, you may request to cancel this program at any time by sending
us satisfactory notice to our Processing Office. Upon cancellation, all
remaining amounts in the Special Dollar Cost Averaging Account will be
transferred out and allocated to the other Investment Options according to the
allocation percentages you currently have on file with us, unless you specify
other allocation percentages. Dollar Cost Averaging from the Special Dollar Cost
Averaging Account may not currently be available in your state. If the Special
Dollar Cost Averaging Account is not available in your state, we offer a Special
Dollar Cost Averaging program from the Alliance Money Market Fund. Under the
Special Dollar Cost Averaging from the Alliance Money Market Fund, the mortality
and expense risks and the administration charges will not be deducted. See
"Charges Deducted from the Investment Funds" in Part 6. We reserve the right to
discontinue offering Special Dollar Cost Averaging from the Alliance Money
Market Fund for new Certificates subject to state availability of the Special
Dollar Cost Averaging Account. Your agent can provide information about state
availability, or you may contact our Processing Office.
General Dollar Cost Averaging
If you have at least $5,000 of Annuity Account Value in the Alliance Money
Market Fund, you may choose to have a specified dollar amount or percentage of
your Annuity Account Value transferred from the Alliance Money Market Fund to
other Investment Funds on a monthly, quarterly or annual basis. You may not have
Annuity Account Value transferred to the Special Dollar Cost Averaging Account
or the Guarantee Periods. This program may be elected at any time.
The minimum amount that may be transferred on each Transaction Date is $250. The
maximum amount which may be transferred is equal to the Annuity Account Value in
the Alliance Money Market Fund at the time the program is elected, divided by
the number of transfers scheduled to be made each Contract Year.
If, on any transfer date, the Annuity Account Value in the Alliance Money Market
Fund is equal to or less than the amount you have elected to have transferred,
the entire amount will be transferred and the Dollar Cost Averaging program will
end. You may change the transfer amount once each Contract Year, or cancel this
program by sending us satisfactory notice to our Processing Office at least
seven calendar days before the next transfer date.
REBALANCING
We currently offer a rebalancing program under which you authorize us to
automatically transfer your Annuity Account Value among the Investment Funds
selected by you in order to maintain a particular percentage allocation (which
you specify) in such Investment Funds. Such percentages must be in whole
numbers. You select the period of time at the end of which the transfers will
take place. The period of time may be quarterly, semiannually, or annually on a
Contract Year basis on the same day of the month as the Contract Date (other
than the 29th, 30th or 31st). The Annuity Account Value allocated to each
selected Investment Fund will grow or decline in value at different rates during
each time period. Rebalancing automatically reallocates the Annuity Account
Value in the chosen Investment Funds at the end of each period to the specified
allocation percentages. Rebalancing is intended to transfer specified portions
of the Annuity Account Value from those chosen Investment Funds that have
increased in value to those chosen Investment Funds that have declined in value.
The transfers to and from each chosen Investment Fund will be made at the
Accumulation Unit Value next computed after the Transaction Date. Rebalancing is
not available for amounts in the Guaranteed Period Account or the Special Dollar
Cost Averaging Account.
Rebalancing does not assure a profit or protect against a loss in declining
markets and should be periodically reviewed as your needs may change. You may
want to discuss the rebalancing program with your financial adviser before
electing such program.
You may elect the rebalancing program at any time by properly completing the
appropriate form, which is available from your agent or our Processing Office.
You may change your rebalancing allocation percentages or cancel this program at
any time by submitting a request in a form satisfactory to us. Such request must
be received at our Processing Office at least seven days before the next
scheduled rebalancing date. A transfer request from you while the rebalancing
program is in effect, will cancel the rebalancing program.
Rebalancing may not be elected if a Dollar Cost Averaging program (discussed
above) is in effect.
BASEBUILDER BENEFITS
The baseBUILDER option provides guaranteed benefits in the form of a Combined
Guaranteed Minimum Income Benefit and Guaranteed Minimum Death Benefit. The
combined benefit is available for Annuitant issue ages 20 through 75 and is
subject to an additional charge (see "baseBUILDER Benefit Charge" in Part 6).
The baseBUILDER provides a degree of protection while you live (Income Benefit),
as well as for your beneficiary should you die. As part of the baseBUILDER you
will have a choice of two Guaranteed Minimum Death Benefit options for Annuitant
issue ages 20 through 75: (i) a 6% Roll Up to Age 80 or (ii) an Annual Ratchet
to Age 80. Under Traditional IRA Certificates for Annuitant issue ages 20
through 60, we offer an alternate Guaranteed Minimum Death Benefit under the
baseBUILDER which is a 6% Roll Up to Age 70. The three baseBUILDER Guaranteed
Minimum Death Benefit options are described below. If you do not elect the
baseBUILDER benefit and for Annuitant issue ages 0 through 19 under NQ
Certificates, the 6% Roll Up to Age 80 and the Annual Ratchet to Age 80
Guaranteed Minimum Death Benefit choices are still provided under the
Certificate. The 6% Roll Up to Age 70 Guaranteed Minimum Death Benefit is
available only under the base-
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BUILDER benefits. The baseBUILDER benefits are not currently available in New
York.
If the Annuitant's age at issue is 76 or older and you are interested in the
Combined Guaranteed Minimum Income Benefit and Guaranteed Minimum Death Benefit,
ask your agent for a copy of the prospectus supplement describing this benefit.
The main advantages of the Guaranteed Minimum Income Benefit relate to amounts
allocated to the Investment Funds. Before electing the baseBUILDER, you should
consider the extent to which you expect to utilize the Investment Funds. You
elect the baseBUILDER guaranteed benefits when you apply for a Certificate and
once elected, it may not be changed or cancelled.
GUARANTEED MINIMUM INCOME BENEFIT
The Guaranteed Minimum Income Benefit provides a minimum amount of guaranteed
lifetime income when you apply the Annuity Account Value under your Equitable
Accumulator Certificate to an Income Manager(R) (Life Annuity with a Period
Certain) payout annuity certificate during the periods of time indicated below.
This Income Manager payout annuity certificate provides payments during a period
certain with payments continuing for life thereafter. This means that payments
will be made for the rest of the Annuitant's life. In addition, if the Annuitant
dies before a specified period of time (period certain) has ended, payments will
continue to the beneficiary for the balance of the period certain.
On the Transaction Date that you exercise the Guaranteed Minimum Income Benefit,
the annual lifetime income that will be provided under the Income Manager (Life
Annuity with a Period Certain) payout annuity certificate will be the greater of
(i) your Guaranteed Minimum Income Benefit, and (ii) the income provided by
application of your Annuity Account Value at our then current annuity purchase
factors. The Guaranteed Minimum Income Benefit does not provide an Annuity
Account Value or guarantee performance of your Investment Options. Because this
benefit is based on conservative actuarial factors, the level of lifetime income
that it guarantees may often be less than the level that would be provided by
application of your Annuity Account Value at current annuity purchase factors.
It should therefore be regarded as a safety net.
Illustrated below are Guaranteed Minimum Income Benefit amounts per $100,000 of
initial contribution, for a male Annuitant age 60 (at issue) on Contract Date
anniversaries as indicated below, assuming no subsequent contributions or
withdrawals and assuming there were no allocations to the Alliance Money Market
Fund or the Guaranteed Period Account.
- -------------------------------------------------------------
GUARANTEED MINIMUM
CONTRACT DATE INCOME BENEFIT -- ANNUAL INCOME
ANNIVERSARY AT ELECTION PAYABLE FOR LIFE WITH
10 YEAR PERIOD CERTAIN
- -------------------------------------------------------------
7 $ 8,992
10 12,160
15 18,358
- -------------------------------------------------------------
Withdrawals will reduce your Guaranteed Minimum Income Benefit, see "How
Withdrawals Affect Your Guaranteed Minimum Income Benefit and Guaranteed Minimum
Death Benefit" in Part 5.
Under Traditional IRA, Roth IRA and NQ Certificates, the Guaranteed Minimum
Income Benefit may be exercised only within 30 days following the seventh or
later Contract Date anniversary under your Equitable Accumulator Certificate.
However, it may not be exercised earlier than the Annuitant's age 60, nor later
than the Annuitant's age 83; except that for Annuitant issue ages 20 through 44,
it may be exercised following the 15th or later Contract Date anniversary.
Because Roth IRAs are new in 1998, the tax treatment of an Income Manager payout
annuity certificate purchased with a Roth IRA Certificate is not clear at this
time. Please consult your tax adviser.
For information on when the Guaranteed Minimum Income Benefit may be exercised
under QP Certificates, see "Exercise of the Guaranteed Minimum Income Benefit
under QP Certificates" below.
When you exercise the Guaranteed Minimum Income Benefit, you will receive an
Income Manager (Life Annuity with a Period Certain) payout annuity certificate
and extinguish your rights in your Equitable Accumulator Certificate, with at
least the minimum annual income specified and a period certain based on the
Annuitant's age at the time the benefit is exercised as follows:
- -------------------------------------------------------------
LEVEL PAYMENTS*
PERIOD CERTAIN YEARS
ANNUITANT'S TRADITIONAL AND
AGE AT ELECTION ROTH IRA NQ
- -------------------------------------------------------------
60 to 75 10 10
76 9 10
77 8 10
78 7 10
79 7 10
80 7 10
81 7 9
82 7 8
83 7 7
- ----------------
* Other forms and periods certain may also be available. For Traditional IRA
Certificates, please see "Traditional Individual Retirement Annuities
(Traditional IRAs): Required Minimum Distributions" in Part 8 to see how this
option may be affected if exercised after age 70 1/2.
- --------------------------------------------------------------------------------
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Payments will start one payment mode from the Contract Date of the Income
Manager payout annuity certificate.
Each year on your Contract Date anniversary, if you are eligible to exercise the
Guaranteed Minimum Income Benefit, we will send you an eligibility notice
illustrating how much income could be provided on the Contract Date anniversary.
You may then notify us within 30 days following the Contract Date anniversary if
you want to exercise the Guaranteed Minimum Income Benefit by submitting the
proper form and returning your Equitable Accumulator Certificate. The amount of
income you actually receive will be determined on the Transaction Date that we
receive your properly completed exercise notice.
You may also apply your Cash Value at any time to an Income Manager (Life
Annuity with a Period Certain) payout annuity certificate, and you may always
apply your Annuity Account Value to any of our life annuity benefits. The
annuity benefits are discussed in Part 5. These benefits differ from the Income
Manager payout annuity certificates and may provide higher or lower income
levels, but do not have all the features of the Income Manager payout annuity
certificates. You may request an illustration from your agent.
The Income Manager (Life Annuity with a Period Certain) payout annuity
certificates are offered through our prospectus for the Income Manager payout
annuities. A copy of the most current version may be obtained from your agent.
You should read it carefully before you decide to exercise your Guaranteed
Minimum Income Benefit.
Successor Annuitant/Certificate Owner
If the successor Annuitant/Certificate Owner (discussed below) elects to
continue the Certificate after your death, the Guaranteed Minimum Income Benefit
will continue to be available on Contract Date anniversaries specified above
based on the Contract Date of your Equitable Accumulator Certificate, provided
the Guaranteed Minimum Income Benefit is exercised as specified above based on
the age of the successor Annuitant/Certificate Owner.
Exercise of the Guaranteed Minimum Income Benefit under QP Certificates
Under QP Certificates, the Guaranteed Minimum Income Benefit may be exercised,
on Contract Date anniversaries as indicated above, only after the trustee of the
qualified plan changes ownership of the QP Certificate to the Annuitant and the
Annuitant, as the new Certificate Owner, converts such QP Certificate in a
direct rollover to a Traditional IRA Certificate according to our rules at the
time of the change. The change of ownership and rollover to a Traditional IRA
Certificate may only occur when the Annuitant will no longer be a participant in
the qualified plan.
DEATH BENEFIT
When the Annuitant Dies
Generally, upon receipt of proof satisfactory to us of the Annuitant's death
prior to the Annuity Commencement Date, we will pay the death benefit to the
beneficiary named in your Certificate. You designate the beneficiary at the time
you apply for the Certificate. While the Certificate is in effect, you may
change your beneficiary by writing to our Processing Office. The change will be
effective on the date the written submission was signed. If the Certificate is
jointly owned, the surviving Owner will be deemed the beneficiary, superseding
any other beneficiary designations. (The joint ownership feature may not
currently be available in your state.) The death benefit payable will be
determined as of the date we receive such proof of death and any required
instructions as to the method of payment.
The death benefit is equal to the Annuity Account Value or, if greater, the
Guaranteed Minimum Death Benefit described below.
GUARANTEED MINIMUM DEATH BENEFIT
Applicable for Annuitant Issue Ages 0 through 79 under NQ Certificates; 20
through 79 under Traditional IRA and Roth IRA Certificates; and 20 through 70
under QP Certificates.
You elect either the "6% Roll Up to Age 80" or the "Annual Ratchet to Age 80"
Guaranteed Minimum Death Benefit when you apply for a Certificate. Once elected,
the benefit may not be changed.
6% Roll Up to Age 80 -- On the Contract Date the Guaranteed Minimum Death
Benefit is equal to the initial contribution. Thereafter, the Guaranteed Minimum
Death Benefit is credited with interest at 6% (4% for amounts in the Alliance
Money Market and Alliance Intermediate Government Securities Funds, and the
Guarantee Periods, except as indicated below) on each Contract Date anniversary
through the Annuitant's age 80 (or at the Annuitant's death, if earlier), and 0%
thereafter, and is adjusted for any subsequent contributions and withdrawals.
The Guaranteed Minimum Death Benefit interest applicable to amounts in the
Alliance Money Market Fund under the Special Dollar Cost Averaging program
(described above) will be 6%. The 6% Roll Up to Age 80 is not available in New
York.
Annual Ratchet to Age 80 -- On the Contract Date, the Guaranteed Minimum Death
Benefit is equal to the initial contribution. Thereafter, the Guaranteed Minimum
Death Benefit is reset through the Annuitant's age 80, to the Annuity Account
Value on a Contract Date anniversary if higher than the then current Guaranteed
Minimum Death Benefit, and is adjusted for any subsequent contributions and
withdrawals.
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<PAGE>
Alternate baseBUILDER Guaranteed Minimum Death Benefit Applicable under
Traditional IRA Certificates for Annuitant Issue Ages 20 through 65
6% Roll Up to Age 70 -- Interest will be credited at 6% and 4% respectively (as
described under the 6% Roll Up to Age 80 above) through the Annuitant's age 70
(or at the Annuitant's death, if earlier) and 0% thereafter and is adjusted for
any subsequent contributions and withdrawals. The Guaranteed Minimum Death
Benefit interest applicable to amounts in the Alliance Money Market Fund under
the Special Dollar Cost Averaging program (discussed above) will be 6%. You also
elect this benefit when you apply for a Certificate and once elected, the
benefit may not be changed.
Applicable for Annuitant Issue Ages 80 through 83
On the Contract Date, the Guaranteed Minimum Death Benefit is equal to the
initial contribution. Thereafter, the initial contribution is adjusted for any
subsequent contributions, and any withdrawals.
Withdrawals will reduce your Guaranteed Minimum Death Benefit, see "How
Withdrawals Affect Your Guaranteed Minimum Income Benefit and Guaranteed Minimum
Death Benefit" in Part 5. For Certificates issued in New York, the Guaranteed
Minimum Death Benefit at the Annuitant's death will not be less than the Annuity
Account Value in the Investment Funds plus the sum of the Guaranteed Period
Amounts in each Guarantee Period. See "Guarantee Periods" in Part 2.
See Appendix III for an example of the calculation of the Guaranteed Minimum
Death Benefit.
HOW DEATH BENEFIT PAYMENT IS MADE
We will pay the death benefit to the beneficiary in the form of the annuity
benefit you have chosen under your Certificate. If no annuity benefit has been
chosen at the time of the Annuitant's death, the beneficiary will receive the
death benefit in a lump sum. However, subject to any exceptions in the
Certificate, Equitable Life's rules then in effect and any other applicable
requirements under the Code, the beneficiary may elect to apply the death
benefit to one or more annuity benefits offered by Equitable Life. See "Annuity
Benefits and Payout Annuity Options" in Part 5. Note that if you are both the
Certificate Owner and the Annuitant, only a life annuity or an annuity that does
not extend beyond the life expectancy of the beneficiary may be elected.
Successor Annuitant/Certificate Owner
If you are both the Certificate Owner and the Annuitant, and if your spouse is
the sole primary beneficiary or the Joint Owner under the Certificate, then upon
your death your spouse beneficiary may elect to receive the death benefit, or to
continue the Certificate and become the successor Annuitant/Certificate Owner by
completing the appropriate form and sending it to our Processing Office.
If the successor Annuitant/Certificate Owner elects to continue the Certificate,
then on the Contract Date anniversary following your death, the Annuity Account
Value will be reset to the then current Guaranteed Minimum Death Benefit if it
is higher than the Annuity Account Value as of such date. In determining whether
the Guaranteed Minimum Death Benefit will continue to grow, we will use the age
(as of the Contract Date anniversary) of the successor Annuitant/Certificate
Owner.
WHEN AN NQ CERTIFICATE OWNER DIES BEFORE THE ANNUITANT
When you are not the Annuitant under an NQ Certificate and you die before the
Annuity Commencement Date, the beneficiary named to receive the death benefit
upon the Annuitant's death will automatically succeed as Certificate Owner
(unless you name a different person as a successor Owner in a written form
acceptable to us and send it to our Processing Office). If the Certificate is
jointly owned and the first Owner to die is not the Annuitant, the surviving
Owner becomes the sole Certificate Owner and will be deemed the "beneficiary"
for purposes of the distribution rules described in this section, automatically
superseding any other beneficiary designation.
Unless the surviving spouse of the deceased Owner (or in the case of a joint
ownership situation, the surviving spouse of the first Owner to die) is the
designated beneficiary for this purpose, the entire interest in the Certificate
must be distributed under these rules.
The Cash Value in the Certificate must be fully paid to the designated
beneficiary (new Owner) by December 31st of the fifth calendar year after your
death (or in a joint ownership situation, the death of the first Owner to die).
A permissible alternative is for the new Owner to elect to receive such amounts
as a life annuity (or payments for a period certain of not longer than the new
Owner's life expectancy), with payments beginning no later than December 31st
following the calendar year of the non-Annuitant Owner's death. If such an
annuity benefit or payments for a period certain is not elected, we will pay any
Cash Value in the Certificate on December 31st of the fifth calendar year
following the year of your death (or the death of the first Owner to die).
Where a surviving spouse is designated beneficiary or Joint Owner, the spouse
may elect to continue the Certificate. No distributions are required as long as
the surviving spouse and Annuitant are living.
CASH VALUE
The Cash Value under the Certificate fluctuates daily with the investment
performance of the Investment Funds you have selected and reflects any
guaranteed interest, and any upward or downward market value adjustment. We do
not guarantee any minimum Cash Value except for amounts in a Guarantee Period
held to the Expiration
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<PAGE>
Date and amounts in the Special Dollar Cost Averaging Account. See "Part 2: The
Guaranteed Period Account" and "Part 3: The Special Dollar Cost Averaging
Account." On any date before the Annuity Commencement Date while the Certificate
is in effect, the Cash Value is equal to the Annuity Account Value, less any
withdrawal charge. The free corridor amount will not apply when calculating the
withdrawal charge applicable upon a surrender. See "Part 6: Deductions and
Charges."
SURRENDERING THE CERTIFICATES TO RECEIVE THE CASH VALUE
You may surrender a Certificate to receive the Cash Value at any time while the
Annuitant is living and before the Annuity Commencement Date. For a surrender to
be effective, we must receive your written request and the Certificate at our
Processing Office. The Cash Value will be determined on the Transaction Date.
All benefits under the Certificate will be terminated as of that date.
You may receive the Cash Value in a single sum payment or apply it under one or
more of the annuity benefits. See "Annuity Benefits and Payout Annuity Options"
in Part 5. We will usually pay the Cash Value within seven calendar days, but we
may delay payment as described in "When Payments Are Made" below.
For the tax consequences of surrenders, see "Part 8: Tax Aspects of the
Certificates."
WHEN PAYMENTS ARE MADE
Under applicable law, application of proceeds from the Investment Funds to a
variable annuity, payment of a death benefit from the Investment Funds, payment
of any portion of the Annuity Account Value (less any applicable withdrawal
charge) from the Investment Funds, and, upon surrender, payment of the Cash
Value from the Investment Funds will be made within seven calendar days after
the Transaction Date. Payments or application of proceeds from the Investment
Funds can be deferred for any period during which (1) the New York Stock
Exchange is closed or trading on it is restricted, (2) sales of securities or
determination of the fair value of an Investment Fund's assets is not reasonably
practicable because of an emergency, or (3) the SEC, by order, permits us to
defer payment in order to protect persons with interest in the Investment Funds.
We can defer payment of any portion of the Annuity Account Value in the
Guaranteed Period Account and the Special Dollar Cost Averaging Account (other
than for death benefits) for up to six months while you are living. We may also
defer payments for any amount attributable to a contribution made in the form of
a check for a reasonable amount of time (not to exceed 15 days) to permit the
check to clear.
ASSIGNMENT
Traditional IRA and Roth IRA Certificates are not assignable or transferable
except through surrender to us. They may not be borrowed against or used as
collateral for a loan or other obligation.
QP Certificates may not be assigned.
The NQ Certificates may be assigned at any time before the Annuity Commencement
Date and for any purpose other than as collateral or security for a loan.
Equitable Life will not be bound by an assignment unless it is in writing and we
have received it at our Processing Office. In some cases, an assignment may have
adverse tax consequences. See "Part 8: Tax Aspects of the Certificates."
SERVICES WE PROVIDE
o REGULAR REPORTS
o Statement of your Certificate values as of the last day of the calendar
year;
o Three additional reports of your Certificate values each year;
o Annual and semiannual statements of each trust; and
o Written confirmation of financial transactions.
o TOLL-FREE TELEPHONE SERVICES
o Call 1-800-789-7771 for a recording of daily Accumulation Unit Values and
Guaranteed Rates applicable to the Guarantee Periods and guaranteed
interest rates for the Special Dollar Cost Averaging Account. Also call
during our regular business hours to speak to one of our customer service
representatives.
o PROCESSING OFFICE
o FOR CONTRIBUTIONS SENT BY REGULAR MAIL:
Equitable Life
Income Management Group
P.O. Box 13014
Newark, NJ 07188-0014
o FOR CONTRIBUTIONS SENT BY EXPRESS MAIL:
Equitable Life
c/o First Chicago National Processing Center
300 Harmon Meadow Boulevard, 3rd Floor
Attn: Box 13014
Secaucus, NJ 07094
o FOR ALL OTHER COMMUNICATIONS (E.G., REQUESTS FOR TRANSFERS, WITHDRAWALS)
SENT BY REGULAR MAIL:
Equitable Life
Income Management Group
P.O. Box 1547
Secaucus, NJ 07096-1547
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o FOR ALL OTHER COMMUNICATIONS (E.G., REQUESTS FOR TRANSFERS, WITHDRAWALS)
SENT BY EXPRESS MAIL:
Equitable Life
Income Management Group
200 Plaza Drive, 4th Floor
Secaucus, NJ 07096
DISTRIBUTION OF THE CERTIFICATES
As the distributor of the Certificates, Equitable Distributors, Inc. (EDI), an
indirect, wholly owned subsidiary of Equitable Life, has responsibility for
sales and marketing functions for the Certificates. EDI also serves as the
principal underwriter of the Separate Account under the 1940 Act. EDI is
registered with the SEC as a broker-dealer under the Exchange Act and is a
member of the National Association of Securities Dealers, Inc. EDI's principal
business address is 1290 Avenue of the Americas, New York, New York 10104. EDI
was paid a fee of $20,088,049 for 1997, $1,204,370 for 1996 and $126,914 for
1995 for its services under a "Distribution Agreement" with Equitable Life and
the Separate Account.
The Certificates will be sold by registered representatives of EDI and its
affiliates, who are also our licensed insurance agents. Broker-dealer sales
compensation for EDI and its affiliates will generally not exceed 6.0% of total
contributions made under the Certificates. EDI may also receive compensation and
reimbursement for its marketing services under the terms of its distribution
agreement with Equitable Life. Broker-dealers receiving sales compensation will
generally pay a portion thereof to their registered representatives as
commissions related to sales of the Certificates. The offering of the
Certificates is intended to be continuous.
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- --------------------------------------------------------------------------------
PART 5: DISTRIBUTION METHODS UNDER THE CERTIFICATES
- --------------------------------------------------------------------------------
The Certificates offer several distribution methods specifically designed to
provide retirement income. Under Traditional IRA and Roth IRA Certificates, the
Assured Payment Option or APO Plus may be elected in the application or as a
distribution option at a later date. In addition, Traditional IRA and Roth IRA
Certificates permit Lump Sum Withdrawals, Substantially Equal Payment
Withdrawals, and Systematic Withdrawals. Minimum Distribution Withdrawals are
available only under Traditional IRA Certificates. NQ Certificates permit Lump
Sum Withdrawals and Systematic Withdrawals. The Certificates also offer fixed
and variable annuity benefits and Income Manager payout annuity options. The
Assured Payment Option and APO plus may not be available in all states.
Traditional IRA Certificate Owners should consider how the distribution method
selected may affect the ability to comply with the minimum distribution rules
discussed in "Part 8: Tax Aspects of the Certificates."
For Traditional IRA retirement benefits subject to minimum distribution
requirements, we will send a form outlining the distribution options available
before you reach age 70 1/2 (if you have not begun your annuity payments before
that time).
ASSURED PAYMENT OPTION
(Available Only under Traditional IRA and Roth IRA Certificates)
The Assured Payment Option is designed to provide you with guaranteed payments
for your life (SINGLE LIFE) or for the lifetime of you and a joint Annuitant you
designate (JOINT AND SURVIVOR) through a series of distributions from the
Annuity Account Value that are followed by Life Contingent Annuity payments.
Payments you receive during the fixed period are designed to pay out the entire
Annuity Account Value by the end of the fixed period and, for Traditional IRA
Certificates, to meet or exceed minimum distribution requirements, if
applicable. See "Minimum Distribution Withdrawals" below. The fixed period ends
with the distribution of the Maturity Value of the last Guarantee Period, or
distribution of the final amount in the Modal Payment Portion of the Guaranteed
Period Account. The fixed period may also be referred to as the "liquidity
period," as during this period, you have access to the Cash Value through Lump
Sum Withdrawals or surrender of the Certificate, with lifetime income continuing
in reduced amounts.
After the fixed period, the payments are made under the Life Contingent Annuity
described below.
You may elect the Assured Payment Option at any time if your initial
contribution or Annuity Account Value is at least $10,000 at the time of
election, by submitting a written request satisfactory to us. The Assured
Payment Option may be elected at ages 59 1/2 through 83. If you are over age
70 1/2, the availability of this option may be restricted under certain limited
circumstances. See "Traditional Individual Retirement Annuities (Traditional
IRAs): Tax Considerations for the Assured Payment Option and APO Plus" in Part
8. The Assured Payment Option may be elected at ages as young as 53 1/2 provided
payments do not start before you attain age 59 1/2.
Once the Assured Payment Option is elected, all amounts currently held under
your Equitable Accumulator Traditional IRA or Roth IRA Certificate must be
allocated to the Guarantee Periods, the Modal Payment Portion of the Guaranteed
Period Account, if applicable, and the Life Contingent Annuity. See "Allocation
of Contributions or Annuity Account Value" below. Subsequent contributions may
be made according to the rules set forth below and in "Part 8: Tax Aspects of
the Certificates."
Subsequent Contributions under the Assured
Payment Option
Under Traditional IRA Certificates, subsequent "regular" Traditional IRA
contributions may no longer be made for the taxable year in which you attain age
70 1/2 and thereafter. Subsequent Traditional IRA rollover and direct transfer
contributions may be made at any time until the earlier of (i) when you attain
age 84 and (ii) when the Certificate is within seven years of the end of the
fixed period while the Assured Payment Option is in effect. However, any amount
contributed after you attain age 70 1/2 must be net of your required minimum
distribution for the year in which the rollover or direct transfer contribution
is made.
We will not accept "regular" IRA contributions to Roth IRAs. Rollover and direct
custodian-to-custodian transfer contributions can be made any time until the
earlier of (i) when you attain age 84 and (ii) when the Certificate is within
seven years of the end of the fixed period while the Assured Payment Option is
in effect and provided you meet certain requirements. See "Part 8: Tax Aspects
of the Certificates."
Payments
You may elect to receive monthly, quarterly or annual payments. However, all
payments are made on the 15th of the month. Payments to be made on an Expiration
Date during the fixed period represent distributions of
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the Maturity Values of serially maturing Guarantee Periods on their Expiration
Dates. Payments to be made monthly, quarterly or annually on dates other than an
Expiration Date represent distributions from amounts in the Modal Payment
Portion of the Guaranteed Period Account. See "Part 2: The Guaranteed Period
Account."
During the fixed period, payments are designed to increase by 10% every three
years on each third anniversary of the payment start date. After the end of the
fixed period, your first payment under the Life Contingent Annuity will be 10%
greater than the final payment made under the fixed period. Thereafter, payments
will increase annually on each anniversary of the payment start date under the
Life Contingent Annuity based on the annual increase, if any, in the Consumer
Price Index, but in no event greater than 3% per year.
Payments will generally start one payment mode from the date the Assured Payment
Option goes into effect. Or you may choose to defer the date payments will start
generally for a period of up to 72 months. Deferral of the payment start date
permits you to lock in rates at a time when you may consider current rates to be
high, while permitting you to delay receiving payments if you have no immediate
need to receive income under your Certificate. In making this decision, you
should consider that the amount of income you purchase is based on the rates
applicable on the Transaction Date, so if rates rise during the interim, your
payments may be less than they would have been if you had elected the Assured
Payment Option at a later date. Deferral of the payment start date is not
available above age 80. For Traditional IRA Certificates, before you elect to
defer the date your payments will start, you should consider the consequences of
this decision on the requirement under the Code that you take minimum
distributions each calendar year with respect to the value of your Traditional
IRA. See "Traditional Individual Retirement Annuities (Traditional IRAs):
Required Minimum Distributions" in Part 8. The ability to defer the payment
start date may not be available in all states.
For Traditional IRA Certificates, required minimum distributions will be
calculated based on the Annuity Account Value in each Guarantee Period and the
deemed value of the Life Contingent Annuity for tax purposes. If at any time
your payment under the Assured Payment Option would be less than the minimum
amount required to be distributed under minimum distribution rules, we will
notify you of the difference. You will have the option to have an additional
amount withdrawn under your Traditional IRA Certificate and such withdrawal will
be treated as a Lump Sum Withdrawal; however, no withdrawal charge will apply.
An adjustment will be made to future scheduled payments. Or, you may take the
amount from other Traditional IRA funds you may have. See "Lump Sum Withdrawals"
below and "Traditional Individual Retirement Annuities (Traditional IRAs):
Required Minimum Distributions" in Part 8.
See Appendix IV for an example of payments purchased under an Assured Payment
Option.
Fixed Period
The fixed period based on your age at issue of the Certificate (or age at the
time of election if the Assured Payment Option is elected after issue) will be
as follows:
- -------------------------------------------------------------
AGE* FIXED PERIOD
- -------------------------------------------------------------
59 1/2 through 70 15 years
71 through 75 12 years
76 through 80 9 years
81 through 83 6 years
- -------------------------------------------------------------
If you defer the date payments will start, your fixed period will be as follows:
- -------------------------------------------------------------
FIXED PERIOD
BASED ON DEFERRAL PERIOD
----------------------------------------
1-36 37-60 61-72
AGE* MONTHS MONTHS MONTHS
- -------------------------------------------------------------
53 1/2 through 70 12 years 9 years 9 years
71 through 75 9 years 9 years N/A
76 through 80 6 years 6 years N/A
81 through 83 N/A N/A N/A
- -------------------
* For joint and survivor, the fixed period is based on the age of the younger
Annuitant.
- --------------------------------------------------------------------------------
Allocation of Contributions or Annuity Account Value
If the Assured Payment Option is elected in the application, then based on the
amount of your initial contribution, your age and sex (and the age and sex of
the joint Annuitant, if applicable), the mode of payment, the form of payments
and the applicable fixed period, your entire contribution will be allocated by
us. A portion of the initial contribution will be allocated among the Guarantee
Periods and the Modal Payment Portion of the Guaranteed Period Account, if
applicable, to provide fixed period payments and a portion will be applied under
the Life Contingent Annuity in order to provide the payments for life. For
initial contributions of $500,000 or more, amounts allocated to the Life
Contingent Annuity may also be based on your underwriting classification. In
general, underwriting classification is based on your medical history and smoker
status and may result in a smaller allocation of amounts to the Life Contingent
Annuity if your classification is lower than our standard class. If the Assured
Payment Option is elected anytime after issue of the Certificate or if you
cancel APO Plus (discussed below) and elect the Assured Payment Option, then
based on your Annuity Account Value and the informa-
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tion you provide as described above, your entire Annuity Account Value,
including any amounts currently invested in the Investment Funds and the Special
Dollar Cost Averaging Account, will be allocated by us among the Guarantee
Periods, the Modal Payment Portion of the Guaranteed Period Account, if
applicable, and applied under the Life Contingent Annuity. While the Assured
Payment Option is in effect, no amounts may be allocated to the Investment Funds
and the Special Dollar Cost Averaging Account. If amounts in the Guarantee
Periods are transferred, a market value adjustment may apply.
If you elect the Assured Payment Option in the application and your initial
contribution will come from multiple sources, your application must also
indicate that contributions are to be allocated to the Alliance Money Market
Fund under Equitable Accumulator Traditional IRA or Roth IRA, as applicable,
described in Part 4. Election of the Assured Payment Option must include your
instructions to apply your Annuity Account Value, on the date the last such
contribution is received, under the Assured Payment Option as described above.
Any subsequent contributions made while the Assured Payment Option is in effect
must be allocated to the Guarantee Periods and applied to the Life Contingent
Annuity. We will determine the allocation of such contributions, such that your
payments will be increased and the fixed period and date that payments are to
start under the Life Contingent Annuity will remain the same.
Life Contingent Annuity
The Life Contingent Annuity provides lifetime payments starting after the end of
the fixed period. The portion of your contributions or Annuity Account Value
applied under the Life Contingent Annuity does not have a Cash Value or an
Annuity Account Value and, therefore, does not provide for transfers or
withdrawals. Once the fixed period has ended and payments have begun under the
Life Contingent Annuity, subsequent amounts may no longer be applied under the
Life Contingent Annuity.
THERE IS NO DEATH BENEFIT PROVIDED UNDER THE LIFE CONTINGENT ANNUITY AND ANNUITY
INCOME IS PAID ONLY IF YOU (OR A JOINT ANNUITANT) ARE LIVING AT THE DATE ANNUITY
BENEFITS BEGIN. BENEFITS ARE ONLY PAID DURING YOUR LIFETIME AND, IF APPLICABLE,
THE LIFETIME OF A JOINT ANNUITANT. CONSEQUENTLY, YOU SHOULD CONSIDER THE
POSSIBILITY THAT NO AMOUNTS WILL BE PAID UNDER THE LIFE CONTINGENT ANNUITY IF
YOU (OR A JOINT ANNUITANT) DO NOT SURVIVE TO THE DATE PAYMENTS ARE TO START
UNDER SUCH ANNUITY.
You may elect to have the Life Contingent Annuity provide level or increasing
payments on a Single Life or a Joint and 100% to Survivor basis. If you elect
increasing payments, the payments will increase annually based on the increase,
if any, in the Consumer Price Index, but in no event greater than 3% per year.
The Life Contingent Annuity may also provide payments on a Joint and one-half to
Survivor or a Joint and two-thirds to Survivor basis.
Payments under the Life Contingent Annuity will be made to you during your
lifetime (and the lifetime of the joint Annuitant, if applicable) on the same
payment mode and date as the payments that were made during the fixed period.
Election Restrictions under Joint and Survivor
Election of the Assured Payment Option with a Joint and Survivor form of the
Life Contingent Annuity is subject to the following restrictions: (i) the joint
Annuitant must be your spouse; (ii) neither you nor the joint Annuitant can be
over age 83.
Withdrawals under the Assured Payment Option
While the Assured Payment Option is in effect, if you take a Lump Sum Withdrawal
as described under "Lump Sum Withdrawals" below (or, if a Lump Sum Withdrawal is
made under a Traditional IRA Certificate to satisfy minimum distribution
requirements under the Certificate), such withdrawals will be taken from all
remaining Guarantee Periods to which your Annuity Account Value is allocated and
the Modal Payment Portion of the Guaranteed Period Account, if applicable, such
that the amount of the payments and the length of the fixed period will be
reduced, and the date payments are to start under the Life Contingent Annuity
will be accelerated. Additional amounts above the amount of the requested
withdrawal will be withdrawn from the Guaranteed Period Account and applied to
the Life Contingent Annuity to the extent necessary to achieve this result. As a
result, the same pattern of payments will continue in reduced amounts for your
life, and if applicable, the life of your joint Annuitant. The first reduction
in your payments will take place no later than the date of the next planned
increase.
Substantially Equal Payment Withdrawals, Systematic Withdrawals and, under
Traditional IRA Certificates, Minimum Distribution Withdrawals, may not be
elected while the Assured Payment Option is in effect. See "Substantially Equal
Payment Withdrawals," "Systematic Withdrawals" and "Minimum Distribution
Withdrawals," below.
Death Benefit
Once you have elected the Assured Payment Option, if a death benefit becomes
payable during the fixed period we will pay the death benefit amount to the
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designated beneficiary. The death benefit amount is equal to the Annuity Account
Value in the Guaranteed Period Account or, if greater, the sum of the Guaranteed
Period Amounts in each Guarantee Period, plus any amounts in the Modal Payment
Portion of the Guaranteed Period Account. Unless you have elected a Joint and
Survivor form under the Life Contingent Annuity, no payment will be made under
the Life Contingent Annuity. The death benefit payable relates only to the
Guarantee Periods under the Certificate; a death benefit is never payable under
the Life Contingent Annuity.
If you have elected a Joint and Survivor form of annuity under the Life
Contingent Annuity, payments will be made to you or the joint Annuitant, if
living on the date payments are to start. The designated beneficiary and the
joint Annuitant must be your spouse.
Termination of the Assured Payment Option
The Assured Payment Option will be terminated if: (i) you cancel such option at
any time by sending a written request satisfactory to us; (ii) you submit a
subsequent contribution and you do not want it applied under the Assured Payment
Option; (iii) you request a transfer of your Annuity Account Value as described
under "Transfers among Investment Options" in Part 4, while the Assured Payment
Option is in effect; or (iv) you request a change in the date the payments are
to start under the Life Contingent Annuity. Once the Assured Payment Option is
terminated, in order to receive distributions from your Annuity Account Value
you must utilize the withdrawal options described under "Withdrawal Options"
below. Although the Life Contingent Annuity will continue in effect and payments
will be made if you or your joint Annuitant, if applicable, are living on the
date payments are to start, additional Life Contingent Annuity payments may not
be purchased. You may elect to start the Assured Payment Option again by
submitting a written request satisfactory to us, but no sooner than three years
after the Option was terminated. If you own a Traditional IRA Certificate and
you elected the Assured Payment Option at age 70 1/2 or older and subsequently
terminate this Option, required minimum distributions must continue to be made
with respect to your Traditional IRA Certificate.
For Traditional IRA Certificates, before terminating the Assured Payment Option,
you should consider the implications this may have under the minimum
distribution requirements. See "Traditional Individual Retirement Annuities
(Traditional IRAs): Tax Considerations for the Assured Payment Option and APO
Plus" in Part 8.
Income Annuity Options and Surrendering the Certificates
If you elect an annuity benefit as described under "Annuity Benefits" below, or
surrender the Certificate for its Cash Value as described under "Surrendering
the Certificates to Receive the Cash Value" in Part 4, once we receive your
returned Certificate, your Certificate will be returned to you with a notation
that the Life Contingent Annuity is still in effect. Thereafter, no subsequent
contributions will be accepted under the Certificate and no amounts may be
applied under the Life Contingent Annuity.
Withdrawal Charge
While the Assured Payment Option is in effect, withdrawal charges will not apply
to the level or increasing payments made during the fixed period. Except as
necessary to meet minimum distribution requirements under the Traditional IRA
Certificate, Lump Sum Withdrawals will be subject to a withdrawal charge and
will have a 10% free corridor available. Upon termination of the Assured Payment
Option, the free corridor will apply as described under "Withdrawal Charge" in
Part 6.
APO PLUS
APO Plus is a variation of the Assured Payment Option. APO Plus is available at
ages 59 1/2 through 83. It may also be elected at ages as young as 53 1/2
provided payments under APO Plus do not start before you attain age 59 1/2.
Except as indicated below, all provisions of the Assured Payment Option apply to
APO Plus. APO Plus enables you to keep a portion of your Annuity Account Value
in the Alliance Common Stock Fund or the Alliance Equity Index Fund as you
select, while periodically converting such Annuity Account Value to increase the
guaranteed lifetime income under the Assured Payment Option. You select either
the Alliance Common Stock Fund or Alliance Equity Index Fund in the application
and once elected it may not be changed. When you elect APO Plus, a portion of
your initial contribution or Annuity Account Value as applicable is allocated by
us to the Assured Payment Option to provide a minimum amount of level guaranteed
lifetime income through allocation of amounts to the Guarantee Periods and the
Modal Payment Portion of the Guaranteed Period Account, if applicable, and
application of amounts to the Life Contingent Annuity. The remaining Annuity
Account Value remains in the Investment Fund you selected. Periodically during
the fixed period (as described below), a portion of the remaining Annuity
Account Value in such Investment Fund is applied to increase the guaranteed
level payments under the Assured Payment Option.
APO Plus allows you to remain invested in an Investment Fund for longer than
would be possible if you applied your entire Annuity Account Value all at once
to the Assured Payment Option or to an annuity
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benefit, while utilizing an "exit strategy" to provide retirement income.
The fixed period under APO Plus will be based on your age (or the age of the
younger Annuitant if Joint and Survivor is elected) at issue of the Certificate
(or age at the time of election if APO Plus is elected after issue) and will be
the same as the periods indicated for payments under "Assured Payment Option"
above.
You may elect to defer the payment start date as described in "Payments" under
"Assured Payment Option" above. The fixed period will also be as indicated for
deferral of the payment start date for increasing payments under the Assured
Payment Option.
You elect APO Plus in the application or at a later date by submitting the
proper form. APO Plus may not be elected if the Assured Payment Option is
already in effect.
The amount applied under APO Plus is either the initial contribution if APO Plus
is elected at issue of the Certificate, or the Annuity Account Value if APO Plus
is elected after issue of the Certificate. Out of a portion of the amount
applied, level payments are provided under the Assured Payment Option equal to
the initial payment that would have been provided on the Transaction Date by the
allocation of the entire amount under the Assured Payment Option where the
payments increase as described above. The difference between the amount required
for level payments and the amount required for the increasing payments is
allocated to the Investment Fund. If you have Annuity Account Value in the
Guaranteed Period Account at the time this option is elected, a market value
adjustment may apply as a result of such amounts being transferred to effect the
Assured Payment Option.
On the third February 15th following the date the first payment is made (if
payments are to be made on February 15th, the date of the first payment will be
counted as the first February 15th) during the fixed period while you are
living, a portion of the Annuity Account Value in the Investment Fund is applied
to increase the level payments under the Assured Payment Option. If a deferral
period of three years or more is elected, a portion of the Annuity Account Value
in the Investment Fund will be applied on the February 15th prior to the date
the first payment is made, to increase the initial level payments. If payments
are to be made on February 15th, the date of the first payment will be counted
as the first February 15th.
The amount applied is the amount which provides for level payments equal to the
initial payment that would have been provided by the allocation of the entire
Annuity Account Value to the Assured Payment Option increasing payments, as
described in the preceding paragraph. This process is repeated each third year
during the fixed period. The first increased payment will be reflected in the
payment made following three full years of payments and then every three years
thereafter. On the Transaction Date immediately following the last payment
during the fixed period, the remaining Annuity Account Value in the Investment
Fund is first applied to the Life Contingent Annuity to change the level
payments previously purchased to increasing payments. If there is any Annuity
Account Value remaining after the increasing payments are purchased, this
balance is applied to the Life Contingent Annuity to further increase such
increasing payments. If the Annuity Account Value in the Investment Fund is
insufficient to purchase the increasing payments, then the level payments
previously purchased will be increased to the extent possible.
While APO Plus provides a minimum amount of level guaranteed lifetime payment
under the Assured Payment Option, the total amount of income that can be
provided over time will depend on the investment performance of the Investment
Fund in which you have Annuity Account Value, as well as the current Guaranteed
Rates and the cost of the Life Contingent Annuity, which may vary. Consequently,
the aggregate amount of guaranteed lifetime income under APO Plus may be more or
less than the amount that could have been purchased by application at the outset
of the entire initial contribution or Annuity Account Value to the Assured
Payment Option with increasing payments.
See Appendix IV for an example of the payments purchased under Assured Payment
Option and APO Plus.
For Traditional IRA Certificates, in calculating your required minimum
distributions your Annuity Account Value in the Investment Fund, the Annuity
Account Value in each Guarantee Period, any amount in the Modal Payment Portion
of the Guaranteed Period Account, and the deemed value of the Life Contingent
Annuity for tax purposes will be taken into account as described in "Payments"
under "Assured Payment Option" above. Also see "Traditional Individual
Retirement Annuities (Traditional IRAs): Required Minimum Distributions" in Part
8.
Allocation of Subsequent Contributions under APO Plus
Any subsequent contributions you make may only be allocated to the Investment
Fund you selected, where it is later applied by us under the Assured Payment
Option. Subsequent contributions may no longer be made after the end of the
fixed period.
Withdrawals under APO Plus
While APO Plus is in effect, if you take a Lump Sum Withdrawal as described
under "Lump Sum Withdrawals" below (or, under Traditional IRA Certificates, if a
Lump Sum Withdrawal is made to satisfy minimum distribution requirements under
the Certificate), such
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withdrawals will be taken from your Annuity Account Value in the Investment Fund
unless you specify otherwise. If there is insufficient value in the Investment
Fund the excess will be taken from the Guarantee Periods and the Modal Payment
Portion of the Guaranteed Period Account, if applicable, as described under
"Withdrawals under the Assured Payment Option" above.
For Traditional IRA Certificates, a Lump Sum Withdrawal taken to satisfy minimum
distribution requirements under the Certificate will not be subject to a
withdrawal charge.
Death Benefit
Once you have elected APO Plus, if a death benefit becomes payable during the
fixed period we will pay the death benefit amount to the designated beneficiary.
The death benefit amount is equal to (i) the Annuity Account Value in the
Guaranteed Period Account or, if greater, the sum of the Guaranteed Period
Amounts in each Guarantee Period, plus (ii) any amounts in the Modal Payment
Portion of the Guaranteed Period Account, plus (iii) contributions allocated to
the selected Investment Fund, less amounts applied to increase payments under
the Assured Payment Option and, less any withdrawals. Unless you have elected
Joint and Survivor under the Life Contingent Annuity, no payment will be made
under the Life Contingent Annuity. The death benefit relates only to the
Investment Funds and the Guarantee Periods under the Certificate; a death
benefit is never payable under the Life Contingent Annuity.
Termination of APO Plus
You may terminate APO Plus at any time by submitting a request satisfactory to
us. In connection with the termination, you may either (i) elect to terminate
APO Plus at any time and have your Certificate operate under the Rollover IRA
rules (see "Part 4: Provisions of the Certificates and Services We Provide") or
(ii) elect the Assured Payment Option. In the latter case your remaining Annuity
Account Value in the Investment Fund will be allocated to the Guaranteed Period
Account and applied under the Life Contingent Annuity. A market value adjustment
may apply for any amounts allocated from a Guarantee Period. At least 45 days
prior to the end of each three-year period, we will send you a quote indicating
how much future income could be provided under the Assured Payment Option. The
quote would be based on your current Annuity Account Value, current Guaranteed
Rates for the Guarantee Periods and current purchase rates under the Life
Contingent Annuity as of the date of the quote. The actual amount of future
income would depend on the rates in effect on the Transaction Date.
WITHDRAWAL OPTIONS
The Certificates are annuity contracts, even though you may elect to receive
your benefits in a non-annuity form. You may take withdrawals from your
Certificate before the Annuity Commencement Date and while you are alive.
Special withdrawal rules may apply under the Assured Payment Option and APO
Plus.
Amounts withdrawn from the Guaranteed Period Account, other than at the
Expiration Date, will result in a market value adjustment. See "Market Value
Adjustment for Transfers, Withdrawals or Surrender Prior to the Expiration Date"
in Part 2. Withdrawals may be taxable and subject to tax penalty. See "Part 8:
Tax Aspects of the Certificates."
As a deterrent to early withdrawal (generally prior to age 59 1/2), the Code
provides certain penalties. We may also be required to withhold income taxes
from the amount distributed. These rules are outlined in "Part 8: Tax Aspects of
the Certificates."
Any withdrawal request while the Special Dollar Cost Averaging program is in
effect will cancel such program. See "Special Dollar Cost Averaging" in Part 4.
LUMP SUM WITHDRAWALS
(Available under Traditional IRA, Roth IRA and NQ Certificates)
You may take Lump Sum Withdrawals at any time subject to a minimum withdrawal
amount of $1,000. A request to withdraw more than 90% of the Cash Value as of
the Transaction Date will result in the termination of the Certificate and will
be treated as a surrender of the Certificate for its Cash Value. See
"Surrendering the Certificates to Receive the Cash Value" in Part 4.
To make a Lump Sum Withdrawal, you must submit a request satisfactory to us
which specifies the Investment Options from which the Lump Sum Withdrawal will
be taken. If we have received the information we require, the requested
withdrawal will become effective on the Transaction Date and proceeds will
usually be mailed within seven calendar days thereafter, but we may delay
payment as described in "When Payments Are Made" in Part 4. If we receive only
partially completed information, our Processing Office will contact you for
specific instructions before your request can be processed.
Lump Sum Withdrawals in excess of the 15% free corridor amount may be subject to
a withdrawal charge. While either the Assured Payment Option or APO Plus is in
effect, Lump Sum Withdrawals that exceed the 10% free corridor amount may be
subject to a withdrawal charge. See "Withdrawal Charge" in Part 6.
SYSTEMATIC WITHDRAWALS
(Available under Traditional IRA, Roth IRA and NQ Certificates)
Under Traditional IRA and Roth IRA Certificates this option may be elected only
if you are between age 59 1/2 to 70 1/2.
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Systematic Withdrawals provide level percentage or level amount payouts. You may
choose to receive Systematic Withdrawals on a monthly, quarterly or annual
basis. You select a dollar amount or percentage of the Annuity Account Value to
be withdrawn, subject to a maximum of 1.2% monthly, 3.6% quarterly and 15.0%
annually, but in no event may any payment be less than $250. If at the time a
Systematic Withdrawal is to be made, the withdrawal amount would be less than
$250, no payment will be made and your Systematic Withdrawal election will
terminate.
You select the date of the month when the withdrawals will be made, but you may
not choose a date later than the 28th day of the month. If no date is selected,
withdrawals will be made on the same calendar day of the month as the Contract
Date. The commencement of payments under the Systematic Withdrawal option may
not be elected to start sooner than 28 days after issue of the Certificate.
You may elect Systematic Withdrawals at any time by completing the proper form
and sending it to our Processing Office. You may change the payment frequency of
your Systematic Withdrawals once each Contract Year or cancel this withdrawal
option at any time by sending notice in a form satisfactory to us. The notice
must be received at our Processing Office at least seven calendar days prior to
the next scheduled withdrawal date. You may also change the amount or percentage
of your Systematic Withdrawals once in each Contract Year. However, you may not
change the amount or percentage in any Contract Year where you have previously
taken another withdrawal under the Lump Sum Withdrawal option described above.
Unless you specify otherwise, Systematic Withdrawals will be withdrawn on a pro
rata basis from your Annuity Account Value in the Investment Funds. If there is
insufficient value or no value in the Investment Funds, any additional amount of
the withdrawal required or the total amount of the withdrawal, as applicable,
will be withdrawn from the Guarantee Periods in order of the earliest Expiration
Date(s) first (a market value adjustment may apply) and then from the Special
Dollar Cost Averaging Account, if applicable.
Systematic Withdrawals are not subject to a withdrawal charge, except to the
extent that, when added to a Lump Sum Withdrawal previously taken in the same
Contract Year, the Systematic Withdrawal exceeds the 15% free corridor amount.
See "Withdrawal Charge" in Part 6.
SUBSTANTIALLY EQUAL PAYMENT WITHDRAWALS
(Available under Traditional IRA and Roth IRA Certificates)
Substantially Equal Payment Withdrawals provide distributions from the Annuity
Account Value of the amounts necessary so that the 10% penalty tax, normally
applicable to distributions made prior to age 59 1/2, does not apply. See "Part
8: Tax Aspects of the Certificates." Once distributions begin, they should not
be changed or stopped until the later of age 59 1/2 or five years from the date
of the first distribution. If you change or stop the distributions or take a
Lump Sum Withdrawal, you may be liable for the 10% penalty tax that would have
otherwise been due on all prior distributions made under this option and for any
interest thereon.
Substantially Equal Payment Withdrawals may be elected at any time if you are
below age 59 1/2. You can elect this option by submitting the proper election
form. You select the day and the month when the first withdrawal will be made,
but it may not be sooner than 28 days after the issue of the Certificate. In no
event may you elect to receive the first payment in the same Contract Year in
which a Lump Sum Withdrawal was taken. We will calculate the amount of the
distribution under a method we select and payments will be made monthly,
quarterly or annually as you select. These payments will continue to be made
until we receive written notice from you to cancel this option. Such notice must
be received at our Processing Office at least seven calendar days prior to the
next scheduled withdrawal date. A Lump Sum Withdrawal taken while Substantially
Equal Payment Withdrawals are in effect will cancel such withdrawals. You may
elect to start receiving Substantially Equal Payment Withdrawals again, but in
no event can the payments start in the same Contract Year in which a Lump Sum
Withdrawal was taken. We will calculate a new distribution amount. As indicated
in the preceding paragraph, you may be liable for the 10% penalty tax on
Substantially Equal Payment Withdrawals made before cancellation.
Unless you specify otherwise, Substantially Equal Payment Withdrawals will be
withdrawn on a pro rata basis from your Annuity Account Value in the Investment
Funds. If there is insufficient value or no value in the Investment Funds, any
additional amount of the withdrawal or the total amount of the withdrawal, as
applicable, will be withdrawn from the Guarantee Periods in order of the
earliest Expiration Date(s) first (a market value adjustment may apply) and then
from the Special Dollar Cost Averaging Account, if applicable.
Substantially Equal Payment Withdrawals are not subject to a withdrawal charge.
MINIMUM DISTRIBUTION WITHDRAWALS
(Available under Traditional IRA Certificates)
Minimum Distribution Withdrawals provide distributions from the Annuity Account
Value of the amounts necessary to meet minimum distribution requirements set
forth in the Code. This option may be elected in the year in which you attain
age 70 1/2. You can elect Minimum Distribution Withdrawals by submitting the
proper election form. The minimum amount we will pay out is $250. You may elect
Minimum Distribution Withdrawals for each Certificate you own, subject to
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our rules then in effect. Currently, Minimum Distribution Withdrawal payments
will be made annually.
Unless you specify otherwise, Minimum Distributions Withdrawals will be
withdrawn on a pro rata basis from your Annuity Account Value in the Investment
Funds. If there is insufficient value or no value in the Investment Funds, any
additional amount of the withdrawal required or the total amount of the
withdrawal, as applicable, will be withdrawn from the Guarantee Periods in order
of the earliest Expiration Date(s) first (a market value adjustment may apply)
and then from the Special Dollar Cost Averaging Account, if applicable.
Minimum Distribution Withdrawals are not subject to a withdrawal charge, except
to the extent that, when added to a Lump Sum Withdrawal previously taken in the
same Contract Year, the Minimum Distribution Withdrawal exceeds the 15% free
corridor amount. See "Withdrawal Charge" in Part 6.
Example
The chart below illustrates the pattern of payments, under Minimum Distribution
Withdrawals for a male who purchases a Traditional IRA Certificate at age 70
with a single contribution of $100,000, with payments commencing at the end of
the first Contract Year.
PATTERN OF MINIMUM DISTRIBUTION WITHDRAWALS
$100,000 SINGLE CONTRIBUTION FOR A
SINGLE LIFE -- MALE AGE 70
[THE FOLLOWING TABLE WAS REPRESENTED AS AN AREA
GRAPH IN THE PROSPECTUS]
AGE AMOUNT WITHDRAWN
70 $6,250
75 $7,653
80 $8,667
85 $8,770
90 $6,931
95 $3,727
100 $1,179
Assumes 6.0% Rate of Return
[END OF GRAPHICALLY REPRESENTED DATA]
Payments are calculated each year based on the Annuity Account Value at the end
of each year, using the recalculation method of determining payments. (See "Part
1 -- Minimum Distribution Withdrawals -- Traditional IRA Certificates" in the
SAI.) Payments are made annually, and it is further assumed that no Lump Sum
Withdrawals are taken.
This example assumes an annual rate of return of 6.0% compounded annually for
both the Investment Funds and the Guaranteed Period Account. It assumes no
allocations to the Special Dollar Cost Averaging Account. This rate of return is
for illustrative purposes only and is not intended to represent an expected or
guaranteed rate of return. Your investment results will vary. In addition, this
example does not reflect any charges that may be applicable under the
Traditional IRA. Such charges would effectively reduce the actual return.
HOW WITHDRAWALS AFFECT YOUR GUARANTEED MINIMUM INCOME
BENEFIT AND GUARANTEED MINIMUM DEATH BENEFIT
Except as described in the next sentence, each withdrawal will cause a reduction
in your current Guaranteed Minimum Death Benefit and Guaranteed Minimum Income
Benefit benefit base (described below) on a pro rata basis. Your current
Guaranteed Minimum Death Benefit if based on the 6% Roll Up to Age 70 or 6% Roll
Up to Age 80, and your Guaranteed Minimum Income Benefit benefit base, will be
reduced on a dollar-for-dollar basis as long as the sum of your withdrawals in
any Contract Year is 6% or less of the beginning of Contract Year Guaranteed
Minimum Death Benefit. Once a withdrawal is made that causes cumulative
withdrawals in a Contract Year to exceed 6% of the beginning of Contract Year
Guaranteed Minimum Death Benefit, that withdrawal and any subsequent withdrawals
in that Contract Year will cause a pro rata reduction to occur.
Reduction on a dollar-for-dollar basis means your current Guaranteed Minimum
Death Benefit and Guaranteed Minimum Income Benefit benefit base are reduced by
the dollar amount of the withdrawal. Reduction on a pro rata basis means that we
calculate the percentage of the Annuity Account Value as of the Transaction Date
that is being withdrawn and we reduce your current Guaranteed Minimum Death
Benefit and Guaranteed Minimum Income Benefit benefit base by that same
percentage. For example, if your Annuity Account Value is $10,000 and you
withdraw $4,000, you have withdrawn 40% ($4,000/ $10,000) of your Annuity
Account Value. If your Guaranteed Minimum Death Benefit was $20,000 prior to the
withdrawal, it would be reduced by $8,000 ($20,000 x .40) and your new
Guaranteed Minimum Death Benefit after the withdrawal would be $12,000 ($20,000
- - $8,000).
The timing of your withdrawals and whether they exceed the 6% threshold
described above can have a significant impact on your Guaranteed Minimum Death
Benefit or Guaranteed Minimum Income Benefit.
GUARANTEED MINIMUM INCOME BENEFIT
BENEFIT BASE
The Guaranteed Minimum Income Benefit benefit base is equal to the initial
contribution on the Contract Date. Thereafter, the Guaranteed Minimum Income
Benefit benefit base is credited with interest at 6% (4% for amounts in the
Alliance Money Market and Alliance Intermediate Government Securities Funds, and
the Guarantee Periods, except as indicated below) on each Contract Date
anniversary through the Annuitant's age 80 (age 70 if the 6% Roll Up to Age 70
is elected), and 0% thereafter, and is adjusted for any subsequent contributions
and withdrawals. The Guaranteed
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Minimum Income Benefit benefit base interest applicable to amounts in the
Alliance Money Market Fund under the Special Dollar Cost Averaging program
(described in Part 4) will be 6%. The Guaranteed Minimum Income Benefit benefit
base will also be reduced by any withdrawal charge remaining on the Transaction
Date that you exercise your Guaranteed Minimum Income Benefit.
Your Guaranteed Minimum Income Benefit benefit base is applied to guaranteed
minimum annuity purchase factors to determine the Guaranteed Minimum Income
Benefit. The guaranteed minimum annuity purchase factors are based on (i)
interest at 2.5% if the Guaranteed Minimum Income Benefit is exercised within 30
days following a Contract Date anniversary in years 7 through 9 and at 3% if
exercised within 30 days following the 10th or later Contract Date anniversary,
and (ii) mortality tables that assume increasing longevity. These interest and
mortality factors are generally more conservative than the basis underlying
current annuity purchase factors, which means that they would produce less
periodic income for an equal amount applied.
Your Guaranteed Minimum Income Benefit benefit base does not create an Annuity
Account Value or a Cash Value and is used solely for purposes of calculating
your Guaranteed Minimum Income Benefit.
ANNUITY BENEFITS AND PAYOUT ANNUITY OPTIONS
The Equitable Accumulator Certificates offer annuity benefits and Income Manager
payout annuity options, described below, for providing retirement income.
ANNUITY BENEFITS
Annuity benefits under the Equitable Accumulator provide periodic payments over
a specified period of time which may be fixed or may be based on the Annuitant's
life. Annuity forms of payment are calculated as of the Annuity Commencement
Date, which is on file with our Processing Office. You can change the Annuity
Commencement Date by writing to our Processing Office anytime before the Annuity
Commencement Date. However, you may not choose a date later than the 28th day of
any month. Also, based on the issue age of the Annuitant, the Annuity
Commencement Date may not be later than the Processing Date which follows the
Annuitant's 90th birthday (may be different in some states).
Before the Annuity Commencement Date, we will send a letter advising that
annuity benefits are available. Unless you otherwise elect, we will pay fixed
annuity benefits on the "normal form" indicated for your Certificate as of the
Annuity Commencement Date. The amount applied to provide the annuity benefit
will be (1) the Annuity Account Value for any life annuity form or (2) the Cash
Value for any period certain only annuity form except that if the period certain
is more than five years, the amount applied will be no less than 95% of the
Annuity Account Value.
Amounts in the Guarantee Periods that are applied to an annuity benefit prior to
an Expiration Date will result in a market value adjustment. See "Market Value
Adjustment for Transfers, Withdrawals or Surrender Prior to the Expiration Date"
in Part 3.
Annuity Forms
o Life Annuity: An annuity which guarantees payments for the rest of the
Annuitant's life. Payments end with the last monthly payment before the
Annuitant's death. Because there is no death benefit associated with this
annuity form, it provides the highest monthly payment of any of the life
income annuity options, so long as the Annuitant is living.
o Life Annuity -- Period Certain: This annuity form also guarantees payments
for the rest of the Annuitant's life. In addition, if the Annuitant dies
before a specified period of time (the "certain period") has ended, payments
will continue to the beneficiary for the balance of the certain period.
Certain periods may be 5, 10, 15 or 20 years. A life annuity with a certain
period of 10 years is the normal form of annuity under the Certificates.
o Life Annuity -- Refund Certain: This annuity form guarantees payments to you
for the rest of your life. In addition, if you die before the amount applied
to purchase this annuity option has been recovered, payments will continue to
your beneficiary until that amount has been recovered. This option is
available only as a fixed annuity.
o Period Certain Annuity: This annuity form guarantees payments for a specific
period of time, usually 5, 10, 15 or 20 years, and does not involve life
contingencies.
o Joint and Survivor Life Annuity: This annuity form guarantees life income to
you and, after your death, continuation of income to the survivor.
The life annuity -- period certain and the life annuity -- refund certain are
available on either a single life or joint and survivor life basis.
The annuity forms outlined above are available in both fixed and variable form,
unless otherwise indicated. Fixed annuity payments are guaranteed by us and will
be based either on the tables of guaranteed annuity payments in your Certificate
or on our then current annuity rates, whichever is more favorable for the
Annuitant. Variable income annuities may be funded through the Investment Funds
through the purchase of annuity units. The amount of each variable annuity
payment may fluctuate, depending upon the performance of the Investment Funds.
That is because the
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annuity unit value rises and falls depending on whether the actual rate of net
investment return (after deduction of charges) is higher or lower than the
assumed base rate. See "Annuity Unit Values" in the SAI. Variable income
annuities may also be available by separate prospectus through the Funds of
other separate accounts we offer.
Under QP Certificates, the only annuity forms available are a Life Annuity 10
Year Period Certain, or a Joint and Survivor Life Annuity 10 Year Period
Certain.
For all Annuitants under Traditional IRA, Roth IRA and NQ Certificates, the
normal form of annuity provides for fixed payments. We may offer other forms not
outlined here. Your agent can provide details.
For each annuity benefit, we will issue a separate written agreement putting the
benefit into effect. Before we pay any annuity benefit, we require the return of
the Certificate.
The amount of the annuity payments will depend on the amount applied to purchase
the annuity, the type of annuity chosen and, in the case of a life annuity form,
the Annuitant's age (or the Annuitant's and joint Annuitant's ages) and in
certain instances, the sex of the Annuitant(s). Once an income annuity form is
chosen and payments have commenced, no change can be made.
If, at the time you elect an annuity form, the amount to be applied is less than
$2,000 or the initial payment under the form elected is less than $20 monthly,
we reserve the right to pay the Annuity Account Value in a single sum rather
than as payments under the annuity form chosen.
INCOME MANAGER PAYOUT ANNUITY OPTIONS
Under Traditional IRA, Roth IRA and NQ Certificates, you may apply your Annuity
Account Value to an Income Manager (Life Annuity with a Period Certain) payout
annuity certificate, or an Income Manager (Period Certain) payout annuity
certificate.
Under QP Certificates, Income Manager payout annuity certificates are available
only after the trustee of the qualified plan changes ownership of the QP
Certificate to the Annuitant, and the Annuitant, as the new Certificate Owner,
converts such QP Certificate in a direct rollover to a Traditional IRA
Certificate according to our rules at the time of the change. The change of
ownership and rollover to a Traditional IRA Certificate may only occur when the
Annuitant will no longer be a Participant/Employee in the qualified plan.
The Income Manager (Life Annuity with a Period Certain) payout annuity
certificates provide guaranteed payments for the Annuitant's life or for the
Annuitant's life and the life of a joint Annuitant. Income Manager (Period
Certain) payout annuity certificates provide payments for a specified period.
The Certificate Owner and Annuitant must meet the issue age and payment
requirements. Income Manager payout annuity certificates provide guaranteed
level (Traditional IRA, Roth IRA and NQ Certificates) under both forms of
certificate, or guaranteed increasing (NQ Certificates) payments under only
Income Manager (Life Annuity with a Period Certain) payout annuity certificates.
If you apply a part of the Annuity Account Value under any of the above Income
Manager payout annuity certificates, it will be considered a withdrawal and may
be subject to withdrawal charges. See "Withdrawal Options" above. If 100% of the
Annuity Account Value is applied from an Equitable Accumulator Certificate at a
time when the dollar amount of the withdrawal charge is greater than 2% of
remaining contributions (after withdrawals), such withdrawal charge will not be
deducted. However, a new withdrawal charge schedule will apply under the new
certificate. For purposes of the withdrawal charge schedule, the year in which
your Annuity Account Value is applied under the new certificate will be
"Contract Year 1." If 100% of the Annuity Account Value is applied from the
Equitable Accumulator when the dollar amount of the withdrawal charge is 2% or
less, such withdrawal charge will not be deducted and there will be no
withdrawal charge schedule under the new certificate. You should consider the
timing of your purchase as it relates to the potential for withdrawal charges
under the new certificate. No subsequent contributions will be permitted under
an Income Manager (Life Annuity with a Period Certain) payout annuity
certificate.
You may also apply your Annuity Account Value to an Income Manager (Period
Certain) payout annuity certificate once withdrawal charges are no longer in
effect under your Equitable Accumulator Certificate. No withdrawal charges will
apply under this Income Manager (Period Certain) payout annuity certificate.
The payout annuities are described in our prospectus for the Income Manager.
Copies of the most current version are available from your agent. To purchase an
Income Manager payout annuity certificate we also require the return of your
Equitable Accumulator Certificate. An Income Manager payout annuity certificate
will be issued to put one of the payout annuity options into effect. Depending
upon your circumstances, this may be accomplished on a tax-free basis. Consult
your tax adviser.
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PART 6: DEDUCTIONS AND CHARGES
- --------------------------------------------------------------------------------
CHARGES DEDUCTED FROM THE ANNUITY ACCOUNT VALUE
We allocate the entire amount of each contribution to the Investment Options you
select, subject to certain restrictions. We then periodically deduct certain
amounts from your Annuity Account Value. Unless otherwise indicated, the charges
described below and under "Charges Deducted from the Investment Funds" below
will not be increased by us for the life of the Certificates. We may reduce
certain charges under group or sponsored arrangements. See "Group or Sponsored
Arrangements" below.
Withdrawal Charge
A withdrawal charge will be imposed as a percentage of each contribution made to
the extent that (i) a Lump Sum Withdrawal or cumulative withdrawals during a
Contract Year exceed the free corridor amount, or (ii) if the Certificate is
surrendered to receive its Cash Value. We determine the withdrawal charge
separately for each contribution in accordance with the table below.
CONTRACT YEAR
1 2 3 4 5 6 7 8+
- -----------------------------------------------------------
Percentage of
Contribution 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0%
If the Assured Payment Option or APO Plus is in effect, the withdrawal charge
will be imposed as a percentage of contributions (less withdrawals), less the
amount applied under the Life Contingent Annuity.
The applicable withdrawal charge percentage is determined by the Contract Year
in which the excess withdrawal is made or the Certificate is surrendered,
beginning with "Contract Year 1" with respect to each contribution withdrawn or
surrendered. For purposes of the table, for each contribution, the Contract Year
in which we receive that contribution is "Contract Year 1."
The withdrawal charge is deducted from the Investment Options from which each
such withdrawal is made in proportion to the amount being withdrawn from each
Investment Option.
Free Corridor Amount
The free corridor amount is 15% of the Annuity Account Value at the beginning of
the Contract Year, minus any amount previously withdrawn during that Contract
Year.
While the Assured Payment Option or APO Plus is in effect, the free corridor
amount is 10% of the Annuity Account Value at the beginning of the Contract
Year.
There is no withdrawal charge if a Lump Sum Withdrawal is taken to satisfy
minimum distribution requirements under a Traditional IRA Certificate. A free
corridor amount is not applicable to a surrender.
For purposes of calculating the withdrawal charge, (1) we treat contributions as
being withdrawn on a first-in, first-out basis, and (2) amounts withdrawn up to
the free corridor amount are not considered a withdrawal of any contributions.
Although we treat contributions as withdrawn before earnings for purposes of
calculating the withdrawal charge, the Federal income tax law treats earnings
under Equitable Accumulator Certificates as withdrawn first. See "Part 8: Tax
Aspects of the Certificates."
The withdrawal charge is to help cover sales expenses.
For NQ Certificates issued to a charitable remainder trust (CRT), the free
corridor amount will be changed to be the greater of (1) the current Annuity
Account Value, less contributions that have not been withdrawn (earnings in the
Certificate), and (2) the free corridor amount defined above. If you are
considering an annuity for use in a CRT, see "Charitable Remainder Trusts" in
Part 8 concerning recent IRS announcements on the use of annuities in CRTs.
We may also offer other Equitable Accumulator certificates, which have other
charges. A current prospectus for these other Equitable Accumulator
certificates, if available, may be obtained from your agent.
baseBUILDER Benefit Charge
If you elect the Combined Guaranteed Minimum Income Benefit and Guaranteed
Minimum Death Benefit, we deduct a charge annually on each Processing Date. The
charge is equal to a percentage of the Guaranteed Minimum Income Benefit benefit
base in effect on the Processing Date. For the baseBUILDER benefit with the 6%
Roll Up to Age 80 Guaranteed Minimum Death Benefit and the Annual Ratchet to Age
80 Guaranteed Minimum Death Benefit (available for Annuitant issue ages 20
through 75), the percentage is equal to 0.30%. For the baseBUILDER benefit with
the 6% Roll Up to Age 70 Guaranteed Minimum Death Benefit (available under
Traditional IRA Certificates for Annuitant issue age 20 through 65), the
percentage is equal to 0.15%. The Guaranteed Minimum Income Benefit benefit base
is described under "How Withdrawals Affect Your Guaranteed Minimum Income
Benefit and Guaranteed Minimum Death Benefit" in Part 5.
This charge will be deducted from your Annuity Account Value in the Investment
Funds on a pro rata basis. If there is insufficient value in the Investment
Funds, all or a portion of such charge will be deducted from the Guarantee
Periods in order of the earliest Expiration Date(s) first. A market value
adjustment may apply. See "Market Value Adjustment for Transfers, Withdrawals or
Surrender Prior to the Expiration Date" in Part 2.
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Charges for State Premium and Other Applicable Taxes
We deduct a charge for applicable taxes, such as state or local premium taxes,
that might be imposed in your state. Generally, we deduct this charge from the
amount applied to provide an annuity benefit. In certain states, however, we may
deduct the charge for taxes from contributions. The current tax charge that
might be imposed varies by state and ranges from 0% to 2.25% for Traditional and
Roth IRA Certificates, and from 0% to 3.5% for NQ Certificates (1% in Puerto
Rico and 5% in the Virgin Islands).
CHARGES DEDUCTED FROM THE INVESTMENT FUNDS
Mortality and Expense Risks Charge
We will deduct a daily charge from the assets in each Investment Fund to
compensate us for mortality and expense risks, including the Guaranteed Minimum
Death Benefit. The daily charge is at the rate of 0.003032%, which is equivalent
to an annual rate of 1.10%, on the assets in each Investment Fund.
The mortality risk assumed is the risk that Annuitants as a group will live for
a longer time than our actuarial tables predict. As a result, we would be paying
more in annuity income than we planned. We also assume a risk that the mortality
assumptions reflected in our guaranteed annuity payment tables, shown in each
Certificate, will differ from actual mortality experience. Lastly, we assume a
mortality risk to the extent that at the time of death, the Guaranteed Minimum
Death Benefit exceeds the Cash Value of the Certificate. The expense risk
assumed is the risk that it will cost us more to issue and administer the
Certificates than we expect.
Administration Charge
We will deduct a daily charge from the assets in each Investment Fund, to
compensate us for administration expenses under the Certificates. The daily
charge is at a rate of 0.000692% (equivalent to an annual rate of 0.25%) on the
assets in each Investment Fund. We reserve the right to increase this charge to
an annual rate of 0.35%, the maximum permitted under the Certificates.
HR TRUST CHARGES TO PORTFOLIOS
Investment advisory fees charged daily against HR Trust's assets, the 12b-1 fee,
direct operating expenses of HR Trust (such as trustees' fees, expenses of
independent auditors and legal counsel, bank and custodian charges and liability
insurance), and certain investment-related expenses of HR Trust (such as
brokerage commissions and other expenses related to the purchase and sale of
securities), are reflected in each Portfolio's daily share price. The maximum
investment advisory fees paid annually by the Portfolios cannot be changed
without a vote by shareholders. They are as follows:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
AVERAGE DAILY ASSETS
------------------------------------------------------------------------------------------
FIRST NEXT NEXT NEXT
$750 MILLION $750 MILLION $1 BILLION $2.5 BILLION THEREAFTER
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Alliance Conservative
Investors 0.475% 0.425% 0.375% 0.350% 0.325%
Alliance Growth
Investors 0.550% 0.500% 0.450% 0.425% 0.400%
Alliance Growth &
Income 0.550% 0.525% 0.500% 0.480% 0.470%
Alliance Common
Stock 0.475% 0.425% 0.375% 0.355% 0.345%*
Alliance Global 0.675% 0.600% 0.550% 0.530% 0.520%
Alliance
International 0.900% 0.825% 0.800% 0.780% 0.770%
Alliance Aggressive
Stock 0.625% 0.575% 0.525% 0.500% 0.475%
Alliance Small Cap
Growth 0.900% 0.850% 0.825% 0.800% 0.775%
Alliance Money
Market 0.350% 0.325% 0.300% 0.280% 0.270%
Alliance Intermediate
Government Securities 0.500% 0.475% 0.450% 0.430% 0.420%
Alliance High Yield 0.600% 0.575% 0.550% 0.530% 0.520%
Alliance Equity Index
Fund 0.325% 0.300% 0.275% 0.255% 0.245%
</TABLE>
- -------------------
* On assets in excess of $10 billion, the management fee for the Alliance Common
Stock Portfolio is reduced to 0.335% of average daily net assets.
- --------------------------------------------------------------------------------
Investment advisory fees are established under HR Trust's investment advisory
agreements between HR Trust and its investment adviser, Alliance.
The Rule 12b-1 Plan provides that HR Trust, on behalf of each Portfolio (other
than the Alliance Small Cap Growth Portfolio), may pay annually up to 0.25% of
the average daily net assets of a Portfolio attributable to its Class IB shares
in respect of activities primarily intended to result in the sale of the Class
IB shares. This fee will not be increased for the life of the Certificates. With
respect to the Alliance Small Cap Growth Portfolio, EDI will receive an annual
fee not to exceed the lesser of (a) 0.25% of the average daily net assets of the
Portfolio attributable to Class IB shares and (b) an amount that, when added to
certain other expenses of the Class IB shares, would result in the ratio of
expenses to average daily net assets attributable to Class IB shares equalling
1.20%. Prior to October 8, 1997, EDI waived a portion of the 12b-1 fee with
respect to the Alliance Small Cap Growth Portfolio. Fees and expenses are
described more fully in the HR Trust prospectus.
EQ TRUST CHARGES TO PORTFOLIOS
Investment management fees charged daily against EQ Trust's assets, the 12b-1
fee, direct operating expenses of EQ Trust (such as trustees' fees, expenses of
independent auditors and legal counsel, administrative service fees, custodian
fees, and liability
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insurance), and certain investment-related expenses of EQ Trust (such as
brokerage commissions and other expenses related to the purchase and sale of
securities), are reflected in each Portfolio's daily share price. The investment
management fees paid annually by the Portfolios cannot be changed without a vote
by shareholders. They are as follows:
- --------------------------------------------------------------
AVERAGE DAILY
NET ASSETS
----------------------
BT Equity 500 Index 0.25%
BT Small Company Index 0.25%
BT International Equity Index 0.35%
MFS Emerging Growth Companies 0.55%
MFS Research 0.55%
Merrill Lynch Basic Value Equity 0.55%
Merrill Lynch World Strategy 0.70%
Morgan Stanley Emerging Markets Equity 1.15%
EQ/Putnam Balanced 0.55%
EQ/Putnam Growth and Income Value 0.55%
T. Rowe Price Equity Income 0.55%
T. Rowe Price International Stock 0.75%
Warburg Pincus Small Company Value 0.65%
- --------------------------------------------------------------
Investment management fees are established under EQ Trust's Investment
Management Agreement between EQ Trust and its investment manager, EQ Financial.
EQ Financial has entered into expense limitation agreements with EQ Trust, with
respect to each Portfolio, pursuant to which EQ Financial has agreed to waive or
limit its fees and to assume other expenses so that the total operating expenses
of each Portfolio are limited to: 0.55% of the respective average daily net
assets of the BT Equity 500 Index Portfolio; 0.60% for the BT Small Company
Index Portfolio; 0.80% for the BT International Equity Index Portfolio; 0.85%
for the MFS Research, MFS Emerging Growth Companies, Merrill Lynch Basic Value
Equity, EQ/Putnam Growth & Income Value, and T. Rowe Price Equity Income
Portfolios; 0.90% for the EQ/Putnam Balanced Portfolio; 1.00% for Warburg Pincus
Small Company Value Portfolio; 1.20% for the Merrill Lynch World Strategy and T.
Rowe Price International Stock Portfolios; and 1.75% for the Morgan Stanley
Emerging Markets Equity Portfolio. See the prospectus for EQ Trust for more
information.
The Rule 12b-1 Plan provides that EQ Trust, on behalf of each Portfolio, may pay
annually up to 0.25% of the average daily net assets of a Portfolio attributable
to its Class IB shares in respect of activities primarily intended to result in
the sale of the Class IB shares. This fee will not be increased for the life of
the Certificates. Fees and expenses are described more fully in the EQ Trust
prospectus.
GROUP OR SPONSORED ARRANGEMENTS
For certain group or sponsored arrangements, we may reduce the withdrawal charge
or the mortality and expense risks charge, or change the minimum initial
contribution requirements. Under the Assured Payment Option and APO Plus we may
increase Guaranteed Rates and reduce purchase rates under the Life Contingent
Annuity. We may also change the Guaranteed Minimum Death Benefit and the
Guaranteed Minimum Income Benefit. We may also offer Investment Funds investing
in Class IA shares of HR Trust and EQ Trust, which are not subject to the 12b-1
fee. Group arrangements include those in which a trustee or an employer, for
example, purchases contracts covering a group of individuals on a group basis.
Group arrangements are not available for Traditional IRA and Roth IRA
Certificates. Sponsored arrangements include those in which an employer allows
us to sell Certificates to its employees or retirees on an individual basis.
Our costs for sales, administration, and mortality generally vary with the size
and stability of the group or sponsoring organization among other factors. We
take all these factors into account when reducing charges. To qualify for
reduced charges, a group or sponsored arrangement must meet certain
requirements, including our requirements for size and number of years in
existence. Group or sponsored arrangements that have been set up solely to buy
Certificates or that have been in existence less than six months will not
qualify for reduced charges.
We may also establish different Guaranteed Rates for the Guarantee Periods under
different classes of Certificates for group or sponsored arrangements.
We will make these and any similar reductions according to our rules in effect
when a Certificate is approved for issue. We may change these rules from time to
time. Any variation in the withdrawal charge will reflect differences in costs
or services and will not be unfairly discriminatory.
Group or sponsored arrangements may be governed by the Code, the Employee
Retirement Income Security Act of 1974 (ERISA), or both. We make no
representations as to the impact of those and other applicable laws on such
programs. WE RECOMMEND THAT EMPLOYERS, TRUSTEES, AND OTHERS PURCHASING OR MAKING
CERTIFICATES AVAILABLE FOR PURCHASE UNDER SUCH PROGRAMS SEEK THE ADVICE OF THEIR
OWN LEGAL AND BENEFITS ADVISERS.
OTHER DISTRIBUTION ARRANGEMENTS
Charges may be reduced or eliminated when sales are made in a manner that
results in savings of sales and administrative expenses, such as sales through
persons who are compensated by clients for recommending investments and receive
no commission or reduced commissions in connection with the sale of the
Certificates. In no event will a reduction or elimination of charges be
permitted where it would be unfairly discriminatory.
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PART 7: VOTING RIGHTS
- --------------------------------------------------------------------------------
HR TRUST AND EQ TRUST VOTING RIGHTS
As explained previously, contributions allocated to the Investment Funds are
invested in shares of the corresponding Portfolios of HR Trust and EQ Trust.
Since we own the assets of the Separate Account, we are the legal owner of the
shares and, as such, have the right to vote on certain matters. Among other
things, we may vote:
o to elect each trust's Board of Trustees,
o to ratify the selection of independent auditors for each trust, and
o on any other matters described in each trust's current prospectus or
requiring a vote by shareholders under the 1940 Act.
Because HR Trust is a Massachusetts business trust and EQ Trust is a Delaware
business trust, annual meetings are not required. Whenever a shareholder vote is
taken, we will give Certificate Owners the opportunity to instruct us how to
vote the number of shares attributable to their Certificates. If we do not
receive instructions in time from all Certificate Owners, we will vote the
shares of a Portfolio for which no instructions have been received in the same
proportion as we vote shares of that Portfolio for which we have received
instructions. We will also vote any shares that we are entitled to vote directly
because of amounts we have in an Investment Fund in the same proportions that
Certificate Owners vote.
Each share of each trust is entitled to one vote. Fractional shares will be
counted. Voting generally is on a Portfolio-by-Portfolio basis except that
shares will be voted on an aggregate basis when universal matters, such as
election of Trustees and ratification of independent auditors, are voted upon.
However, if the Trustees determine that shareholders in a Portfolio are not
affected by a particular matter, then such shareholders generally would not be
entitled to vote on that matter.
VOTING RIGHTS OF OTHERS
Currently, we control each trust. EQ Trust shares currently are sold only to our
separate accounts. HR Trust shares are held by other separate accounts of ours
and by separate accounts of insurance companies affiliated and unaffiliated with
us. Shares held by these separate accounts will probably be voted according to
the instructions of the owners of insurance policies and contracts issued by
those insurance companies. While this will dilute the effect of the voting
instructions of the Certificate Owners, we currently do not foresee any
disadvantages arising out of this. HR Trust's Board of Trustees intends to
monitor events in order to identify any material irreconcilable conflicts that
possibly may arise and to determine what action, if any, should be taken in
response. If we believe that HR Trust's response to any of those events
insufficiently protects our Certificate Owners, we will see to it that
appropriate action is taken to protect our Certificate Owners.
SEPARATE ACCOUNT VOTING RIGHTS
If actions relating to the Separate Account require Certificate Owner approval,
Certificate Owners will be entitled to one vote for each Accumulation Unit they
have in the Investment Funds. Each Certificate Owner who has elected a variable
annuity payout may cast the number of votes equal to the dollar amount of
reserves we are holding for that annuity in an Investment Fund divided by the
Accumulation Unit Value for that Investment Fund. We will cast votes
attributable to any amounts we have in the Investment Funds in the same
proportion as votes cast by Certificate Owners.
CHANGES IN APPLICABLE LAW
The voting rights we describe in this prospectus are created under applicable
Federal securities laws. To the extent that those laws or the regulations
promulgated under those laws eliminate the necessity to submit matters for
approval by persons having voting rights in separate accounts of insurance
companies, we reserve the right to proceed in accordance with those laws or
regulations.
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- --------------------------------------------------------------------------------
PART 8: TAX ASPECTS OF THE CERTIFICATES
- --------------------------------------------------------------------------------
This Part of the prospectus generally covers our understanding of the current
Federal income tax rules that apply to NQ, Traditional IRA, and Roth IRA
Certificates owned by United States taxpayers.
This Part does not apply to NQ Certificates used as the investment vehicle for
qualified plans discussed in Appendix II.
This prospectus does not provide detailed tax information and does not address
issues such as state income and other taxes, Federal income tax and withholding
rules for non-U.S. taxpayers, or Federal gift and estate taxes. A gift or estate
tax transfer may arise whenever payments or contract rights are provided to
someone other than the original owner of the Certificates. Please consult a tax
adviser when considering the tax aspects of the Certificates.
TAX CHANGES
The United States Congress has in the past considered and may in the future
consider proposals for legislation that, if enacted, could change the tax
treatment of annuities and individual retirement arrangements. In addition, the
Treasury Department may amend existing regulations, issue new regulations, or
adopt new interpretations of existing laws. State tax laws and, if you are not a
United States resident, foreign tax laws, may also affect the tax consequences
to you or the beneficiary. These laws may change from time to time without
notice and, as a result, the tax consequences may be altered. There is no way of
predicting whether, when or in what form any such change would be adopted.
Any such change could have retroactive effects regardless of the date of
enactment. We suggest you consult your legal or tax adviser.
TAXATION OF NON-QUALIFIED ANNUITIES
This section generally covers our understanding of the current Federal income
tax laws that apply to a non-qualified annuity purchased with only after-tax
dollars and not subject to any special retirement plan rules.
Equitable Life has designed the NQ Certificate to qualify as an "annuity" for
purposes of Federal income tax law. Gains in the Annuity Account Value of the
Certificate generally will not be taxable to you until a distribution occurs,
either by a withdrawal of part or all of its value or as a series of periodic
payments. However, there are some exceptions to this rule: (1) if a Certificate
fails the investment diversification requirements; (2) if you transfer a
Certificate, for example, as a gift to someone other than your spouse (or
divorced spouse), any gain in its Annuity Account Value will be taxed at the
time of transfer; (3) the assignment or pledge of any portion of the value of a
Certificate will be treated as a distribution of that portion of the
Certificate; and (4) when an insurance company (or its affiliate) issues more
than one non-qualified deferred annuity certificate or contract during any
calendar year to the same taxpayer, the certificates or contracts are required
to be aggregated in computing the taxable amount of any distribution.
Corporations, partnerships, trusts and other non-natural persons generally
cannot defer the taxation of current income credited to the Certificate unless
an exception under the Code applies.
Withdrawals
Prior to the Annuity Commencement Date, any withdrawals which do not terminate
your total interest in the NQ Certificate are taxable to you as ordinary income
to the extent there has been a gain in the Annuity Account Value, and is subject
to income tax withholding. See "Federal and State Income Tax Withholding" below.
The balance of the distribution is treated as a return of the "investment" or
"basis" in the Certificate and is not taxable. Generally, the investment or
basis in the NQ Certificate equals the contributions made, less any amounts
previously withdrawn which were not taxable. If your Equitable Accumulator NQ
Certificate was issued as a result of a tax-free exchange of another NQ life
insurance or deferred annuity contract as described in "Methods of Payment:
Section 1035 Exchanges" in Part 4, your investment in that original contract
generally is treated as the basis in the Equitable Accumulator NQ Certificate
regardless of the value of that original contract at the time of the exchange.
Special rules may apply if contributions made to another annuity certificate or
contract prior to August 14, 1982 are transferred to a Certificate in a tax-free
exchange. To take advantage of these rules, you must notify us prior to such an
exchange.
If you surrender or cancel the NQ Certificate, the distribution is taxable to
the extent it exceeds the investment in the NQ Certificate.
Annuity Payments
Once annuity payments begin, a portion of each payment is considered to be a
tax-free recovery of investment based on the ratio of the investment to the
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expected return under the NQ Certificate. The remainder of each payment will be
taxable. In the case of a variable annuity, special rules apply if the payments
received in a year are less than the amount permitted to be recovered tax free.
In the case of a life annuity, after the total investment has been recovered,
future payments are fully taxable. If payments cease as a result of death, a
deduction for any unrecovered investment will be allowed.
Early Distribution Penalty Tax
In addition to income tax, a penalty tax of 10% applies to the taxable portion
of a distribution unless the distribution is (1) made on or after the date you
attain age 59 1/2, (2) made on or after your death, (3) attributable to your
disability, (4) part of a series of substantially equal installments as an
annuity for your life (or life expectancy) or the joint lives (or joint life
expectancies) of you and a beneficiary, or (5) with respect to income allocable
to amounts contributed to an annuity certificate or contract prior to August 14,
1982 which are transferred to the Certificate in a tax-free exchange.
Payments as a Result of Death
If, as a result of the Annuitant's death, the beneficiary is entitled to receive
the death benefit described in Part 4, the beneficiary is generally subject to
the same tax treatment as would apply to you, had you surrendered the
Certificate (discussed above).
If the beneficiary elects to take the death benefit in the form of a life income
or installment option, the election should be made within 60 days after the day
on which a lump sum death benefit first becomes payable and before any benefit
is actually paid. The tax computation will reflect your investment in the
Certificate.
The Certificate provides a minimum guaranteed death benefit that in certain
circumstances may be greater than either the contributions made or the Annuity
Account Value. This provision provides investment protection against an untimely
termination of a Certificate on the death of an Annuitant at a time when the
Certificate's Annuity Account Value might otherwise have provided a lower
benefit. Although we do not believe that the provision of this benefit should
have any adverse tax effect, it is possible that the IRS could take a contrary
position and could assert that some portion of the charges for the minimum
guaranteed death benefit should be treated for Federal income tax purposes as a
partial withdrawal from the Certificate. If this were so, such a deemed
withdrawal could be taxable, and for Certificate Owners under age 59 1/2, also
subject to tax penalty.
Special distribution requirements apply upon the death of the owner of a
non-qualified annuity. That is, in the case of a contract where the owner and
annuitant are different, even though the annuity contract could continue because
the annuitant has not died, Federal tax law requires that the person who
succeeds as owner of the contract take taxable distribution of the contract
within a specified period of time. This includes the surviving Joint Owner in a
nonspousal joint ownership situation. See "When an NQ Certificate Owner Dies
before the Annuitant" in Part 4.
CHARITABLE REMAINDER TRUSTS
On April 17, 1997, the IRS issued proposed regulations concerning CRTs. The
preamble to the proposed regulation indicates that the IRS is studying whether
the use of deferred annuities or other assets offering similar tax benefits
causes a CRT to fail to qualify as a CRT under the tax law. The IRS also issued
a Revenue Procedure which indicates that effective such date it will no longer
issue rulings that a trust qualifies as a CRT in situations where the timing of
trust income can be controlled to take advantage of the difference between trust
income and taxable income for the benefit of the unitrust recipient.
SPECIAL RULES FOR NQ CERTIFICATES ISSUED IN PUERTO RICO
Under current law Equitable Life treats income from NQ Certificates as
U.S.-source. A Puerto Rico resident is subject to U.S. taxation on such
U.S.-source income. Only Puerto Rico-source income of Puerto Rico residents is
excludable from U.S. taxation. Income from NQ Certificates is also subject to
Puerto Rico tax. The computation of the taxable portion of amounts distributed
from a Certificate may differ in the two jurisdictions. Therefore, you might
have to file both U.S. and Puerto Rico tax returns, showing different amounts of
income for each. Puerto Rico generally provides a credit against Puerto Rico tax
for U.S. tax paid. Depending on your personal situation and the timing of the
different tax liabilities, you may not be able to take full advantage of this
credit.
Please consult your tax adviser to determine the applicability of these rules to
your own tax situation.
IRA TAX INFORMATION
The term "IRA" may generally refer to all individual retirement arrangements,
including individual retirement accounts and individual retirement annuities. In
addition to being available in both trusteed or custodial account form or
individual annuity form, there are many varieties of IRAs. There are
"Traditional IRAs" which are generally funded on a pretax basis. There are Roth
IRAs, newly available in 1998, which must be funded on an after-tax basis.
SEP-IRAs (including SARSEP-IRAs) and SIMPLE-IRAs are issued and funded in
connection with employer-sponsored retirement plans. There are also Education
IRAs, which are not discussed herein
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because they are not available in individual retirement annuity form. As the
Equitable Accumulator Roth IRA is an individual retirement annuity, the term
"Roth IRA" refers to a Roth individual retirement annuity unless the context
requires otherwise.
There is no limit to the number of IRAs (including Roth IRAs) you may establish
or maintain as long as you meet the requirements for establishing and funding
the IRA. However, if you maintain multiple IRAs, you may be required to
aggregate IRA values or contributions for tax purposes. You should be aware that
all types of IRAs are subject to certain restrictions in order to qualify for
special treatment under the Federal tax law.
TRADITIONAL INDIVIDUAL RETIREMENT ANNUITIES (TRADITIONAL IRAS)
This prospectus contains the information which the Internal Revenue Service
(IRS) requires to be disclosed to you before you purchase a Traditional IRA.
The Equitable Accumulator IRA Certificate is designed to qualify as a
Traditional IRA under Section 408(b) of the Code. Your rights under the IRA
Certificate cannot be forfeited.
This prospectus covers some of the special tax rules that apply to individual
retirement arrangements. You should be aware that a Traditional IRA is subject
to certain restrictions in order to qualify for its special treatment under the
Federal tax law.
This prospectus provides our general understanding of applicable Federal income
tax rules, but does not provide detailed tax information and does not address
issues such as state income and other taxes or Federal gift and estate taxes.
Please consult a tax adviser when considering the tax aspects of the Traditional
IRA Certificates.
Further information on Traditional IRA tax matters can be obtained from any IRS
district office. Additional information regarding IRAs, including a discussion
of required distributions, can be found in IRS Publication 590, entitled
"Individual Retirement Arrangements (IRAs)," which is generally updated
annually.
The Equitable Accumulator IRA Certificate has been approved by the IRS as to
form for use as a Traditional IRA. This IRS approval is a determination only as
to the form of the annuity, does not represent a determination of the merits of
the annuity as an investment, and may not address certain features under the
Equitable Accumulator IRA Certificate.
Cancellation
You can cancel a Certificate issued as a Traditional IRA by following the
directions in Part 4 under "Free Look Period." Since there may be adverse tax
consequences if a Certificate is cancelled (and because we are required to
report to the IRS certain distributions from cancelled Traditional IRAs), you
should consult with a tax adviser before making any such decision. If you cancel
this Certificate, you may establish a new individual retirement arrangement if
at the time you meet the requirements for establishing an individual retirement
arrangement.
Contributions to Traditional IRAs
Individuals may make three different types of contributions to purchase a
Traditional IRA, or as later additions to an existing Traditional IRA: "regular"
contributions out of earnings, tax-free "rollover" contributions from
tax-qualified plans, or direct custodian-to-custodian transfers from other
traditional individual retirement arrangements ("direct transfers").
The initial contribution to the Certificate must be either a rollover or a
direct custodian-to-custodian transfer. See "Tax-Free Transfers and Rollovers"
discussed below. Any subsequent contributions you make may be any of rollovers,
direct transfers or "regular" Traditional IRA contributions. See "Contributions
under the Certificates" in Part 4. The immediately following discussion relates
to "regular" Traditional IRA contributions. For the reasons noted in "Tax-Free
Transfers and Rollovers" below, you should consult with your tax adviser before
making any subsequent contributions to a Traditional IRA which is intended to
serve as a "conduit" IRA.
Generally, $2,000 is the maximum amount of deductible and nondeductible
contributions which you may make to all IRAs (including Roth IRAs) in any
taxable year. The above limit may be less when your earnings are below $2,000.
This limit does not apply to rollover contributions or direct
custodian-to-custodian transfers into a Traditional IRA.
If you are married and file a joint income tax return, your and your spouse's
compensation effectively can be aggregated for purposes of determining the
permissible amount of regular contributions to Traditional IRAs (and Roth IRAs
discussed below). Even if one spouse has no compensation or compensation under
$2,000, married individuals filing jointly can contribute up to $4,000 for any
taxable year to any combination of Traditional IRAs and Roth IRAs. (Any
contributions to Roth IRAs reduce the ability to contribute to Traditional IRAs
and vice versa.) The maximum amount may be less if earnings are less and the
other spouse has made IRA contributions. No more than a combined total of $2,000
can be contributed annually to either spouse's traditional and Roth individual
retirement arrangements. Each spouse owns his or her individual retirement
arrangements (Traditional and Roth IRA) even if contributions were fully funded
by the other spouse.
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The amount of Traditional IRA contributions for a tax year that you can deduct
depends on whether you are covered by an employer-sponsored tax-favored
retirement plan. An employer-sponsored tax-favored retirement plan includes a
qualified plan, a tax-sheltered account or annuity under Section 403(b) of the
Code (TSA) or a simplified employee pension plan. In certain cases, individuals
covered by a tax-favored retirement plan include persons eligible to participate
in the plan although not actually participating. Whether or not a person is
covered by a retirement plan will be reported on an employee's Form W-2.
Regardless of adjusted gross income (AGI), you may make deductible contributions
to a Traditional IRA for each tax year up to the lesser of $2,000 or 100% of
compensation (MAXIMUM PERMISSIBLE DOLLAR DEDUCTION) if not covered by a
retirement plan.
If you are single and covered by a retirement plan during any part of the
taxable year, the deduction for IRA contributions phases out with AGI between
$30,000 and $40,000. This amount will be indexed every year until 2005. If you
are married and file a joint return, and you are covered by a tax-favored
retirement plan during any part of the taxable year, the deduction for
Traditional IRA contributions phases out with AGI between $50,000 and $60,000.
This amount will be indexed every year until 2007.
Married individuals filing separately and living apart at all times are not
treated as being married for purposes of this deductible contribution
calculation. Generally, the active participation in an employer-sponsored
retirement plan of an individual is determined independently for each spouse.
Where spouses have "married filing jointly" status, however, the maximum
deductible Traditional IRA contribution for an individual who is not an active
participant (but whose spouse is an active participant) is phased out for
taxpayers with AGI of between $150,000 and $160,000. To determine the deductible
amount of the contribution with the phase out, you determine AGI and subtract
$30,000 if you are single, $50,000 if you are married and file a joint return
with your spouse. The resulting amount is your Excess AGI. You then determine
the limit on the deduction for Traditional IRA contributions using the following
formula:
Maximum Adjusted
$10,000 - Excess AGI x Permissible = Dollar
-------------------- Dollar Deduction
$10,000 Deduction Limit
Traditional IRA contributions may be made for a tax year until the deadline for
filing a Federal income tax return for that tax year (without extensions). No
contributions are allowed for the tax year in which you attain age 70 1/2 or any
tax year after that. A working spouse age 70 1/2 or over, however, can
contribute up to the lesser of $2,000 or 100% of "earned income" to a spousal
individual retirement arrangement for a nonworking spouse until the year in
which the nonworking spouse reaches age 70 1/2.
If you are not eligible to deduct part or all of the Traditional IRA
contribution you may still make nondeductible contributions on which earnings
will accumulate on a tax-deferred basis. The deductible and nondeductible
contributions to your Traditional IRA (or the nonworking spouse's Traditional
IRA) may not, however, together exceed the maximum $2,000 per person limit. See
"Excess Contributions" below. You must keep your own records of deductible and
nondeductible contributions in order to prevent double taxation on the
distribution of previously taxed amounts. See "Distributions from Traditional
IRA Certificates" below.
If you make nondeductible contributions in any taxable year, or you have made
nondeductible contributions to a Traditional IRA in prior years and are
receiving amounts from any Traditional IRA, you must file the required
information with the IRS. Moreover, if you are making nondeductible Traditional
IRA contributions, you must retain all income tax returns and records pertaining
to such contributions until interests in all Traditional IRAs are fully
distributed.
EXCESS CONTRIBUTIONS
Excess contributions to a Traditional IRA are subject to a 6% excise tax for the
year in which made and for each year thereafter until withdrawn. In the case of
"regular" Traditional IRA contributions any contribution in excess of the lesser
of $2,000 or 100% of compensation or earned income is an "excess contribution"
(without regard to the deductibility or nondeductibility of Traditional IRA
contributions under this limit). Also, any "regular" contributions made after
you reach age 70 1/2 are excess contributions. In the case of rollover
Traditional IRA contributions, excess contributions are amounts which are not
eligible to be rolled over (for example, after-tax contributions to a qualified
plan or minimum distributions required to be made after age 70 1/2). An excess
contribution (rollover or "regular") which is withdrawn, however, before the
time for filing the individual's Federal income tax return for the tax year
(including extensions) is not includable in income and therefore is not subject
to the 10% penalty tax on early distributions (discussed below under "Penalty
Tax on Early Distributions"), provided any earnings attributable to the excess
contribution are also withdrawn and no tax deduction is taken for the excess
contribution. The withdrawn earnings on the excess contribution, however, would
be includable in your gross income and would be subject to the 10% penalty tax.
If excess contributions are not withdrawn before the time for filing your
Federal income tax return for
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the year (including extensions), "regular" contributions may still be withdrawn
after that time if the Traditional IRA contribution for the tax year did not
exceed $2,000 and no tax deduction was taken for the excess contribution; in
that event, the excess contribution would not be includable in gross income and
would not be subject to the 10% penalty tax. Lastly, excess "regular"
contributions may also be removed by underutilizing the allowable contribution
limits for a later year.
If excess rollover contributions are not withdrawn before the time for filing
your Federal tax return for the year (including extensions) and the excess
contribution occurred as a result of incorrect information provided by the plan,
any such excess amount can be withdrawn if no tax deduction was taken for the
excess contribution. As above, excess rollover contributions withdrawn under
those circumstances would not be includable in gross income and would not be
subject to the 10% penalty tax.
TAX-FREE TRANSFERS AND ROLLOVERS
Tax-free rollover contributions may be made to a Traditional IRA from these
sources: (i) qualified plans, (ii) TSAs (including 403(b)(7) custodial accounts)
and (iii) other traditional individual retirement arrangements.
The rollover amount must be transferred to the Certificate either as a direct
rollover of an "eligible rollover distribution" (described below) or as a
rollover by the individual plan participant or owner of the individual
retirement arrangement. In the latter cases, the rollover must be made within 60
days of the date the proceeds from another traditional individual retirement
arrangement or an eligible rollover distribution from a qualified plan or TSA
were received. Generally, the taxable portion of any distribution from a
qualified plan or TSA is an eligible rollover distribution and may be rolled
over tax free to a Traditional IRA unless the distribution is (i) a required
minimum distribution under Section 401(a)(9) of the Code; or (ii) one of a
series of substantially equal periodic payments made (not less frequently than
annually) (a) for the life (or life expectancy) of the plan participant or the
joint lives (or joint life expectancies) of the plan participant and his or her
designated beneficiary, or (b) for a specified period of ten years or more. Any
amount contributed to a Traditional IRA after you attain age 70 1/2 must be net
of your required minimum distribution for the year in which the rollover or
direct transfer contribution is made.
Under some circumstances, amounts from a Certificate may be rolled over on a
tax-free basis to a qualified plan. To get this "conduit" Traditional IRA
treatment, the source of funds used to establish the Traditional IRA must be a
rollover contribution from the qualified plan and the entire amount received
from the Traditional IRA (including any earnings on the rollover contribution)
must be rolled over into another qualified plan within 60 days of the date
received. Similar rules apply in the case of a TSA. If you make a contribution
to the Certificate which is from an eligible rollover distribution and you
commingle such contribution with other contributions, you may not be able to
roll over these eligible rollover distribution contributions and earnings to
another qualified plan (or TSA, as the case may be) at a future date, unless the
Code permits.
Under the conditions and limitations of the Code, you may elect for each
Traditional IRA to make a tax-free rollover once every 12-month period among
individual retirement arrangements (including rollovers from retirement bonds
purchased before 1983). Custodian-to-custodian transfers are not rollovers and
can be made more frequently than once a year.
The same tax-free treatment applies to amounts withdrawn from the Certificate
and rolled over into other traditional individual retirement arrangements unless
the distribution was received under an inherited Traditional IRA. Tax-free
rollovers are also available to the surviving spouse beneficiary of a deceased
individual, or a spousal alternate payee of a qualified domestic relations order
applicable to a qualified plan. In some cases, Traditional IRAs can be
transferred on a tax-free basis between spouses or former spouses incidental to
a judicial decree of divorce or separation.
DISTRIBUTIONS FROM TRADITIONAL IRA CERTIFICATES
Income or gains on contributions under Traditional IRAs are not subject to
Federal income tax until benefits are distributed to you. Distributions include
withdrawals from your Certificate, surrender of your Certificate and annuity
payments from your Certificate. Death benefits are also distributions. Except as
discussed below, the amount of any distribution from a Traditional IRA is fully
includable as ordinary income by you in your gross income.
If you have made nondeductible IRA contributions to any Traditional IRA (whether
or not this particular arrangement), those contributions are recovered tax free
when distributions are received. You must keep records of all such nondeductible
contributions. At the end of each tax year in which you have received a
distribution from any traditional individual retirement arrangement, you
determine a ratio of the total nondeductible Traditional IRA contributions (less
any amounts previously withdrawn tax free) to the total account balances of all
Traditional IRAs held by you at the end of the tax year (including rollover
Traditional IRAs) plus all Traditional IRA distributions made during such tax
year. The resulting ratio is then multiplied by all distributions from the
Traditional IRA during that tax year to determine the nontaxable portion of each
distribution.
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In addition, a distribution (other than a required minimum distribution received
after age 70 1/2) is not taxable if (1) the amount received is a return of
excess contributions which are withdrawn, as described under "Excess
Contributions" above, (2) the entire amount received is rolled over to another
traditional individual retirement arrangement (see "Tax-Free Transfers and
Rollovers" above) or (3) in certain limited circumstances, where the Traditional
IRA acts as a "conduit," the entire amount is paid into a qualified plan or TSA
that permits rollover contributions.
Distributions from a Traditional IRA are not entitled to the special favorable
five-year averaging method (or, in certain cases, favorable ten-year averaging
and long-term capital gain treatment) available in certain cases to
distributions from qualified plans.
REQUIRED MINIMUM DISTRIBUTIONS
The minimum distribution rules require Traditional IRA owners to start taking
annual distributions from their retirement plans by age 70 1/2. The distribution
requirements are designed to provide for distribution of your interest in the
IRA over your life expectancy. Whether the correct amount has been distributed
is calculated on a year-by-year basis; there are no provisions in the Code to
allow amounts taken in excess of the required amount to be carried over or
carried back and credited to other years.
Generally, you must take the first required minimum distribution with respect to
the calendar year in which you turn age 70 1/2. You have the choice to take the
first required minimum distribution during the calendar year you turn age
70 1/2, or to delay taking it until the three-month (January 1 - April 1) period
in the next calendar year. (Distributions must commence no later than the
"Required Beginning Date," which is the April 1st of the calendar year following
the calendar year in which you turn age 70 1/2.) If you choose to delay taking
the first annual minimum distribution, then you will have to take two minimum
distributions in that year -- the delayed one for the first year and the one
actually for that year. Once minimum distributions begin, they must be made at
some time every year.
There are two approaches to taking minimum distributions -- "account based" or
"annuity based" -- and there are a number of distribution options in both of
these categories. These choices are intended to give you a great deal of
flexibility to provide for yourself and your family.
An account-based minimum distribution approach may be a lump sum payment, or
periodic withdrawals made over a period which does not extend beyond your life
expectancy or the joint life expectancies of you and a designated beneficiary.
An annuity-based approach involves application of the Annuity Account Value to
an annuity for your life or the joint lives of you and a designated beneficiary,
or for a period certain not extending beyond applicable life expectancies.
You should discuss with your tax adviser which minimum distribution options are
best for your own personal situation. Individuals who are participants in more
than one tax-favored retirement plan may be able to choose different
distribution options for each plan.
Your required minimum distribution for any taxable year is calculated by taking
into account the required minimum distribution from each of your traditional
individual retirement arrangements. The IRS, however, does not require that you
make the required distribution from each traditional individual retirement
arrangement that you maintain. As long as the total amount distributed annually
satisfies your overall minimum distribution requirement, you may choose to take
your annual required distribution from any one or more traditional individual
retirement arrangements that you maintain.
You may recompute your minimum distribution amount each year based on your
current life expectancy as well as that of your spouse. No recomputation is
permitted, however, for a beneficiary other than a spouse.
If you have been computing minimum distributions with respect to Traditional IRA
funds on an account-based approach (discussed above) you may subsequently apply
such funds to a life annuity-based payout, provided that you have elected to
recalculate life expectancy annually (and your spouse's life expectancy if a
spousal joint annuity is selected). For example, if you anticipate exercising
your Guaranteed Minimum Income Benefit or selecting any other form of life
annuity payout after you are age 70 1/2, you must have elected to recalculate
life expectancies.
If there is an insufficient distribution in any year, a 50% tax may be imposed
on the amount by which the minimum required to be distributed exceeds the amount
actually distributed. The penalty tax may be waived by the Secretary of the
Treasury in certain limited circumstances. Failure to have distributions made as
the Code and Treasury regulations require may result in disqualification of your
Traditional IRA. See "Tax Penalty for Insufficient Distributions" below.
Except as described in the next sentence, if you die after distribution in the
form of an annuity has begun, or after the Required Beginning Date, payment of
the remaining interest must be made at least as rapidly as under the method used
prior to your death. (The IRS has indicated that an exception to the rule that
payment of the remaining interest must be made at least as rapidly as under the
method used prior to your death applies if the beneficiary of the Traditional
IRA is your surviving spouse. In some circumstances,
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your surviving spouse may elect to "make the Traditional IRA his or her own" and
halt distributions until he or she reaches age 70 1/2.)
If you die before the Required Beginning Date and before distributions in the
form of an annuity begin, distributions of your entire interest under the
Certificate must be completed within five years after death, unless payments to
a designated beneficiary begin within one year of your death and are made over
the beneficiary's life or over a period certain which does not extend beyond the
beneficiary's life expectancy.
If your surviving spouse is the designated beneficiary, your spouse may delay
the commencement of such payments up until you would have attained 70 1/2. In
the alternative, a surviving spouse may elect to roll over the inherited
Traditional IRA into the surviving spouse's own Traditional IRA.
TAXATION OF DEATH BENEFITS
Distributions received by a beneficiary are generally given the same tax
treatment you would have received if distribution had been made to you.
If your spouse is the sole primary beneficiary and elects to become the
successor Annuitant and Certificate Owner, no death benefit is payable until the
surviving spouse's death.
GUARANTEED MINIMUM DEATH BENEFIT
The Code provides that no part of an individual retirement account may be
invested in life insurance contracts. Treasury Regulations provide that an
individual retirement account may be invested in an annuity contract which
provides a death benefit of the greater of premiums paid or the contract's cash
value. Your Certificate provides a minimum death benefit guarantee that in
certain circumstances may be greater than either of contributions made or the
Annuity Account Value. Although there is no ruling regarding the type of minimum
death benefit guarantee provided by the Certificate, Equitable Life believes
that the Certificate's minimum death benefit guarantee should not adversely
affect the qualification of the Certificate as a Traditional IRA. Nevertheless,
it is possible that the IRS could disagree, or take the position that some
portion of the charge in the Certificate for the minimum death benefit guarantee
should be treated for Federal income tax purposes as a taxable partial
withdrawal from the Certificate. If this were so, such a deemed withdrawal would
also be subject to tax penalty for Certificate Owners under age 59 1/2.
TAX CONSIDERATIONS FOR THE ASSURED PAYMENT OPTION AND APO PLUS
Although the Life Contingent Annuity does not have a Cash Value, it will be
assigned a value for tax purposes which will generally change each year. This
value must be taken into account when determining the amount of required minimum
distributions from your Traditional IRA even though the Life Contingent Annuity
may not be providing a source of funds to satisfy such required minimum
distribution. Accordingly, before you apply any Traditional IRA funds under the
Assured Payment Option or APO Plus or terminate such Options, you should be
aware of the tax considerations discussed below. Consult with your tax adviser
to determine the impact of electing the Assured Payment Option and APO Plus in
view of your own particular situation.
When funds have been allocated to the Life Contingent Annuity, you will
generally be required to determine your required minimum distribution by
annually recalculating your life expectancy. The Assured Payment Option and APO
Plus will not be available if you have previously made a different election.
Recalculation is no longer required once the only payments you or your spouse
receive are under the Life Contingent Annuity.
If prior to the date payments are to start under the Life Contingent Annuity,
you surrender your Certificate, or withdraw any remaining Annuity Account Value,
it may be necessary for you to satisfy your required minimum distribution by
accelerating the start date of payments for your Life Contingent Annuity, or to
the extent available, take distributions from other Traditional IRA funds you
may have. Alternatively, you may convert your Traditional IRA Life Contingent
Annuity under the Certificate to a non-qualified Life Contingent Annuity. This
would be viewed as a distribution of the value of the Life Contingent Annuity
from the Traditional IRA, and therefore, would be a taxable event. However,
since the Life Contingent Annuity would no longer be part of a Traditional IRA,
its value would not have to be taken into account in determining future required
minimum distributions.
If you have elected a Joint and Survivor form of the Life Contingent Annuity,
the joint Annuitant must be your spouse. You must determine your required
minimum distribution by annually recalculating both your life expectancy and
your spouse's life expectancy. The Assured Payment Option and APO Plus will not
be available if you have previously made a different election. Recalculation is
no longer required once the only payments you or your spouse receive are under
the Life Contingent Annuity. The value of such an annuity will change in the
event of your death or the death of your spouse. For this reason, it is
important that we be informed if you or your spouse dies before the Life
Contingent Annuity has started payments so that a lower valuation can be made.
Otherwise a higher tax value may result in an overstatement of the amount that
would be necessary to satisfy your required minimum distribution amount.
Allocations of funds to the Life Contingent Annuity may prevent the Certificate
from later receiving
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"conduit" Traditional IRA treatment. See "Tax-Free Transfers and Rollovers"
above.
PROHIBITED TRANSACTION
A Traditional IRA may not be borrowed against or used as collateral for a loan
or other obligation. If the IRA is borrowed against or used as collateral, its
tax-favored status will be lost as of the first day of the tax year in which the
event occurred. If this happens, you must include in Federal gross income for
that year an amount equal to the fair market value of the Traditional IRA
Certificate as of the first day of that tax year, less the amount of any
nondeductible contributions not previously withdrawn. Also, the early
distribution penalty tax of 10% will apply if you have not reached age 59 1/2
before the first day of that tax year. See "Penalty Tax on Early Distributions"
below.
PENALTY TAX ON EARLY DISTRIBUTIONS
The taxable portion of Traditional IRA distributions will be subject to a 10%
penalty tax unless the distribution is made (1) on or after your death, (2)
because you have become disabled, (3) on or after the date when you reach age
59 1/2, or (4) in accordance with the exception outlined below if you are under
59 1/2. Also not subject to penalty tax are IRA distributions used to pay (5)
certain extraordinary medical expenses or medical insurance premiums for defined
unemployed individuals, (6) qualified first-time home buyer expense payments, or
(7) higher educational expense payments, all as defined in the Code.
A payout over your life or life expectancy (or joint and survivor lives or life
expectancies), which is part of a series of substantially equal periodic
payments made at least annually, is also not subject to penalty tax. To permit
you to meet this exception, Equitable Life has two options: Substantially Equal
Payment Withdrawals and the Income Manager (Life Annuity with a Period Certain)
payout annuity certificates, both of which are described in Part 5. The version
of the Income Manager payout annuity certificates which would meet this
exception must provide level payments for life. If you are a Traditional IRA
Certificate Owner who will be under age 59 1/2 as of the date the first payment
is expected to be received and you choose either option, Equitable Life will
calculate the substantially equal annual payments under a method we will select
based on guidelines issued by the IRS (currently contained in IRS Notice 89-25,
Question and Answer 12). Although Substantially Equal Payment Withdrawals and
Income Manager payments are not subject to the 10% penalty tax, they are taxable
as discussed in "Distributions from Traditional IRA Certificates" above. Once
Substantially Equal Payment Withdrawals or Income Manager payments begin, the
distributions should not be stopped or changed until the later of your attaining
age 59 1/2 or five years after the date of the first distribution, or the
penalty tax, including an interest charge for the prior penalty avoidance, may
apply to all prior distributions under this option. Also, it is possible that
the IRS could view any additional withdrawal or payment you take from your
Certificate as changing your pattern of Substantially Equal Payment Withdrawals
or Income Manager payments for purposes of determining whether the penalty
applies.
Where a taxpayer under age 59 1/2 purchases a traditional individual retirement
annuity contract calling for substantially equal periodic payments during a
fixed period, continuing afterwards under a joint life contingent annuity with a
reduced payment to the survivor (e.g., a joint and 50% to survivor), the
question might be raised whether payments will not be substantially equal for
the joint lives of the taxpayer and survivor, as the payments will be reduced at
some point. In issuing our information returns, we code the substantially equal
periodic payments from such a contract as eligible for an exception from the
early distribution penalty. We believe that any change in payments to the
survivor would come within the statutory provision covering change of payments
on account of death. As there is no direct authority on this point, however, if
you are under age 59 1/2, you should discuss this item with your own tax adviser
when electing a reduced survivorship option.
TAX PENALTY FOR INSUFFICIENT DISTRIBUTIONS
Failure to make required distributions discussed above in "Required Minimum
Distributions" may cause the disqualification of the Traditional IRA.
Disqualification may result in current taxation of your entire benefit. In
addition a 50% penalty tax may be imposed on the difference between the required
distribution amount and the amount actually distributed, if any.
We do not automatically make distributions from a Certificate before the Annuity
Commencement Date unless a request has been made. It is your responsibility to
comply with the minimum distribution rules. We will notify you when our records
show that your age 70 1/2 is approaching. If you do not select a method, we will
assume you are taking your minimum distribution from another Traditional IRA
that you maintain. You should consult with your tax adviser concerning these
rules and their proper application to your situation.
ROTH INDIVIDUAL RETIREMENT ANNUITIES (ROTH IRAS)
This prospectus contains the information which the IRS requires to be disclosed
to you before you purchase a Roth IRA. This section of Part 8 covers some of the
special tax rules that apply to Roth IRAs.
The Equitable Accumulator Roth IRA is designed to qualify as a Roth individual
retirement annuity under
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Sections 408A and 408(b) of the Code. Your interest in the Roth IRA cannot be
forfeited. You or your beneficiaries who survive you are the only ones who can
receive the benefits or payments.
Further information regarding individual retirement arrangements generally can
be found in Internal Revenue Service Publication 590, entitled "Individual
Retirement Arrangements (IRAs)," which is generally updated annually, and can be
obtained from any IRS district office.
We have received favorable opinion letters from the IRS approving the forms of
the individual Contract and group certificates for the Equitable Accumulator as
a Traditional IRA. Such IRS approval is a determination only that the form of
the contract or certificate meets the requirements for an individual retirement
annuity and does not represent a determination of the merits of the contract or
certificate as an investment. The IRS does not yet have a procedure in place for
approving the form of Roth IRAs.
Cancellation
You can cancel a Certificate issued as a Roth IRA by following the directions in
Part 4 under "Free Look Period." In addition, you can cancel an Equitable
Accumulator Roth IRA Certificate issued as a result of a full conversion of an
Equitable Accumulator Traditional IRA Certificate by following the instructions
in the request for full conversion form available from our Processing Office or
your agent. Since there may be adverse tax consequences if a Certificate is
cancelled (and because we are required to report to the IRS certain
distributions from cancelled IRAs), you should consult with a tax adviser before
making any such decision.
Contributions to Roth IRAs
The following discussion relates to contributions to Roth IRAs. Contributions to
Traditional IRAs are discussed above.
Individuals may make four different types of contributions to purchase a Roth
IRA, or as later additions to an existing Roth IRA: (1) "regular" after-tax
contributions out of earnings, (2) taxable "rollover" contributions from
Traditional IRAs ("conversion" contributions), (3) tax-free rollover
contributions from other Roth IRAs, or (4) tax-free direct
custodian-to-custodian transfers from other Roth IRAs ("direct transfers"). See
"Contributions under the Certificates" in Part 4. Since only direct transfer and
rollover contributions are permitted under the Roth IRA Certificate, regular
after-tax contributions are not discussed here.
ROLLOVERS AND DIRECT TRANSFERS -- WHAT IS THE DIFFERENCE BETWEEN ROLLOVER AND
DIRECT TRANSFER TRANSACTIONS?
Rollover contributions may be made to a Roth IRA from only two sources: (i)
another Roth IRA ("tax-free rollover contribution"), or (ii) another Traditional
IRA in a taxable "conversion" rollover ("conversion contribution"). No
contribution may be made to a Roth IRA from a qualified plan under Section
401(a) of the Code, or a tax-sheltered arrangement under Section 403(b) of the
Code. Currently we also do not accept rollover contributions from SEP-IRAs,
SARSEP-IRAs or SIMPLE-IRAs. The rollover contribution must be applied to the new
Roth IRA Certificate within 60 days of the date the proceeds from the other Roth
IRA or the Traditional IRA was received by you.
Direct transfer contributions may be made to a Roth IRA only from another Roth
IRA. The difference between a rollover transaction and a direct transfer
transaction is that in a rollover transaction the individual actually takes
possession of the funds rolled over, or constructively receives them in the case
of a change from one type of plan to another. In a direct transfer transaction,
the individual never takes possession of the funds, but directs the first Roth
IRA custodian, trustee or issuer to transfer the first Roth IRA funds directly
to Equitable Life, as the Roth IRA issuer. Direct transfer transactions can only
be made between identical plan types (for example, Roth IRA to Roth IRA);
rollover transactions may be made between identical plan types but must be made
between different plan types (for example, Traditional IRA to Roth IRA).
Although the economic effect of a Roth IRA to Roth IRA rollover transaction and
a Roth IRA to Roth IRA direct transfer is the same -- both can be accomplished
on a completely tax-free basis -- Roth IRA to Roth IRA rollover transactions are
limited to once every 12-month period for the same funds. Trustee-to-trustee or
custodian-to-custodian direct transfers are not rollovers and can be made more
frequently than once a year.
The surviving spouse beneficiary of a deceased individual can roll over or
directly transfer an inherited Roth IRA to one or more other Roth IRAs. Also, in
some cases, Roth IRAs can be transferred on a tax-free basis between spouses or
former spouses incidental to a judicial decree of divorce or separation.
CONVERSION CONTRIBUTIONS TO ROTH IRAS
In a conversion rollover transaction, you withdraw (or are deemed to withdraw)
all or a portion of funds from a Traditional IRA you maintain and convert it to
a Roth IRA within 60 days after you receive (or are deemed to receive) the
Traditional IRA proceeds. Unlike a rollover from a Traditional IRA to another
Traditional IRA, the conversion rollover transaction is not tax exempt; the
distribution from the Traditional IRA is generally fully
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taxable. (If you have ever made nondeductible regular contributions to any
Traditional IRA -- whether or not it is the Traditional IRA you are converting
- -- a pro rata portion of the distribution is tax exempt.)
However, even if you are under age 59 1/2 there is no premature distribution
penalty on the Traditional IRA withdrawal that you are converting to a Roth IRA.
Also, a special rule applies to Traditional IRA funds converted to a Roth IRA in
calendar year 1998 only. For 1998 Roth IRA conversion rollover transactions, you
include the gross income from the Traditional IRA conversion ratably over the
four-year period 1998-2001. See discussion of the pre-age 59 1/2 withdrawal
penalty and the special penalties that may apply to premature withdrawals of
converted funds under "Additional Taxes and Penalties" and "Penalty Tax on
Premature Distributions" below.
YOU CANNOT MAKE CONVERSION CONTRIBUTIONS TO A ROTH IRA FOR ANY TAXABLE YEAR IN
WHICH YOUR ADJUSTED GROSS INCOME EXCEEDS $100,000. (For this purpose, your
adjusted gross income is computed without the gross income stemming from the
Traditional IRA conversion.) You also cannot make conversion contributions to a
Roth IRA for any taxable year in which your Federal income tax filing status is
"married filing separately."
Finally, you cannot make conversion contributions to a Roth IRA to the extent
that the funds in your Traditional IRA are subject to the annual required
minimum distribution rule applicable to Traditional IRAs beginning at age
70 1/2. For the potential effects of violating these rules, see discussion
of "Additional Taxes and Penalties" and "Excess Contributions" below.
WITHDRAWALS, PAYMENTS AND TRANSFERS OF FUNDS OUT OF ROTH IRAS
NO RESTRICTIONS ON WITHDRAWALS. You can withdraw any or all of your funds from a
Roth IRA at any time; you do not need to wait for a special event like
retirement. However, these withdrawals may be subject to a withdrawal charge as
stated in your Certificate. See discussion in Part 6. Also, the withdrawal may
be taxable to an extent and, even if not taxable, may be subject to tax penalty
in certain circumstances. See the discussion below under "Distributions from
Roth IRAs," "Additional Taxes and Penalties," and "Penalty Tax on Premature
Distributions."
DISTRIBUTIONS FROM ROTH IRAS
Distributions include withdrawals from your Certificate, surrender of your
Certificate and annuity payments from your Certificate. Death benefits are also
distributions.
The following distributions from Roth IRAs are free of income tax:
(1) Rollovers from a Roth IRA to another Roth IRA.
(2) Direct transfers from a Roth IRA to another Roth IRA (see "Rollovers and
Direct Transfers" above).
(3) "Qualified Distributions" from Roth IRAs (see "Qualified Distributions from
Roth IRAs" below).
(4) Return of excess contributions (see "Additional Taxes and Penalties," and
"Excess Contributions" below).
Qualified Distributions from Roth IRAs
Distributions from Roth IRAs made because of one of the following four
qualifying events or reasons are not includable in income, provided a specified
five-year holding or aging period is met. The qualifying events or reasons are
(1) you attain age 59 1/2, (2) your death, (3) your disability, or (4) a
"qualified first-time homebuyer distribution" (as defined in the Code).
Qualified first-time homebuyer distributions are limited to $10,000 lifetime in
the aggregate from all Roth and Traditional IRAs of the taxpayer.
Five-Year Holding or Aging Period
The applicable five-year holding or aging period depends on the type of
contribution made to the Roth IRA. For Roth IRAs funded by regular
contributions, or rollover or direct transfer contributions which are not
directly or indirectly attributable to converted Traditional IRAs, any
distribution made after the five-taxable year period beginning with the first
taxable year for which you made a regular contribution to any Roth IRA (whether
or not the one from which the distribution is being made) meets the five-year
holding or aging period. The Equitable Accumulator Roth IRA does not accept
"regular" contributions. However, it does accept Roth IRA to Roth IRA rollovers
and direct transfers. If the source of your contribution is (indirectly) regular
contributions made to another Roth IRA and not conversion contributions, the
five-year holding or aging period discussed in the prior sentence applies to
you.
For Roth IRAs funded directly or indirectly by converted Traditional IRAs, the
applicable five-year holding period begins with the year of the conversion
rollover transaction to a Roth IRA.
Although there is currently no statutory prohibition against commingling regular
contributions and conversion contributions in any Roth IRA, or against
commingling conversion contributions made in more than one taxable year to Roth
IRAs, the IRS strongly encourages individuals to maintain separate Roth IRAs for
regular contributions and conversion contributions. It also strongly encourages
individuals to differentiate conversion Roth IRAs by conversion year. Under
pending legislation which could be enacted with a retroactive effective date,
aggregation of Roth IRAs by
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conversion year may be required. In the case of a Roth IRA which contains
conversion contributions and regular contributions, or conversion contributions
from more than one year, the five-year holding period would be reset to begin
with the most recent taxable year for which a conversion contribution is made.
Non-Qualified Distributions from Roth IRAs
Non-qualified distributions from Roth IRAs are any distributions which do not
meet the qualifying event and five-year holding or aging period tests described
above and are potentially taxable as ordinary income. In contrast to Traditional
IRA distributions, which are assumed to be fully taxable, non-qualified
distributions receive return-of-investment-first treatment. That is, the
recipient is taxed only on the difference between the amount of the distribution
and the amount of Roth IRA contributions (less any distributions previously
recovered tax free).
Like Traditional IRAs, taxable distributions from a Roth IRA are not entitled to
the special favorable five-year averaging method (or, in certain cases,
favorable ten-year averaging and long-term capital gain treatment) available in
certain cases to distributions from qualified plans.
Although the IRS has not yet issued complete guidance on all aspects of Roth
IRAs, it is highly possible that you will be required to keep your own records
of regular and conversion contributions to all Roth IRAs in order to assure
appropriate taxation. An individual making contributions to a Roth IRA in any
taxable year, or receiving amounts from any Roth IRA may be required to file the
information with the IRS and retain all income tax returns and records
pertaining to such contributions until interests in Roth IRAs are fully
distributed.
REQUIRED MINIMUM DISTRIBUTIONS AT DEATH
If you die before annuitization or before the entire amount of the Roth IRA has
been distributed to you, distributions of your entire interest under the Roth
IRA must be completed to your designated beneficiary by December 31 of the fifth
year after your death, unless payments to a designated beneficiary begin by
December 31 of the year after your death and are made over the beneficiary's
life or over a period which does not extend beyond the beneficiary's life
expectancy. If your surviving spouse is the designated beneficiary, no
distributions to a beneficiary are required until after the surviving spouse's
death.
TAXATION OF DEATH BENEFIT
Distributions received by a beneficiary are generally given the same tax
treatment you would have received if distribution had been made to you.
ADDITIONAL TAXES AND PENALTIES
You are subject to additional taxation for using your Roth IRA funds in
prohibited transactions (as described below). There are also additional taxes
for making excess contributions and making certain pre-age 59 1/2 distributions.
Prohibited Transactions
A Roth IRA may not be borrowed against or used as collateral for a loan or other
obligation. If the Roth IRA is borrowed against or used as collateral, its
tax-favored status will be lost as of the first day of the tax year in which the
event occurred. If this happens, you may be required to include in your Federal
gross income for that year an amount equal to the fair market value of your Roth
IRA Certificate as of the first day of that tax year. Also, an early
distribution penalty tax of 10% could apply if you have not reached age 59 1/2
before the first day of that tax year. See "Penalty Tax on Premature
Distributions" below.
EXCESS CONTRIBUTIONS
Excess contributions to a Roth IRA are subject to a 6% excise tax for the year
in which made and for each year thereafter until withdrawn. In the case of
rollover Roth IRA contributions, "excess contributions" are amounts which are
not eligible to be rolled over (for example, conversion contributions from a
Traditional IRA if your adjusted gross income is in excess of $100,000 in the
conversion year).
As of the date of this prospectus, there is some uncertainty regarding the
adjustment of excess contributions to Roth IRAs. The rules applicable to
Traditional IRAs, which may apply, provide that an excess contribution
("regular" or rollover) which is withdrawn before the time for filing your
Federal income tax return for the tax year (including extensions) is not
includable in income and is not subject to the 10% penalty tax on early
distributions (discussed below under "Penalty Tax on Premature Distributions"),
provided any earnings attributable to the excess contribution are also
withdrawn. The withdrawn earnings on the excess contribution, however, could be
includable in your gross income for the tax year in which the excess
contribution from which they arose was made and could be subject to the 10%
penalty tax.
As of the date of this prospectus, pending legislation, if enacted, would
provide that a taxpayer has up until the due date of the Federal income tax
return for a tax year (including extensions) to correct an excess contribution
to a Roth IRA by doing a trustee-to-trustee transfer to a Traditional IRA of the
excess contribution and the applicable earnings, as long as no deduction is
taken for the contribution. There can be no assurance that such pending
legislation will be enacted or will not be modified. Please consult your tax
adviser for informa-
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tion on the status of any legislation concerning Roth IRAs.
PENALTY TAX ON PREMATURE DISTRIBUTIONS
The taxable portion of distributions from a Roth IRA made before you reach age
59 1/2 will be subject to an additional 10% Federal income tax penalty unless
one of the following exceptions applies. There are exceptions for:
o Your death,
o Your disability,
o Distributions used to pay certain extraordinary medical expenses,
o Distributions used to pay medical insurance premiums for certain unemployed
individuals,
o Substantially equal payments made at least annually over your life (or your
life expectancy), or over the lives of you and your beneficiary (or your
joint life expectancies) using an IRS-approved distribution method,
o "Qualified first-time homebuyer distributions" as defined in the Code, and
o Distributions used to pay specified higher education expenses as defined in
the Code.
Under legislation pending as of the date of this prospectus, if amounts
converted from a Traditional IRA to a Roth IRA are withdrawn in the five-year
period beginning with the year of conversion, to the extent attributable to
amounts that were includable in income due to the conversion transaction, the
amount withdrawn from the Roth IRA would be subject to the 10% early withdrawal
penalty, EVEN IF THE AMOUNT WITHDRAWN FROM THE ROTH IRA IS NOT INCLUDABLE IN
INCOME BECAUSE OF THE RECOVERY-OF-INVESTMENT FIRST RULE. However, if the
recipient is eligible for one of the penalty exceptions described above (e.g.,
being age 59 1/2 or older) no penalty will apply.
Such pending legislation also provides that an additional 10% penalty applies,
apparently without exception, to withdrawals allocable to 1998 conversion
transactions before the five-year exclusion date, in order to recapture the
benefit of the prorated inclusion of Traditional IRA conversion income over the
four-year period. See "Contributions to Roth IRAs," and "Conversion
Contributions to Roth IRAs" above. It is not known whether this legislation will
be enacted in its current form, but it may be retroactive to January 1, 1998.
Because Roth IRAs have only been recently approved, you should consult with your
tax adviser as to whether they are an appropriate investment vehicle for you.
FEDERAL AND STATE INCOME TAX WITHHOLDING
Equitable Life is required to withhold Federal income tax from Traditional IRA
distributions and the taxable portion of payments from annuity contracts, unless
the recipient elects not to be subject to income tax withholding. Withholding
may also apply to taxable amounts paid under a free look or cancellation. No
withholding is required on distributions which are not taxable (for example, a
direct transfer from one Roth IRA to another Roth IRA you own). In the case of
distributions from a Roth IRA, we may not be able to calculate the portion of
the distribution (if any) subject to tax. We may be required to withhold on the
gross amount of the distribution unless you elect out of withholding as
described below.
The rate of withholding will depend on the type of distribution and, in certain
cases, the amount of the distribution. Special withholding rules apply to
foreign recipients and United States citizens residing outside the United
States. See your tax adviser if you think you may be affected by such rules.
Any income tax withheld is a credit against your income tax liability. If a
recipient does not have sufficient income tax withheld or does not make
sufficient estimated income tax payments, however, the recipient may incur
penalties under the estimated income tax rules. Recipients should consult their
tax advisers to determine whether they should elect out of withholding. Requests
not to withhold Federal income tax must be made in writing prior to receiving
benefits under the Certificate. Our Processing Office will provide forms for
this purpose. No election out of withholding is valid unless the recipient
provides us with the correct taxpayer identification number and a United States
residence address.
Certain states have indicated that income tax withholding will apply to payments
from the Certificates made to residents. In some states, a recipient may elect
out of state withholding. Generally, an election out of Federal withholding will
also be considered an election out of state withholding. If you need more
information concerning a particular state or any required forms, call our
Processing Office at the toll-free number and consult your tax adviser.
Periodic payments are generally subject to wage-bracket type withholding (as if
such payments were payments of wages by an employer to an employee) unless the
recipient elects no withholding. If a recipient does not elect out of
withholding or does not specify the number of withholding exemptions,
withholding will generally be made as if the recipient is married and claiming
three withholding exemptions. There is an annual threshold of taxable income
from periodic annuity payments which is exempt from withholding
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based on this assumption. For 1998, a recipient of periodic payments (e.g.,
monthly or annual payments) which total less than a $14,400 taxable amount will
generally be exempt from Federal income tax withholding, unless the recipient
specifies a different choice of withholding exemption. A withholding election
may be revoked at any time and remains effective until revoked. If a recipient
fails to provide a correct taxpayer identification number, withholding is made
as if the recipient is single with no exemptions.
A recipient of a non-periodic distribution (total or partial) will generally be
subject to withholding at a flat 10% rate. A recipient who provides a United
States residence address and a correct taxpayer identification number will
generally be permitted to elect not to have tax withheld.
All recipients receiving periodic and non-periodic payments will be further
notified of the withholding requirements and of their right to make withholding
elections.
OTHER WITHHOLDING
As a general rule, if death benefits are payable to a person two or more
generations younger than you, a Federal generation skipping tax may be payable
with respect to the benefit at rates similar to the maximum estate tax rate in
effect at the time. The generation skipping tax provisions generally apply to
transfers which would also be subject to the gift and estate tax rules.
Individuals are generally allowed an aggregate generation skipping tax exemption
of $1 million. Because these rules are complex, you should consult with your tax
adviser for specific information, especially where benefits are passing to
younger generations, as opposed to a spouse or child.
If we believe a benefit may be subject to generation skipping tax we may be
required to withhold for such tax unless we receive acceptable written
confirmation that no such tax is payable.
IMPACT OF TAXES TO EQUITABLE LIFE
The Certificates provide that Equitable Life may charge the Separate Account for
taxes. Equitable Life can set up reserves for such taxes.
TRANSFERS AMONG INVESTMENT OPTIONS
Transfers among the Investment Funds or between the Guaranteed Period Account
and one or more Investment Funds, or from the Special Dollar Cost Averaging
Account are not taxable.
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- --------------------------------------------------------------------------------
PART 9: INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
The consolidated financial statements and consolidated financial statement
schedules of Equitable Life at December 31, 1997 and 1996 and for each of the
three years in the period ended December 31, 1997 included in Equitable Life's
Annual Report on Form 10-K, incorporated by reference in the prospectus, have
been examined by Price Waterhouse LLP, independent accountants, whose reports
thereon are incorporated herein by reference. Such consolidated financial
statements and consolidated financial statement schedules have been incorporated
herein by reference in reliance upon the reports of Price Waterhouse LLP given
upon their authority as experts in accounting and auditing.
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- --------------------------------------------------------------------------------
PART 10: INVESTMENT PERFORMANCE
- --------------------------------------------------------------------------------
This Part presents performance data for each of the Investment Funds included in
the tables below. The performance data were calculated by two methods. The first
method presented in the tables under "Adjusted Historical Performance Data,"
reflects all applicable fees and charges, including the optional benefit charge,
but not the charges for any applicable taxes such as premium taxes.
The second method presented in the tables under "Rate of Return Data for
Investment Funds," also reflects all applicable fees and charges, but does not
reflect the withdrawal charge, the optional benefit charge, or the charge for
tax such as premium taxes. These additional charges would effectively reduce the
rates of return credited to a particular Certificate.
No Certificates were offered prior to the date of this prospectus. Accordingly,
the performance data for the Investment Funds have been adjusted for expenses,
as described herein, that would have been incurred had these Certificates been
available prior to such date.
HR Trust Portfolios
The performance data shown for the Investment Funds investing in Class IB shares
of HR Trust Portfolios (other than the Alliance Small Cap Growth Portfolio which
commenced operations on May 1, 1997) are based on the actual investment results
of the Portfolios, and have been adjusted for the fees and charges applicable
under the Certificates. In addition, the investment results for the Alliance
Growth and Income, Alliance International, Alliance Conservative Investors and
Alliance Intermediate Government Securities Portfolios (under which Class IB
shares were only recently available) and for other Portfolios prior to October
1996, when Class IB shares were not available, have been adjusted to reflect
12b-1 fees.
The performance data for the Alliance Money Market and Alliance Common Stock
Funds that invest in corresponding HR Trust Portfolios, for periods prior to
March 22, 1985, reflect the investment results of two open-end management
separate accounts (the "predecessor separate accounts") which were reorganized
in unit investment trust form. The "Since Inception" figures for these
Investment Funds are based on the date of inception of the predecessor separate
accounts. These performance data have been adjusted to reflect the maximum
investment advisory fee payable for the corresponding Portfolio of HR Trust, as
well as an assumed charge of 0.06% for direct operating expenses.
EQ Trust Portfolios
The Investment Funds of the Separate Account that invest in Class IB shares of
Portfolios of EQ Trust have only recently been established. EQ Trust commenced
operations on May 1, 1997. In this connection, see the discussion immediately
following the tables below.
See "Part 2: The Guaranteed Period Account" for information on the Guaranteed
Period Account, and "Part 3: The Special Dollar Cost Averaging Account" for
information on the Special Dollar Cost Averaging Account.
ADJUSTED HISTORICAL PERFORMANCE DATA
The performance data in the following tables illustrate the average annual total
return of the Investment Funds over the periods shown, assuming a single initial
contribution of $1,000 and the surrender of a Certificate, at the end of each
period. These tables (which reflect the first calculation method described
above) are prepared for use when we advertise the performance of the Separate
Account. An Investment Fund's average annual total return is the annual rate of
growth of the Investment Fund that would be necessary to achieve the ending
value of a contribution kept in the Investment Fund for the period specified.
Each calculation assumes that the $1,000 contribution was allocated to only one
Investment Fund, no transfers or subsequent contributions were made and no
amounts were allocated to any other Investment Option under the Certificate.
In order to calculate annualized rates of return, we divide the Cash Value of a
Certificate which is surrendered on December 31, 1997 by the $1,000 contribution
made at the beginning of each period illustrated. The result of that calculation
is the total growth rate for the period. Then we annualize that growth rate to
obtain the average annual percentage increase (decrease) during the period
shown. When we "annualize," we assume that a single rate of return applied each
year during the period will produce the ending value, taking into account the
effect of compounding.
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ADJUSTED HISTORICAL PERFORMANCE DATA
AVERAGE ANNUAL TOTAL RETURN UNDER A CERTIFICATE SURRENDERED ON
DECEMBER 31, 1997*
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
LENGTH OF INVESTMENT PERIOD
------------------------------------------------------------------------------------
INVESTMENT ONE THREE FIVE TEN SINCE
FUND YEAR YEARS YEARS YEARS INCEPTION**
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C>
HR TRUST
Alliance Conservative Investors
Alliance Growth Investors
Alliance Growth & Income
Alliance Common Stock
Alliance Global [TO BE INSERTED BY AMENDMENT]
Alliance International
Alliance Aggressive Stock
Alliance Money Market
Alliance Intermediate Government
Securities
Alliance High Yield
Alliance Equity Index
- -------------------
See footnotes below.
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The table below illustrates the growth of an assumed investment of $1,000, with
fees and charges deducted on the basis described above for the first method of
calculation.
ADJUSTED HISTORICAL PERFORMANCE DATA
GROWTH OF $1,000 UNDER A CERTIFICATE SURRENDERED ON DECEMBER 31, 1997*
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
LENGTH OF INVESTMENT PERIOD
------------------------------------------------------------------------------------
INVESTMENT ONE THREE FIVE TEN SINCE
FUND YEAR YEARS YEARS YEARS INCEPTION**
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C>
HR TRUST
Alliance Conservative Investors
Alliance Growth Investors
Alliance Growth & Income
Alliance Common Stock
Alliance Global [TO BE INSERTED BY AMENDMENT]
Alliance International
Alliance Aggressive Stock
Alliance Money Market
Alliance Intermediate Government
Securities
Alliance High Yield
Alliance Equity Index
- -------------------
<FN>
* For all the Investment Funds shown other than the Alliance Equity Index Fund, the tables reflect the withdrawal charge and
the optional benefit charge. The values shown for the Alliance Equity Index Fund reflect the withdrawal charge.
** The "Since Inception" dates for the Portfolios of HR Trust are as follows: Alliance Conservative Investors (October 2, 1989);
Alliance Growth Investors (October 2, 1989); Alliance Growth & Income (October 1, 1993); Alliance Common Stock (January 13,
1976); Alliance Global (August 27, 1987); Alliance International (April 3, 1995); Alliance Aggressive Stock (January 27,
1986); Alliance Money Market (July 13, 1981); Alliance Intermediate Government Securities (April 1, 1991); Alliance High
Yield (January 2, 1987); and Alliance Equity Index (March 1, 1994).
</FN>
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Additional investment performance information appears in the attached HR Trust
and EQ Trust prospectuses.
The Alliance Small Cap Growth Portfolio of HR Trust commenced operations on May
1, 1997. Historical performance of a composite of six other advisory accounts
managed by Alliance is described in the attached HR Trust prospectus. According
to that prospectus, these accounts have substantially the same investment
objectives and policies, and are managed in accordance with essentially the same
investment strategies and techniques, as those of the Alliance Small Cap Growth
Portfolio. It should be noted that these accounts are not subject to certain of
the requirements and restrictions to which the Alliance Small Cap Growth
Portfolio is subject and that they are managed for tax-exempt clients of
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Alliance. The investment performance information included in the HR Trust
prospectus for all Portfolios other than the Alliance Small Cap Growth Portfolio
is based on actual historical performance.
The investment performance data for HR Trust's Alliance Small Cap Growth
Portfolio and for each of the Portfolios of EQ Trust, contained in the HR Trust
and the EQ Trust prospectuses, are provided by those prospectuses to illustrate
the past performance of each respective Portfolio adviser in managing
substantially similar investment vehicles as measured against specified market
indices and do not represent the past or future performance of any Portfolio.
None of the performance data contained in the HR Trust and EQ Trust prospectuses
reflects fees and charges imposed under your Certificate, which fees and charges
would reduce such performance figures. Therefore, the performance data for each
of the Portfolios described in the EQ Trust prospectus and for the Alliance
Small Cap Growth Portfolio in the HR Trust prospectus may be of limited use and
are not intended to be a substitute for actual performance of the corresponding
Portfolios, nor are such results an estimate or guarantee of future performance
for these Portfolios.
RATE OF RETURN DATA FOR INVESTMENT FUNDS
The following tables (which reflect the second calculation method described
above) provide you with information on rates of return on an annualized,
cumulative and year-by-year basis.
All rates of return presented are time-weighted and include reinvestment of
investment income, including interest and dividends. Cumulative rates of return
reflect performance over a stated period of time. Annualized rates of return
represent the annual rate of growth that would have produced the same cumulative
return, if performance had been constant over the entire period.
BENCHMARKS
Market indices are not subject to any charges for investment advisory fees,
brokerage commission or other operating expenses typically associated with a
managed portfolio. Nor do they reflect other charges such as the mortality and
expense risks charge, administration charge, or any withdrawal or optional
benefit charge, under the Certificates. Comparisons with these benchmarks,
therefore, are of limited use. We include them because they are widely known and
may help you to understand the universe of securities from which each Portfolio
is likely to select its holdings. Benchmark data reflect the reinvestment of
dividend income.
PORTFOLIO INCEPTION DATES AND COMPARATIVE BENCHMARKS:
ALLIANCE CONSERVATIVE INVESTORS: October 2, 1989; 70% Lehman Treasury Bond
Composite Index and 30% Standard & Poor's 500 Index.
ALLIANCE GROWTH INVESTORS: October 2, 1989; 30% Lehman Government/Corporate Bond
Index and 70% Standard & Poor's 500 Index.
ALLIANCE GROWTH & INCOME: October 1, 1993; 75% Standard & Poor's 500 Index and
25% Value Line Convertible Index.
ALLIANCE COMMON STOCK: January 13, 1976; Standard & Poor's 500 Index.
ALLIANCE GLOBAL: August 27, 1987; Morgan Stanley Capital International World
Index.
ALLIANCE INTERNATIONAL: April 3, 1995; Morgan Stanley Capital International
Europe, Australia, Far East Index.
ALLIANCE AGGRESSIVE STOCK: January 27, 1986; 50% Standard & Poor's Mid-Cap Total
Return Index and 50% Russell 2000 Small Stock Index.
ALLIANCE MONEY MARKET: July 13, 1981; Salomon Brothers Three-Month T-Bill Index.
ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES: April 1, 1991; Lehman Intermediate
Government Bond Index.
ALLIANCE HIGH YIELD: January 2, 1987; Merrill Lynch Master High Yield.
ALLIANCE EQUITY INDEX FUND: March 1, 1994; Standard & Poor's 500 Index.
The Lipper Variable Insurance Products Performance Analysis Survey (LIPPER)
records the performance of a large group of variable annuity products, including
managed separate accounts of insurance companies. According to Lipper Analytical
Services, Inc., the data are presented net of investment management fees, direct
operating expenses and asset-based charges applicable under annuity contracts.
Lipper data provide a more accurate picture than market benchmarks of the
Equitable Accumulator performance relative to other variable annuity products.
62
<PAGE>
ANNUALIZED RATES OF RETURN FOR PERIODS ENDED DECEMBER 31, 1997:*
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
SINCE
1 YEAR 3 YEARS 5 YEARS 10 YEARS 15 YEARS 20 YEARS INCEPTION
-----------------------------------------------------------------------------------------
<S> <C>
ALLIANCE CONSERVATIVE INVESTORS
Lipper Income
Benchmark
ALLIANCE GROWTH INVESTORS
Lipper Flexible Portfolio
Benchmark
ALLIANCE GROWTH & INCOME
Lipper Growth & Income
Benchmark
ALLIANCE COMMON STOCK
Lipper Growth
Benchmark
ALLIANCE GLOBAL
Lipper Global [TO BE INSERTED BY AMENDMENT]
Benchmark
ALLIANCE INTERNATIONAL
Lipper International
Benchmark
ALLIANCE AGGRESSIVE STOCK
Lipper Small Company Growth
Benchmark
ALLIANCE MONEY MARKET
Lipper Money Market
Benchmark
ALLIANCE INTERMEDIATE GOVERNMENT
SECURITIES
Lipper Gen. U.S. Government
Benchmark
ALLIANCE HIGH YIELD
Lipper High Yield
Benchmark
ALLIANCE EQUITY INDEX
Lipper S&P Index
Benchmark
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
63
<PAGE>
CUMULATIVE RATES OF RETURN FOR PERIODS ENDED DECEMBER 31, 1997:*
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
SINCE
1 YEAR 3 YEARS 5 YEARS 10 YEARS 15 YEARS 20 YEARS INCEPTION
-----------------------------------------------------------------------------------------
<S> <C>
ALLIANCE CONSERVATIVE
INVESTORS
Lipper Income
Benchmark
ALLIANCE GROWTH
INVESTORS
Lipper Flexible Portfolio
Benchmark
ALLIANCE GROWTH &
INCOME
Lipper Growth & Income
Benchmark
ALLIANCE COMMON STOCK
Lipper Growth
Benchmark
ALLIANCE GLOBAL [TO BE INSERTED BY AMENDMENT]
Lipper Global
Benchmark
ALLIANCE
INTERNATIONAL
Lipper International
Benchmark
ALLIANCE AGGRESSIVE
STOCK
Lipper Small Company Growth
Benchmark
ALLIANCE MONEY MARKET
Lipper Money Market
Benchmark
ALLIANCE INTERMEDIATE
GOVERNMENT
SECURITIES
Lipper Gen. U.S. Government
Benchmark
ALLIANCE HIGH YIELD
Lipper High Yield
Benchmark
ALLIANCE EQUITY INDEX
Lipper S&P Index
Benchmark
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
64
<PAGE>
YEAR-BY-YEAR RATES OF RETURN*
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
-------------------------------------------------------------------------------------------------------------------------
<S> <C>
ALLIANCE
CONSERVATIVE
INVESTORS
ALLIANCE
GROWTH
INVESTORS
ALLIANCE
GROWTH &
INCOME
ALLIANCE
COMMON
STOCK**
ALLIANCE
GLOBAL
ALLIANCE [TO BE INSERTED BY AMENDMENT]
INTERNATIONAL
ALLIANCE
AGGRESSIVE
STOCK
ALLIANCE MONEY
MARKET**
ALLIANCE
INTERMEDIATE
GOVERNMENT
SECURITIES
ALLIANCE
HIGH
YIELD
ALLIANCE
EQUITY INDEX
- ----------------
<FN>
* Returns do not reflect the withdrawal charge, the optional benefit charge and any charge for tax such as premium taxes.
** Prior to 1984 the Year-by-Year Rates of Return were: 1976 1977 1978 1979 1980 1981 1982 1983
------------------------------------------------------
ALLIANCE COMMON STOCK [TO BE INSERTED BY AMENDMENT]
ALLIANCE MONEY MARKET
</FN>
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
COMMUNICATING PERFORMANCE DATA
In reports or other communications or in advertising material, we may describe
general economic and market conditions affecting the Separate Account and each
respective trust and may present the performance of the Investment Funds or
compare it with (1) that of other insurance company separate accounts or mutual
funds included in the rankings prepared by Lipper Analytical Services, Inc.,
Morningstar, Inc., VARDS or similar investment services that monitor the
performance of insurance company separate accounts or mutual funds, (2) other
appropriate indices of investment securities and averages for peer universes of
funds which are shown under "Benchmarks" and "Portfolio Inception Dates and
Comparative Benchmarks" in this Part 10, or (3) data developed by us derived
from such indices or averages. The Morningstar Variable Annuity/Life Report
consists of nearly 700 variable life and annuity funds, all of which report
their data net of investment management fees, direct operating expenses and
separate account charges. VARDS is a monthly reporting service that monitors
approximately 760 variable life and variable annuity funds on performance and
account information. Advertisements or other communications furnished to present
or prospective Certificate Owners may also include evaluations of an Investment
Fund or Portfolio by financial publications that are nationally recognized such
as Barron's, Morningstar's Variable Annuity Sourcebook, Business Week, Chicago
Tribune, Forbes, Fortune, Institutional Investor, Investment Adviser, Investment
Dealer's Digest, Investment Management Weekly, Los Angeles Times, Money, Money
Management Letter, Kiplinger's Personal Finance, Financial Planning, National
Underwriter, Pension & Investments, USA Today, Investor's Daily, The New York
Times, and The Wall Street Journal.
65
<PAGE>
ALLIANCE MONEY MARKET FUND AND ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES FUND
YIELD INFORMATION
The current yield and effective yield of the Alliance Money Market Fund may
appear in reports and promotional material to current or prospective Certificate
Owners.
Current yield for the Alliance Money Market Fund will be based on net changes in
a hypothetical investment over a given seven-day period, exclusive of capital
changes, and then "annualized" (assuming that the same seven-day result would
occur each week for 52 weeks). Current yield for the Alliance Intermediate
Government Securities Fund will be based on net changes in a hypothetical
investment over a given 30-day period, exclusive of capital changes, and then
"annualized" (assuming that the same 30-day result would occur each month for 12
months). "Effective yield" is calculated in a manner similar to that used to
calculate current yield, but when annualized, any income earned by the
investment is assumed to be reinvested. The "effective yield" will be slightly
higher than the "current yield" because any earnings are compounded weekly for
the Alliance Money Market Fund and monthly for the Alliance Intermediate
Government Securities Fund. Alliance Money Market Fund and Alliance Intermediate
Government Securities Fund yields and effective yields assume the deduction of
all Certificate charges and expenses other than the withdrawal charge, the
optional benefit charge, and any charge for tax such as premium tax. The yields
and effective yields for the Alliance Money Market Fund when used for the
Special Dollar Cost Averaging program, assume that no Certificate charges are
deducted. See "Part 5: Alliance Money Market Fund and Alliance Intermediate
Government Securities Fund Yield Information" in the SAI.
66
<PAGE>
APPENDIX I: MARKET VALUE ADJUSTMENT EXAMPLE
- --------------------------------------------------------------------------------
The example below shows how the market value adjustment would be determined and
how it would be applied to a withdrawal, assuming that $100,000 was allocated on
February 15, 1999 to a Guarantee Period with an Expiration Date of February 15,
2008 at a Guaranteed Rate of 7.00% resulting in a Maturity Value at the
Expiration Date of $183,846, and further assuming that a withdrawal of $50,000
was made on February 15, 2003.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
ASSUMED
GUARANTEED RATE ON FEBRUARY 15, 2003
5.00% 9.00%
-----------------------------------------------------------
<S> <C> <C>
As of February 15, 2003 (Before Withdrawal)
- -------------------------------------------
(1) Present Value of Maturity Value,
also Annuity Account Value.................................. $ 144,048 $ 119,487
(2) Guaranteed Period Amount.................................... 131,080 131,080
(3) Market Value Adjustment: (1) - (2).......................... 12,968 (11,593)
On February 15, 2003 (After Withdrawal)
- ---------------------------------------
(4) Portion of (3) Associated
with Withdrawal: (3) x [$50,000/(1)]........................ $ 4,501 $ (4,851)
(5) Reduction in Guaranteed
Period Amount: [$50,000 - (4)].............................. 45,499 54,851
(6) Guaranteed Period Amount: (2) - (5)......................... 85,581 76,229
(7) Maturity Value.............................................. 120,032 106,915
(8) Present Value of (7), also
Annuity Account Value....................................... 94,048 69,487
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
You should note that under this example if a withdrawal is made when rates have
increased (from 7.00% to 9.00% in the example), a portion of a negative market
value adjustment is realized. On the other hand, if a withdrawal is made when
rates have decreased (from 7.00% to 5.00% in the example), a portion of a
positive market value adjustment is realized.
67
<PAGE>
APPENDIX II: PURCHASE CONSIDERATIONS FOR QP CERTIFICATES
- --------------------------------------------------------------------------------
Any trustee considering a purchase of a QP Certificate should discuss with its
tax adviser whether this is an appropriate investment vehicle for the employer's
plan. The form of Certificate and this prospectus should be reviewed in full,
and the following factors, among others, should be noted. This QP Certificate
accepts transfer contributions only and not regular, ongoing payroll
contributions. For 401(k) plans under defined contribution plans, no employee
after-tax contributions are accepted. Under defined benefit plans, we will not
accept rollovers from a defined contribution plan to a defined benefit plan. We
will only accept transfers from a defined benefit plan or a change of investment
vehicles in the plan.
Further, Equitable will not perform or provide any plan recordkeeping services
with respect to the QP Certificates. The plan's administrator will be solely
responsible for performing or providing for all such services. There is no loan
feature offered under the QP Certificates, so if the plan provides for loans and
a Participant takes a loan from the plan, other plan assets must be used as the
source of the loan and any loan repayments must be credited to other investment
vehicles and/or accounts available under the plan.
Finally, because the method of purchasing the QP Certificates and the features
of the QP Certificates may appeal more to plan Participants who are older and
tend to be highly paid, and because certain features of the QP Certificates are
available only to plan Participants who meet certain minimum and/or maximum age
requirements, plan trustees should discuss with their advisers whether the
purchase of the QP Certificates would cause the plan to engage in prohibited
discrimination in contributions, benefits or otherwise.
68
<PAGE>
APPENDIX III: GUARANTEED MINIMUM DEATH BENEFIT EXAMPLE
- --------------------------------------------------------------------------------
Under the Certificates the death benefit is equal to the Annuity Account Value
or, if greater, the Guaranteed Minimum Death Benefit (see "Guaranteed Minimum
Death Benefit" in Part 4).
The following is an example illustrating the calculation of the Guaranteed
Minimum Death Benefit. Assuming $100,000 is allocated to the Investment Funds
(with no allocation to the Alliance Money Market and Alliance Intermediate
Government Securities Funds or the Guarantee Periods), no subsequent
contributions, no transfers and no withdrawals, the Guaranteed Minimum Death
Benefit for an Annuitant age 45 would be calculated as follows:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
END OF 6% ROLL UP TO AGE 80 ANNUAL RATCHET TO AGE 80
CONTRACT ANNUITY GUARANTEED MINIMUM GUARANTEED MINIMUM
YEAR ACCOUNT VALUE DEATH BENEFIT(1) DEATH BENEFIT
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1 $105,000 $106,000 $105,000(2)
2 $115,500 $112,360 $115,500(2)
3 $132,825 $119,102 $132,825(2)
4 $106,260 $126,248 $132,825(3)
5 $116,886 $133,823 $132,825(3)
6 $140,263 $141,852 $140,263(2)
7 $140,263 $150,363 $140,263(3)
- --------------------------------------------------------------------------------------------------
</TABLE>
The Annuity Account Values for Contract Years 1 through 7 are determined based
on hypothetical rates of return of 5.00%, 10.00%, 15.00%, (20.00)%, 10.00%,
20.00% and 0.00%, respectively.
6% ROLL UP TO AGE 80
(1) For Contract Years 1 through 7, the Guaranteed Minimum Death Benefit equals
the initial contribution increased by 6%.
ANNUAL RATCHET TO AGE 80
(2) At the end of Contract Years 1, 2 and 3, and again at the end of Contract
Year 6, the Guaranteed Minimum Death Benefit is equal to the current
Annuity Account Value.
(3) At the end of Contract Years 4, 5 and 7, the Guaranteed Minimum Death
Benefit is equal to the Guaranteed Minimum Death Benefit at the end of the
prior year since it is equal to or higher than the current Annuity Account
Value.
69
<PAGE>
APPENDIX IV: EXAMPLE OF PAYMENTS
UNDER THE ASSURED PAYMENT OPTION AND APO PLUS
- --------------------------------------------------------------------------------
The second column in the chart below illustrates the payments for a male age 70
who purchased the Assured Payment Option on February 14, 1997 with a single
contribution of $100,000, with increasing annual payments. The payments are to
commence on February 15, 1998. It assumes that the fixed period is 15 years and
that the Life Contingent Annuity will provide payments on a Single Life basis.
Based on Guaranteed Rates for the Guarantee Periods and the current purchase
rate for the Life Contingent Annuity, on February 14, 1997, the initial payment
would be $6,730.77 and would increase in each three-year period to a final
payment of $9,854.53. The first payment under the Life Contingent Annuity would
be $10,839.98.
The Guaranteed Rates as of February 14, 1997 for Guarantee Periods maturing on
February 15, 1998 through 2012 are: 4.40%, 4.69%, 4.86%, 5.00%, 5.11%, 5.22%,
5.32%, 5.41%, 5.50%, 5.57%, 5.56%, 5.56%, 5.56%, 5.56% and 5.56%, respectively.
Alternatively as shown in the third and fourth columns, this individual could
purchase APO Plus with the same $100,000 contribution, with the same fixed
period and the Life Contingent Annuity on a Single Life basis. Assuming election
of the Alliance Common Stock Fund based on Guaranteed Rates for the Guarantee
Periods and the current purchase rate for the Life Contingent Annuity, on
February 14, 1997, the same initial payment of $6,730.77 would be purchased
under APO Plus. However, unlike the payment under the Assured Payment Option
that will increase every three years, this initial payment under APO Plus is not
guaranteed to increase. Therefore, only $78,949.12 is needed to purchase the
initial payment stream, and the remaining $21,050.87 is invested in the
Investment Funds. Any future increase in payments under APO Plus will depend on
the investment performance in the Alliance Common Stock Fund.
Assuming hypothetical average annual rates of return of 0% and 8% (after
deduction of charges) for the Investment Fund, the Annuity Account Value in the
Investment Fund would grow to $21,050.87 and $26,518.03 respectively after three
years. A portion of this amount is used to purchase the increase in the payments
at the beginning of the fourth year. The remainder will stay in the Investment
Fund to be drawn upon for the purchase of increases in payments at the end of
each third year thereafter during the fixed period and at the end of the fixed
period under the Life Contingent Annuity. Based on Guaranteed Rates for the
Guarantee Periods and purchase rates for the Life Contingent Annuity as of
February 14, 1997, the third and fourth columns illustrate the increasing
payments that would be purchased under APO Plus assuming 0% and 8% rates of
return respectively.
Under both options, while the Certificate Owner is living payments increase
annually after the 16th year under the Life Contingent Annuity based on the
increase, if any, in the Consumer Price Index, but in no event greater than 3%
per year.
ANNUAL PAYMENTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
GUARANTEED INCREASING PAYMENTS ILLUSTRATIVE ILLUSTRATIVE
UNDER THE PAYMENTS PAYMENTS
ASSURED PAYMENT OPTION UNDER UNDER
YEARS APO PLUS AT 0% APO PLUS AT 8%
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1-3 $ 6,730.77 $6,730.77 $ 6,730.77
4-6 7,403.85 7,100.57 7,520.00
7-9 8,144.23 7,483.79 8,345.92
10-12 8,958.66 7,868.31 9,191.42
13-15 9,854.53 8,217.67 10,010.94
16 10,839.98 8,475.41 10,731.67
- ---------------------------------------------------------------------------------------------------------
</TABLE>
As described above, a portion of the illustrated contribution is applied to the
Life Contingent Annuity. This amount will generally be larger under the Assured
Payment Option than under APO Plus. Also, a larger portion of the contribution
will be allocated to Guarantee Periods under the former than the latter. In this
illustration, $80,458.33 is allocated under the Assured Payment Option to the
Guarantee Periods and under APO Plus, $68,020.34 is allocated to the Guarantee
Periods. In addition, under APO Plus $21,050.87 is allocated to the Investment
Fund. The balance of the $100,000 ($19,541.67 and $10,928.78, respectively) is
applied to the Life Contingent Annuity.
The rates of return of 0% and 8% are for illustrative purposes only and are not
intended to represent an expected or guaranteed rate of return. Your investment
results will vary. Payments will also depend on the Guaranteed Rates and Life
Contingent Annuity purchase rates in effect as of the Transaction Date. It is
assumed that no Lump Sum Withdrawals are taken.
70
<PAGE>
- --------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
PAGE
- --------------------------------------------------------------------------------
Part 1: Minimum Distribution Withdrawals --
Traditional IRA Certificates 2
- --------------------------------------------------------------------------------
Part 2: Accumulation Unit Values 2
- --------------------------------------------------------------------------------
Part 3: Annuity Unit Values 2
- --------------------------------------------------------------------------------
Part 4: Custodian and Independent Accountants 3
- --------------------------------------------------------------------------------
Part 5: Alliance Money Market Fund and Alliance
Intermediate Government Securities Fund Yield
Information 3
- --------------------------------------------------------------------------------
Part 6: Long-Term Market Trends 4
- --------------------------------------------------------------------------------
Part 7: Key Factors in Retirement Planning 6
- --------------------------------------------------------------------------------
Part 8: Financial Statements 10
- --------------------------------------------------------------------------------
HOW TO OBTAIN AN EQUITABLE ACCUMULATOR STATEMENT OF ADDITIONAL
INFORMATION FOR SEPARATE ACCOUNT NO. 45
Send this request form to:
Equitable Life
Income Management Group
P.O. Box 1547
Secaucus, NJ 07096-1547
Please send me an Equitable Accumulator SAI dated May 1, 1998:
--------------------------------------------------------------
Name
--------------------------------------------------------------
Address
--------------------------------------------------------------
City State Zip
(EDISAI 5/98)
71
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The by-laws of The Equitable Life Assurance Society of the
United States ("Equitable Life") provide, in Article VII, as follows:
7.4 Indemnification of Directors, Officers and Employees. (a)
To the extent permitted by the law of the State of New
York and subject to all applicable requirements thereof:
(i) any person made or threatened to be made a party to any
action or proceeding, whether civil or criminal, by reason
of the fact that he or she, or his or her testator or
intestate, is or was a director, officer or employee of
the Company shall be indemnified by the Company;
(ii) any person made or threatened to be made a party to any
action or proceeding, whether civil or criminal, by reason
of the fact that he or she, or his or her testator or
intestate serves or served any other organization in any
capacity at the request of the Company may be indemnified
by the Company; and
(iii) the related expenses of any such person in any of said
categories may be advanced by the Company.
(b) To the extent permitted by the law of the State of New
York, the Company may provide for further indemnification
or advancement of expenses by resolution of shareholders
of the Company or the Board of Directors, by amendment of
these By-Laws, or by agreement. {Business Corporation Law
ss.ss. 721-726; Insurance Law ss.1216}
The directors and officers of Equitable Life are insured under policies
issued by Lloyd's of London, X. L. Insurance Company and ACE Insurance Company.
The annual limit on such policies is $100 million, and the policies insure the
officers and directors against certain liabilities arising out of their conduct
in such capacities.
<PAGE>
ITEM 16. EXHIBITS
Exhibits No.
(1) (a) Form of Distribution Agreement by and among
Equitable Distributors, Inc., Separate
Account Nos. 45 and 49 of Equitable Life and
Equitable Life Assurance Society of the
United States, incorporated by reference to
Exhibit 1(a) to the Registration Statement
on Form S-3 (File No. 33-88456).
(b) Form of Sales Agreement among Equitable
Distributors, Inc. as Distributor, a
Broker-Dealer (to be named) and a General
Agent (to be named), incorporated by
reference to Exhibit 1(b) to the
Registration Statement on Form S-3 (File No.
33-88456).
(c) Form of The Hudson River Trust Sales
Agreement by and among Equico Securities,
Inc., The Equitable Life Assurance Society
of the United States, Equitable
Distributors, Inc. and Separate Account No.
49 of The Equitable Life Assurance Society
of the United States, incorporated by
reference to Exhibit 1(c) to the
Registration Statement on Form S-3 (File No.
33-88456).
(4) (a) Form of group annuity contract no.
1050-94IC.
(b) Form of group annuity certificate nos. 94ICA
and 94ICB.
(c) Forms of endorsement nos. 94ENIRAI, 94ENNQI
and 94ENMVAI to contract no. 1050-94IC and
data pages no. 94ICA/BIM(IRA), (NQ), (NQ
Plan A) and (NQ Plan B).
(d) Forms of application used with the IRA, NQ
and Fixed Annuity Markets.
(e) Form of endorsement no. 95ENLCAI to contract
no. 1050-94IC and data pages no. 94ICA/BLCA.
(f) Forms of data pages for Rollover IRA, IRA
Assured Payment Option, IRA Assured Payment
Option Plus, Accumulator, Assured Growth
Plan, Assured Growth Plan (Flexible Income
Program), Assured Payment Plan (Period
Certain) and Assured Payment Plan (Life with
a Period Certain), incorporated by reference
to Exhibit 4(f) to the Registration
Statement on Form S-3 (File No. 33-88456).
<PAGE>
Exhibits No.
(g) Forms of data pages for Rollover IRA, IRA
Assured Payment Option, IRA Assured Payment
Option Plus, Accumulator, Assured Growth
Plan and Assured Payment Plan (Life Annuity
with a Period Certain), incorporated by
reference to Exhibit 4(g) to the
Registration Statement on Form S-3 (File No.
33-88456).
(h) Form of Separate Account Insulation
Endorsement for the Endorsement Applicable
to Market Value Adjustment Terms,
incorporated by reference to Exhibit 4(h) to
the Registration Statement on Form S-3 (File
No. 33-88456).
(i) Forms of Guaranteed Minimum Income Benefit
Endorsements (and applicable data page for
Rollover IRA) for Endorsement Applicable to
Market Value Adjustment Terms and for the
Life Contingent Annuity Endorsement,
incorporated by reference to Exhibit 4(i) to
the Registration Statement on Form S-3 (File
No. 33-88456).
(j) Forms of Enrollment Form/Application for
Rollover IRA, Choice Income Plan, Assured
Growth Plan, Accumulator and Assured Payment
Plan, incorporated by reference to Exhibit
4(j) to the Registration Statement on Form
S-3 (File No. 33-88456).
(k) Forms of data pages for the Accumulator,
incorporated by reference to Exhibit 4(k) to
the Registration Statement on Form S-3 (File
No. 33-88456).
(l) Forms of data pages for the Rollover IRA,
incorporated by reference to Exhibit 4(l) to
the Registration Statement on Form S-3 (File
No. 33-88456).
(m) Forms of data pages for the Accumulator and
Rollover IRA, incorporated by reference to
Exhibit 4(m) to the Registration Statement
on Form S-3 (File No. 33-88456).
(n) Forms of data pages for Accumulator and
Rollover IRA, incorporated by reference to
Exhibit 4(n) to the Registration Statement
on Form S-3 (File No. 33-88456).
(o) Forms of data pages for the Accumulator,
Rollover IRA, Income Manager Accumulator,
Income Manager Rollover IRA, Equitable
Accumulator, Income Manager (IRA and NQ) and
MVA Annuity (IRA and NQ), previously filed
with this Registration Statement (File No.
333-24009) on April 30, 1997.
(p) Forms of Enrollment Form/Application for
Income Manager Accumulator, Income Manager
Rollover IRA, Equitable Accumulator, Income
Manager (IRA and NQ) and MVA Annuity (IRA
and NQ), previously filed with this
Registration Statement (File No. 333-24009)
on April 30, 1997.
(q) Forms of data pages for Equitable
Accumulator Select (IRA) and Equitable
Accumulator Select (NQ), previously filed
with this Registration Statement (File No.
333-24009) on September 18, 1997.
(r) Forms of Enrollment Form/Application for
Equitable Accumulator Select (IRA and NQ),
previously filed with this Registration
Statement (File No. 333-24009) on September
18, 1997.
(s) Form of data pages No. 94ICB and 94ICBMVA
for Equitable Accumulator (IRA)
Certificates, incorporated by reference to
Exhibit 4(m) to the Registration Statement
on Form N-4 (File No. 33-83750).
(t) Form of data pages No. 94ICB and 94ICBMVA
for Equitable Accumulator (NQ) Certificates,
incorporated by reference to Exhibit 4(n) to
the Registration Statement on Form N-4 (File
No. 33-83750).
(u) Form of data pages No. 94ICB and 94ICBMVA
for Equitable Accumulator (QP) Certificates,
incorporated by reference to Exhibit 4(o) to
the Registration Statement on Form N-4 (File
No. 33-83750).
(v) Form of data pages No. 94ICB, 94ICBMVA and
94ICBLCA for Assured Payment Option
Certificates, incorporated by reference to
Exhibit 4(p) to the Registration Statement
on Form N-4 (File No. 33-83750).
(w) Form of data pages No. 94ICB, 94ICBMVA and
94ICBLCA for APO Plus Certificates,
incorporated by reference to Exhibit 4(q) to
the Registration Statement on Form N-4 (File
No. 33-83750).
*(x) Form of Endorsement applicable to Defined
Benefit Qualified Plan Certificates No.
98ENDQPI.
(y) Form of Endorsement applicable to
Non-Qualified Certificates No. 98ENJONQI,
incorporated by reference to Exhibit 4(s) to
the Registration Statement on Form N-4 (File
No. 33-83750).
(z) Form of Endorsement applicable to Charitable
Remainder Trusts No. 97ENCRTI, incorporated
by reference to Exhibit 4(t) to the
Registration Statement on Form N-4 (File No.
33-83750).
(a)(a) Form of Enrollment Form/Application No.
126737 (5/98) for Equitable Accumulator
(IRA, NQ and QP), incorporated by reference
to Exhibit 5(e) to the Registration
Statement on Form N-4 (File No. 33-83750).
- ----------
*To be incorporated by reference by amendment.
<PAGE>
Exhibits No.
(5) (a) Opinion and Consent of Jonathan E. Gaines,
Esq., Vice President and Associate General
Counsel of Equitable, as to the legality of
the securities being registered, previously
filed with this Registration Statement (File
No. 333-24009) on April 30, 1997.
(b) Opinion and Consent of Jonathan E. Gaines,
Esq., Vice President and Associate General
Counsel of Equitable, as to the legality of
the securities being registered,
incorporated by reference to Exhibit 9 of
the Registrant's Registration Statement on
Form N-4 (File No. 333-31131).
(c) Copy of the Internal Revenue Service
determination letter regarding qualification
under Section 401 of the Internal Revenue
Code, incorporated by reference to Exhibit
5(b) to the Registration Statement on Form
S-3 (File No. 33-88456).
(23) *(a) Consent of Price Waterhouse LLP.
(b) Consent of Counsel (see Exhibits 5(a)
and (b)).
(24) (a) Powers of Attorney, previously filed with
this Registration Statement No. 333-24009
on March 26, 1997.
(b) Power of attorney for Edward D. Miller
previously filed with this Registration
Statement (File No. 333-24009) on September
18, 1997.
(c) Power of attorney for Michael Hegarty,
incorporated by reference to Exhibit
10(b)(4) to the Registration Statement on
Form N-4 (33-83750).
- ----------
*To be filed by amendment.
<PAGE>
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post- effective amendment
to this registration statement:
(i) to include any prospectus required
by section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any
facts or events arising after the
effective date of the registration
statement (or the most recent
post-effective amendment thereof)
which, individually or in the
aggregate represent a fundamental
change in the information set forth
in the registration statement;
(iii) to include any material information
with respect to the plan of
distribution not previously
disclosed in the registration
statement or any material change to
such information in the registration
statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
with or furnished to the Commission by the registrant pursuant to
Section 13 or 15(d) of the Securities Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any
liability under the Securities Act of 1933,
each such post-effective amendment shall be
deemed to be a new registration statement
relating to the securities offered therein,
and the offering of such securities at that
time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the
securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or 15(d) of the Securities Exchange
Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
<PAGE>
(h) Insofar as indemnification for liabilities 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 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.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement or amendment thereto to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City and State of New York, on
March 6, 1998.
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE
UNITED STATES
(Registrant)
By: /s/Jerome S. Golden
-------------------
Jerome S. Golden
Executive Vice President
Product Development Group
The Equitable Life Assurance Society
of the United States
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed by or on behalf of
the following persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
PRINCIPAL EXECUTIVE OFFICERS:
<S> <C>
Edward D. Miller Chairman of the Board, Chief Executive Officer and Director
Michael Hegarty President, Chief Operating Officer and Director
PRINCIPAL FINANCIAL OFFICER:
Stanley B. Tulin Vice Chairman of the Board, Chief Financial Officer and Director
PRINCIPAL ACCOUNTING OFFICER:
/s/ Alvin H. Fenichel Senior Vice President and Controller
- ---------------------
Alvin H. Fenichel
March 6, 1998
</TABLE>
DIRECTORS:
Claude Bebear Donald J. Greene Joseph J. Melone
Francoise Colloc'h John T. Hartley Edward D. Miller
Henri de Castries John H.F. Haskell, Jr. Didier Pineau-Valencienne
Joseph L. Dionne Michael Hegarty George J. Sella, Jr.
William T. Esrey W. Edwin Jarmain Stanley B. Tulin
Jean-Rene Fourtou G. Donald Johnston, Jr. Dave H. Williams
Norman C. Francis George T. Lowy
By: /s/Jerome S. Golden
-------------------
Jerome S. Golden
Attorney-in-Fact
March 6, 1998
<PAGE>
EXHIBIT INDEX
-------------
EXHIBIT NO. TAG VALUE
- ----------- ---------
(4) (a) Form of group annuity contract EX-99.4a CONTRACT
no. 1050-94IC.
(b) Form of group annuity certificate EX-99.4b CERTIFICATE
nos. 94ICA and 94ICB.
(c) Forms of endorsement nos. 94ENIRAI, EX-99.4c ENDORSEMENT
94ENNQI and 94ENMVAI to contract
no. 1050-94IC and data pages
no. 94ICA/BIM(IRA), (NQ), (NQ Plan A)
and (NQ Plan B).
(d) Forms of application used with the EX-99.4d APPLICATION
IRA, NQ and Fixed Annuity Markets.
(e) Form of endorsement no. 95ENLCAI to EX-99.4e ENDORSEMENT
contract no. 1050-94IC and data
pages no. 94ICA/BLCA.
GROUP ANNUITY CONTRACT NO.: [AC 0000]
CONTRACT HOLDER: [UNITED STATES TRUST COMPANY OF NEW YORK]
- --------------------------------------------------------------------------------
REGISTER DATE: [September 1, 1994]
ISSUED IN: [New York]
This Contract is issued in consideration of payment of the Contributions under
the terms of this Contract.
The terms of this Contract, which include the following pages, are agreed to by
the Contract Holder and The Equitable Life Assurance Society of the United
States ("Equitable").
FOR THE CONTRACT HOLDER FOR EQUITABLE
Title By /s/ Joseph J. Melone
---------------------- ------------------------------------
Chairman and Chief Executive Officer
By By /s/ James M. Benson
---------------------- ------------------------------------
President and Chief Operating Officer
Dated By /s/ Molly K. Heines
---------------------- ------------------------------------
Vice President and Secretary
At [New York, New York] By
------------------------------------
Assistant Registrar
Date of Issue
-------------------------
THE PORTION OF ANNUITY ACCOUNT VALUE HELD IN THE SEPARATE ACCOUNT MAY INCREASE
OR DECREASE IN VALUE AS DESCRIBED IN PART II OF THIS CONTRACT.
No. 1050-94IC INTEREST RATE GUARANTEE -- NON-PARTICIPATING
<PAGE>
TABLE OF CONTENTS
Page
Part I - DEFINITIONS 3
Part II - INVESTMENT OPTIONS 6
Part III - CONTRIBUTIONS AND ALLOCATIONS 10
Part IV - TRANSFERS AMONG INVESTMENT OPTIONS 11
Part V - WITHDRAWALS AND TERMINATION 12
Part VI - DEATH BENEFITS 13
Part VII - ANNUITY BENEFITS 14
Part VIII - CHARGES 17
Part IX - GENERAL PROVISIONS 20
TABLE OF GUARANTEED ANNUITY PAYMENTS 22
APPENDIX A 24
APPENDIX B 28
APPENDIX C 30
APPENDIX D 33
No. 1050-94IC Page 2
<PAGE>
PART I - DEFINITIONS
SECTION 1.01 ANNUITANT
"Annuitant" means the individual shown as such in the Certificate who has been
enrolled under the Contract according to Equitable's enrollment procedures, or
any successor annuitant. If a Certificate uses the term "Participant" to refer
to the Annuitant, then any reference in this Contract to the Annuitant will be
deemed to mean the "Participant" shown in such Certificate.
SECTION 1.02 ANNUITY ACCOUNT VALUE
"Annuity Account Value" means the sum of the amounts held with respect to a
Certificate in the Investment Options.
SECTION 1.03 ANNUITY BENEFIT
"Annuity Benefit" means a benefit payable by Equitable pursuant to Part VII of
this Contract.
SECTION 1.04 ANNUITY COMMENCEMENT DATE
"Annuity Commencement Date" means the date on which annuity payments are to
commence pursuant to Section 7.03. The Annuity Commencement Date is shown on the
Certificate and is subject to change as described in Section 7.03.
SECTION 1.05 BUSINESS DAY
A "Business Day" is any day on which Equitable is open and the New York Stock
Exchange is open for trading, or any other day specified in the Certificate.
Equitable's Business Day ends at 4:00 p.m., Eastern Time, or such other time as
Equitable designates in writing to each Owner.
SECTION 1.06 CASH VALUE
"Cash Value" means an amount equal to the Annuity Account Value, less any
charges that apply as described in Part VIII and any charges that may apply as
described in any applicable Appendix hereto.
SECTION 1.07 CERTIFICATE
"Certificate" means the certificate which will be issued by Equitable with
respect to each Annuitant, setting forth the benefits and the rights which the
Owner may exercise. The Certificate will also reflect the terms of this Contract
which may differ based on the type of Certificate issued. Some provisions of
this Contract refer to specific requirements related to certain types of
retirement programs, and the Certificate issued with respect to such types of
programs will reflect said provisions; to distinguish among Certificate versions
which may thus be issued under this Contract, the following terms are sometimes
used herein. (These terms represent the Certificate forms which may be available
as of the
No. 1050-94IC Page 3
<PAGE>
Register Date; variations of such form and other forms may be made available by
Equitable at any time on or after the Register Date.)
"IRA Certificate," which applies to a Certificate issued as an
individual retirement annuity meeting the requirements of Section
[408(b)] of the Code;
"Non-Qualified Certificate," which applies to a Certificate which is an
annuity issued other than pursuant to a qualified plan.
SECTION 1.08 CODE
"Code" means the Internal Revenue Code of [1986], as now or hereafter amended,
or any corresponding provisions of prior or subsequent United States revenue
laws.
SECTION 1.09 CONTRACT
"Contract" means this contract including each Appendix, if any, attached hereto.
SECTION 1.10 CONTRACT DATE
"Contract Date" means, with respect to a Certificate, the earlier of (a) the
date on which the Annuitant is enrolled under the Contract, according to
Equitable's enrollment procedures, and (b) the date on which the Annuitant was
enrolled under a Prior Contract, if applicable.
SECTION 1.11 CONTRACT YEAR
"Contract Year" means, with respect to a Certificate, the twelve month period
starting on (i) the Contract Date and (ii) each anniversary of the Contract
Date, unless Equitable agrees to another period.
SECTION 1.12 CONTRIBUTION
"Contribution" means a payment made to Equitable as described in Section 3.01.
SECTION 1.13 EMPLOYER
"Employer" means, if applicable, an employer defined in an Appendix hereto.
SECTION 1.14 GUARANTEED INTEREST RATE
"Guaranteed Interest Rate" means the effective annual rate(s) at which interest
accrues on amounts in the Guaranteed Interest Account as described in Section
2.01. (If a Certificate uses the term "Guaranteed Rate Account" to refer to the
Guaranteed Interest Account, then any reference in this Contract to the
Guaranteed Interest Account will be deemed to mean the "Guaranteed Rate Account"
described in such Certificate.)
No. 1050-94IC Page 4
<PAGE>
SECTION 1.15 INVESTMENT FUND
"Investment Fund" means a sub-fund of a Separate Account. An Investment Fund may
invest its assets in a separate class (or series) or shares of a specified trust
or investment company where each class (or series) represents a separate
portfolio in the specified trust or investment company.
SECTION 1.16 INVESTMENT OPTION
"Investment Option" means the Guaranteed Interest Account, a Separate Account,
or an Investment Fund of a Separate Account or each Guarantee Period in the
Guaranteed Period Account (Separate Account No. 46).
SECTION 1.17 OWNER
"Owner" means the person or entity which owns a Certificate on behalf of the
Annuitant, as named on the Certificate, or any successor owner.
SECTION 1.18 PLAN
"Plan" means, if applicable, the annuity program sponsored by the Employer of
the Annuitant and as may be defined in any Appendix hereto.
SECTION 1.19 PRIOR CONTRACT
"Prior Contract" means another contract or certificate issued by Equitable and
from which the Owner and Equitable have agreed to transfer amounts with respect
to the Annuitant to this Contract.
SECTION 1.20 PROCESSING DATE
"Processing Date" means the day(s) Equitable deducts charges from the Annuity
Account Value. The Certificate shows how often a Processing Date will occur.
SECTION 1.21 PROCESSING OFFICE
"Processing Office" means the Equitable administrative office specified in the
Certificate, or such other location as Equitable may designate upon written
notice to each Owner.
SECTION 1.22 SEPARATE ACCOUNT
"Separate Account" means any of the Separate Accounts (except Equitable's
Separate Account No. 46) described or referred to in Sections 2.02 and 2.05.
SECTION 1.23 TRANSACTION DATE
The Transaction Date is the Business Day Equitable receives at the Processing
Office a Contribution or a transaction request providing the information
Equitable needs. Transaction requests must be in a form acceptable to Equitable.
No. 1050-94IC Page 5
<PAGE>
PART II - INVESTMENT OPTIONS
SECTION 2.01 GUARANTEED INTEREST ACCOUNT
Any amount held in the Guaranteed Interest Account becomes part of Equitable's
general assets, which support the guarantees of this Contract as well as other
obligations of Equitable.
The amount in such Account at any time with respect to a Certificate is equal to
the sum of:
o all amounts that have been allocated or transferred to such Account,
plus
o the amount of any interest credited, less
o all amounts that have been withdrawn (including charges) or
transferred from such Account.
Equitable will credit the amount held in the Guaranteed Interest Account with
interest at effective annual rates that Equitable determines. Equitable will
also determine a minimum Guaranteed Interest Rate that will remain in effect
throughout a stated twelve-month period or a calendar year. The Certificate will
describe the initial Rate(s) to apply for a stated period or periods starting
with the Contract Date.
Equitable guarantees that any rate so determined after a Contract Date will
never be less than the minimum rate shown in the Certificate.
SECTION 2.02 SEPARATE ACCOUNT
Equitable has established the Separate Account(s) and maintains such Account(s)
in accordance with the laws of New York State. Income, realized and unrealized
gains and losses from the assets of the Separate Account(s) are credited to or
charged against it without regard to Equitable's other income, gains or losses.
Assets are placed in the Separate Account(s) to support this Contract and other
variable annuity contracts and certificates. Assets may be placed in the
Separate Account(s) for other purposes, but not to support contracts or policies
other than variable annuities and variable life insurance.
The Certificate sets forth the Separate Account(s) available under this
Contract. A Separate Account may be subdivided into Investment Funds.
The assets of a Separate Account are Equitable's property. The portion of such
assets equal to the reserves and other contract liabilities will not be
chargeable with liabilities which arise out of any other business Equitable
conducts. Equitable may transfer assets of a Separate Account in excess of the
reserves and other liabilities with respect to such Account to another Separate
Account or to Equitable's general account.
No. 1050-94IC Page 6
<PAGE>
Equitable may, in its discretion, invest Separate Account assets in any
investment permitted by applicable law. Equitable may rely conclusively on the
opinion of counsel (including counsel in its employ) as to what investments
Equitable may make as law permits.
SECTION 2.03 SEPARATE ACCOUNT ACCUMULATION UNITS AND UNIT VALUES
The amount in a Separate Account with respect to an Annuitant at any time is
equal to the number of Accumulation Units in that Account with respect to the
Annuitant multiplied by the Accumulation Unit Value which applies at that time.
For the purposes of this Contract, "Accumulation Unit" means a unit which is
purchased in a Separate Account, and "Accumulation Unit Value" means the dollar
value of each Accumulation Unit in a Separate Account on a given date. (If
Investment Funds apply as described in Section 2.02, then the terms of this
Section 2.03 apply separately to each Fund, unless otherwise stated.)
Amounts allocated or transferred to a Separate Account are used to purchase
Accumulation Units of that Account. Units are redeemed when amounts are
deducted, transferred or withdrawn.
The number of Accumulation Units in a Separate Account at any time is equal to
the number of Accumulation Units purchased minus the number of Units redeemed in
that Account up to that time. The number of Accumulation Units purchased or
redeemed in a transaction is equal to the dollar amount of the transaction
divided by the Account's Accumulation Unit Value for that Transaction Date.
Equitable determines Accumulation Unit Values for each Separate Account for each
Valuation Period. A "Valuation Period" is each Business Day together with any
consecutive preceding non-business days. For example, for each Monday which is a
Business Day, the preceding Saturday and Sunday will be included to equal a
three-day Valuation Period.
Unless the following paragraph applies, the Accumulation Unit Value for a
Separate Account for any Valuation Period is equal to the Accumulation Unit
Value for the immediately preceding Valuation Period multiplied by the ratio of
(i) the value of the Separate Account at the close of business at the end of the
current Valuation Period, before any amounts are allocated to or withdrawn from
the Separate Account in that Period, to (ii) the value of the Separate Account
at the close of business at the end of the preceding Valuation Period, after all
allocations and withdrawals were made for that Period. For this purpose, "value
of the Separate Account" means the market value or, where there is no readily
available market, the fair value of the assets allocated to the Separate
Account, as determined in accordance with Equitable's rules, accepted accounting
practices, and applicable laws and regulations.
To the extent the Separate Account invests in Investment Funds, and the assets
of the Funds are invested in a class or series of shares of a specified trust or
investment company, then the Accumulation Unit Value of an Investment Fund for
any Valuation Period is equal to the Accumulation Unit Value for that Fund on
the immediately
No. 1050-94IC Page 7
<PAGE>
preceding Valuation Period multiplied by the Net Investment Factor of that Fund
for the current Valuation Period. The Net Investment Factor for a Valuation
Period is (a) divided by (b) minus (c), where
(a) is the value of the Investment Fund's shares of the related
portfolio of the specified trust or investment company at the
end of the Valuation Period (before taking into account any
amounts allocated to or withdrawn from the Investment Fund for
the Valuation Period and after deduction of investment
advisory fees and direct operating expenses of the specified
trust or investment company; for this purpose, Equitable uses
the share value reported to Equitable by the specified trust
or investment company);
(b) is the value of the Investment Fund's shares of the related
portfolio of the specified trust or investment company at the
end of the preceding Valuation Period (taking into account any
amounts allocated or withdrawn for that Valuation Period);
(c) is the daily Separate Account charges (see Section 8.04) for
the expenses and risks of the Contract, times the number of
calendar days in the Valuation Period, plus any charge for
taxes or amounts set aside as a reserve for taxes.
SECTION 2.04 AVAILABILITY OF INVESTMENT OPTIONS
Section 3.01 of this Contract describes the allocation of Contributions among
Investment Options pursuant to the Owner's election. Such election is subject to
the following:
(a) If the Contributions made under this Contract with respect to a
Certificate are made pursuant to the terms of a Plan, then the
availability of Investment Options may be subject to the terms of
such Plan, as reported to Equitable by the Owner.
(b) Equitable reserves the right to limit the number of Options which
an Owner may elect.
The Certificate will list which Options are available.
SECTION 2.05 CHANGES WITH RESPECT TO SEPARATE ACCOUNTS
In addition to the right reserved pursuant to subsection (b) of Section 2.04,
Equitable reserves the right, subject to compliance with applicable law,
including approval of Owners if required:
(a) to add Investment Funds (or sub-funds of Investment Funds) to, or
to remove Investment Funds (or sub-funds) from, a Separate
Account, or to add or remove Separate Accounts;
(b) to combine any two or more Investment Funds or sub-funds thereof;
No. 1050-94IC Page 8
<PAGE>
(c) to transfer the assets Equitable determines to be the share of the
class of contracts to which this Contract belongs from any
Separate Account or Investment Fund to another Separate Account or
Investment Fund;
(d) to operate the Separate Account or any Investment Fund as a
management investment company under the Investment Company Act of
1940, in which case charges and expenses that otherwise would be
assessed against an underlying Mutual Fund would be assessed
against the Separate Account;
(e) to operate the Separate Account or any Investment Fund as a unit
investment trust under the Investment Company Act of 1940;
(f) to deregister the Separate Account or any Investment Fund under
the Investment Company Act of 1940, provided that such action
conforms with the requirements of applicable law;
(g) to restrict or eliminate any voting rights as to the Separate
Account;
(h) to cause one or more Separate Accounts or Investment Funds to
invest some or all of their assets in one or more other trusts or
investment companies.
If the exercise of these rights results in a material change in the underlying
investments of a Separate Account, the Contract Holder and each Owner will be
notified of such exercise, as required by law.
A Separate Account or Investment Fund which may be added by Equitable as
described above may be one with respect to which (i) there may be periods during
which contributions are restricted pursuant to the maturity terms of such
Account, (ii) amounts therein may be automatically liquidated according to the
investment policy of the Account, and (iii) investments therein may mature.
Equitable will have the right to reallocate amounts arising from liquidation or
maturity according to the Owner's allocation instructions then in effect unless
the Owner specifies other instructions with respect to said amounts. If no such
allocation instructions have been made, the reallocation will be made to a
designated Investment Option, or to the next established Account or Fund of the
same type as described in this paragraph, if applicable, as specified in the
Certificate.
No. 1050-94IC Page 9
<PAGE>
PART III - CONTRIBUTIONS AND ALLOCATIONS
SECTION 3.01 CONTRIBUTIONS, ALLOCATIONS
Contributions will be remitted on behalf of an Annuitant from the Owner (who may
also be the Annuitant, if so stated in the Certificate.)
The Owner will elect which Investment Options will be available under the
Certificate issued to the Owner, subject to the terms of Section 2.04. Once this
election is made, the Owner may only allocate Contributions to, or transfer
among, these Options. The Owner may add or subtract Options after the
Certificate is issued by sending Equitable a written request, but Equitable has
the right to decline such request.
The Owner will also elect how to allocate Contributions among the Options
elected. If the Owner is not the Annuitant, the Owner may delegate to the
Annuitant authority to allocate Contributions. The Owner need not allocate
Contributions to each Option elected. The Owner may change the allocation
instruction at any time by sending Equitable the proper form. Allocation
percentages must be in whole numbers (no fractions) and must equal 100%.
Each Contribution is allocated (after deduction of any charges that may apply)
in accordance with the allocation instructions in effect on the Transaction
Date. Contributions made to a Separate Account purchase Accumulation Units in
that Account, using the Accumulation Unit Value for that Transaction Date.
SECTION 3.02 LIMITS ON CONTRIBUTIONS
Equitable reserves the right not to accept any Contribution which is less than
the amount shown in the Certificate. The applicable Appendix to this Contract
indicates other minimum and maximum Contribution requirements which may apply.
Equitable also reserves the right, upon advance notice to the Contract Holder
and each Owner, to
(a) change such requirements to apply to Contributions made after
the date of such change, and
(b) discontinue acceptance of Contributions under this Contract
(i) with respect to all Owners or (ii) with respect to all
Owners to whom the same type of Certificate applies (as
described in Section 1.07).
No. 1050-94IC Page 10
<PAGE>
PART IV - TRANSFERS AMONG INVESTMENT OPTIONS
SECTION 4.01 TRANSFER REQUESTS
The Owner may upon request transfer all or part of the amount held with respect
to a Certificate in an Investment Option to one or more of the other Options. A
transfer request must be made in a form acceptable to Equitable. All transfers
will be made on the Transaction Date and will be subject to the terms of Section
4.02 and to Equitable's rules in effect at the time of transfer. With respect to
a Separate Account, the transfers will be made at the Accumulation Unit Value
for that Transaction Date.
SECTION 4.02 TRANSFER RULES
The transfer rules which apply are stated in the Certificate. A transfer request
will not be accepted by Equitable if it involves less than the minimum amount,
if any, stated in the Certificate (unless the Annuity Account Value is less than
such amount). Equitable has the right to change transfer rules. Any change will
be made upon advance notice to the Contract Holder and to each Owner.
The Investment Funds may consist of funds which are classified as "Type A"
Investment Options or "Type B" Investment Options or any other type which may be
specified in the Certificate, as Equitable designates in its discretion for
purposes of the transfer rules described in the Certificate. The Certificate
will specify whether such Investment Options are designated Type A or Type B, or
another type as well as the minimum or maximum limits on transfers which apply.
No. 1050-94IC Page 11
<PAGE>
PART V - WITHDRAWALS AND TERMINATION
SECTION 5.01 WITHDRAWALS
Unless otherwise stated in the Certificate, the Owner may make a request to
Equitable, pursuant to Equitable's procedures then in effect, for a withdrawal
from the Investment Options before the Annuity Commencement Date and while the
Annuitant is alive.
On the Transaction Date, Equitable will pay the amount of the withdrawal
requested by the Owner or, if less, the Cash Value. The amount to be paid plus
any Withdrawal Charge applicable pursuant to Section 8.01 will be withdrawn on a
pro-rata basis from the amounts held with respect to the Certificate in the
Investment Options, unless the Owner elects otherwise or unless otherwise stated
in the Certificate.
A withdrawal request will not be accepted by Equitable if it involves less than
the minimum amount, if any, stated in the Certificate (unless the Annuity
Account Value is less than such amount). Further conditions or restrictions on
distributions may apply if stated in the Certificate.
SECTION 5.02 TERMINATION
The Certificate will terminate if one or more of the following events occurs,
unless otherwise specified in the Certificate:
(a) If a withdrawal made under Section 5.01 would result in an Annuity
Account Value of an amount less than the minimum amount stated in the
Certificate, Equitable will so advise the Owner and reserve the right
to pay such Value to the Owner, in which case the Certificate will be
terminated.
(b) Before an Annuitant's Annuity Commencement Date, Equitable has the
right to pay the Cash Value and terminate the Certificate if no
Contributions are made during the last three completed Contract Years
(or such other number of years stated in the Certificate and permitted
under applicable law), and the Annuity Account Value is less than the
amount described in subsection (a) above.
(c) Equitable also has the right to terminate the Certificate if no
Contributions have been made with respect to the Annuitant within 120
days of the Contract Date.
No. 1050-94IC Page 12
<PAGE>
PART VI - DEATH BENEFITS
SECTION 6.01 DEATH BENEFIT
Upon receipt by Equitable of due proof that the Annuitant has died prior to the
Annuity Commencement Date, Equitable will pay a death benefit to the beneficiary
named under Section 6.02. Payment of the death benefit is subject to the terms
of Section 6.02 and any special rules which may apply as stated in an Appendix
hereto and the Certificate.
The amount of the death benefit under this Contract will be determined by
Equitable as specified in the Certificate.
The death benefit will be paid as an Annuity Benefit or in a single sum, as
described in Section 6.02.
SECTION 6.02 BENEFICIARY
The Owner will give Equitable the name of the beneficiary who is to receive any
death benefit payable on the Annuitant's death. The Owner may change the
beneficiary from time to time during the Annuitant's lifetime and while coverage
under this Contract is in force. Any such change must be made in writing in a
form Equitable accepts. A change will, upon receipt at the Processing Office,
take effect as of the date the written form is executed, whether or not the
Owner is living on the date of receipt. Equitable will not be liable as to any
payments it made before it receives any such change.
The Owner may name one or more persons to be primary beneficiary on the
Annuitant's death and one or more persons to be successor beneficiary if the
primary beneficiary dies before the Annuitant. Unless the Owner directs
otherwise, if the Owner has named two or more persons as beneficiary, the
beneficiary will be the named person or persons who survive the Annuitant and
payments will be made to such persons in equal shares or the survivor.
Any part of a death benefit payable as described in Section 6.01 for which there
is no named beneficiary living at the Annuitant's death will be payable in a
single sum to the Annuitant's children who survive the Annuitant, in equal
shares, or should none survive or should there be none, then to the Annuitant's
estate.
If the Owner so elects in writing, any amount that would otherwise be payable to
a beneficiary in a single sum may be applied to provide an Annuity Benefit, on
the form of annuity elected by the Owner, subject to Equitable's rules then in
effect. If at the Annuitant's death there is no election in effect, the
beneficiary may make such an election. In the absence of any election by either
the Owner or the beneficiary, Equitable will pay the death benefit in a single
sum.
The naming of a beneficiary is subject to the terms of the Plan, if applicable,
including any terms requiring spousal consent.
No. 1050-94IC Page 13
<PAGE>
PART VII ANNUITY BENEFITS
SECTION 7.01 ANNUITY BENEFIT
Payments under an Annuity Benefit will be made monthly. An election may be made
by the Owner instead to have the Annuity Benefit paid at other intervals, such
as every three months, six months, or twelve months, instead of monthly, subject
to Equitable's rules at the time of election or as stated in the Certificate.
This election may be made at the time the Annuity Benefit form as described in
Section 7.02 is elected; in that event, all references in this Contract to
monthly payments will, with respect to the Annuity Benefit of such an Annuitant
to whom the election applies, be deemed to mean payments at the frequency
elected.
SECTION 7.02 ELECTION OF ANNUITY BENEFITS
As of the Annuitant's Annuity Commencement Date, provided the Annuitant is then
living, the Annuity Account Value will be applied to provide the Normal Form of
Annuity Benefit (described in Section 7.04). However, the Owner may instead
elect (i) to have the Cash Value paid in a single sum, (ii) to apply the Annuity
Account Value or Cash Value, whichever is applicable pursuant to the first
paragraph of Section 7.05 to provide an Annuity Benefit of any form offered by
Equitable or one of Equitable's subsidiary life insurance companies, or (iii) to
apply the Cash Value to provide any other form of benefit payment offered by
Equitable, subject to Equitable's rules then in effect and applicable laws and
regulations. At the time an Annuity Benefit is purchased, Equitable will issue a
supplementary contract which reflects the Annuity Benefit terms.
Equitable will provide notice and election forms to the Owner within six months
before the Annuity Commencement Date.
Equitable will have the right to require the Owner to furnish any information
Equitable needs to provide an Annuity Benefit and will be fully protected in
relying on such information and need not inquire as to the accuracy or
completeness thereof.
SECTION 7.03 COMMENCEMENT OF ANNUITY BENEFITS
Before the Annuity Commencement Date, the Owner may elect to change such Date.
The changed Date may be any date after the election is filed (other than the
29th, 30th, or 31st day of any month). Any election for such change must be made
in writing by the Owner and will not take effect until received and accepted by
Equitable at its Processing Office.
However, unless provided otherwise in any Appendix of this Contract, no Annuity
Commencement Date will be later than the first day of the month which follows
the date the Annuitant attains the "maximum maturity age" or, if later, the
tenth anniversary of the Contract Date. The current maximum maturity age is
specified in the Certificate; such age may be changed by Equitable in
conformance with applicable law.
No. 1050-94IC Page 14
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SECTION 7.04 ANNUITY BENEFIT FORMS
The "Normal Form" of Annuity Benefit is an Annuity Benefit payable on the
Life-Period Certain Annuity Form described below, unless another form is to
apply pursuant to the terms of the Plan, if applicable, the requirements of the
Employee Retirement Income Security Act of 1974 (ERISA), as amended, or any
other law that applies. The Certificate will specify the Normal Form which
applies. Equitable may offer other annuity forms as available from Equitable or
from one of Equitable's affiliated or subsidiary life insurance companies. Such
a form may include the Joint and Survivor Life Annuity Form providing monthly
payments while either of two persons upon whose lives such payments depend is
living. The monthly amount to be continued when only one of the persons is
living will be equal to a percentage, as elected, of the monthly amount that was
paid while both were living.
The Life-Period Certain Annuity is an annuity payable during the lifetime of the
person upon whose life the payments depend, but with 10 years of payments
guaranteed (10 years certain period). That is, if the Annuitant dies before the
certain period has ended, payments will continue to the beneficiary named to
receive such payments for the balance of the certain period.
SECTION 7.05 AMOUNT OF ANNUITY BENEFITS
If the Owner elects pursuant to Section 7.02 to have an Annuity Benefit paid in
lieu of the Cash Value, the amount applied to provide the Annuity Benefit will,
unless otherwise specified in the Certificate or required by applicable laws and
regulations, be (i) the Annuity Account Value if the annuity form elected
provides payments for a person's remaining lifetime or (ii) the Cash Value if
the annuity form elected does not provide such lifetime payments.
The amount applied to provide an Annuity Benefit may be reduced by a charge for
any taxes which apply on annuity purchase payments. If Equitable has previously
deducted charges for applicable taxes from Contributions, Equitable will not
again deduct charges for the same taxes before an Annuity Benefit is provided.
The balance will be used to purchase the Annuity Benefit on the basis of either
(i) the Tables of Guaranteed Annuity Payments or (ii) Equitable's then current
individual annuity rates, whichever rates would provide a larger benefit with
respect to the payee.
SECTION 7.06 CONDITIONS
Equitable may require proof acceptable to it that the person on whose life a
benefit payment is based is alive when each payment is due. Equitable will
require proof of the age of any person on whose life an Annuity Benefit is
based.
If a benefit was based on information that is later found not to be correct,
such benefit will be adjusted on the basis of the correct information. The
adjustment will be made in the number or amount of the benefit payments, or any
amount used to provide the benefit, or any combination. Overpayments by
Equitable will be charged against future payments. Underpayments will be added
to future payments. Equitable's liability is limited to the correct information
and the actual amounts used to provide the benefits.
No. 1050-94IC Page 15
<PAGE>
If the age (or sex, if applicable as stated in the Tables of Guaranteed Annuity
Payments) of any person upon whose life an Annuity Benefit depends has been
misstated, any benefits will be those which would have been purchased at the
correct age (or sex). Any overpayments or underpayments made by Equitable will
be charged or credited with interest at (a) the rate shown in the Certificate or
(b) the then current Guaranteed Interest Rate; Equitable will determine which
rate will apply, on a uniform and nondiscriminatory manner, for similar
Certificates. Such interest will be deducted from or added to future payments.
If Equitable receives proof satisfactory to it that (i) a payee entitled to
receive any payment under the terms of this Contract is physically or mentally
incompetent to receive such payment or a minor, (ii) another person or an
institution is then maintaining or has custody of such payee, and (iii) no
guardian, committee, or other representative of the estate of such payee has
been appointed, Equitable may make the payments to such other person or
institution. In the case of a minor, the payments will not exceed [$200] or such
other amount shown in the Certificate. Equitable will have no further liability
with respect to the payments so made.
If the amount to be applied hereunder is less than [$2,000] or would result in
an initial payment of less than [$20], Equitable may pay the amount to the payee
in a single sum instead of applying it under the annuity form elected.
SECTION 7.07 CHANGES
Equitable reserves the right, upon advance notice to the Contract Holder and
each Owner, to change at any time on and after the fifth anniversary of the
Register Date of this Contract, at intervals of not less than five years, the
actuarial basis used in the Tables of Guaranteed Annuity Payments; however, no
such change will apply to (A) any Annuity Benefit provided before the change or
(B) Contributions made before such change which are applied to provide an
Annuity Benefit.
No. 1050-94IC Page 16
<PAGE>
PART VIII - CHARGES
SECTION 8.01 WITHDRAWAL CHARGES
The amount of the Withdrawal Charge, if applicable, will be specified in the
Certificate issued with respect to the Annuitant. Equitable reserves the right
to change such Charge with respect to future Contributions, subject to any
maximum amount specified in the Certificate.
If specified in the Certificate, a "Free Corridor Amount" will apply as follows:
"Free Corridor Amount" means an amount equal to a percentage of the
Annuity Account Value, minus the total of all prior withdrawals (and
associated Withdrawal Charges) made as described in Section 5.01 in the
current Contract Year. Such percentage for this purpose will be (a)
determined by Equitable with respect to each Annuitant on a uniform and
nondiscriminatory basis and (b) specified in the Certificate; it will be
any percentage between [0% and 30%] if so provided in the Certificate.
If the amount of a withdrawal made under Part V is more than the Free
Corridor Amount (defined above), Equitable will (a) first withdraw from
the Investment Options, on the basis described in Section 5.01, an amount
equal to the Free Corridor Amount, and (b) then withdraw from the
Investment Options an amount equal to the excess of the amount requested
over the Free Corridor Amount, plus a Withdrawal Charge as specified in
the Certificate.
For purposes of this Section, amounts withdrawn up to the Free Corridor
Amount will not be deemed a withdrawal of any Contributions. Equitable
reserves the right to carry forward the Free Corridor Amount into a future
Contract Year, if not used in any Year with respect to an Annuitant, as
specified in the Certificate.
Any withdrawals in excess of the Free Corridor Amount will be deemed
withdrawals of Contributions in the reverse order in which they were made;
that is, Contributions will be withdrawn on a last-in, first-out basis.
However, Equitable reserves the right instead to deem Contributions
withdrawn on a first-in, first-out basis. If Equitable exercises this
right, it will do so with respect to Certificates for which the Contract
Date occurs after the effective date of the change, and the first-in,
first-out basis will be specified in the Certificate.
In addition, the Annuitant's years of participation under the Prior Contract, if
applicable, will be included for purposes of determining the Withdrawal Charge,
if so specified in the Certificate in accordance with Equitable's rules then in
effect.
If specified in the Certificate, Equitable reserves the right to reduce or waive
the Withdrawal Charge in such circumstances as it determines. The Certificate
issued with respect to the Annuitant will specify the circumstances, if any, by
which a waiver will apply.
No. 1050-94IC Page 17
<PAGE>
Moreover, the Withdrawal Charge will be reduced if needed in order to comply
with any applicable state or federal law.
SECTION 8.02 ADMINISTRATIVE AND OTHER CHARGES DEDUCTED FROM ANNUITY ACCOUNT
VALUE
As of each Processing Date, Equitable will deduct Administrative Charges, a
charge for the minimum guaranteed death benefit, if applicable, or other Charges
related to the administration and/or distribution of certificates under this
Contract from the Annuity Account Value. Such Charges are specified in the
Certificate.
If specified in the Certificate, the Charges will be deducted in full or
prorated for the Contract Year, or portion thereof, in which the Contract Date
occurs or in which the Annuity Account Value is withdrawn or applied to provide
an Annuity Benefit or death benefit. If so, the Charges will be deducted when
withdrawn or so applied.
The amount of any such Charge for any Contract Year will in no event exceed any
maximum amount stated in the Certificate subject to the maximum amount permitted
under any applicable law.
Equitable reserves the right to reduce or waive said Charges in such
circumstances as it determines.
SECTION 8.03 TRANSFER CHARGES
Equitable reserves the right to impose a charge with respect to any transfer
among Investment Options after the number of free transfers, as specified in the
Certificate, made on behalf of an Annuitant. The amount of such charge will be
set forth in a notice from Equitable to the Contract Holder and each Owner and
in no event will exceed any maximum amount stated in the Certificate.
SECTION 8.04 DAILY SEPARATE ACCOUNT CHARGE
Assets of the Separate Account will be subject to a daily asset charge. This
daily asset charge is for mortality risk, expenses and expense risk which
Equitable assumes, as well as for financial accounting and death benefits if
specified in the Certificate. The charge will be made pursuant to item (c) of
"Net Investment Factor" as defined in Section 2.03. Such charge will be applied
after any deductions to provide for taxes. It will be at a rate not to exceed
the maximum annual rate stated in the Certificate. Equitable reserves the right
to charge less on a current basis; the actual charge to apply will be specified
in the Certificate.
SECTION 8.05 CHANGES
In addition to the right of Equitable to reduce or waive charges as described in
this Part VIII, Equitable reserves the right, upon advance notice to the
Contract Holder and each Owner, to increase the amount of any charge stated in
the Certificate issued with respect to each Annuitant, subject to (a) any
maximum amount provided in this Part VIII and (b)
No. 1050-94IC Page 18
<PAGE>
with respect to Withdrawal Charges and Administrative or other Charges deducted
from the Annuity Account Value, the application of any increase only to
Contributions made after the date of the change.
Equitable also reserves the right, upon advance written notice to the Contract
Holder, to increase the maximum amount of any charge provided in this Part VIII
or the Certificate, only with respect to Annuitants whose Contract Date occurs
after the effective date of the increase, but not to exceed the maximum amount
then permitted by any law that applies or, with respect to the daily Separate
Account charge described in Section 8.04, by the Securities and Exchange
Commission.
No. 1050-94IC Page 19
<PAGE>
PART IX - GENERAL PROVISIONS
SECTION 9.01 CONTRACT
This Contract constitutes the entire contract between the parties and will
govern with respect to the rights and obligations of Equitable.
This Contract may not be modified, nor may any of Equitable's rights or
requirements be waived, except in writing and by an authorized officer of
Equitable. In addition to the rights of change reserved by Equitable as provided
in this Contract, the Contract may be changed by amendment or replacement
without the consent of any other person provided that such change does not
reduce any Annuity Benefit provided before such change and provided that no
rights, privileges or benefits under the Contract with respect to Contributions
made hereunder prior to the effective date of such change may be adversely
affected by an amendment to the Contract without the consent of the Contract
Holder and each Owner.
SECTION 9.02 STATUTORY COMPLIANCE
Equitable reserves the right to amend this Contract without the consent of any
other person in order to comply with applicable laws and regulations. Such right
will include, but not be limited to, the right to conform the Contract to
reflect changes in the Code, in Treasury regulations or published rulings of the
Internal Revenue Service, ERISA, and in Department of Labor regulations.
The benefits and values available under this Contract will not be less than the
minimum benefits required by any applicable state law.
SECTION 9.03 DEFERMENT
Application of proceeds to provide a payment of a death benefit under Part VI
and payment of any portion of the Annuity Account Value (less any applicable
Withdrawal Charge) will be made within seven days after the Transaction Date.
Payments or applications of proceeds from a Separate Account may be deferred for
any period during which (1) the New York Stock Exchange is closed or trading is
restricted, (2) sales of securities or determination of the fair value of the
Account's assets is not reasonably practicable because of an emergency, or (3)
the Securities and Exchange Commission, by order, permits Equitable to defer
payment in order to protect persons with interests in the Separate Account.
Equitable may defer payment or transfer of any portion of the Annuity Account
Value in the Guaranteed Interest Account for up to six months while the Owner is
living.
SECTION 9.04 REPORTS AND NOTICES
With respect to each Certificate, at least once each year until the Annuity
Commencement Date, Equitable will furnish the Owner with a report showing the
following:
(a) the dollar amount in the Guaranteed Interest Account,
No. 1050-94IC Page 20
<PAGE>
(b) the total number of Accumulation Units in each Separate Account
or Investment Fund,
(c) the Accumulation Unit Value,
(d) the dollar amount in each Separate Account or Investment Fund,
(e) the Cash Value, and
(f) the amount of the death benefit.
The terms of this Contract which require Equitable to send a report as described
above or any written notice as described in any other Section will be satisfied
by Equitable mailing any such report or notice to the Owner's last known address
as shown in Equitable's records.
All written notices sent to Equitable will not be effective until received in
good order at the Processing Office.
SECTION 9.05 ASSIGNMENTS
No amounts payable under this Contract to a payee other than the Owner may be
assigned by that payee unless permitted herein, nor will they be subject to the
claims of creditors or to legal process, except to the extent permitted by law.
The Certificate will describe any other restrictions or assignments which may
apply.
SECTION 9.06 CONTRACT HOLDER'S RESPONSIBILITY
The sole responsibility of the Contract Holder is to serve as party to the
Contract. The Contract Holder will have no responsibility for the administration
of any Plan or agreement, or for Contributions or any payments or other
distributions hereunder. Equitable will deal with the Contract Holder in
accordance with the terms and conditions of the trust agreement pursuant to
which the Contract Holder agreed to act as such and in such manner as the
Contract Holder and Equitable agree, without the consent of any other person.
SECTION 9.07 MANNER OF PAYMENT
Equitable will pay all amounts payable under this Contract by check (in United
States dollars) or, if so agreed upon by an Owner and Equitable, by wire
transfer. All amounts payable by the Owner will be paid by check payable to
Equitable (in United States dollars) or by any other method acceptable to
Equitable.
No. 1050-94IC Page 21
<PAGE>
TABLE OF GUARANTEED ANNUITY PAYMENTS
------------------------------------
[APPLICABLE TO IRA CERTIFICATES]
------------------------------
[AMOUNT OF ANNUITY BENEFIT PAYABLE MONTHLY ON THE JOINT AND SURVIVOR LIFE
ANNUITY FORM (WITH 100% OF THE AMOUNT OF THE ANNUITANT'S PAYMENT CONTINUED TO
THE ANNUITANT'S SPOUSE) PROVIDED BY AN APPLICATION OF $1,000.
FEMALE AGES
<TABLE>
<CAPTION>
AGE 60 61 62 63 64 65 66 67 68 69 70
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 3.39 3.42 3.46 3.49 3.52 3.55 3.58 3.61 3.64 3.67 3.70
61 3.41 3.45 3.48 3.51 3.55 3.58 3.61 3.64 3.68 3.71 3.74
62 3.43 3.47 3.50 3.54 3.57 3.61 3.64 3.68 3.71 3.74 3.78
63 3.45 3.49 3.52 3.56 3.60 3.63 3.67 3.71 3.74 3.78 3.82
MALE 64 3.47 3.51 3.54 3.58 3.62 3.66 3.70 3.74 3.78 3.82 3.86
AGES 65 3.48 3.52 3.56 3.61 3.65 3.69 3.73 3.77 3.81 3.85 3.89
66 3.50 3.54 3.58 3.63 3.67 3.71 3.76 3.80 3.84 3.89 3.93
67 3.52 3.56 3.60 3.65 3.69 3.74 3.78 3.83 3.88 3.92 3.97
68 3.53 3.57 3.62 3.67 3.71 3.76 3.81 3.86 3.91 3.96 4.00
69 3.54 3.59 3.64 3.69 3.73 3.78 3.83 3.88 3.94 3.99 4.04
70 3.56 3.60 3.65 3.70 3.75 3.81 3.86 3.91 3.96 4.02 4.07
</TABLE>
The amount of income provided under an Annuity Benefit payable on the Joint and
Survivor Life Annuity form is based on 2.5% interest and the 1983 Individual
Annuity Mortality Table "a" projected with modified Scale G.
Amounts required for ages or for annuity forms not shown in the above Table will
be calculated by Equitable on the same actuarial basis.
If a variable annuity form is available from Equitable and elected pursuant to
Section 7.02, then the amounts required will be calculated by Equitable based on
the 1983 Individual Annuity Mortality Table "a" projected with modified Scale
"G" and a modified two year age setback and on an Assumed Base Rate of Net
Investment Return of 3.5%/5.0%.]
No. 1050-94IC Page 22
<PAGE>
TABLE OF GUARANTEED ANNUITY PAYMENTS
[APPLICABLE TO NON-QUALIFIED CERTIFICATES]
[AMOUNT OF ANNUITY BENEFIT PAYABLE MONTHLY ON THE LIFE ANNUITY FORM
WITH TEN YEARS CERTAIN PROVIDED BY APPLICATION OF $1,000.
Monthly Income Monthly Income
[Ages Males Females Age Males Females
---- ----- ------- --- ----- -------
60 4.12 3.70 73 5.52 4.87
61 4.20 3.76 74 5.66 4.99
62 4.29 3.83 75 5.80 5.12
63 4.38 3.90 76 5.95 5.26
64 4.48 3.98 77 6.10 5.40
65 4.58 4.06 78 6.25 5.55
66 4.68 4.14 79 6.40 5.70
67 4.79 4.23 80 6.56 5.85
68 4.90 4.32 81 6.72 6.01
69 5.02 4.42 82 6.88 6.18
70 5.14 4.52 83 7.04 6.34
71 5.26 4.63 84 7.20 6.51
72 5.39 4.75 85 7.36 6.67
The amount of income provided under an Annuity Benefit payable on the Joint and
Survivor Life Annuity form is based on 2.5% interest and the 1983 Individual
Annuity Mortality Table "a" projected with modified Scale G, adjusted to a
unisex basis, reflecting a 20%-80% split of males and females at pivotal age 55.
Amounts required for ages not shown in the above Table or for other annuity
forms will be calculated by Equitable on the same actuarial basis.
If a variable annuity form is available from Equitable and elected pursuant to
Section 7.02, then the amounts required will be calculated by Equitable based on
the 1983 Individual Annuity Mortality Table "a" projected with modified Scale
"G" and a modified two year age setback and a 20%-80% split of males and females
at age 55 and on an Assumed Base Rate of Net Investment Return of 3.5%/5.0%.]
No. 1050-94IC Page 23
<PAGE>
APPENDIX A
----------
APPLICABLE TO IRA CERTIFICATES
1. OWNER:
The Annuitant is the Owner.
2. ANNUITY COMMENCEMENT DATE:
The Owner may not choose Annuity Commencement Date later than the
maximum maturity age specified in the Certificate. If the Owner chooses
a date later than the Annuitant's age [70 1/2], the Owner must withdraw
at least the minimum distributions required under Section [408(b)] and
[401(a)(9)] of the Code and Treasury regulations that apply. See Item 4
of this Appendix.
3. CONTRIBUTIONS:
No Contributions will be accepted unless they are in cash (or check or
other form as Equitable may require). Except in the case of a rollover
contribution (as permitted by Sections [402(c), 403(a)(4), 403(b)(8),
or 408(d)(3)] of the Code), the total of such Contributions will not
exceed [$2,000] for any taxable year. Amounts transferred to the
Contract from an individual retirement account or annuity contract
which meets the requirements of Section [408] of the Code are not
subject to the [$2,000] limit.
If the Owner makes a Contribution which qualifies as an eligible
retirement plan rollover as defined in Section [402(c) or 403(b)(8)] of
the Code and the Owner commingles such Contribution with other
Contributions, the Owner may not be able to roll over the eligible
retirement plan Contributions and earnings to another qualified plan or
Code Section [403(b)] arrangement at a future date, unless the Code
permits.
Equitable may agree, if requested, to maintain records with respect to
each source of Contributions. For example, a source may arise as
follows:
[(a) Salary Deferral Contributions: Contributions made
pursuant to an individual retirement annuity program in
accordance with the requirements of Section 408(b) of
the Code and applicable Treasury regulations;
(b) Rollover Contributions: Contributions which qualify
as eligible retirement plan rollovers within the meaning
of Section 402(c) of the Code and applicable Treasury
regulations.]
The Owner, or Employer if applicable, will determine and report each
Source to Equitable, in a form acceptable to Equitable, and will
specify as part of each withdrawal and transfer request the Source(s)
from which each individual or transfer is to be made.
No. 1050-94IC Page 24
<PAGE>
4. DEATH BENEFITS:
Under the following circumstances, the death benefit described in
Section 6.01 will not be paid at the Annuitant's death before the
Annuity Commencement Date, and the coverage under this Contract will
continue with the Annuitant's surviving spouse as Successor Annuitant
and Owner:
a. the Annuitant is married at death;
b. the person named as beneficiary under Section 6.02 is the
Annuitant's surviving spouse; and
c. the Annuitant has requested that the spouse become "Successor
Annuitant and Owner" of the Certificate if the spouse survives
the Annuitant.
5. REQUIRED DISTRIBUTIONS:
[The Annuitant's entire interest in the Certificate will be distributed
or begin to be distributed no later than the April 1 which follows the
calendar year in which the Annuitant attains age 70 1/2 ("Required
Beginning Date"). The entire interest may be distributed, as the
Annuitant elects, over (a) the Annuitant's life, or the lives of the
Annuitant and the named beneficiary, or (b) a period which does not
extend beyond the Annuitant's "life expectancy" (defined below), or the
joint and last survivor expectancy of the Annuitant and the named
beneficiary. Distributions must be made in periodic payments at
intervals no longer than one year. Also, payments must be either
non-increasing or they may increase only as provided in Regulations
(Q & A F-3 of Proposed Treasury Regulation Section 1.401(a)(9)-1 or
successor thereto).
All distributions made under the Certificate will be made in accordance
with the requirements of Code Sections [408(b) and 401(a)(9), including
the incidental death benefit requirement of the Code (Section
401(a)(9)(G)) and Treasury Regulations which apply (including minimum
distribution incidental benefit requirements of Proposed Treasury
Regulation Section 1.401(a)(9)-2) or any successor thereto.]
[For purposes of determining the "period certain" referred to in the
first paragraph of this item 5, life expectancy is computed by use of
the expected return multiples in Tables V and VI of Treasury Regulation
Section 1.72-9. Unless the Annuitant otherwise elects before the time
distributions are required to begin, life expectancies will be
recalculated annually. Such election will be irrevocable and will apply
to all subsequent years. In the case of any named beneficiary other
than the spouse, if permitted under Equitable's rules then in effect,
life expectancies may not be recalculated. Instead, life expectancy
will be calculated using the attained age of such beneficiary during
the calendar year in which the Annuitant attains age 70 1/2 and payment
for any subsequent calendar year will be calculated based on life
expectancy reduced by one for each calendar year which has elapsed
since the calendar year life expectancy was first calculated.]
No. 1050-94IC Page 25
<PAGE>
[If the Annuitant dies after distribution of the Annuitant's entire
interest has begun, the remainder of such interest will continue to be
distributed at least as rapidly as under the payment method of
distribution being used before the Annuitant's death.
If the Annuitant dies before distribution of the Annuitant's entire
interest begins, distribution of the Annuitant's entire interest will
be completed no later than December 31 of the calendar year in which
the fifth anniversary of the Annuitant's death occurs, except to the
extent that a choice is made to receive death benefit distributions
under (a) or (b) below:
(a) If the Annuitant's interest is payable to a beneficiary, then
the entire interest may be distributed over the life of, or
over a period certain not greater than the life expectancy of,
the named beneficiary. Such distributions must commence on or
before December 31 of the calendar year which follows the
calendar year of the Annuitant's death.
(b) If the named beneficiary is the Annuitant's surviving spouse,
the date that distributions must begin under (a) above will
not be earlier than the later of (i) December 31 of the
calendar year which follows the year of the Annuitant's death
or, (ii) December 31 of the calendar year in which the
Annuitant would have reached age 70 1/2.
If the designated beneficiary is the Annuitant's surviving
spouse, and a Successor Annuitant and Owner option (described
in item 4 preceding) is in effect, the distribution of the
Annuitant's interest need not be made until after the spouse's
death.
For purposes of the "period certain" used in (a) above, life expectancy
is computed by use of the expected return multiples in Tables V and VI
of Treasury Regulation Section 1.72-9. For purposes of distributions
which begin after the Annuitant's death, unless the surviving spouse
elects otherwise by the time distributions are required to begin, life
expectancies will be recalculated annually. Such election will be
irrevocable by such surviving spouse and will apply to all subsequent
years.
In the case of any other designated beneficiary, life expectancies will
be calculated using the attained age of such beneficiary during the
calendar year in which distributions are required to begin, pursuant to
this item, and payments for any subsequent calendar year will be
calculated based on such life expectancy reduced by one for each
calendar year which has elapsed since the calendar year life expectancy
was first calculated.
Distributions under this item are considered to have begun if
distributions are made because the Annuitant has reached the Required
Beginning Date or if, before the Required Beginning Date, distributions
irrevocably commence to the Annuitant over a period permitted and in an
annuity form acceptable under Proposed Treasury Regulation
1.401(a)(9)-1 or any successor thereto.]
No. 1050-94IC Page 26
<PAGE>
6. REPORTS - NOTICES:
In addition to the reports described in Section 9.04, Equitable will
send the Annuitant a report as of the end of each calendar year showing
the status of the annuity and any other reports required by the Code or
Treasury regulations.
7. ASSIGNMENTS, NONTRANSFERABILITY, NONFORFEITABILITY:
The Owner's rights may not be assigned, pledged, or otherwise
transferred except as permitted by law. The Owner may not name a new
Owner, except as described in item 4 above. The interest under the
Certificate is nonforfeitable.
8. TERMINATION:
In the event that an annuity bought under the Contract fails to qualify
as an annuity under Section [408(b)] of the Code, Equitable will have
the right, upon receipt of notice of such fact, before the Annuity
Commencement Date, to terminate the Certificate. In that case,
Equitable will pay the Annuity Account Value less a deduction for the
part which applies to any Federal income tax payable by the Annuitant
which would not have been payable with respect to an annuity which
meets the terms of the Code.
No. 1050-94IC Page 27
<PAGE>
APPENDIX B
----------
APPLICABLE TO NON-QUALIFIED CERTIFICATES
1. CONTRIBUTIONS:
Equitable has the right not to accept a Contribution less than the
amount(s) shown in the Certificate.
2. OWNER DEATH DISTRIBUTION RULES:
Upon the death of an Owner before the Annuity Commencement Date:
(a) If the Owner is both the Owner and the Annuitant,
Equitable will pay the death benefit described in
Section 6.01. Any part of a death benefit payable as
described in Section 6.01 for which there is no named
beneficiary living at the Owner's death will be
payable in a single sum to the Owner's children who
survive the Owner in equal shares, or should none
survive, then to the Owner's estate.
Under the following circumstances, the death benefit
described in Section 6.01 will not be paid at the
Owner's death before the Annuity Commencement Date,
and the coverage under the Contract will continue
with the Owner's surviving spouse as Successor
Annuitant and Owner:
(i) the Owner is married at his or her death;
(ii) the person named as the beneficiary who is
to receive any death benefit payable on the
Owner's death under Section 6.02 is the
surviving spouse; and
(iii) the Owner has additionally requested that
the spouse become "Successor Annuitant and
Owner" of the Certificate if such spouse
survives the Owner.
(b) If the Owner is not the Annuitant, the named
beneficiary (successor Owner) will succeed as Owner.
The entire amount in the Investment Options subject
to any Withdrawal Charge which applies must be fully
paid by the fifth anniversary of the Owner's death,
or payments must begin within one year after the
Owner's death as a life annuity or installment
option, for a period of not longer than the life
expectancy of the named beneficiary. If the Owner has
not elected a form of payment as described in the
next to last paragraph of Section 6.02, and if the
beneficiary named under Section 6.02 does not elect
to receive the payments required by this Section in a
form of Annuity Benefit, a series of partial
withdrawals, or any payout option acceptable under
Section [72(s)] of the Code and Equitable's rules at
the time, Equitable
No. 1050-94IC Page 28
<PAGE>
will pay the amount in the Options in a single sum to
the beneficiary on the fifth anniversary of the
Owner's death. Subject to Equitable's rules at the
time of payment and the completion of an application,
the beneficiary may elect to apply such a single sum
payment to a new non qualified annuity contract to be
owned by the beneficiary. However, if the named
beneficiary is the Owner's spouse, full payments of
amounts under this Contract must be made not later
than five years after the spouse's death.
If payments under an Annuity Benefit had begun before
the Owner's death, such payments will continue to be
made over a period not longer than the period
provided for under the Annuity Benefit elected.
If the Annuitant dies before the entire amount in the
Investment Options is paid, Equitable will pay the
death benefit as described in Section 6.01.
(c) Unless the Owner directs otherwise, the named
beneficiary will also be the person who succeeds as
Owner on the Owner's death while the Annuitant is
alive as described in Section 6.02. The Owner may
change any beneficiary or successor Owner from time
to time during the Annuitant's lifetime and while
coverage under this Contract is in force, also as
described in item (b) above.
(d) If the Owner is not the Annuitant, the Owner may name
another person to be the successor Owner and to
receive the amounts to be paid under item (b) above
and another person to be successor Owner if the first
choice as successor Owner dies before the Owner. If
the Owner has named two or more persons as successor
Owner, and more than one survive, they will share
equally unless the Owner directs otherwise. If no
person named as beneficiary to receive the death
benefit survives the Annuitant, Equitable will pay
such death benefit in a single sum to the Owner. In
the event of the Owner's death after the Annuitant,
but before Equitable pays such death benefit, the
death benefit will be payable in a single sum to the
children who survive the Owner, in equal shares, or
should none survive, to the Owner's estate.
If the Owner dies before the Annuity Commencement
Date while the Annuitant is still living, and if no
person named as successor Owner is living at the
Owner's death, the beneficiary will be presumed to
be, in this order, (i) the Owner's surviving spouse,
(ii) the Annuitant, (iii) the children who survive
the Owner, in equal shares, or (iv) the Owner's
estate.
3. ASSIGNMENTS:
Notwithstanding the terms of Section 9.05, the Owner may assign the
Certificate and the rights described therein before the Annuity
Commencement Date. Equitable will not be bound by an assignment unless
Equitable has received it and
No. 1050-94IC Page 29
<PAGE>
it is in writing. The Owner's rights and those of any other persons
referred to in the Certificate will be subject to the assignment.
Equitable assumes no responsibility for the validity of any assignment.
No. 1050-94IC Page 30
<PAGE>
APPENDIX C
----------
MARKET VALUE ADJUSTMENT PROVISIONS
The terms of this Appendix will become operative only upon advance notice from
Equitable to the Contract Holder and to each Owner affected by such terms. If
this Appendix becomes operative, the terms herein will be included in each
Certificate issued thereafter.
THE TERMS OF THIS APPENDIX CONTAIN A MARKET VALUE ADJUSTMENT ("MVA") FORMULA
WHICH MAY RESULT IN ADJUSTMENTS, POSITIVE OR NEGATIVE, IN BENEFITS. AN MVA WILL
NOT APPLY UPON TRANSFER TO A NEW GUARANTEE PERIOD OR OTHER INVESTMENT OPTION ON
THE EXPIRATION DATE OR PURSUANT TO ITEM 1 BELOW.
1. GUARANTEED PERIOD ACCOUNT
Under the terms of this Appendix, Equitable will specify one or more
Guarantee Periods in the Guaranteed Period Account. For each such
Guarantee Period, Equitable guarantees to credit an interest rate
(called the "Guaranteed Rate"). Interest will be credited daily to
amounts in the Guaranteed Period Account. The duration of each
Guarantee Period provided at any time and the Guaranteed Rate that
applies to each Period will be furnished by Equitable upon request. The
Guarantee Period(s) and the Rate for each such Period the Owner
initially elects are shown in the Certificate.
One or more Guarantee Period(s) may be elected by the Owner, according
to Equitable's rules then in effect. Contributions and transfers to be
made to the Guaranteed Period Account pursuant to Section 3.01 will be
allocated to the Guarantee Period(s) according to the Owner's election.
Contributions and transfers into the Guaranteed Period Account will
receive the Guaranteed Rate applicable to the elected Guarantee Period
as of the Business Day Equitable receives such Contribution or transfer
request at the Processing Office. The amount held with respect to a
given Guarantee Period is referred to as the Guaranteed Period Amount
which reflects Contributions and transfers made to the Guaranteed
Period Account, plus interest at the Guaranteed Rate(s), minus any
withdrawals, transfers and charges, if any, deducted from the
Guaranteed Period Account.
The last day of a Guarantee Period is the Expiration Date. Equitable
will notify the Owner at least [15 but not more 45] days before the
Expiration Date of each Period. The Owner may elect one of the
following three options effective at the Expiration Date, none of which
will result in a market value adjustment:
a) to transfer the Guaranteed Period Amount into a Guarantee
Period of any duration which Equitable then offers;
b) to transfer the Guarantee Period Amount to another
Investment Option;
No. 1050-94IC Page 31
<PAGE>
c) to make a withdrawal of the Guaranteed Period Amount (subject to
any Withdrawal Charges which apply pursuant to section 8.01).
If no such election is made on or prior to the Expiration Date, the
Guaranteed Period Amount (without any market value adjustment) will be
transferred into the Investment Option described in the Certificate.
During the 30 days following the Expiration Date, the full Guaranteed
Period Amount (less any withdrawals and transfers made or charges
deducted during that 30 day period) may be transferred into a new
Guarantee Period or other Investment Option. In no event can the Owner
elect a Guarantee Period which extends beyond the Annuity Commencement
Date.
The "Guaranteed Period Account" is Equitable's Separate Account No. 46
that Equitable uses to account for amounts allocated to Guarantee
Periods under the Contract. All amounts allocated to a Guarantee
Period, whether Contributions or transfers, become part of the
Guaranteed Period Account.
2. TRANSFERS, WITHDRAWALS, DEATH AND ANNUITY BENEFITS
If the Owner requests, other than as described in item 1 above, a
transfer to another Investment Option pursuant to Section 4.01 or a
withdrawal pursuant to Section 5.01, any such transfer or withdrawal
from a Guaranteed Period Amount will be subject to a market value
adjustment described below. For this purpose, the Annuity Account Value
in Separate Account No. 46 will be after the market value adjustment.
The market value adjustment will be in addition to any other charges
which apply pursuant to Section 8.01.
In addition, amounts applied from a Guaranteed Period Amount to provide
a death benefit pursuant to Section 6.01, an annuity pursuant to
Section 7.02 or any other annuity form offered by Equitable, will be
subject to a market value adjustment, unless otherwise specified in the
Certificate.
Payment or transfers from a Guaranteed Period Amount may be deferred
for up to six months while the Owner is living.
3. MARKET VALUE ADJUSTMENT
The market value adjustment with respect to each Guarantee Period that
applies to a Certificate Owner is determined as follows:
(a) Equitable determines the Guaranteed Period Amount that will be
payable on the Expiration Date, using the Guaranteed Rate for
such Guarantee Period.
(b) Equitable determines the period remaining in the Guarantee
Period (based on the Business Day Equitable received the Owner's
transaction request at the Processing Office) and converts it to
fractional years based on a 365 day year. For example, three
years and 12 days, becomes 3.0329.
No. 1050-94IC Page 32
<PAGE>
(c) Equitable determines the current Guaranteed Rate which applies
to new Contributions for the same class of Certificates under a
Guarantee Period with the same Expiration Date as the Owner's
Guarantee Period. Equitable adds to such current rate a
percentage which is no greater than that shown in the
Certificate.
(d) Equitable determines the present value of the Guaranteed Period
Amount payable at the Expiration Date, using the period
determined in (b) and the rate determined in (c).
(e) Equitable subtracts the current Guaranteed Period Amount from
the result in (d). The result is the Market Value Adjustment,
which may be positive or negative, applicable to such Guarantee
Period.
If Equitable is not offering a Guarantee Period to which the "current
Guaranteed Rate" would apply, Equitable will use the Rate at the
closest Expiration Date. If Equitable is no longer offering new
Guarantee Periods, Equitable will use a procedure for determining such
current Rate which will be stated in the Certificate or which Equitable
will develop and file with the insurance supervisory official of the
appropriate jurisdiction.
4. REPORTS AND NOTICES
Equitable will report the values under this Appendix with the reports
sent out as described in Section 9.04. It will include the Guaranteed
Period Amount, market value adjustment, and Annuity Account Value in
Separate Account No. 46.
No. 1050-94IC Page 33
<PAGE>
APPENDIX D
----------
APPLICABLE TO LIFE CONTINGENT ANNUITY
DESCRIBED HEREIN
The terms of this Appendix apply, notwithstanding any terms to the contrary
contained in the Contract and Certificate, if the Owner has elected the Life
Contingent Annuity described herein.
Under the terms of this Appendix, Equitable provides this Annuity Benefit in
consideration of the purchase payment(s) made. The effective date of this
Endorsement is the date Equitable receives the initial purchase payment.
Equitable pays an Annuity Benefit during the lifetime of the Annuitant(s). The
Annuity Benefit ends upon the death of the Annuitant(s). IF THE DEATH OF THE
ANNUITANT(S) OCCURS BEFORE THE FIRST ANNUITY BENEFIT PAYMENT IS DUE, EQUITABLE
WILL NOT MAKE ANY PAYMENTS NOR WILL EQUITABLE REFUND ANY PURCHASE PAYMENT. THE
TERMS HEREIN DO NOT CREATE A CASH VALUE BENEFIT.
1. ANNUITANT(S)
The Annuitant is named in the Certificate. If this Annuity Benefit is
purchased on a survivorship basis as described below, then more than
one Annuitant may be named.
2. PURCHASE PAYMENTS
Purchase payments may be made on a flexible basis; the amount,
frequency and other conditions are shown in the Certificate. Purchase
payments may be paid by check, withdrawn from the Annuity Account Value
under the Certificate or from another Equitable contract that the Owner
owns. No purchase payments may be paid after the Initial Benefit
Payment Date. Purchase payments do not create a cash value under the
Certificate.
Each purchase payment (less any charges shown in the Data pages) will
provide a guaranteed amount of annuity which, when added to all other
guaranteed amounts of annuity so purchased with respect to the
Annuitant, equals the guaranteed Annuity Benefit to be provided under
the terms of this Appendix.
3. ANNUITY BENEFIT PAYMENTS
Annuity Benefit payments under the Life Contingent Annuity begin at the
Initial Benefit Payment Date stated in the Certificate and continue (a)
for the lifetime of the Annuitant or (b) if the Annuity Benefit is
purchased on a survivorship basis as elected by the Owner, for as long
as at least one of the Annuitants named in the
No. 1050-94IC Page 34
<PAGE>
Certificate is living. The Annuity Benefit form elected by the Owner at
issue will be set forth in the Certificate. The form of the Annuity
Benefit may not be changed.
Annuity Benefit payments will be made as set forth in the Certificate.
They may be made monthly, quarterly or annually. If Equitable does not
receive written notice from the Owner, the payments will be made
annually. Equitable reserves the right to change the frequency to meet
its minimum payment rules, as described in the Certificate.
4. AMOUNT OF ANNUITY BENEFIT
Guaranteed Annuity Benefit payments will be based on [4% interest and
the 1983 "a" Individual Annuity Mortality table, projected with
modified Scale "G"]. The schedule in the Certificate shows the
guaranteed purchase rates for the Initial Benefit Payment Date
selected. Before the Initial Benefit Payment Date, Equitable will
report annually the amount of payments to be provided at such Date. In
addition, Equitable may from time to time increase the amount of the
Annuity Benefit payments based on changes in its expectations as to
future mortality and interest. Any such increase will be made on a
uniform and non-discriminatory basis.
5. INITIAL BENEFIT PAYMENT DATE
The Owner may elect to change the Initial Benefit Payment Date subject
to conditions shown in the Certificate. The Annuity Benefit will be
determined by applying the present value of Annuity Benefits as of the
prior Initial Benefit Payment Date using the guaranteed mortality and
interest (see item 4). If the Owner wishes to change such Date, the
Owner must do so with at least 30 days advance notice to Equitable. The
Owner must do this in writing. The change will not take effect until
written election is received and accepted by Equitable at its
Processing Office.
If this Appendix applies in connection with an IRA Certificate, the
recalculation of life expectancies as described in item 5, the third
paragraph, of Appendix A will apply in determining the required
distributions.
6. TRANSFERS/WITHDRAWALS
This Appendix provides no Annuity Account Value. No transfers or
withdrawals, described in Parts IV and V of the Certificate, will apply
to purchase payments made under this Appendix.
7. DEATH BENEFITS
Payments will continue as long as an Annuitant survives. There will be
no death benefits payable to any beneficiary under this Appendix.
No. 1050-94IC Page 35
<PAGE>
If the death of the Annuitant(s) occurs before the due date of the
first Annuity Benefit payment, Equitable will not make any payments
under the Annuity Benefit nor will Equitable refund any part of the
purchase payments paid for it.
8. ASSIGNMENT
This Annuity may not be sold, assigned, discounted or pledged as
collateral for a loan or as security for the performance of an
obligation or for any other purpose, and except as otherwise permitted
by law, no sum payable under this Annuity may be transferred, assigned
or encumbered, or will in any way be subject to any legal process to
subject the same to the payment of any claim against the person to whom
any sum is payable.
9. PAYMENT
All payments by Equitable under this Annuity will be made by check (in
United States dollars) and will be payable at the Processing Office.
10. CONDITIONS
Equitable may require proof acceptable to it that the person(s) on
whose life the Annuity Benefit payment is based is alive when each
payment is due. Equitable will require proof of the age of any such
person.
If the Annuity Benefit was based on information that is later found not
to be correct, such Benefit will be adjusted on the basis of the
correct information. The adjustment will be made in the amount of the
Annuity Benefit payments, or any amount used to provide the Annuity
Benefit, or any combination. Overpayments by Equitable will be charged
against future payments. Underpayments will be added to future
payments. Equitable's liability is limited to the correct information
and the actual amounts used to provide the Annuity Benefit.
If the age or sex of any person upon whose life the Annuity Benefit
depends has been misstated, the Annuity Benefit payments will be those
which would have been purchased at the correct age or sex. Any
overpayments or underpayments made by Equitable will be charged or
credited with interest at the rate shown in the Certificate; Equitable
will choose which rate will apply on a uniform basis for like
Certificates. Such interest will be deducted from or added to future
payments.
11. STATUTORY COMPLIANCE
The benefits under this Appendix have been determined without regard to
other benefits provided under the Certificate. They will not be less
than the minimum benefits required by any applicable state law.
No. 1050-94IC Page 36
CERTIFICATE
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
("Equitable")
Processing Office: [Individual Annuity Center, P.O. Box XXXX, G.P.O.
New York, New York, 10016]
This is the Certificate which is issued under the terms of the Contract defined
in Section 1.09. This Certificate is issued in return for the application for
coverage under the Contract and the Contributions to be made to us under the
Contract.
In this Certificate, "we", "our" and "us" mean Equitable. "You" and "your" mean
the Owner.
We will provide the benefits and other rights pursuant to the terms of this
Certificate.
[TEN DAYS TO CANCEL - Not later than ten days after you receive this
Certificate, you may return it to us. We will cancel it and refund any
Contribution made to us.]
NEW YORK,
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
<TABLE>
<S> <C> <C>
/s/ Joseph J. Melone /s/ James M. Benson /s/ Molly K. Heines
Chairman and Chief Executive Officer President and Chief Operating Officer Vice President and Secretary
</TABLE>
THE PORTION OF ANNUITY ACCOUNT VALUE HELD IN THE SEPARATE ACCOUNT MAY INCREASE
OR DECREASE IN VALUE (SEE PART II OF THIS CERTIFICATE).
No. 94ICA
[Cover Page "A"]
<PAGE>
CERTIFICATE
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
("Equitable")
Processing Office: [Individual Annuity Center, P.O. Box XXXX, G.P.O.
New York, New York, 10016]
This is the Certificate which is issued under the terms of the Contract defined
in Section 1.09. This Certificate is issued in return for the application for
coverage under the Contract and the Contributions to be made to us under the
Contract.
In this Certificate, "we", "our" and "us" mean Equitable. "You" and "your" mean
the Owner.
We will provide the benefits and other rights pursuant to the terms of this
Certificate.
[TEN DAYS TO CANCEL - Not later than ten days after you receive this
Certificate, you may return it to us. We will cancel it and refund any
Contribution made to us, plus or minus any investment gain or loss which applies
to the Investment Funds of the Separate Account from the date such Contribution
was allocated to such Fund to the date of cancellation.]
NEW YORK,
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
<TABLE>
<S> <C> <C>
/s/ Joseph J. Melone /s/ James M. Benson /s/ Molly K. Heines
Chairman and Chief Executive Officer President and Chief Operating Officer Vice President and Secretary
</TABLE>
THE PORTION OF ANNUITY ACCOUNT VALUE HELD IN THE SEPARATE ACCOUNT MAY INCREASE
OR DECREASE IN VALUE (SEE PART II OF THIS CERTIFICATE).
No. 94ICB
[Cover Page "B"]
<PAGE>
TABLE OF CONTENTS
Page
----
Part I - DEFINITIONS 3
Part II - INVESTMENT OPTIONS 6
Part III - CONTRIBUTIONS AND ALLOCATIONS 10
Part IV - TRANSFERS AMONG INVESTMENT OPTIONS 11
Part V - WITHDRAWALS AND TERMINATION 12
Part VI - DEATH BENEFITS 13
Part VII - ANNUITY BENEFITS 14
Part VIII - CHARGES 17
Part IX - GENERAL PROVISIONS 19
TABLE OF GUARANTEED ANNUITY PAYMENTS 21
DATA
No. 94ICA/B Page 2
<PAGE>
PART I - DEFINITIONS
SECTION 1.01 [ANNUITANT]
["Annuitant"] means the individual shown as such in the Data pages, or any
successor [Annuitant].
SECTION 1.02 ANNUITY ACCOUNT VALUE
"Annuity Account Value" means the sum of the amounts held for you in the
Investment Options.
SECTION 1.03 ANNUITY BENEFIT
"Annuity Benefit" means a benefit payable by us as described in Part VII.
SECTION 1.04 ANNUITY COMMENCEMENT DATE
"Annuity Commencement Date" means the date on which annuity payments are to
commence as described in Section 7.03. Such date is the date shown in the Data
pages and is subject to change as described in Section 7.03.
SECTION 1.05 BUSINESS DAY
A "Business Day" is any day on which we are open and the New York Stock Exchange
is open for trading, or any other day specified in the Data pages. Our Business
Day ends at 4:00 p.m., Eastern time, or such other time as we state in writing
to you.
SECTION 1.06 CASH VALUE
"Cash Value" means an amount equal to the Annuity Account Value, less any
charges that apply as described in Part VIII and any charges that may apply as
described in any applicable Endorsement(s).
SECTION 1.07 CERTIFICATE
"Certificate" means this certificate including the Data pages and any
endorsement(s). It is a summary of the Contract terms which affect you.
SECTION 1.08 CODE
"Code" means the Internal Revenue Code of [1986], as amended at any time, or any
corresponding provisions of prior or subsequent United States revenue laws.
SECTION 1.09 CONTRACT
"Contract" means the Group Annuity Contract named in the Data pages. A copy of
the contract is on file with us. You may ask to see it at any reasonable time.
No. 94ICA/B Page 3
<PAGE>
SECTION 1.10 CONTRACT DATE
"Contract Date" means the earlier of (a) the date on which the [Annuitant] is
enrolled under the Contract according to our enrollment procedures and (b) the
date of enrollment under a prior Contract. Such date is shown in the Data pages.
SECTION 1.11 CONTRACT YEAR
"Contract Year" means the twelve month period starting on (i) the Contract Date
and (ii) each anniversary of the Contract Date, unless we agree to another
period.
SECTION 1.12 CONTRIBUTION
"Contribution" means a payment made to us under the Contract. See Section 3.01.
SECTION 1.13 EMPLOYER
"Employer" means, if applicable, an employer as defined in an endorsement
hereto.
SECTION 1.14 GUARANTEED INTEREST RATE
"Guaranteed Interest Rate" means the effective annual rate(s) at which interest
accrues on amounts in the [Guaranteed Interest Account].
SECTION 1.15 INVESTMENT FUND
"Investment Fund" means a sub-fund of a Separate Account. An Investment Fund may
invest its assets in a separate class (or series) or shares of a specified trust
or investment company where each class (or series) represents a separate
portfolio in such trust or investment company.
SECTION 1.16 INVESTMENT OPTION
"Investment Option" means the [Guaranteed Interest Account], a Separate Account,
or an Investment Fund of a Separate Account [or each Guarantee Period in the
Guaranteed Period Account (Separate Account No. 46)].
SECTION 1.17 OWNER
"Owner" means the person or entity shown as such in the Data pages, or any
successor owner.
SECTION 1.18 PLAN
"Plan" means, if applicable, the annuity program sponsored by the Employer and
as may be defined in an endorsement hereto.
SECTION 1.19 PRIOR CONTRACT
"Prior Contract" means another contract or certificate issued by us and from
which the Owner and we have agreed to transfer amounts to this Contract.
No. 94ICA/B Page 4
<PAGE>
SECTION 1.20 PROCESSING DATE
"Processing Date" means the day(s) we deduct charges from the Annuity Account
Value. The Data pages show how often a Processing Date will occur.
SECTION 1.21 PROCESSING OFFICE
"Processing Office" means the Equitable administrative office shown on the cover
page of this Certificate, or such other location we may state upon written
notice to you.
SECTION 1.22 SEPARATE ACCOUNT
"Separate Account" means any of the Separate Accounts [(except our Separate
Account No. 46)] described or referred to in Sections 2.02 and 2.05.
SECTION 1.23 TRANSACTION DATE
The Transaction Date is the Business Day we receive at the Processing Office a
Contribution or a transaction request providing the information we need.
Transaction requests must be in a form acceptable to us.
No. 94ICA/B Page 5
<PAGE>
PART II - INVESTMENT OPTIONS
SECTION 2.01 [GUARANTEED INTEREST ACCOUNT]
Any amount held in the [Guaranteed Interest Account] becomes part of our general
assets, which support the guarantees of the Contract and other contracts.
The amount in such Account at any time is equal to:
o all amounts that have been allocated or transferred to such Account,
plus
o the amount of any interest credited, less
o all amounts that have been withdrawn (including charges) or
transferred from such Account.
We will credit the amount held in such Account with interest at effective annual
rates that we set. We will also set a minimum Guaranteed Interest Rate that will
remain in effect through a stated twelve-month period or a calendar year. The
Data pages show the initial Rate(s) to apply.
We guarantee that any rate so set after your Contract Date will never be less
than the minimum rate shown in the Data pages.
SECTION 2.02 SEPARATE ACCOUNT
We have established the Separate Account(s) and maintain such Account(s) in
accordance with the laws of New York State. Income, realized and unrealized
gains and losses from the assets of the Separate Account(s) are credited to or
charged against it without regard to our other income, gains or losses. Assets
are placed in the Separate Account(s) to support the Contract and other variable
annuity contracts and certificates. Assets may be placed in the Separate
Account(s) for other purposes, but not to support contracts or policies other
than variable annuities and variable life insurance.
The Data pages set forth the Separate Account(s). A Separate Account may be
subdivided into Investment Funds.
The assets of a Separate Account are our property. The portion of such assets
equal to the reserves and other contract liabilities will not be chargeable with
liabilities which arise out of any other business we conduct. We may transfer
assets of a Separate Account in excess of the reserves and other liabilities
with respect to such Account to another Separate Account or to our general
account.
We may, at our discretion, invest Separate Account assets in any investment
permitted by applicable law. We may rely conclusively on the opinion of counsel
(including counsel in our employ) as to what investments we may make as law
permits.
No. 94ICA/B Page 6
<PAGE>
SECTION 2.03 SEPARATE ACCOUNT ACCUMULATION UNITS AND UNIT VALUES
The amount you have in an Investment Fund at any time is equal to the number of
Accumulation Units you have in that Fund multiplied by the Fund's Accumulation
Unit Value at that time. "Accumulation Unit" means a unit which is purchased in
a Separate Account. "Accumulation Unit Value" means the dollar value of each
Accumulation unit in a Separate Account on a given date. (If Investment Funds
apply as described in Section 2.02, then the terms of this Section 2.03 apply
separately to each Fund, unless otherwise stated.)
Amounts allocated or transferred to a Separate Account are used to purchase
Accumulation Units of that Account. Units are redeemed when amounts are
deducted, transferred or withdrawn.
The number of Accumulation Units you have in a Separate Account at any time is
equal to the number of Accumulation Units purchased minus the number of Units
redeemed in that Account up to that time. The number of Accumulation Units
purchased or redeemed in a transaction is equal to the dollar amount of the
transaction divided by the Account's Accumulation Unit Value for that
Transaction Date.
We determine Accumulation Unit Values for each Separate Account for each
Valuation Period. A "Valuation Period" is each Business Day together with any
consecutive preceding non-business days. For example, for each Monday which is a
Business Day, the preceding Saturday and Sunday will be included to equal a
three-day Valuation Period.
Unless the following paragraph applies, the Accumulation Unit Value for a
Separate Account for any Valuation Period is equal to the Accumulation Unit
Value for the immediately preceding Valuation Period multiplied by the ratio of
values "(i) " and "(ii) ". Value "(i) " is the value of the Separate Account at
the close of business at the end of the current Valuation Period, before any
amounts are allocated to or withdrawn from the Separate Account in that Period.
Value "(ii)" is the value of the Separate Account at the close of business at
the end of the preceding Valuation Period, after all allocations and withdrawals
were made for that Period. For this purpose, "value of the Separate Account"
means the market value or, where there is no readily available market, the fair
value of the assets allocated to the Separate Account, as determined in
accordance with our rules, accepted accounting practices, and applicable laws
and regulations.
To the extent the Separate Account invests in Investment Funds, and the assets
of the Funds are invested in a class or series of shares of a specified trust or
investment company, the Accumulation Unit Value of an Investment Fund for any
Valuation Period is equal to the Accumulation Unit Value for that Fund on the
immediately preceding Valuation Period multiplied by the Net Investment Factor
for that Fund for the current Valuation Period. The Net Investment Factor for a
Valuation Period is (a) divided by (b) minus (c), where
(a) is the value of the Investment Fund's shares of the related
portfolio of the specified trust or investment company at the
end of the Valuation Period (before taking into account any
amounts allocated to or withdrawn from the Investment Fund for
the Valuation Period and after deduction of investment
advisory fees and direct operating expenses of the specified
trust or investment
No. 94ICA/B Page 7
<PAGE>
company; for this purpose, we use the share value reported to
us by the specified trust or investment company);
(b) is the value of the Investment Fund's shares of the related
portfolio of the specified trust or investment company at the
end of the preceding Valuation Period (taking into account any
amounts allocated or withdrawn for that Valuation Period);
(c) is the daily Separate Account charges (see Section 8.04) for
the expenses and risks of the Contract, times the number of
calendar days in the Valuation Period, plus any charge for
taxes or amounts set aside as a reserve for taxes.
SECTION 2.04 AVAILABILITY OF INVESTMENT OPTIONS
Section 3.01 describes how Contributions are allocated among Investment Options
based on your election. Your election is subject to the following:
(a) If the Contributions are made pursuant to the terms of a Plan,
then Investment Options available may be subject to the terms
of such Plan, as reported to us by the Owner.
(b) We have the right to limit the number of Options which you may
elect.
The Data pages list which Options are available as of the Contract Date.
SECTION 2.05 CHANGES WITH RESPECT TO SEPARATE ACCOUNT
In addition to the right reserved pursuant to subsection (b) of Section 2.04, we
have the right, subject to compliance with applicable law, including approval of
Certificate owners if required:
(a) to add Investment Funds (or sub-funds of Investment Funds) to,
or to remove Investment Funds (or sub-funds) from, the
Separate Account, or to add other separate accounts;
(b) to combine any two or more Investment Funds or sub-funds
thereof;
(c) to transfer the assets we determine to be the share of the
class of contracts to which the Contract belongs from any
Investment Fund to another Investment Fund;
(d) to operate the Separate Account or any Investment Fund as a
management investment company under the Investment Company Act
of 1940, in which case charges and expenses that otherwise
would be assessed against an underlying mutual fund would be
assessed against the Separate Account;
(e) to operate the Separate Account or any Investment Fund as a
unit investment trust under the Investment Company Act of
1940;
(f) to deregister the Separate Account under the Investment
Company Act of 1940, provided that such action conforms with
the requirements of applicable law;
No. 94ICA/B Page 8
<PAGE>
(g) to restrict or eliminate any voting rights as to the Separate
Account;
(h) to cause one or more Investment Funds to invest some or all of
their assets in one or more other trusts or investment
companies.
If the exercise of these rights results in a material change in the underlying
investment of a Separate Account, you will be notified of such exercise, as
required by law.
A Separate Account or Investment Fund which may be added by us as described
above may be one with respect to which (i) there may be periods during which
Contributions may be restricted pursuant to the maturity terms of such Account
or Fund, (ii) amounts therein may be automatically liquidated pursuant to the
investment policy of the Account, and (iii) investments therein may mature. We
will have the right to reallocate amounts arising from liquidation or maturity
according to your allocation instructions then in effect unless you specify
other instructions with respect to such amounts. If no such allocation
instructions have been made, the reallocation will be made to a designated
Investment Option, or to the next established Account or Fund of the same type
as described in this paragraph, if applicable, as specified in the Data pages.
No. 94ICA/B Page 9
<PAGE>
PART III - CONTRIBUTIONS AND ALLOCATIONS
SECTION 3.01 CONTRIBUTIONS, ALLOCATIONS
You elect which Investment Options will be available under the Certificate
subject to the terms of Section 2.04. Once this election is made, you may
allocate Contributions to, or transfer among, only these Options. You may add or
subtract Options by sending us a written request, but we have the right to
decline your request.
You also elect how to allocate Contributions among the Options chosen. If you
are not the Annuitant, you may delegate to the Annuitant authority to allocate
Contributions. You need not allocate Contributions to each Option you have
chosen. You may change the allocation election at any time by sending us the
proper form. Allocation percentages must be in whole numbers (no fractions) and
must equal 100%.
Each Contribution is allocated (after deduction of any charges that may apply)
in accordance with the allocation election in effect on the Transaction Date.
Contributions made to a Separate Account purchase Accumulation Units in that
Account, using the Accumulation Unit Value for that Transaction Date.
SECTION 3.02 LIMITS ON CONTRIBUTIONS
We have the right not to accept any Contribution which is less than the amount
shown in the Data pages. The Data pages indicate other minimum and maximum
Contribution requirements which may apply. We also have the right, upon advance
notice to you, to
(a) change such requirements to apply to Contributions made after
the date of such change, and
(b) discontinue acceptance of Contributions under the Contract
with respect to all Owners or with respect to all Owners to
whom the same type of Certificate applies.
No. 94ICA/B Page 10
<PAGE>
PART IV - TRANSFERS AMONG INVESTMENT OPTIONS
SECTION 4.01 TRANSFER REQUESTS
You may request to transfer all or part of the amount held in an Investment
Option to one or more of the other Options. The request must be in a form we
accept. All transfers will be made on the Transaction Date. Transfers are
subject to the terms of Section 4.02 and to our rules in effect at the time of
transfer. With respect to a Separate Account, the transfers will be made at the
Accumulation Unit Value for that Transaction Date.
SECTION 4.02 TRANSFER RULES
The transfer rules which apply are described in the Data pages. A transfer
request will not be accepted if it involves less than the minimum amount, if
any, stated in the Data pages (unless the Annuity Account Value is less than
such amount). We have the right to change our transfer rules. Any change will be
made upon advance notice to you.
The Investment Funds may consist of funds which are classified as "Type A"
Investment Options or "Type B" Investment Options or any other type which may be
specified in the Data pages, as we designate in our discretion for purposes of
the transfer rules described in the Data pages. The Data pages specify whether
such Investment Options are designated Type A or Type B or another type as well
as the minimum or maximum limits on transfers which apply.
No. 94ICA/B Page 11
<PAGE>
PART V - WITHDRAWALS AND TERMINATION
SECTION 5.01 WITHDRAWALS
Unless otherwise stated in the Data pages, you may request, pursuant to our
procedures then in effect, a withdrawal from the Investment Options before the
Annuity Commencement Date and while the [Annuitant] is alive. The request must
be in a form we accept.
On the Transaction Date, we will pay the amount of the withdrawal requested or,
if less, the Cash Value. The amount to be paid plus any Withdrawal Charge which
applies (see Section 8.01) will be withdrawn on a pro-rata basis from the
amounts held for you in the Investment Options, unless you elect otherwise and
unless otherwise stated in the Data pages.
We will not accept a withdrawal request if it involves less than the minimum
amount, if any, stated in the Data pages. Further conditions or restrictions may
apply if stated in the Data pages or in an endorsement hereto.
SECTION 5.02 TERMINATION
This Certificate will terminate if one or more of the following events occurs,
unless otherwise specified in the Data pages:
(a) If a withdrawal made under Section 5.01 would result in an Annuity
Account Value of an amount less than the minimum amount stated in the
Data pages, we will so advise you and have the right to pay you such
Value. In that case this Certificate will be terminated.
(b) Before the Annuity Commencement Date, we have the right to pay the Cash
Value and terminate this Certificate if no Contributions are made
during the last [three] completed Contract Years, and the Annuity
Account Value is less than the amount described in item (a) above.
(c) We also have the right to terminate this Certificate if no
Contributions have been made within 120 days of the Contract Date.
No. 94ICA/B Page 12
<PAGE>
PART VI - DEATH BENEFITS
SECTION 6.01 DEATH BENEFIT
Upon receipt of due proof that the [Annuitant] has died before the Annuity
Commencement Date, we will pay a death benefit to the beneficiary named under
Section 6.02. Payment may be subject to the terms of Section 6.02 and any
special rules which may apply as described in any endorsement hereto.
The amount of the death benefit is described in the Data pages.
The death benefit will be paid as an Annuity Benefit or in a single sum, as
described in Section 6.02.
SECTION 6.02 BENEFICIARY
You give us the name of the beneficiary who is to receive any death benefit
payable on the [Annuitant]'s death. You may change the beneficiary from time to
time during the [Annuitant]'s lifetime and while coverage under the Contract is
in force. Any such change must be made in writing in a form we accept. A change
will, upon receipt at the Processing Office, take effect as of the date the
written form is executed, whether or not you are living on the date of receipt.
We will not be liable as to any payments we made before we receive any such
change.
You may name one or more persons to be primary beneficiary on the [Annuitant]'s
death and one or more other persons to be successor beneficiary if the primary
beneficiary dies before the [Annuitant]. Unless you direct otherwise, if you
have named two or more persons as beneficiary, the beneficiary will be the named
person or persons who survive the [Annuitant] and payments will be made to such
persons in equal shares or to the survivor.
Any part of a death benefit payable as described in Section 6.01 for which there
is no named beneficiary living at the [Annuitant]'s death will be payable in a
single sum to the [Annuitant]'s surviving children. The payments will be made in
equal shares, or should none survive or should there be none, then to the
[Annuitant]'s estate.
If you so elect in writing, any amount that would otherwise be payable to a
beneficiary in a single sum may be applied to provide an Annuity Benefit, on the
form of annuity elected by you, subject to our rules then in effect. If at the
[Annuitant]'s death there is no election in effect, the beneficiary may make
such an election. In the absence of any election by either you or the
beneficiary, we will pay the death benefit in a single sum.
Any naming of a beneficiary is subject to the terms of the Plan, if one applies,
including any terms requiring spousal consent.
No. 94ICA/B Page 13
<PAGE>
PART VII ANNUITY BENEFITS
SECTION 7.01 ANNUITY BENEFIT
Payments under an Annuity Benefit will be made monthly. You may elect instead to
have the Annuity Benefit paid at other intervals, such as every three months,
six months, or twelve months, instead of monthly, subject to our rules at the
time of your election or as otherwise stated in the Data pages or any
endorsement hereto. This election may be made at the time the Annuity Benefit
form as described in Section 7.02 is elected. In that event, all references in
this Certificate to monthly payments will, with respect to the Annuity Benefit
to which the election applies, be deemed to mean payments at the frequency
elected.
SECTION 7.02 ELECTION OF ANNUITY BENEFITS
As of the Annuity Commencement Date, provided the [Annuitant] is then living,
the Annuity Account Value will be applied to provide the Normal Form of Annuity
Benefit (described below). However, you may instead elect (i) to have the Cash
Value paid in a single sum, (ii) to apply the Annuity Account Value or Cash
Value, whichever applies pursuant to the first paragraph of Section 7.05, to
provide an Annuity Benefit of any form offered by us or one of our subsidiary
life insurance companies , or (iii) to apply the Cash Value to provide any other
form of benefit payment we offer, subject to our rules then in effect and
applicable laws and regulations. At the time an Annuity Benefit is purchased, we
will issue a supplementary contract which reflects the Annuity Benefit terms.
We will provide notice and election forms to you not more than six months before
the Annuity Commencement Date.
We will have the right to require you to furnish any information we need to
provide an Annuity Benefit. We will be fully protected in relying on such
information and need not inquire as to its accuracy or completeness.
SECTION 7.03 COMMENCEMENT OF ANNUITY BENEFITS
Before the Annuity Commencement Date, you may elect to change such Date to any
date after your election is filed (other than the 29th, 30th, or 31st of any
month). You must do this in writing. The change will not take effect until your
written election is received and accepted by us at our Processing Office.
However, no Annuity Commencement Date will be later than the first day of the
month which follows the date the [Annuitant] attains the "maximum maturity age"
or, if later, the tenth anniversary of the Contract Date. The current maximum
maturity age is shown in the Data pages, but may be changed by us in conformance
with applicable law.
SECTION 7.04 ANNUITY BENEFIT FORMS
The "Normal Form" of Annuity Benefit is an Annuity Benefit payable on the
Life-Period Certain Annuity Form described below, unless another Form is to
apply pursuant to the terms of the Plan, if applicable, the requirements of the
Employee Retirement Income
No. 94ICA/B Page 14
<PAGE>
Security Act of 1974 (ERISA), as amended, or any other law that applies. The
Data pages will state the Normal Form which applies. We may offer other annuity
forms as available from us or from one of our affiliated or subsidiary life
insurance companies. Such a form may, for example, include the Joint and
Survivor Life Annuity Form which provides monthly payments while either of two
persons upon whose lives such payments depend is living. The monthly amount to
be continued when only one of the persons is living will be equal to a
percentage, as elected, of the monthly amount that was paid while both were
living.
The Life-Period Certain Annuity is an annuity payable during the lifetime of the
person upon whose life the payments depend, but with 10 years of payments
guaranteed (10 years certain period). That is, if the original payee dies before
the certain period has ended, payments will continue to the beneficiary named to
receive such payments for the balance of the certain period.
SECTION 7.05 AMOUNT OF ANNUITY BENEFITS
If you elect pursuant to Section 7.02 to have an Annuity Benefit paid in lieu of
the Cash Value, the amount applied to provide the Annuity Benefit will, unless
otherwise stated in the Data pages or required by applicable laws or
regulations, be (i) the Annuity Account Value if the annuity form elected
provides payments for a person's remaining lifetime or (ii) the Cash Value if
the annuity form elected does not provide such lifetime payments.
The amount applied to provide an Annuity Benefit may be reduced by a charge for
any taxes which apply on annuity purchase payments. If we have previously
deducted charges for taxes from Contributions, we will not again deduct charges
for the same taxes before an Annuity Benefit is provided. The balance will be
used to purchase the Annuity Benefit on the basis of either (i) the Tables of
Guaranteed Annuity Payments or (ii) our then current individual annuity rates,
whichever rates would provide a larger benefit with respect to the payee.
SECTION 7.06 CONDITIONS
We may require proof acceptable to us that the person on whose life a benefit
payment is based is alive when each payment is due. We will require proof of the
age of any such person on whose life an Annuity Benefit is based.
If a benefit was based on information that is later found not to be correct,
such benefit will be adjusted on the basis of the correct information. The
adjustment will be made in the number or amount of the benefit payments, or any
amount used to provide the benefit, or any combination. Overpayments by us will
be charged against future payments. Underpayments will be added to future
payments. Our liability is limited to the correct information and the actual
amounts used to provide the benefits.
If the age (or sex, if applicable as stated in the Tables of Guaranteed Annuity
Payments) of any person upon whose life an Annuity Benefit depends has been
misstated, any benefits will be those which would have been purchased at the
correct age (or sex). Any overpayments or underpayments made by us will be
charged or credited with interest at (a) the rate shown in the Data pages or (b)
the then current Guaranteed Interest Rate; we will choose which rate will apply
on a uniform basis for like Certificates. Such interest will be deducted from or
added to future payments.
No. 94ICA/B Page 15
<PAGE>
If we receive acceptable proof that (i) a payee entitled to receive any payment
under the terms of the Contract is physically or mentally incompetent to receive
such payment or a minor, (ii) another person or an institution is then
maintaining or has custody of such payee, and (iii) no guardian, committee, or
other representative of the estate of such payee has been appointed, we may make
the payments to such other person or institution. In the case of a minor, the
payments will not exceed [$200,] or such other amount as may be shown in the
Data pages. We will have no further liability with respect to the payments so
made.
If the amount to be applied hereunder is less than the minimum amount stated in
the Data pages, we may pay the amount to the payee in a single sum instead of
applying it under the annuity form elected.
SECTION 7.07 CHANGES
We have the right, upon advance notice to you, to change at any time after the
fifth anniversary of the Contract's register date and at intervals of not less
than five years, the actuarial basis used in the Tables of Guaranteed Annuity
Payments. However, no such change will apply to (a) any Annuity Benefit provided
before the change or (b) Contributions made before such change which are applied
to provide an Annuity Benefit.
No. 94ICA/B Page 16
<PAGE>
PART VIII - CHARGES
SECTION 8.01 WITHDRAWAL CHARGES
The amount of the Withdrawal Charge is stated in the Data pages. We have the
right to change the Charge shown in the Data pages with respect to future
Contributions, subject to any maximum stated in the Data pages. We will give you
notice of any change.
If specified in the Data pages, a "Free Corridor Amount" will apply as follows:
"Free Corridor Amount" means an amount equal to the percentage, stated in
the Data pages, of the Annuity Account Value, minus the total of all prior
withdrawals (and associated Withdrawal Charges) made as described in
Section 5.01 in the current Contract Year. We have the right to change the
Free Corridor Amount, but it will always be a percentage between [0% and
30%] if so provided in the Data pages.
If the amount of a withdrawal made under Part V is more than the Free
Corridor Amount (defined above), we will (a) first withdraw from the
Investment Options, on the basis described in Section 5.01, an amount
equal to the Free Corridor Amount, and (b) then withdraw from the
Investment Options an amount equal to the excess of the amount requested
over the Free Corridor Amount, plus a Withdrawal Charge if one applies.
For purposes of this Section, amounts withdrawn up to the Free Corridor
Amount will not be deemed a withdrawal of any Contributions. We have the
right to carry forward the Free Corridor Amount into a future Contract
Year, if not used in any Year, if so stated in the Data pages.
Any withdrawals in excess of the Free Corridor Amount will be deemed
withdrawals of Contributions in the reverse order in which they were made.
That is, contributions will be withdrawn on a last-in, first-out basis
unless the Data pages state that a first-in, first-out basis will apply.
In addition, the [Annuitant]'s years of participation under the Prior Contract,
if applicable, will be included for purposes of determining the Withdrawal
Charge, if so specified in the Data pages in accordance with our rules then in
effect.
If specified in the Data pages we have the right to reduce or waive the
Withdrawal Charge upon such events as stated in the Data pages. Moreover, the
Withdrawal Charge will be reduced if needed in order to comply with any
applicable state or federal law.
SECTION 8.02 ADMINISTRATIVE AND OTHER CHARGES DEDUCTED FROM ANNUITY ACCOUNT
VALUE
As of each Processing Date, we will deduct Administrative Charges or other
Charges related to the administration and/or distribution of this Certificate
from the Annuity Account Value. Such Charges are shown in the Data pages.
No. 94ICA/B Page 17
<PAGE>
If specified in the Data pages, the Charges will be deducted in full or prorated
for the Contract Year, or portion thereof, in which the Contract Date occurs or
in which the Annuity Account Value is withdrawn or applied to provide an Annuity
Benefit or death benefit. If so, the Charges will be deducted when withdrawn or
so applied.
The amount of any such Charge will in no event exceed any maximum amount shown
in the Data pages, subject to any maximum amount permitted under any applicable
law.
We have the right to change the amount of the Charges with respect to future
Contributions. We will give you advance notice of any such change.
SECTION 8.03 TRANSFER CHARGES
We have the right to impose a charge with respect to any transfer among
Investment Options after the number of free transfers, shown in the Data pages,
made on behalf of an [Annuitant]. The amount of such charge will be set forth in
a notice from us to you and will in no event exceed any maximum amount stated in
the Data pages.
SECTION 8.04 DAILY SEPARATE ACCOUNT CHARGE
Assets of the Investment Funds will be subject to a daily asset charge. This
daily asset charge is for mortality risk, expenses and expense risk that we
assume, as well as for financial accounting and death benefits if specified in
the Data pages. The charge will be made pursuant to item (c) of "Net Investment
Factor" as defined in Section 2.03. Such charge will be applied after any
deductions to provide for taxes. It will be at a rate not to exceed the maximum
annual rate stated in the Data pages. We have the right to charge less on a
current basis; the actual charge to apply, for at least the first Contract Year,
is also stated in the Data pages.
SECTION 8.05 CHANGES
In addition to our right to reduce or waive charges as described in this Part
VIII, we have the right, upon advance notice to you, to increase the amount of
any charge stated in the Data pages, subject to (a) any maximum amount provided
in this Part VIII or the Data pages and (b) with respect to Withdrawal Charges
and Administrative or Other Charges deducted from the Annuity Account Value, the
application of any increase only to Contributions made after the date of the
change.
No. 94ICA/B Page 18
<PAGE>
PART IX - GENERAL PROVISIONS
SECTION 9.01 CONTRACT
The Contract is the entire contract between the parties. It will govern with
respect to our rights and obligations.
The Contract may not be changed, nor may any of our rights or rules be waived,
except in writing and by our authorized officer. In addition to the rights of
change reserved by us as provided in this Certificate, the Contract may be
changed by amendment or replacement upon agreement between the Contract Holder
and us without the consent of any other person provided that any such change
does not reduce any Annuity Benefit provided before such change and provided
that no rights, privileges or benefits under the Contract and this Certificate
with respect to Contributions made hereunder prior to the effective date of such
change may be adversely affected by an amendment without the consent of the
Contract Holder and each Certificate Owner.
SECTION 9.02 STATUTORY COMPLIANCE
We have the right to change the Contract without the consent of any other person
in order to comply with any laws and regulations that apply. Such right will
include, but not be limited to, the right to conform the Contract to reflect
changes in the Code, in Treasury regulations or published rulings of the
Internal Revenue Service, ERISA, and in Department of Labor regulations.
The benefits and values available under the Contract will not be less than the
minimum benefits required by any state law that applies.
SECTION 9.03 DEFERMENT
The use of proceeds to provide a payment of a death benefit and payment of any
portion of the Annuity Account Value (less any Withdrawal Charge that applies)
will be made within seven days after the Transaction Date. Payments or use of
proceeds from the Investment Funds can be deferred for any period during which
(1) the New York Stock Exchange is closed or trading is restricted, (2) sales of
securities or determination of the fair value of an Investment Fund's assets is
not reasonably practicable because of an emergency, or (3) the Securities and
Exchange Commission, by order, permits us to defer payment in order to protect
persons with interests in the Investment Funds. We can defer payment or transfer
of any portion of the Annuity Account Value in the [Guaranteed Interest Account]
for up to six months while you are living.
SECTION 9.04 REPORTS AND NOTICES
At least once each year until the Annuity Commencement Date, we will send you a
report showing:
(a) the dollar amount in the [Guaranteed Interest Account];
(b) the total number of Accumulation Units in each Separate Account
or Investment Fund;
No. 94ICA/B Page 19
<PAGE>
(c) the Accumulation Unit Value;
(d) the dollar amount in each Separate Account or Investment Fund;
(e) the Cash Value; and
(f) the amount of the death benefit.
The terms which require us to send you a report as described above or any
written notice as described in any other Section will be satisfied by our
mailing any such report or notice to your last known address as shown in our
records.
All written notices sent to us will not be effective until received at the
Processing Office. Your Certificate Number should be included in all
correspondence.
SECTION 9.05 ASSIGNMENTS, NONTRANSFERABILITY, NONFORFEITABILITY
No amounts payable under the Contract to a payee other than you may be assigned
by that payee unless permitted herein, nor will they be subject to the claims of
creditors or to legal process, except to the extent permitted by law. Other
restrictions may apply if stated in any endorsement hereto.
SECTION 9.06 MANNER OF PAYMENT
We will pay all amounts hereunder by check (in United States dollars) or, if so
agreed by you and us, by wire transfer. All amounts payable by you must be paid
by check payable to us (in United States dollars) or by any other method
acceptable to us.
No. 94ICA/B Page 20
<PAGE>
TABLE OF GUARANTEED ANNUITY PAYMENTS
[APPLICABLE TO IRA CERTIFICATES]
[AMOUNT OF ANNUITY BENEFIT PAYABLE MONTHLY ON THE JOINT AND SURVIVOR LIFE
ANNUITY FORM (WITH 100% OF THE AMOUNT OF THE ANNUITANT'S PAYMENT CONTINUED TO
THE ANNUITANT'S SPOUSE) PROVIDED BY AN APPLICATION OF $1,000.
FEMALE AGES
<TABLE>
<CAPTION>
AGE 60 61 62 63 64 65 66 67 68 69 70
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 3.39 3.42 3.46 3.49 3.52 3.55 3.58 3.61 3.64 3.67 3.70
61 3.41 3.45 3.48 3.51 3.55 3.58 3.61 3.64 3.68 3.71 3.74
62 3.43 3.47 3.50 3.54 3.57 3.61 3.64 3.68 3.71 3.74 3.78
63 3.45 3.49 3.52 3.56 3.60 3.63 3.67 3.71 3.74 3.78 3.82
MALE 64 3.47 3.51 3.54 3.58 3.62 3.66 3.70 3.74 3.78 3.82 3.86
AGES 65 3.48 3.52 3.56 3.61 3.65 3.69 3.73 3.77 3.81 3.85 3.89
66 3.50 3.54 3.58 3.63 3.67 3.71 3.76 3.80 3.84 3.89 3.93
67 3.52 3.56 3.60 3.65 3.69 3.74 3.78 3.83 3.88 3.92 3.97
68 3.53 3.57 3.62 3.67 3.71 3.76 3.81 3.86 3.91 3.96 4.00
69 3.54 3.59 3.64 3.69 3.73 3.78 3.83 3.88 3.94 3.99 4.04
70 3.56 3.60 3.65 3.70 3.75 3.81 3.86 3.91 3.96 4.02 4.07
</TABLE>
The amount of income provided under an Annuity Benefit payable on the Joint and
Survivor Life Annuity form is based on 2.5% interest and the 1983 Individual
Annuity Mortality Table "a" projected with modified Scale "G" .
Amounts required for ages or for annuity forms not shown in the above Table will
be calculated by us on the same actuarial basis.
If a variable annuity form is available from us and elected pursuant to Section
7.02, then the amounts required will be calculated by us based on the 1983
Individual Annuity Mortality Table "a" projected with modified Scale "G" and a
modified two year age setback and on an Assumed Base Rate of Net Investment
Return of 3.5%/5.0%.]
No. 94ICA/B Page 21
<PAGE>
TABLE OF GUARANTEED ANNUITY PAYMENTS
[APPLICABLE TO NON-QUALIFIED CERTIFICATES]
[AMOUNT OF ANNUITY BENEFIT PAYABLE MONTHLY ON THE LIFE ANNUITY FORM
WITH TEN YEARS CERTAIN PROVIDED BY APPLICATION OF $1,000.
Monthly Income Monthly Income
Ages Males Females Age Males Females
---- ----- ------- --- ----- -------
60 4.12 3.70 73 5.52 4.87
61 4.20 3.76 74 5.66 4.99
62 4.29 3.83 75 5.80 5.12
63 4.38 3.90 76 5.95 5.26
64 4.48 3.98 77 6.10 5.40
65 4.58 4.06 78 6.25 5.55
66 4.68 4.14 79 6.40 5.70
67 4.79 4.23 80 6.56 5.85
68 4.90 4.32 81 6.72 6.01
69 5.02 4.42 82 6.88 6.18
70 5.14 4.52 83 7.04 6.34
71 5.26 4.63 84 7.20 6.51
72 5.39 4.75 85 7.36 6.67
The amount of income provided under an Annuity Benefit payable on the Joint and
Survivor Life Annuity form is based on 2.5% interest and the 1983 Individual
Annuity Mortality Table "a" projected with modified Scale G, adjusted to a
unisex basis, reflecting a 20%-80% split of males and females at pivotal age 55.
Amounts required for ages not shown in the above Table or for other annuity
forms will be calculated by us on the same actuarial basis.
If a variable annuity form is available from us and elected pursuant to Section
7.02, then the amounts required will be calculated by us based on the 1983
Individual Annuity Mortality Table "a" projected with modified Scale "G" and a
modified two year age setback and a 20%-80% split of males and females at age 55
and on an Assumed Base Rate of Net Investment Return of 3.5%/5.0%.]
No. 94ICA/B Page 22
ENDORSEMENT
APPLICABLE TO IRA CERTIFICATES
As specified in the Data pages, this Certificate is an "IRA Certificate" which
is issued as an individual retirement annuity contract which meets the
requirements of Section [408(b)] of the Code. It is established for the
exclusive benefit of you and your beneficiaries, and the terms below change, or
are added to, applicable sections of this Certificate. Also, your rights
under the Contract are not forfeitable.
1. OWNER (SECTION 1.17):
You must be both the Owner and the Annuitant.
2. ANNUITY COMMENCEMENT DATE (SECTION 1.04):
You may not choose an Annuity Commencement Date later than the maximum
maturity age stated in the Data pages. If you choose a Date later than
age [70 1/2], you must withdraw at least the minimum payments required
under Sections [408(b) and 401(a)(9)] of the Code and applicable
Treasury regulations. See Section 5.01 of the Certificate and item 5
below.
3. CONTRIBUTIONS (SECTION 3.01 AND 3.02):
No Contributions will be accepted unless they are in cash (or check or
other form if we require). Except in the case of a "rollover
contribution," the total of such Contributions will not exceed [$2,000]
for any taxable year. A "rollover contribution" is one permitted by
Sections [402(c), 403(a)(4), 403(b)(8), or 408(d)(3)] of the Code.
Amounts transferred to the Contract from an individual retirement
account or annuity contract which meets the requirements of Section
[408] of the Code are not subject to the [$2,000] limit.
If you make a Contribution which is an "eligible retirement plan
rollover" as defined in Section [402(c) or 403(b)(8)] of the Code, and
you commingle such Contribution with other Contributions, you may not
be able to roll over the eligible retirement plan Contributions and
earnings to another qualified plan or Code Section [403(b)] arrangement
at a future date, unless the Code permits.
4. DEATH BENEFITS (SECTION 6.01):
Under the following circumstances, the death benefit described in
Section 6.01 of the Certificate will not be paid at your death before
the Annuity Commencement Date and the coverage under the Contract will
continue with your surviving spouse as Successor Annuitant and Owner:
a. you are married at your death;
b. the person named as death beneficiary under Section 6.02 of
the Certificate is your surviving spouse; and
No. 94ENIRAI Page 1
<PAGE>
c. you have additionally requested that your spouse become
"Successor Annuitant and Owner" of your Certificate if your
spouse survives you.
5. REQUIRED PAYMENTS:
This Certificate is subject to these "Required Payment" or "Minimum
Distribution" rules of Sections [408(b) and 401(a)(9)] of the Code and
the Treasury Regulations which apply.
MINIMUM DISTRIBUTION RULES -- REQUIRED PAYMENTS DURING YOUR LIFE --
[Your entire interest in this Certificate will be distributed or begin
to be distributed no later than the first day of April following the
calendar year in which you attain age 70 1/2 ("Required Beginning
Date"). Your entire interest may be distributed, as you elect, over (a)
your life, or the lives of you and your designated beneficiary, or (b)
a period certain not extending beyond your life expectancy, or the
joint and last survivor expectancy for you and your designated
beneficiary. Distributions must be made in periodic payments at
intervals of no longer than one year. In addition, payments must be
either non-increasing or they may increase only as provided in Q & A
F-3 of Section 1.401(a)(9)-1 of the Proposed Treasury Regulations, or
any successor Regulation thereto.
All distributions made under this Certificate must be made in
accordance with the requirements of Sections 408(b) and 401(a)(9) of
the Code, including the incidental death benefit requirements of
Section 401(a)(9)(G) of the Code, and applicable Treasury Regulations,
including the minimum distribution incidental benefit requirements of
Section 1.401(a)(9)-2 of the Proposed Treasury Regulations, or any
successor Regulation thereto.
For purposes of determining the "period certain" referred to in the
first paragraph of this Section, life expectancy is computed by use of
the expected return multiples in Tables V and VI of Treasury Regulation
Section 1.72-9. Unless you otherwise elect prior to the time
distributions are required to begin, life expectancies will be
recalculated annually. Such election will be irrevocable and will apply
to all subsequent years. The life expectancy of a non-spouse
beneficiary, if the naming of such a beneficiary is permitted by our
rules then in effect, may not be recalculated. Instead, life expectancy
will be calculated using the attained age of such beneficiary during
the calendar year in which you attain age 70 1/2, and payments of
subsequent years will be calculated based on such life expectancy
reduced by one for each calendar year which has elapsed since the
calendar year life expectancy was first calculated.
MINIMUM DISTRIBUTION RULES -- DEATH BENEFIT - If you die after
distribution of your interest in this Certificate has begun, the
remaining portion of such interest will continue to be distributed at
least as rapidly as under the method of distribution being used prior
to your death.
If you die before distribution of your interest in this Certificate
begins, distribution of your entire interest will be completed no later
than December 31 of the calendar year containing the fifth anniversary
of your death, except to the extent that an election is made to receive
death benefit distributions in accordance with (a) or (b) below:
No. 94ENIRAI Page 2
<PAGE>
(a) If your interest is payable to a designated
beneficiary, then your entire interest may be
distributed over the life of, or over a period certain
not greater than the life expectancy of, the designated
beneficiary. Such distributions must commence on or
before December 31 of the calendar year immediately
following the calendar year of your death.
(b) If the designated beneficiary is your surviving spouse,
the date that distributions are required to begin in
accordance with (a) above shall not be earlier than the
later of (1) December 31 of the calendar year
immediately following the calendar year of your death
or (2) December 31 of the calendar year in which you
would have attained age 70 1/2.
If the designated beneficiary is your surviving spouse, and a Successor
Annuitant and Owner option (described in item 4 above of this
Endorsement) is in effect, the distribution of your interest need not
be made until after your spouse's death.
For purposes of determining the "period certain" referred to in the
immediately preceding paragraph, life expectancy is computed by use of
the expected return multiples in Table V and VI of Treasury Regulation
Section 1.72-9. For purposes of distributions beginning after your
death, unless otherwise elected by the surviving spouse by the time
distributions are required to begin, life expectancies will be
recalculated annually. Such election will be irrevocable by the
surviving spouse and will apply to all subsequent years. In the case of
any other designated beneficiary, life expectancies will be calculated
using the attained age of such beneficiary during the calendar year in
which distributions are required to begin, pursuant to this item, and
payments for any subsequent calendar year will be calculated based on
such life expectancy reduced by one for each calendar year which has
elapsed since the calendar year life expectancy was first calculated.
Distributions under this item are considered to have begun if
distributions are made because you have reached your Required Beginning
Date, or if prior to the Required Beginning Date, distributions
irrevocably commence to you over a period permitted and in any annuity
form acceptable under Section 1.401(a)(9)-1 of the Proposed Treasury
Regulations or any successor Regulation thereto.]
6. REPORTS - NOTICES (SECTION 9.04):
We will send you a report as of the end of each calendar year showing
the status of the annuity and any other reports required by the Code or
Treasury Regulations.
7. ASSIGNMENTS (SECTION 9.05):
Your rights may not be assigned, pledged or transferred except as
permitted by law. You may not name a new Owner, except as described in
item 4 of this Endorsement.
8. TERMINATION OF CERTIFICATE:
If an annuity under the Contract fails to qualify as an annuity under
Section [408(b)] of the Code, we will have the right to terminate the
Certificate. We may do so, upon receipt of notice of such fact, before
the Annuity Commencement Date. In that case, we will pay the Annuity
Account Value less a deduction for the part
No. 94ENIRAI Page 3
<PAGE>
which applies to any Federal income tax payable by you which would not
have been payable with respect to an annuity which meets the terms of
the Code.
No. 94ENIRAI Page 4
<PAGE>
ENDORSEMENT
APPLICABLE TO NON-QUALIFIED
CERTIFICATES
This Endorsement applies only to the Owner of a Non-Qualified Certificate.
1. CONTRIBUTIONS (SECTION 3.01):
We have the right not to accept any Contribution which is less than the
amount(s) stated in the Data pages.
2. OWNER DEATH DISTRIBUTION RULES (SECTION 6.01):
Upon the death of you, as Owner, before the Annuity Commencement Date:
(a) If you are both the Owner and the Annuitant, we will pay the
death benefit described in Section 6.01. Any part of a death
benefit for which there is no named beneficiary living at your
death will be payable in a single sum to your children who
survive you in equal shares, or should none survive, then to
your estate.
Under the following circumstances, the death benefit described
in Section 6.01 of the Certificate will not be paid at your
death before the Annuity Commencement Date and the coverage
under the Contract will continue with your surviving spouse as
Successor Annuitant and Owner:
(i) you are married at your death;
(ii) the person named as death beneficiary under Section
6.02 of the Certificate is your surviving spouse; and
(iii) you have additionally requested that your spouse
become "Successor Annuitant and Owner" of your
Certificate if your spouse survives you.
(b) If you are not the Annuitant, the named beneficiary will
succeed as Owner. The entire amount in the Investment Options
(after any Withdrawal Charge) must be fully paid within five
years after your death, or payments must begin within one year
after your death as a life annuity or installment option for a
period of not longer than the life expectancy of the named
beneficiary. If you have not elected a form of payment as
described in Section 6.02, we will make a single sum payment
to the beneficiary on the fifth anniversary of your death.
Subject to our rules at the time of payment, the beneficiary
may elect to apply such a single sum payment to a new
non-qualified annuity contract to be owned by the beneficiary.
Instead of a single sum payment, the beneficiary may elect to
receive an Annuity Benefit or a payout option which satisfies
the terms of Section [72(s)] of the Code and our rules at the
time. However, if the named beneficiary is your spouse, full
payment of amounts
No. 94ENNQI Page 1
<PAGE>
under the Certificate must be made not later than five years
after the spouse's death.
If payments under an Annuity Benefit had begun before your
death, such payments will continue to be made pursuant to the
terms of such Benefit.
If the Annuitant dies before the entire amount under the
Certificate is paid, we will pay the death benefit as
described in Section 6.01.
(c) Unless you direct otherwise, the named beneficiary will also
be the person who succeeds as Owner on your death while the
Annuitant is alive as described in Section 6.02. You may
change any beneficiary or successor Owner from time to time
during the Annuitant's lifetime and while the Certificate is
in force, as described in item (a) above.
(d) If you are not the Annuitant, you may name another person to
be the successor Owner and to receive the amounts to be paid
under (b) above. You may also name another person to be
successor Owner if the first choice as successor Owner dies
before you. If you have so named two or more persons to
succeed as Owner and more than one survive, they will share
equally unless you direct otherwise. If no person named as
beneficiary to receive the death benefit survives the
Annuitant, we will pay the death benefit in a single sum to
you. In the event of your death after the Annuitant, but
before we pay such death benefit, the benefit will be payable
in a single sum to the children who survive you, in equal
shares, or should none survive, to your estate.
If you die before the Annuity Commencement Date while the
Annuitant is still living, and if no person named as successor
Owner is living at the Owner's death, the beneficiary will be
deemed to be, in this order, (i) your surviving spouse, (ii)
the Annuitant, (iii) the children who survive you, in equal
shares, or (iv) your estate.
3. ASSIGNMENTS (SECTION 9.05):
Notwithstanding the terms of Section 9.05, you may assign the
Certificate and the rights described therein before the Annuity
Commencement Date. We will not be bound by an assignment unless we have
received it and it is in writing. Your rights and those of any other
persons referred to in the Certificate and this Endorsement will be
subject to the assignment. We assume no responsibility for the validity
of any assignment.
No. 94ENNQI Page 2
<PAGE>
ENDORSEMENT
APPLICABLE TO MARKET VALUE ADJUSTMENT TERMS
********************************************************************************
THE TERMS OF THIS ENDORSEMENT CONTAIN A MARKET VALUE ADJUSTMENT ("MVA") FORMULA
WHICH MAY RESULT IN ADJUSTMENTS, POSITIVE OR NEGATIVE, IN BENEFITS. AN MVA WILL
NOT APPLY UPON TRANSFER TO A NEW GUARANTEE PERIOD OR OTHER INVESTMENT OPTION ON
THE EXPIRATION DATE OR PURSUANT TO ITEM 1 BELOW.
********************************************************************************
1. GUARANTEED PERIOD ACCOUNT
We will specify one or more Guarantee Periods in the Guaranteed Period
Account. For each such Guarantee Period, we guarantee to credit an
interest rate (called the Guaranteed Rate). Interest will be credited
daily to amounts in the Guaranteed Period Account. The duration of each
Guarantee Period provided at any time and the Guaranteed Rate that
applies to each Period will be furnished by us upon request. The
Guarantee Period(s) and the Rate for each such Period you initially
elect are shown in the Data pages.
You may elect one or more Guarantee Period(s), according to our rules
then in effect. Contributions and transfers to be made to the
Guaranteed Period Account as described in Section 3.01 will be
allocated to the Guarantee Period(s) according to your election.
Contributions and transfers into the Guaranteed Period Account will
receive the Guaranteed Rate applicable to the elected Guarantee Period
as of the Business Day we receive your Contribution or transfer request
at our Processing Office. The amount held with respect to a given
Guarantee Period is called the Guaranteed Period Amount which reflects
Contributions and transfers made to the Guaranteed Period Account, plus
interest at the Guaranteed Rate(s), minus any withdrawals, transfers
and charges, if any, deducted from the Guaranteed Period Account.
The last day of a Guarantee Period is the Expiration Date. We will
notify you at least [15 but not more than 45] days before the
Expiration Date of each Period. You may elect one of the following
three options effective at the Expiration Date, none of which will
result in a market value adjustment:
(a) to transfer the Guaranteed Period Amount into a Guarantee Period
of any duration which we then offer;
(b) to transfer the Guaranteed Period Amount to another Investment
Option;
(c) to make a withdrawal of the Guaranteed Period Amount (subject to
any Withdrawal Charges which apply pursuant to Section 8.01).
No. 94ENMVAI Page 1
<PAGE>
If no election is made on or prior to the Expiration Date, the
Guaranteed Period Amount (without any market value adjustment) will be
transferred into the Investment Option described in the Data pages.
During the 30 days following the Expiration Date, the full Guaranteed
Period Amount (less any withdrawals or transfers made or charges
deducted during such 30 day period) may be transferred into a new
Guarantee Period or other Investment Option. In no event may you elect
a Guarantee Period which extends beyond the Annuity Commencement Date.
The "Guaranteed Period Account" is our Separate Account No. 46 that we
use to account for amounts allocated to Guarantee Periods under this
Certificate. All amounts allocated to a Guarantee Period, whether
Contributions or transfers, become part of the Guaranteed Period
Account.
2. TRANSFERS, WITHDRAWALS, DEATH AND ANNUITY BENEFITS
If you request, other than as described in item 1 above, a transfer to
another Investment Option as described in Section 4.01 or a withdrawal
as described in Section 5.01, any such transfer or withdrawal from a
Guaranteed Period Amount will be subject to a market value adjustment
described below. For this purpose, the Annuity Account Value in
Separate Account No. 46 will be after the market value adjustment. The
market value adjustment will be in addition to any charges which apply
as described in Section 8.01.
In addition, amounts applied from a Guaranteed Period Amount to provide
a death benefit as described in Section 6.01, an annuity as described
in Section 7.02, or any other annuity form offered by us, will be
subject to a market value adjustment, unless otherwise provided in the
Data pages.
Payment or transfers from the Guaranteed Period Account may be deferred
for up to six months while you are living.
3. MARKET VALUE ADJUSTMENT
The market value adjustment with respect to each Guarantee Period that
applies to you is determined as follows:
(a) We determine the Guaranteed Period Amount that will be payable on
the Expiration Date, using the Guaranteed Rate for such Guarantee
Period.
(b) We determine the period remaining in your Guarantee Period (based
on the Business Day we receive your transaction request at our
Processing Office or effective date for such determination) and
convert it to fractional years based on a 365 day year. For
example, three years and 12 days becomes 3.0329.
(c) We determine the current Guaranteed Rate which applies to new
Contributions, for the same class of Certificates as yours, under
a Guarantee Period with the same Expiration Date as your
Guarantee Period. We add to such current Rate a percentage which
is no greater than that shown in the Data pages.
No. 94ENMVAI Page 2
<PAGE>
(d) We determine the present value of the Guaranteed Period Amount
payable at the Expiration Date, using the period determined in
(b) and the rate determined in (c).
(e) We subtract the current Guaranteed Period Amount from the result
in (d). The result is the Market Value Adjustment, which may be
positive or negative, applicable to such Guarantee Period.
If we are not offering a Guarantee Period to which the "current
Guaranteed Rate" would apply, we will use the Rate at the closest
Expiration Date. If we are no longer offering new Guarantee Periods, we
will use a procedure for determining such current Rate that is stated
in the Data pages or which we will develop and file with insurance
supervisory officials of the appropriate jurisdiction.
4. REPORTS AND NOTICES
We will report the values under this Endorsement with the reports sent
out as described in Section 9.04. Such report will include the
Guaranteed Period Amount, market value adjustment, and Annuity Account
Value in Separate Account No. 46.
No. 94ENMVAI Page 3
<PAGE>
FOR IRA (1/31/95)
DATA
----
PART A -- THIS PART LISTS YOUR PERSONAL DATA.
- ------
OWNER: [John Doe]
ANNUITANT: [Annuitant must be Owner]
[John Doe] Age: [60] Sex: [Male]
CERTIFICATE NUMBER: [00000]
Endorsements Attached: [Endorsement Applicable to IRA Certificates]
[Endorsement Applicable to Market Value
Adjustment Terms]
CONTRACT: GROUP ANNUITY CONTRACT NO. AC [0000]
ISSUE DATE: [January 1, 1995]
CONTRACT DATE: [January 1, 1995]
ANNUITY COMMENCEMENT DATE:
THE MAXIMUM MATURITY AGE IS AGE [85] -- SEE SECTION 7.03.
The Annuity Commencement Date may not be later than the month which
follows your [85th] birthday, or seven years after the Contract Date,
if later.
However, if you choose a date later than age 70 1/2, distribution of at
least the minimum payments required must commence by April 1 of the
calendar year following the calendar year in which you attain age
70 1/2 (see item 2 of the Endorsement Applicable to IRA Certificates).
BENEFICIARY: [Jane Doe]
SUCCESSOR OWNER/ANNUITANT: [Applicable if beneficiary is the spouse at the
time of election and time of Owner/Annuitant's
death]
No. 94ICA/BIM Data Page 1
<PAGE>
DATA PAGES (CONT'D.)
PART B -- THIS PART LISTS THE CONTRACT TERMS WHICH AFFECT THE TYPE OF
- ------ CERTIFICATE YOU HAVE.
INITIAL CONTRIBUTION RECEIVED (SEE SECTION 3.02): [$10,000]
INVESTMENT OPTIONS AVAILABLE (SEE PART II); YOUR INITIAL ALLOCATION IS ALSO
SHOWN.
INVESTMENT OPTIONS ALLOCATION (SEE SECTION 3.01)
- ------------------ -----------------------------
o [CONSERVATIVE INVESTORS FUND
o GROWTH INVESTORS FUND
o GROWTH AND INCOME FUND
o COMMON STOCK FUND
o GLOBAL FUND
o INTERNATIONAL FUND*
o AGGRESSIVE STOCK FUND
o MONEY MARKET FUND
o INTERMEDIATE GOVERNMENT
SECURITIES FUND
o QUALITY BOND FUND
o GUARANTEE PERIODS
EXPIRATION DATE AND GUARANTEED RATE
FEBRUARY 15, 1996 - 5.00%
FEBRUARY 15, 1997 - 5.00%
FEBRUARY 15, 1998 - 5.00%
FEBRUARY 15, 1999 - 6.00%
FEBRUARY 15, 2000 - 6.00%
FEBRUARY 15, 2001 - 6.00%
FEBRUARY 15, 2002 - 7.00%
FEBRUARY 15, 2003 - 7.00%
FEBRUARY 15, 2004 - 7.00%
FEBRUARY 15, 2005 - 8.00%**
FEBRUARY 15, 2006 - 8.00%**
FEBRUARY 15, 2007 - 8.00%**
FEBRUARY 15, 2008 - 9.00%**
FEBRUARY 15, 2009 - 9.00%**
FEBRUARY 15, 2010 - 9.00%**]
-----------------------------
TOTAL: 100%
Investment Options shown are Investment Funds of our Separate Account No. 45 and
Guarantee Periods shown are in the Guaranteed Period Account. See Endorsement
Applicable to Market Value Adjustment Terms.
[*Will be available April 1, 1995]
[**Not available in New York and Pennsylvania]
"TYPES" OF INVESTMENT OPTIONS (SEE SECTION 4.02): Not applicable.
GUARANTEED INTEREST ACCOUNT (SEE SECTION 2.01): Not available under this
Certificate.
No. 94ICA/BIM Data Page 2
<PAGE>
DATA PAGES (CONT'D.)
BUSINESS DAY (SEE SECTION 1.05): A Business Day for this Certificate will mean
any day on which the New York Stock Exchange is open for trading.
PROCESSING DATES (SEE SECTION 1.20): A Processing Date is each Contract Date
anniversary.
AVAILABILITY OF INVESTMENT OPTIONS (SEE SECTION 2.04): (See Data Pages, Part C:
Allocation Restrictions)
DESIGNATED INVESTMENT OPTION (SEE THE LAST PARAGRAPH OF SECTION 2.05): (See Data
Pages, Part C; Transfers at Expiration Date)
ALLOCATION OF CONTRIBUTIONS (SEE SECTION 3.01): Allocations of Contributions may
be in dollar amounts or percentages. Allocations must equal the total dollar
amount or 100% of the Contribution, as applicable. If we do not receive
subsequent instructions from you, subsequent Contributions will be allocated
only among the Investment Funds and in proportion to the Annuity Account Value
in each Investment Fund as of the Transaction Date. (Also see Data Pages, Part
C; Allocation Restrictions)
CONTRIBUTION LIMITS (SEE SECTION 3.02): We will only accept initial
Contributions of at least $10,000 in the form of either a rollover Contribution
or a direct custodian-to-custodian transfer from other individual retirement
arrangements. Subsequent Contributions may be made in an amount of at least
$1,000 or under the Automatic Investment Program in an amount of at least $150
monthly. Subsequent Contributions may be "regular" IRA Contributions (limited to
a maximum of $2,000 a year), rollover Contributions or direct transfers.
Rollover Contributions and direct transfers are not subject to the $2,000 annual
limit. Regular IRA Contributions may not be made for the taxable year in which
you attain age 70 1/2 and thereafter. Rollover and direct transfer Contributions
may be made until you attain age 78. However, any amount contributed after you
attain age 70 1/2 must be net of your required minimum distribution for the year
in which the rollover or direct transfer Contribution is made. We may refuse to
accept any Contribution if the sum of all Contributions under your Certificate
would then total more than $1,500,000.
TRANSFER RULES (SEE SECTION 4.02): (See Data Pages, Part C)
MINIMUM TRANSFER AMOUNT (SEE SECTION 4.02): Not applicable
ALLOCATION OF WITHDRAWALS (SEE SECTION 5.01): Unless you elect otherwise,
withdrawals plus any withdrawal charges will be withdrawn on a pro rata basis
from the Annuity Account Value in the Investment Funds.
No. 94ICA/BIM Data Page 3
<PAGE>
DATA PAGES (CONT'D.)
WITHDRAWAL RESTRICTIONS (SEE SECTION 5.01): Lump Sum Withdrawal - May not be
taken until after the first Contract Year, and only one Lump Sum Withdrawal may
be taken during a Contract Year thereafter at any time during such Contract
Year; Minimum Distribution Withdrawals - May be elected in the year in which you
attain age 70 1/2 or at a later date. Minimum Distribution Withdrawals will be
made annually.
MINIMUM WITHDRAWAL AMOUNT (SEE SECTION 5.01): Lump Sum Withdrawal minimum-
$1,000; Minimum Distribution Withdrawals minimum - $250.
MINIMUM AMOUNT OF ANNUITY ACCOUNT VALUE AFTER A WITHDRAWAL (SEE SECTION 5.02):
Requests for a withdrawal must be for either (a) 90% or less of the Cash Value
or (b) 100% of the Cash Value (surrender of the Certificate).
We will not exercise our rights, described in Sections 5.02(b) and 5.02(c), to
terminate the Certificate.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01):
The sum of:
(1) The Annuity Account Value in the Investment Funds or, if
greater, the guaranteed minimum death benefit defined below;
and
(2) The death benefit amount provided with respect to the
Endorsement Applicable to Market Value Adjustment Terms.
[VERSION 1 - NON NY]
Guaranteed Minimum Death Benefit (GMDB)
The GMDB is determined daily. On the Contract Date, the GMDB is equal
to the portion of the initial Contribution allocated to the Investment
Funds. Thereafter (except as adjusted at the end of the seventh
Contract Year, see (1) below) the GMDB is equal to (a) the GMDB
determined on the immediately preceding Business Day, plus (b) any
subsequent Contributions and transfers into the Investment Funds, less
(c) any transfers and withdrawals from such Funds. In addition,
interest (see (2) below) is credited to the GMDB on each Processing
Date.
(1) At the end of the seventh Contract Year, the GMDB calculated
on such date will be set at the then GMDB determined above or,
if greater, the current Annuity Account Value in the
Investment Funds.
No. 94ICA/BIM Data Page 4
<PAGE>
DATA PAGES (CONT'D.)
(2) Interest will be calculated at the applicable effective annual
GMDB interest rate for your "attained age" (your age at issue
of the Certificate plus the number of Contract Years that have
elapsed since the Contract Date, see table below) taking into
account Contributions, transfers and withdrawals during the
Contract Year, except with respect to amounts in the Money
Market Fund where the interest credit will be based on the
lesser of the actual rate of return and the GMDB interest rate
below.
Attained Age Rate
------------ ----
up to and including 70 6%
71 through 85 0%
[VERSION 2 - NY]
Guaranteed Minimum Death Benefit (GMDB)
The GMDB is determined daily. On the Contract Date, the GMDB is equal
to the portion of the initial Contribution allocated to the Investment
Funds. Thereafter (except as adjusted at the end of the seventh
Contract Year, see (1) below), the GMDB is equal to (a) the GMDB
calculated on the immediately preceding Business Day, plus (b) any
subsequent Contributions and transfers into the Investment Funds, less
(c) any transfers and withdrawals from such Funds. Additionally, on
each Processing Date the GMDB is reset at the greater of the current
GMDB and the current Annuity Account Value in the Investment Funds. On
no date (except possibly at the end of the seventh Contract Year)
however, will the GMDB be greater than (a) the portion of the initial
Contribution allocated to the Investment Funds, plus (b) any subsequent
Contributions and transfers into the Investment Funds, less (c) any
transfers and withdrawals from such Funds plus (d) interest (see (2)
below) that is credited on each Processing Date.
(1) At the end of the seventh Contract Year, the GMDB calculated
on such date will be set at the then GMDB determined above or,
if greater, the current Annuity Account Value in the
Investment Funds.
(2) Interest will be calculated at the applicable effective annual
GMDB interest rate for your "attained age" (your age at issue
of the Certificate plus the number of Contract Years that have
elapsed since the Contract Date, see table below) taking into
account Contributions, transfers and withdrawals during the
Contract Year, except with respect to amounts in the Money
Market Fund where the interest credit will be based on the
lesser of the actual rate of return and the GMDB interest rate
below.
Attained Age Rate
------------ ----
up to and including 70 6%
71 through 85 0%
No. 94ICA/BIM Data Page 5
<PAGE>
DATA PAGES (CONT'D.)
NORMAL FORM OF ANNUITY (SEE SECTION 7.04): Life Annuity 10 Year Period Certain
AMOUNT OF ANNUITY BENEFIT (SEE SECTION 7.05): The amount applied to provide the
Annuity Benefit will be the Cash Value.
INTEREST RATE TO BE APPLIED IN ADJUSTING FOR MISSTATEMENT OF AGE OR SEX (SEE
SECTION 7.06): 6% per year
MINIMUM AMOUNT TO BE APPLIED TO AN ANNUITY (SEE SECTION 7.06): $2,000, as well
as minimum of $20 for initial monthly annuity payment.
WITHDRAWAL CHARGES (SEE SECTION 8.01): A withdrawal charge will be imposed as a
percentage of the initial and each subsequent Contribution made to the extent
that a Lump Sum Withdrawal exceeds the Free Corridor Amount as discussed in
Section 8.01 or, if the Certificate is surrendered to receive the Cash Value. We
determine the withdrawal charge separately for each Contribution in accordance
with the table below.
Current and Maximum
Percentage of
Contract Year Contributions
------------- -------------
1 7.00%
2 6.00%
3 5.00%
4 4.00%
5 3.00%
6 2.00%
7 1.00%
8 and later 0.00%
The applicable withdrawal charge percentage is determined by the Contract Year
in which the Lump Sum Withdrawal is made or the Certificate is surrendered,
beginning with "Contract Year 1" with respect to each Contribution withdrawn or
surrendered. For purposes of the table, for each Contribution, the Contract Year
in which we receive that Contribution is "Contract Year 1."
Withdrawal charges will be deducted from the Annuity Account Value in the
Investment Options from which each Lump Sum Withdrawal is made in proportion to
the amount being withdrawn from each Investment Option.
No. 94ICA/BIM Data Page 6
<PAGE>
DATA PAGES (CONT'D.)
FREE CORRIDOR AMOUNT (SEE SECTION 8.01):
15% of Annuity Account Value at the beginning of the Contract Year,
minus any amount previously withdrawn during the Contract Year. Amounts
withdrawn up to the Free Corridor Amount will not be deemed a
withdrawal of Contributions.
Lump Sum Withdrawals in excess of the Free Corridor Amount will be
deemed withdrawals of Contributions in the order in which they were
made (that is, the first-in, first-out basis will apply).
The Free Corridor Amount does not apply when calculating the withdrawal
charge applicable upon a surrender.
CHARGES DEDUCTED FROM ANNUITY ACCOUNT VALUE (SEE SECTION 8.02):
(a) Guaranteed Minimum Death Benefit Charge: For the guaranteed
minimum death benefit we will deduct on each Processing Date
an amount equal to 0.20% of the guaranteed minimum death
benefit in effect on such Processing Date. 0.20% is the
maximum we will charge.
(b) Annual Contract Fee: An administrative charge of $30 per
Contract Year is incurred at the beginning of each Contract
Year and deducted on each Processing Date. $30 is the maximum
amount we will charge. If total Contributions received in the
first Contract Year equal $25,000 or more, this charge will be
zero.
(c) Premium Taxes: A charge for any applicable premium tax
generally will be deducted from the amount applied to provide
an Annuity Benefit if you elect to annuitize. In certain
states, however, we may deduct the charge from Contributions
rather than at the Annuity Commencement Date.
Unless you specify otherwise, all of the above charges will be deducted
from the Annuity Account Value in the Investment Funds on a pro rata
basis. If there is insufficient value in the Investment Funds, all or a
portion of the charges in (b) and (c) will be deducted from the Annuity
Account Value in the Guaranteed Period Account. The charge in (a) will
always be deducted from the Annuity Account Value in the Investment
Funds on a pro rata basis. Also, if you surrender the Certificate or it
is terminated during a Contract Year before the next Processing Date,
we will deduct any annual contract fee in (b) incurred but not yet
deducted.
TRANSFER CHARGE (SEE SECTION 8.03): Currently, there is no charge. However, we
reserve the right to impose a charge at a maximum of $25 for each transfer per
Contract Year in excess of five.
No. 94ICA/BIM Data Page 7
<PAGE>
DATA PAGES (CONT'D.)
DAILY SEPARATE ACCOUNT CHARGES (SEE SECTION 8.04):
Current and Maximum Mortality and Expense Risk Charge: Annual rate of 0.90%
(equivalent to a daily
rate of 0.002477%).
Current and Maximum Asset Based Administrative Charge: Annual rate of 0.25%
(equivalent to a daily
rate of 0.000692%).
No. 94ICA/BIM Data Page 8
<PAGE>
DATA PAGES (CONT'D.) FOR IRA (1/31/95)
PART C -- THIS PART LISTS THE TERMS WHICH APPLY TO THE ENDORSEMENT APPLICABLE TO
- ------ MARKET VALUE ADJUSTMENT TERMS (MVA)
ALLOCATION RESTRICTIONS (SEE SECTION 3.01): You must provide specific
instructions as to how each Contribution will be allocated among the Guarantee
Periods. If you are between ages 65 through 74 allocations may not be made to a
Guarantee Period with a maturity year that would exceed the year in which you
will attain age 80. At ages 75 and above, allocations may be made only to
Guarantee Periods with maturities of five years or less; however, in no event
may allocations be made to Guarantee Periods with maturities beyond the Annuity
Commencement Date.
TRANSFERS AT EXPIRATION DATE (SEE ITEM 1 OF MVA ENDORSEMENT): If no election is
made with respect to amounts in the Guaranteed Period Account as of the
Expiration Date, such amounts will be transferred into the Guarantee Period with
the shortest Expiration Date.
MARKET VALUE ADJUSTMENT ON TRANSFERS AND WITHDRAWALS (SEE ITEM 2 OF MVA
ENDORSEMENT): The MVA (positive or negative) resulting from a withdrawal or
transfer of a portion of the amount in a Guarantee Period will be a percentage
of the MVA that would be applicable upon a withdrawal of all of the Annuity
Account Value in a Guarantee Period. This percentage is determined by (i)
dividing the amount of the withdrawal or transfer from the Guarantee Period by
(ii) the Annuity Account Value in such Guarantee Period prior to the withdrawal
or transfer.
TRANSFER RULES (SEE SECTION 4.02): No transfers are permitted to or from the
Guaranteed Period Account during the first Contract Year and only one transfer
per Contract Year may be made thereafter. Transfers are limited based on your
attained age (see "Allocation Restrictions" above).
WITHDRAWALS (SEE SECTION 5.01): If you choose to have withdrawals allocated to
the Guaranteed Period Account, or a withdrawal is greater than the Annuity
Account Value in the Investment Funds, you must specify the Guarantee Period(s)
from which the withdrawal plus any withdrawal charge will be taken.
MVA FORMULA (SEE ITEM 3 OF MVA ENDORSEMENT): The Guaranteed Rate for new
allocations to a Guarantee Period is the rate we have in effect for this
purpose. Guaranteed Rates will be in effect even if new allocations to a
particular Guarantee Period would not be accepted at the time.
No. 94ICA/BIM Data Page 9
<PAGE>
DATA PAGES (CONT'D.)
The current rate percentage we use in item (c) of the formula is 0.00%. For
purposes of calculating the MVA only, we reserve the right add up to 0.25% to
such current rate percentage.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01): The larger of (a) the Annuity Account
Value in the Guaranteed Period Account and (b) the sum of the Guaranteed Period
Amounts in each Guarantee Period.
No. 94ICA/BIM Data Page 10
<PAGE>
FOR NQ (1/31/95)
DATA
----
PART A -- THIS PART LISTS YOUR PERSONAL DATA.
- ------
OWNER: [John Doe]
ANNUITANT: [John Doe] Age: [60] Sex: [Male]
CERTIFICATE NUMBER: [00000]
Endorsements Attached: [Endorsement Applicable to Non-Qualified
Certificates]
[Endorsement Applicable to Market Value
Adjustment Terms]
CONTRACT: GROUP ANNUITY CONTRACT NO. AC [0000]
ISSUE DATE: [January 1, 1995]
CONTRACT DATE: [January 1, 1995]
ANNUITY COMMENCEMENT DATE:
THE MAXIMUM MATURITY AGE IS AGE [85] -- SEE SECTION 7.03.
The Annuity Commencement Date may not be later than the month which
follows the Annuitant's [85th] birthday or seven years after the
Contract Date, if later.
BENEFICIARY: [Jane Doe]
SUCCESSOR OWNER: [Applicable if Owner is different than the Annuitant]
SUCCESSOR OWNER/ANNUITANT: [Applicable if Owner and Annuitant are the same and
beneficiary is the spouse at the time of election and
time of Owner/Annuitant's death]
No. 94ICA/BIM Data Page 1
<PAGE>
DATA PAGES (CONT'D.)
PART B -- THIS PART LISTS THE CONTRACT TERMS WHICH AFFECT THE TYPE OF
- ------ CERTIFICATE YOU HAVE.
INITIAL CONTRIBUTION RECEIVED (SEE SECTION): [$10,000]
INVESTMENT OPTIONS AVAILABLE (SEE PART II); YOUR INITIAL ALLOCATION IS ALSO
SHOWN.
INVESTMENT OPTIONS ALLOCATION (SEE SECTION 3.01)
- ------------------ -----------------------------
o [CONSERVATIVE INVESTORS FUND
o GROWTH INVESTORS FUND
o GROWTH AND INCOME FUND
o COMMON STOCK FUND
o GLOBAL FUND
o INTERNATIONAL FUND*
o AGGRESSIVE STOCK FUND
o MONEY MARKET FUND
o INTERMEDIATE GOVERNMENT
SECURITIES FUND
o QUALITY BOND FUND
o GUARANTEE PERIODS
EXPIRATION DATE AND GUARANTEED RATE
FEBRUARY 15, 1996 - 5.00%
FEBRUARY 15, 1997 - 5.00%
FEBRUARY 15, 1998 - 5.00%
FEBRUARY 15, 1999 - 6.00%
FEBRUARY 15, 2000 - 6.00%
FEBRUARY 15, 2001 - 6.00%
FEBRUARY 15, 2002 - 7.00%
FEBRUARY 15, 2003 - 7.00%
FEBRUARY 15, 2004 - 7.00%
FEBRUARY 15, 2005 - 8.00%**
FEBRUARY 15, 2006 - 8.00%**
FEBRUARY 15, 2007 - 8.00%**
FEBRUARY 15, 2008 - 9.00%**
FEBRUARY 15, 2009 - 9.00%**
FEBRUARY 15, 2010 - 9.00%**]
-----------------------------
TOTAL: 100%
Investment Options shown are Investment Funds of our Separate Account No. 45 and
Guarantee Periods shown are in the Guaranteed Period Account. See Endorsement
Applicable to Market Value Adjustment Terms.
[*Will be available April 1, 1995]
[**Not available in New York and Pennsylvania]
"TYPES" OF INVESTMENT OPTIONS (SEE SECTION 4.02): Not applicable
GUARANTEED INTEREST ACCOUNT (SEE SECTION 2.01): Not available under this
Certificate
No. 94ICA/BIM Data Page 2
<PAGE>
DATA PAGES (CONT'D.)
BUSINESS DAY (SEE SECTION 1.05): A Business Day for this Certificate will mean
any day on which the New York Stock Exchange is open for trading.
PROCESSING DATES (SEE SECTION 1.20): A Processing Date is each Contract Date
anniversary.
AVAILABILITY OF INVESTMENT OPTIONS (SEE SECTION 2.04): (See Data Pages, Part C;
Allocation Restrictions)
DESIGNATED INVESTMENT OPTION (SEE THE LAST PARAGRAPH OF SECTION 2.05): (See Data
Pages, Part C; Transfers at Expiration Date)
ALLOCATION OF CONTRIBUTIONS (SEE SECTION 3.01): Allocations of Contributions may
be in dollar amounts or percentages. Such allocations must equal the total
dollar amount or 100% of the Contribution, as applicable. No more than 60% of
any Contribution may be allocated to the Guaranteed Period Account. If we do not
receive subsequent instructions from you, subsequent Contributions will be
allocated only among the Investment Funds and in proportion to the Annuity
Account Value in each Investment Fund as of the Transaction Date. (Also see Data
Pages, Part C; Allocation Restrictions)
CONTRIBUTION LIMITS (SEE SECTION 3.02): Initial Contribution minimum: $10,000.
Subsequent Contribution minimum $1,000 or $250 monthly under the Automatic
Investment Program. Subsequent Contributions can be made until the Annuity
reaches age 78. We may refuse to accept any Contribution if the sum of all
Contributions under your Certificate would then total more than $1,500,000.
TRANSFER RULES (SEE SECTION 4.02): (See Data Pages, Part C)
MINIMUM TRANSFER AMOUNT (SEE SECTION 4.02): (See Data Pages, Part C)
ALLOCATION OF WITHDRAWALS (SEE SECTION 5.01): Unless you elect otherwise,
withdrawals plus any withdrawal charges will be withdrawn on a pro rata basis
from the Annuity Account Value in the Investment Funds.
WITHDRAWAL RESTRICTIONS (SEE SECTION 5.01): Lump Sum Withdrawal - May not be
taken until after the first Contract Year, and only one Lump Sum Withdrawal may
be taken during a Contract Year thereafter at any time during such Contract
Year; Periodic Withdrawals - May not start sooner than 28 days after issue of
this Certificate. You may elect to receive Periodic Withdrawals on a quarterly
or annual basis.
MINIMUM WITHDRAWAL AMOUNT (SEE SECTION 5.01): Lump Sum Withdrawal minimum
$1,000; Periodic Withdrawals minimum - $250.
No. 94ICA/BIM Data Page 3
<PAGE>
DATA PAGES (CONT'D.)
MINIMUM AMOUNT OF ANNUITY ACCOUNT VALUE AFTER A WITHDRAWAL (SEE SECTION 5.02):
Requests for a withdrawal must be for either (a) 90% or less of the Cash Value
or (b) 100% of the Cash Value (surrender of the Certificate).
We will not exercise our rights, described in Sections 5.02(b) and 5.02(c), to
terminate the Certificate.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01):
The sum of:
(1) The Annuity Account Value in the Investment Funds or, if
greater, the guaranteed minimum death benefit defined below;
and
(2) The death benefit amount provided by the Endorsement
Applicable to Market Value Adjustment Terms.
[VERSION 1 - NON NY]
Guaranteed Minimum Death Benefit (GMDB)
The GMDB is determined daily. On the Contract Date, the GMDB is equal
to the portion of the initial Contribution allocated to the Investment
Funds. Thereafter (except as adjusted at the end of the seventh
Contract Year, see (1) below) the GMDB is equal to (a) the GMDB
determined on the immediately preceding Business Day, plus (b) any
subsequent Contributions and transfers into the Investment Funds, less
(c) any transfers and withdrawals from such Funds. In addition,
interest (see (2) below) is credited to the GMDB on each Processing
Date.
(1) At the end of the seventh Contract Year, the GMDB calculated
on such date will be set at the then GMDB determined above or,
if greater, the current Annuity Account Value in the
Investment Funds.
(2) Interest will be calculated at the effective annual GMDB
interest rate based on the Annuitant's "issue age"
(Annuitant's age at issue of the Certificate, see table below)
taking into account Contributions, transfers and withdrawals
during the Contract Year, except with respect to amounts in
the Money Market Fund where the interest credit will be based
on the lesser of the actual rate of return and the GMDB
interest rate below.
Issue Age Rate
--------- ----
0 through 69 6%
70 through 74 3%
75+ 0%
No. 94ICA/BIM Data Page 4
<PAGE>
DATA PAGES (CONT'D.)
[VERSION 2 - NY]
Guaranteed Minimum Death Benefit (GMDB)
The GMDB is determined daily. On the Contract Date, the GMDB is equal
to the portion of the initial Contribution allocated to the Investment
Funds. Thereafter (except as adjusted at the end of the seventh
Contract Year, see (1) below), the GMDB is equal to (a) the GMDB
calculated on the immediately preceding Business Day, plus (b) any
subsequent Contributions and transfers into the Investment Funds, less
(c) any transfers and withdrawals from such Funds. Additionally, on
each Processing Date the GMDB is reset at the greater of the current
GMDB and the current Annuity Account Value in the Investment Funds. On
no date (except possibly at the end of the seventh Contract Year)
however, will the GMDB be greater than (a) the portion of the initial
Contribution allocated to the Investment Funds, plus (b) any subsequent
Contributions and transfers into the Investment Funds, less (c) any
transfers and withdrawals from such Funds plus (d) interest (see (2)
below) that is credited on each Processing Date.
(1) At the end of the seventh Contract Year, the GMDB calculated
on such date will be set at the then GMDB determined above or,
if greater, the current Annuity Account Value in the
Investment Funds.
(2) Interest will be calculated at the effective annual GMDB
interest rate based on the Annuitant's "issue age"
(Annuitant's age at issue of the Certificate, see table below)
taking into account Contributions, transfers and withdrawals
during the Contract Year, except with respect to amounts in
the Money Market Fund where the interest credit will be based
on the lesser of the actual rate of return and the GMDB
interest rate below.
Issue Age Rate
--------- ----
0 through 69 6%
70 through 74 3%
75+ 0%
Death Benefit Adjustment: A "special adjustment" is made to the GMDB if on the
next Processing Date following a withdrawal, both (i) the Annuity Account Value
is less than the GMDB, and (ii) the withdrawals made during the Contract Year
prior to such Processing Date are greater than the difference between the GMDB
(before reduction for withdrawals made during the Contract Year) and the "GMDB
Contributions." GMDB Contributions are equal to the sum of all Contributions
made, plus at the time of any seventh year reset, the amount by which the GMDB
is increased to match the then current Annuity Account Value. Such GMDB
contributions are not reduced by withdrawals.
No. 94ICA/BIM Data Page 5
<PAGE>
DATA PAGES (CONT'D.)
The special adjustment will be equal to: (A) x (B) - (C):
Where:
(A) equals the GMDB (before the special adjustment and
reduction for withdrawals made during the prior Contract
Year),
(B) equal (i)/(ii);
where
(i) equals the sum of withdrawals during the
Contract Year, and
(ii) equals the Annuity Account Value (plus any
withdrawals made during the prior Contract Year), and
(C) equals the sum of withdrawals made during the prior
Contract Year.
NORMAL FORM OF ANNUITY (SEE SECTION 7.04): Life Annuity 10 Year Period Certain
AMOUNT OF ANNUITY BENEFIT (SEE SECTION 7.05): The amount applied to provide the
Annuity Benefit will be the Cash Value.
INTEREST RATE TO BE APPLIED IN ADJUSTING TO MISSTATEMENT OF AGE OR SEX (SEE
SECTION 7.06): 6% per year
MINIMUM AMOUNT TO BE APPLIED FOR AN ANNUITY (SEE SECTION 7.06): $2,000, as well
as minimum of $20 for initial monthly annuity payment.
WITHDRAWAL CHARGES (SEE SECTION 8.01): A withdrawal charge will be imposed as a
percentage of the initial and each subsequent Contribution made to the extent
that a withdrawal exceeds the Free Corridor Amount as discussed in Section 8.01
or, if the Certificate is surrendered to receive the Cash Value. We determine
the withdrawal charge separately for each Contribution in accordance with the
table below.
Current and Maximum
Percentage of
Contract Year Contributions
------------- -------------
1 7.00%
2 6.00%
3 5.00%
4 4.00%
5 3.00%
6 2.00%
7 1.00%
8 and later 0.00%
The applicable withdrawal charge percentage is determined by the Contract Year
in which the withdrawal is made or the Certificate is surrendered, beginning
with "Contract Year 1" with respect to each Contribution withdrawn or
surrendered. For purposes of the table, for each Contribution, the Contract Year
in which we receive that Contribution is "Contract Year 1."
No. 94ICA/BIM Data Page 6
<PAGE>
DATA PAGES (CONT'D.)
Withdrawal charges will be deducted from the Investment Options from which each
withdrawal is made in proportion to the amount being withdrawn from each
Investment Option.
FREE CORRIDOR AMOUNT (SEE SECTION 8.01): 15% of Annuity Account Value at the
beginning of the Contract Year, minus any amount previously withdrawn during the
Contract Year. Amounts withdrawn up to the Free Corridor Amount will not be
deemed a withdrawal of Contributions.
Withdrawals in excess of the Free Corridor Amount will be deemed withdrawals of
Contributions in the order in which they were made (that is, the first-in,
first-out basis will apply).
The Free Corridor Amount does not apply when calculating the withdrawal charge
applicable upon a surrender.
CHARGES DEDUCTED FROM ANNUITY ACCOUNT VALUE (SEE SECTION 8.02):
(a) Distribution Fee: A distribution fee is deducted in an amount
of 0.35% of each Contribution made on each of the seven
Processing Dates (so long as the Certificate is in force)
following receipt of each Contribution. 0.35% is the maximum
we will charge.
(b) Guaranteed Minimum Death Benefit Charge: For the guaranteed
minimum death benefit we will deduct on each Processing Date
an amount equal to 0.35% of the guaranteed minimum death
benefit in effect on such Processing Date. 0.35% is the
maximum we will charge.
(c) Annual Contract Fee: An administrative charge of $30 per
Contract Year is incurred at the beginning of each Contract
Year and deducted on each Processing Date. $30 is the maximum
amount we will charge. If total Contributions received in the
first Contract Year equal $25,000 or more, this charge will be
zero.
(d) Premium Taxes: A charge for any applicable premium tax
generally will be deducted from the amount applied to provide
an Annuity Benefit if you elect to annuitize. In certain
states, however, we may deduct the charge from Contributions
rather than at the Annuity Commencement Date.
Unless you specify otherwise, all of the above charges will be deducted from the
Annuity Account Value in the Investment Funds on a pro rata basis. If there is
insufficient value in the Investment Funds, all or a portion of the charges in
(a), (c) and (d) will be deducted from the Annuity Account Value in the
Guaranteed Period Account. The charge in (b) will always be deducted from the
Annuity Account Value in the Investment Funds on a pro rata basis. Also, if you
surrender the Certificate or it is terminated during a Contract Year before the
next Processing Date, we will deduct any annual contract fee in (c) incurred but
not yet deducted.
No. 94ICA/BIM Data Page 7
<PAGE>
DATA PAGES (CONT'D.)
TRANSFER CHARGE (SEE SECTION 8.03): Currently, there is no charge. However, we
reserve the right to impose a charge at a maximum of $25 for each transfer per
Contract Year in excess of five.
DAILY SEPARATE ACCOUNT CHARGES (SEE SECTION 8.04):
Current and Maximum Mortality and Expense Risk Charge: Annual rate of 0.90%
(equivalent to a daily
rate of 0.002477%).
Current and Maximum Asset Based Administrative Charge: Annual rate of 0.25%
(equivalent to a daily
rate of 0.000692%).
No. 94ICA/BIM Data Page 8
<PAGE>
DATA PAGES (CONT'D.) FOR NQ (1/31/95)
PART C -- THIS PART LISTS THE TERMS WHICH APPLY TO THE ENDORSEMENT APPLICABLE TO
- ------ MARKET VALUE ADJUSTMENT TERMS (MVA).
ALLOCATION RESTRICTIONS (SEE SECTION 3.01): You must provide specific
instructions as to how each Contribution will be allocated among the Guarantee
Periods. If the Annuitant is between ages 65 through 74 allocations may not be
made to a Guarantee Period with a maturity year that would exceed the year in
which the Annuitant will attain age 80. If the Annuitant is age 75 or above,
allocations may be made only to Guarantee Periods with maturities of five years
or less; however, in no event may allocations be made to Guarantee Periods with
maturities beyond the Annuity Commencement Date.
TRANSFERS AT EXPIRATION DATE (SEE ITEM 1 OF MVA ENDORSEMENT): If no election is
made with respect to amounts in the Guaranteed Period Account as of the
Expiration Date, such amounts will be transferred into the Guarantee Period with
the shortest Expiration Date.
MARKET VALUE ADJUSTMENT ON TRANSFERS AND WITHDRAWALS (SEE ITEM 2 OF MVA
ENDORSEMENT): The MVA (positive or negative) resulting from a withdrawal or
transfer of a portion of the amount in a Guarantee Period will be a percentage
of the MVA that would be applicable upon a withdrawal of all of the Annuity
Account Value from a Guarantee Period. This percentage is determined by (i)
dividing the amount of the withdrawal or transfer from the Guarantee Period by
(ii) the Annuity Account Value in such Guarantee Period prior to the withdrawal
or transfer.
TRANSFER RULES (SEE SECTION 4.02): No transfers are permitted to or from the
Guaranteed Period Account during the first Contract Year and only one transfer
per Contract Year may be made thereafter. Transfers are limited based on the
attained age of the Annuitant(see "Allocation Restrictions" above).
MINIMUM TRANSFER AMOUNT (SEE SECTION 4.02): The amount transferred to or from
the Guaranteed Period Account must be at least $2,000 or, if less, the entire
Annuity Account Value may be transferred from the Guaranteed Period Account.
Similarly, the entire Annuity Account Value in the Investment Funds may be
transferred to the Guaranteed Period Account.
WITHDRAWALS (SEE SECTION 5.01): If you choose to have withdrawals allocated to
the Guaranteed Period Account, or a withdrawal is greater than the Annuity
Account Value in the Investment Funds, you must specify the Guarantee Period(s)
from which the withdrawal plus any withdrawal charge will be taken.
No. 94ICA/BMVA Data Page 9
<PAGE>
DATA PAGES (CONT'D.)
MVA FORMULA (SEE ITEM 3 OF MVA ENDORSEMENT): The Guaranteed Rate for new
allocations to a Guarantee Period is the rate we have in effect for this
purpose. Guaranteed Rates will be in effect even if new allocations to a
particular Guarantee Period would not be accepted at the time.
The current rate percentage we use in item (c) of the formula is 0.00%. For
purposes of calculating the MVA only, we reserve the right add up to 0.25% to
such current rate percentage.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01): The larger of (a) the Annuity Account
Value in the Guaranteed Period Account and (b) the sum of the Guaranteed Period
Amounts in each Guarantee Period.
No. 94ICA/BMVA Data Page 10
<PAGE>
FOR NQ PLAN A (1/31/95)
DATA
PART A -- THIS PART LISTS YOUR PERSONAL DATA.
OWNER: [John Doe]
ANNUITANT: [John Doe] Age: [60] Sex: [Male]
CERTIFICATE NUMBER: [00000]
Endorsements Attached: [Endorsement Applicable to Non-Qualified
Certificates]
[Endorsement Applicable to Market Value
Adjustment Terms]
CONTRACT: GROUP ANNUITY CONTRACT NO. AC [0000]
ISSUE DATE: [January 1, 1995]
CONTRACT DATE: [January 1, 1995]
ANNUITY COMMENCEMENT DATE:
THE MAXIMUM MATURITY AGE IS AGE [85] -- SEE SECTION 7.03.
The Annuity Commencement Date may not be later than the month which
follows the Annuitant's [85th] birthday, or seven years after the
Contract Date, if later.
BENEFICIARY: [Jane Doe]
SUCCESSOR OWNER: [Applicable if Owner is different than the Annuitant]
SUCCESSOR OWNER/ANNUITANT: [Applicable if Owner and Annuitant are the same and
beneficiary is the spouse at the time of election and
time of Owner/Annuitant's death]
No. 94ICA/BIM Data Page 1
<PAGE>
DATA PAGES (CONT'D.)
PART B - -THIS PART LISTS THE CONTRACT TERMS WHICH AFFECT THE TYPE OF
CERTIFICATE YOU HAVE.
INITIAL CONTRIBUTION RECEIVED (SEE SECTION 3.02): [$10,000]
INVESTMENT OPTIONS AVAILABLE (SEE PART II); YOUR INITIAL ALLOCATION IS ALSO
SHOWN.
INVESTMENT OPTIONS ALLOCATION PERCENTAGE (SEE SECTION 3.01)
- ------------------ ----------------------------------------
o [GUARANTEE PERIODS
EXPIRATION DATE AND GUARANTEED RATE
FEBRUARY 15, 1996 - 5.00%
FEBRUARY 15, 1997 - 5.00%
FEBRUARY 15, 1998 - 5.00%
FEBRUARY 15, 1999 - 6.00%
FEBRUARY 15, 2000 - 6.00%
FEBRUARY 15, 2001 - 6.00%
FEBRUARY 15, 2002 - 7.00%
FEBRUARY 15, 2003 - 7.00%
FEBRUARY 15, 2004 - 7.00%
FEBRUARY 15, 2005 - 8.00%*
FEBRUARY 15, 2006 - 8.00%*
FEBRUARY 15, 2007 - 8.00%*
FEBRUARY 15, 2008 - 9.00%*
FEBRUARY 15, 2009 - 9.00%*
FEBRUARY 15, 2010 - 9.00%*] ________________________
TOTAL: 100%
Guarantee Periods shown are in the Guaranteed Period Account. See Endorsement
Applicable to Market Value Adjustment Terms.
[*Not available in New York and Pennsylvania]
"TYPES" OF INVESTMENT OPTIONS (SEE SECTION 4.02): Not applicable
GUARANTEED INTEREST ACCOUNT (SEE SECTION 2.01): Not available under this
Certificate
SEPARATE ACCOUNT (SEE SECTION 2.02, 2.03 AND 2.05): Not applicable
No. 94ICA/BIM Data Page 2
<PAGE>
DATA PAGES (CONT'D.)
BUSINESS DAY (SEE SECTION 1.05): A Business Day for this Certificate will mean
any day on which the New York Stock Exchange is open for trading.
PROCESSING DATES (SEE SECTION 1.20): Not applicable
AVAILABILITY OF INVESTMENT OPTIONS (SEE SECTION 2.04): The only Investment
Options available under this Certificate are the Guarantee Periods. (See Data
Pages, Part C: Allocation Restrictions)
DESIGNATED INVESTMENT OPTION (SEE THE LAST PARAGRAPH OF SECTION 2.05): (See Data
Pages, Part C; Transfers at Expiration Date)
ALLOCATION OF CONTRIBUTIONS (SEE SECTION 3.01): Allocations of Contributions may
be in dollar amounts or percentages. Such allocations must equal the total
dollar amount or 100% of the Contribution, as applicable. You must provide
allocation instructions for each subsequent Contribution. (Also see Data Pages,
Part C; Allocation Restrictions)
CONTRIBUTION LIMITS (SEE SECTION 3.02): Initial Contribution minimum: $10,000.
Subsequent Contribution minimum $1,000 or $250 monthly under the Automatic
Investment Program. Subsequent Contributions can be made until the Annuitant
reaches age 78. We may refuse to accept any Contribution if the sum of all
Contributions under your Certificate would then total more than $1,500,000.
TRANSFER RULES (SEE SECTION 4.02): (See Data Pages, Part C)
MINIMUM TRANSFER AMOUNT (SEE SECTION 4.02): (See Data Pages, Part C)
ALLOCATION OF WITHDRAWALS (SEE SECTION 5.01): (See Data Pages, Part C;
Withdrawals)
WITHDRAWAL RESTRICTIONS (SEE SECTION 5.01): Lump Sum Withdrawal - May not be
taken until after the first Contract Year, and only one Lump Sum Withdrawal may
be taken during a Contract Year thereafter at any time during such Contract
Year. Periodic Withdrawals - Will be made annually on the Expiration Dates of
the applicable Guarantee Periods.
MINIMUM WITHDRAWAL AMOUNT (SEE SECTION 5.01): Lump Sum Withdrawal and Periodic
Withdrawals minimum- $1,000.
MINIMUM AMOUNT OF ANNUITY ACCOUNT VALUE AFTER A WITHDRAWAL (SEE SECTION 5.02):
Requests for a withdrawal must be for either (a) 90% or less of the Cash Value
or (b) 100% of the Cash Value (surrender of the Certificate).
No. 94ICA/BIM Data Page 3
<PAGE>
DATA PAGES (CONT'D.)
We will not exercise our rights, described in Sections 5.02(b) and 5.02(c), to
terminate the Certificate.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01): (See Data Pages, Part C)
NORMAL FORM OF ANNUITY (SEE SECTION 7.04): Life Annuity 10 Year Period Certain
AMOUNT OF ANNUITY BENEFIT (SEE SECTION 7.05): The amount applied to provide the
Annuity Benefit will be the Cash Value.
INTEREST RATE TO BE APPLIED IN ADJUSTING FOR MISSTATEMENT OF AGE OR SEX (SEE
SECTION 7.06): 6% per year
MINIMUM AMOUNT TO BE APPLIED FOR AN ANNUITY (SEE SECTION 7.06): $2,000, as well
as minimum of $20 for initial monthly annuity payment.
WITHDRAWAL CHARGES (SEE SECTION 8.01): A withdrawal charge will be imposed as a
percentage of the initial and each subsequent Contribution made to the extent
that a withdrawal exceeds the Free Corridor Amount as discussed in Section 8.01
or, if the Certificate is surrendered to receive the Cash Value. We determine
the withdrawal charge separately for each Contribution in accordance with the
table below.
Current and Maximum
Percentage of
Contract Year Contributions
------------- -------------
1 7.00%
2 6.00%
3 5.00%
4 4.00%
5 3.00%
6 2.00%
7 1.00%
8 and later 0.00%
The applicable withdrawal charge percentage is determined by the Contract Year
in which the withdrawal is made or the Certificate is surrendered, beginning
with "Contract Year 1" with respect to each Contribution withdrawn or
surrendered. For purposes of the table, for each Contribution, the Contract Year
in which we receive that Contribution is "Contract Year 1."
Withdrawal charges will be deducted from the Annuity Account Value in the
Investment Options from which each withdrawal is made in proportion to the
amount being withdrawn from each Investment Option.
No. 94ICA/BIM Data Page 4
<PAGE>
DATA PAGES (CONT'D.)
FREE CORRIDOR AMOUNT (SEE SECTION 8.01): 10% of Annuity Account Value at the
beginning of the Contract Year, minus any amount previously withdrawn during the
Contract Year. Amounts withdrawn up to the Free Corridor Amount will not be
deemed a withdrawal of Contributions.
Withdrawals in excess of the Free Corridor Amount will be deemed withdrawals of
Contributions in the order in which they were made (that is, the first-in,
first-out basis will apply).
The Free Corridor Amount does not apply when calculating the withdrawal charge
applicable upon a surrender.
CHARGES DEDUCTED FROM ANNUITY ACCOUNT VALUE (SEE SECTION 8.02):
Premium Taxes: A charge for any applicable premium tax generally will be
deducted from the amount applied to provide an Annuity Benefit or any other form
of benefit payment. In certain states, however, we may deduct the charge from
Contributions rather than at the Annuity Commencement Date.
TRANSFER CHARGE (SEE SECTION 8.03): Not applicable
DAILY SEPARATE ACCOUNT CHARGES (SEE SECTION 8.04): Not applicable
No. 94ICA/BIM Data Page 5
<PAGE>
DATA PAGES (CONT'D.) FOR NQ PLAN A (1/31/95)
PART C -- THIS PART LISTS THE TERMS WHICH APPLY TO THE MARKET VALUE ADJUSTMENT
TERMS (MVA) ENDORSEMENT.
ALLOCATION RESTRICTIONS (SEE SECTION 3.01): If the Annuitant is between ages 65
through 74 allocations may not be made to a Guarantee Period with a maturity
year that would exceed the year in which the Annuitant will attain age 80. If
the Annuitant is age 75 or above, allocations may be made only to Guarantee
Periods with maturities of five years or less; however, in no event may
allocations be made to Guarantee Periods with maturities beyond the Annuity
Commencement Date.
TRANSFERS AT EXPIRATION DATE (SEE ITEM 1 OF MVA ENDORSEMENT): If no election is
made with respect to amounts in the Guaranteed Period Account as of the
Expiration Date, such amounts will be transferred into the Guarantee Period with
the shortest Expiration Date.
MARKET VALUE ADJUSTMENT ON TRANSFERS AND WITHDRAWALS (SEE ITEM 2 OF MVA
ENDORSEMENT): The MVA (positive or negative) resulting from a withdrawal or
transfer of a portion of the amount in a Guarantee Period will be a percentage
of the MVA that would be applicable upon a withdrawal of all of the Annuity
Account Value in a Guarantee Period. This percentage is determined by (i)
dividing the amount of the withdrawal or transfer from the Guarantee Period by
(ii) the Annuity Account Value in such Guarantee Period prior to the withdrawal
or transfer.
TRANSFER RULES (SEE SECTION 4.02): No transfers are permitted among the
Guarantee Periods during the first Contract Year and only one transfer per
Contract Year may be made thereafter. Transfers are limited based on the
attained age of the Annuitant (see "Allocation Restrictions" above).
MINIMUM TRANSFER AMOUNT (SEE SECTION 4.02): The amount transferred from a
Guarantee Period must be at least $2,000 or, if less, the entire Annuity Account
Value may be transferred from such Guarantee Period.
WITHDRAWALS (SEE SECTION 5.01): Unless you elect otherwise, withdrawals plus any
withdrawal charges that apply will be withdrawn from the Annuity Account Value
in the Guarantee Periods in order of the Expiration Dates, beginning with the
shortest Expiration Date.
MVA FORMULA (SEE ITEM 3 OF MVA ENDORSEMENT): The Guaranteed Rate for new
allocations to a Guarantee Period is the rate we have in effect for this
purpose. Guaranteed Rates will be in effect even if new allocations to a
particular Guarantee Period would not be accepted at the time.
No. 94ICA/BMVA Data Page 6
<PAGE>
DATA PAGES (CONT'D.)
The current rate percentage we use in item (c) of the formula is 0.00%. For
purposes of calculating the MVA only, we reserve the right to add up to 0.25% to
such current rate percentage.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01): The larger of (a) the Annuity Account
Value and (b) the sum of the Guaranteed Period Amounts in each Guarantee Period.
No. 94ICA/BMVA Data Page 7
<PAGE>
FOR NQ PLAN B (1/31/95)
DATA
----
PART A -- THIS PART LISTS YOUR PERSONAL DATA.
- ------
OWNER: [John Doe]
ANNUITANT: [John Doe] Age: [60] Sex: [Male]
CERTIFICATE NUMBER: [00000]
Endorsements Attached: [Endorsement Applicable to Non-Qualified
Certificates]
[Endorsement Applicable to Market Value
Adjustment Terms]
CONTRACT: GROUP ANNUITY CONTRACT NO. AC [0000]
ISSUE DATE: [January 1, 1995]
CONTRACT DATE: [January 1, 1995]
ANNUITY COMMENCEMENT DATE:
THE MAXIMUM MATURITY AGE IS AGE [85] -- SEE SECTION 7.03.
The Annuity Commencement Date is the date on which the first payment is
made under this Certificate. The first payment under this Certificate
will be made on February 15, [1996].
BENEFICIARY: [Jane Doe]
SUCCESSOR OWNER: [Applicable if Owner is different than the Annuitant]
SUCCESSOR OWNER/ANNUITANT: [Applicable if Owner and Annuitant are the same and
beneficiary is the spouse at the time of election
and time of Owner/Annuitant's death]
No. 94ICA/BIM Data Page 1
<PAGE>
DATA PAGES (CONT'D.)
PART B -- THIS PART LISTS THE CONTRACT TERMS WHICH AFFECT THE TYPE OF
- ------ CERTIFICATE YOU HAVE.
INITIAL CONTRIBUTION RECEIVED (SEE SECTION 3.02): [$10,000]
INVESTMENT OPTIONS AVAILABLE (SEE PART II); YOUR INITIAL ALLOCATION IS ALSO
SHOWN.
INVESTMENT OPTIONS ALLOCATION PERCENTAGE (SEE SECTION 3.01)
- ------------------ ----------------------------------------
o [GUARANTEE PERIODS
EXPIRATION DATE AND GUARANTEED RATE
FEBRUARY 15, 1996 - 5.00%
FEBRUARY 15, 1997 - 5.00%
FEBRUARY 15, 1998 - 5.00%
FEBRUARY 15, 1999 - 6.00%
FEBRUARY 15, 2000 - 6.00%
FEBRUARY 15, 2001 - 6.00%
FEBRUARY 15, 2002 - 7.00%
FEBRUARY 15, 2003 - 7.00%
FEBRUARY 15, 2004 - 7.00%
FEBRUARY 15, 2005 - 8.00%*
FEBRUARY 15, 2006 - 8.00%*
FEBRUARY 15, 2007 - 8.00%*
FEBRUARY 15, 2008 - 9.00%*
FEBRUARY 15, 2009 - 9.00%*
FEBRUARY 15, 2010 - 9.00%*]
-----------------------------
TOTAL: 100%
Guarantee Periods shown are in the Guaranteed Period Account. See Endorsement
Applicable to Market Value Adjustment Terms.
[*Not available in New York and Pennsylvania]
"TYPES" OF INVESTMENT OPTIONS (SEE SECTION 4.02): Not applicable
GUARANTEED INTEREST ACCOUNT (SEE SECTION 2.01): Not available under this
Certificate
SEPARATE ACCOUNT (SEE SECTION 2.02, 2.03 AND 2.05): Not applicable
No. 94ICA/BIM Data Page 2
<PAGE>
DATA PAGES (CONT'D.)
BUSINESS DAY (SEE SECTION 1.05): A Business Day for this Certificate will mean
any day on which the New York Stock Exchange is open for trading.
PROCESSING DATES (SEE SECTION 1.20): Not applicable
AVAILABILITY OF INVESTMENT OPTIONS (SEE SECTION 2.04): The only Investment
Options available under this Certificate are the Guarantee Periods. (See Data
Pages, Part C: Allocation Restrictions)
DESIGNATED INVESTMENT OPTION (SEE THE LAST PARAGRAPH OF SECTION 2.05): (See Data
Pages, Part C; Transfers at Expiration Date)
ALLOCATION OF CONTRIBUTIONS (SEE SECTION 3.01): (See Data Pages, Part C;
Allocation Restrictions)
CONTRIBUTION LIMITS (SEE SECTION 3.02): Initial Contribution minimum: $10,000.
No subsequent Contribution may be made. We may refuse to accept any Contribution
in excess of $1,500,000.
TRANSFER RULES (SEE SECTION 4.02): Transfers are not permitted.
MINIMUM TRANSFER AMOUNT (SEE SECTION 4.02): Not applicable
ALLOCATION OF WITHDRAWALS (SEE SECTION 5.01): (See Data Pages, Part C;
Withdrawals)
WITHDRAWAL RESTRICTIONS (SEE SECTION 5.01): After the first Contract Year, you
may take one Lump Sum Withdrawal during a Contract Year at any time during such
Contract Year.
MINIMUM WITHDRAWAL AMOUNT (SEE SECTION 5.01): Lump Sum Withdrawal minimum- the
greater of $2,000 and 25% of the Cash Value.
MINIMUM AMOUNT OF ANNUITY ACCOUNT VALUE AFTER A WITHDRAWAL (SEE SECTION 5.02):
Requests for a Lump Sum Withdrawal must be for either (a) 90% or less of the
Cash Value or (b) 100% of the Cash Value (surrender of the Certificate).
We will not exercise our rights, described in Sections 5.02(b) and 5.02(c), to
terminate the Certificate.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01): (See Data Pages, Part C)
ANNUITY BENEFIT (SEE SECTION 7.01): (See Data Pages, Part C)
No. 94ICA/BIM Data Page 3
<PAGE>
DATA PAGES (CONT'D.)
BENEFIT PAYMENT SELECTED (SEE SECTION 7.02): Plan B pursuant to Section 7.02
(iii), with a fixed period of [15] years and level annual payments in the amount
of [$5,000]. Amounts may not be applied under any other Annuity Benefit.
NORMAL FORM OF ANNUITY (SEE SECTION 7.04): Not applicable
AMOUNT OF ANNUITY BENEFIT (SEE SECTION 7.05): The amount applied to provide the
Annuity Benefit will be the Annuity Account Value.
INTEREST RATE TO BE APPLIED IN ADJUSTING FOR MISSTATEMENT OF AGE OR SEX (SEE
SECTION 7.06): 6% per year
MINIMUM AMOUNT TO BE APPLIED TO AN ANNUITY (SEE SECTION 7.06): $2,000
WITHDRAWAL CHARGES (SEE SECTION 8.01): A withdrawal charge will be imposed as a
percentage of the initial Contribution made when a Lump Sum Withdrawal is taken,
or if the Certificate is surrendered to receive the Cash Value. The withdrawal
charge is determined in accordance with the table below.
Current and Maximum
Percentage of
Contract Year Contributions
------------- -------------
1 7.00%
2 6.00%
3 5.00%
4 4.00%
5 3.00%
6 2.00%
7 1.00%
8 and later 0.00%
The applicable withdrawal charge percentage is determined by the Contract Year
in which the Lump Sum Withdrawal is made or the Certificate is surrendered,
beginning with "Contract Year 1."
Withdrawal charges will be deducted from the Annuity Account Value in the
Guarantee Periods from which each Lump Sum Withdrawal is taken in proportion to
the amount being withdrawn from each Guarantee Period.
FREE CORRIDOR AMOUNT (SEE SECTION 8.01): There is no Free Corridor Amount.
No. 94ICA/BIM Data Page 4
<PAGE>
DATA PAGES (CONT'D.)
CHARGES DEDUCTED FROM ANNUITY ACCOUNT VALUE (SEE SECTION 8.02):
Premium Taxes: A charge for any applicable premium tax generally will be
deducted no later than the Annuity Commencement Date.
TRANSFER CHARGE (SEE SECTION 8.03): Not applicable
DAILY SEPARATE ACCOUNT CHARGES (SEE SECTION 8.04): Not applicable
No. 94ICA/BIM Data Page 5
<PAGE>
DATA PAGES (CONT'D.) FOR NQ PLAN B (1/31/95)
PART C -- THIS PART LISTS THE TERMS WHICH APPLY TO THE ENDORSEMENT APPLICABLE TO
- ------ MARKET VALUE ADJUSTMENT TERMS (MVA).
ALLOCATION RESTRICTIONS (SEE SECTION 3.01): The entire amount of any
Contribution and any Annuity Account Value must be allocated to [seven] or more
Guarantee Periods having Expiration Dates in annual sequence, so as to provide
substantially equal annual payments for a fixed period.
TRANSFERS AT EXPIRATION DATE (SEE ITEM 1 OF MVA ENDORSEMENT): The Guaranteed
Period Amount will be paid out on each Expiration Date. Such amounts may not be
transferred into any other Guarantee Periods or applied under any other Annuity
Benefit. There is no Designated Investment Option.
MARKET VALUE ADJUSTMENT ON WITHDRAWALS (SEE ITEM 2 OF MVA ENDORSEMENT): The MVA
(positive or negative) resulting from a withdrawal of a portion of the amount in
a Guarantee Period will be a percentage of the MVA that would be applicable upon
a withdrawal of all of the Annuity Account Value from a Guarantee Period. This
percentage is determined by (i) dividing the amount of the withdrawal from the
Guarantee Period by (ii) the Annuity Account Value in such Guarantee Period
prior to the withdrawal.
WITHDRAWALS (SEE SECTION 5.01): Lump Sum Withdrawals plus any withdrawal charges
that apply will be taken pro rata from the Annuity Account Value in all
unmatured Guarantee Periods so that the annual payments under Plan B will
continue in reduced level amounts over the remaining term of the fixed period.
MVA FORMULA (SEE ITEM 3 OF MVA ENDORSEMENT): The Guaranteed Rate for new
allocations to a Guarantee Period is the rate we have in effect for this
purpose. Guaranteed Rates will be in effect even if new allocations to a
particular Guarantee Period would not be accepted at the time.
The current rate percentage we use in item (c) of the formula is 0.00%. For
purposes of calculating the MVA only, we reserve the right to add up to 0.25% to
such current rate percentage.
DEATH BENEFIT AMOUNT (SEE SECTION 6.01): Prior to the Annuity Commencement Date,
the death benefit amount is equal to larger of (a) the Annuity Account Value and
(b) the sum of the Guaranteed Period Amounts in each Guarantee Period.
No. 94ICA/BMVA Data Page 6
<PAGE>
DATA PAGES (CONT'D.)
If you (or the Annuitant, if you are not the Annuitant) die after the Annuity
Commencement Date, payments will continue to be made to the designated
beneficiary on the same basis that was in effect prior to the death. The
beneficiary has the option of discontinuing payments and receiving a single sum.
ANNUITY BENEFIT (SEE SECTION 7.01): Plan B payments wil be made annually.
No. 94ICA/BMVA Data Page 7
<TABLE>
<CAPTION>
COMBINATION VARIABLE AND FIXED
ROLLOVER IRA APPLICATION
<S> <C> <C>
- --------------------------------------------------- ------------------------------------------ -----------------------------------
1. OWNER/ANNUITANT Street, City, State, Zip Code Date of Birth (Month/Day/Year)
(First, Middle, Last Name)
Phone Number(s): Social Security No.
----------------------------------------------------------- ----------------
|_| Male |_| Female
- --------------------------------------------------- ------------------------------------------ -----------------------------------
2. CUSTODIAN (If applicable) Street, City, State, Zip Code Phone Number(s):
(First, Middle, Last Name)
- ----------------------------------------------------------------------------------------------------------------------------------
3. (A) PRIMARY BENEFICIARY(IES) (If more than one - indicate %) Relationship to Annuitant:
(B) SUCCESSOR BENEFICIARY(IES) (If any) (If more than one - indicate %) Relationship to Annuitant:
- ----------------------------------------------------------------------------------------------------------------------------------
4. SUCCESSOR ANNUITANT/OWNER INFORMATION (Optional)
Must be Annuitant's spouse and the sole primary Beneficiary named in Number 3(a) above.
Complete the following: _________________________________ ________________________________
Spouse's Social Security No. Spouse's Date of Birth (Month/Day/Year)
- ----------------------------------------------------------------------------------------------------------------------------------
5. AGE AT WHICH ANNUITY PAYMENTS ARE TO COMMENCE ____________________
- ----------------------------------------------------------------------------------------------------------------------------------
6. INITIAL CONTRIBUTION INFORMATION
TOTAL INITIAL CONTRIBUTION: $_______________ |_| By check payable to Equitable Life |_| By Wire
- ----------------------------------------------------------------------------------------------------------------------------------
7. ALLOCATION Fill in the initial contribution allocation to the Investment Options below.
(A) INITIAL CONTRIBUTION ALLOCATION TO INVESTMENT FUNDS:
<S> <C>
ASSET ALLOCATION SERIES: EQUITY SERIES:
|_| Conservative Investors............._______% or $_______ |_| Growth & Income......._______% or $_______
|_| Growth Investors..................._______% or $_______ |_| Common Stock.........._______% or $_______
FIXED INCOME SERIES: |_| Global................_______% or $_______
|_| Money Market......................._______% or $_______ |_| International........._______% or $_______
|_| Quality Bond......................._______% or $_______ |_| Aggressive Stock......_______% or $_______
|_| Intermediate Gov't Securities......_______% or $_______
(B) INITIAL CONTRIBUTION ALLOCATION TO GUARANTEED PERIOD ACCOUNT:
Each Guarantee Period expires on February 15 of the maturity year. See the prospectus for allocation restrictions which apply to
Annuitants age 65 and above.
<S> <C> <C> <C>
|_|1996 ______% or $______ |_|2000 ______% or $______ |_|2004 ______% or $______ |_|2008 ______% or $______
|_|1997 ______% or $______ |_|2001 ______% or $______ |_|2005 ______% or $______ |_|2009 ______% or $______
|_|1998 ______% or $______ |_|2002 ______% or $______ |_|2006 ______% or $______ |_|2010 ______% or $______
|_|1999 ______% or $______ |_|2003 ______% or $______ |_|2007 ______% or $______
TOTAL INITIAL CONTRIBUTION: 100% OR $_______
- ----------------------------------------------------------------------------------------------------------------------------------
EQUITABLE LIFE, INCOME MANAGEMENT GROUP, P.O. BOX 13014, NEWARK, N.J. 07188-0014
(800) 789-7771
IRASEC
</TABLE>
<PAGE>
<TABLE>
- ----------------------------------------------------------------------------------------------------------------------------------
8. |_| MINIMUM DISTRIBUTION WITHDRAWALS (Can only be elected if the Annuitant will attain age 70 1/2 in the current calendar year.)
The minimum withdrawal amount is $250.
WITHHOLDING ELECTION INFORMATION
<S> <C>
A. |_| I do not want to have Federal income tax withheld. (U.S. residence address and Social Security No. required)
B. |_| I want to have 10% Federal income tax withheld from each withdrawal. (You may also designate an additional amount in
line "C.")
C. |_| I want the following additional amount withheld from each withdrawal $______________. (You must also complete line
"B.")
See the prospectus for Withholding Election Instructions.
- ----------------------------------------------------------------------------------------------------------------------------------
9. TELEPHONE TRANSFER AUTHORIZATION ________________ Annuitant's Initials
I authorize Equitable Life to act upon transfer instructions given by telephone from _____________________________ (name of your
registered representative) upon furnishing the proper identification. Neither Equitable Life nor any person authorized by Equitable
Life will be responsible for any claim, loss, liability or expense in connection with transfer instructions received by telephone
from such person if Equitable Life or such other person acted on such telephone instructions in good faith in reliance upon this
authorization. Equitable Life will continue to act upon this authorization until such time as I notify Equitable Life otherwise in
writing.
- ----------------------------------------------------------------------------------------------------------------------------------
10. SPECIAL INSTRUCTIONS
- ----------------------------------------------------------------------------------------------------------------------------------
11. SUITABILITY
A. Did you receive THE INCOME MANAGER IRA prospectus? |_| Yes |_| No
------------------------------------ -----------------------------------
Date of Prospectus Date(s) of any Supplement(s) to Prospectus
B. Will any existing insurance or annuity be (or has it been) replaced or changed, assuming the Certificate applied for will be
issued? |_| Yes |_| No If Yes, complete the following:
---------- --------------- ------------------------------- ------------------------
Year Issued Type of Plan Company Certificate/Contract Number
----------------------------------------------------------------------------
Company Address
- ----------------------------------------------------------------------------------------------------------------------------------
12. AGREEMENT
All information and statements furnished in this application are true and complete to the best of my knowledge and belief. I
understand and acknowledge that no registered representative has the authority to make or modify any Certificate on behalf of
Equitable Life, or to waive or alter any of Equitable Life's rights and regulations. I understand that the Annuity Account Value
attributable to allocations to the Investment Funds and variable annuity benefit payments may increase or decrease and are not
guaranteed as to dollar amount. I understand that amounts allocated to the Guaranteed Period Account may increase or decrease in
accordance with a market value adjustment and are not guaranteed unless held to the Expiration Date.
LAWS IN YOUR STATE MAY MAKE IT A CRIME TO FILL OUT AN
INSURANCE OR ANNUITY APPLICATION WITH INFORMATION YOU
KNOW IS FALSE OR TO LEAVE OUT MATERIAL FACTS.
- -------------------------------------------------------------------------------- ------------------------------
Signature of Annuitant Date Signed at (City, State)
- ----------------------------------------------------------------------------------------------------------------------------------
Do you have reason to believe that the Certificate applied for will replace any existing annuity or life insurance on the life
of the annuitant? |_| Yes |_| No (In Florida only) Florida License ID No. _______________
- ----------------------------------------------------------------------------------------------------------------------------------
Registered Representative Signature Print Name & No. of Registered Representative
- ----------------------------------------------------------------------------------------------------------------------------------
Registered Representative Soc. Sec. No./TIN Broker-Dealer/Branch Client Account No.
- ----------------------------------------------------------------------------------------------------------------------------------
IRASEC
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COMBINATION VARIABLE AND
FIXED NON-QUALIFIED (NQ)
DEFERRED ANNUITY APPLICATION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. OWNER(S) (First, Middle, Last Name) Street, City, State, Zip Code Date of Birth (Month/Day/Year)
Phone Number(s): Social Security No./TIN
|_| Male |_| Female
- ------------------------------------------------------------------------------------------------------------------------------------
2. ANNUITANT (If other than Owner) Street, City, State, Zip Code Date of Birth (Month/Day/Year)
Relationship to Owner: Phone Number(s): Social Security No./TIN
|_| Male |_| Female
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
3. (A) PRIMARY BENEFICIARY(IES) (If more than one - indicate %) Relationship to Annuitant:
(B) SUCCESSOR BENEFICIARY(IES) (If any) (If more than one - indicate %) Relationship to Annuitant:
- ------------------------------------------------------------------------------------------------------------------------------------
4. SUCCESSOR ANNUITANT/OWNER INFORMATION (Can only be elected if the Owner and Annuitant are the same person) Must be Annuitant's
spouse and the sole primary Beneficiary named in Number 3(a) above. Complete the following:
_________________________________ ______________________________________
Spouse's Social Security No. Spouse's Date of Birth (Month/Day/Year)
- ------------------------------------------------------------------------------------------------------------------------------------
5. SUCCESSOR OWNER INFORMATION (Available only when the Annuitant and Owner are different persons)
<S> <C> <C>
First, Middle, Last Name Street, City, State, Zip Code Date of Birth (Month/Day/Year)
Social Security No./TIN
|_| Male |_| Female
- ------------------------------------------------------------------------------------------------------------------------------------
6. AGE AT WHICH ANNUITY PAYMENTS ARE TO COMMENCE ____________________
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
7. INITIAL CONTRIBUTION INFORMATION
TOTAL INITIAL CONTRIBUTION: $_______________ |_| By check payable to Equitable Life |_| By Wire
- ------------------------------------------------------------------------------------------------------------------------------------
8. ALLOCATION Fill in the initial contribution allocation to the Investment Options below.
(A) INITIAL CONTRIBUTION ALLOCATION TO INVESTMENT FUNDS:
ASSET ALLOCATION SERIES: EQUITY SERIES:
<S> <C>
|_| Conservative Investors............._______% or $_______ |_| Growth & Income......._______% or $_______
|_| Growth Investors..................._______% or $_______ |_| Common Stock.........._______% or $_______
FIXED INCOME SERIES: |_| Global................_______% or $_______
|_| Money Market......................._______% or $_______ |_| International........._______% or $_______
|_| Quality Bond......................._______% or $_______ |_| Aggressive Stock......_______% or $_______
|_| Intermediate Gov't Securities......_______% or $_______
(B) INITIAL CONTRIBUTION ALLOCATION TO GUARANTEED PERIOD ACCOUNT:
Each Guarantee Period expires on February 15 of the maturity year. See the prospectus for allocation restrictions which apply to
Annuitants age 65 and above.
<S> <C> <C> <C>
|_|1996 ______% or $______ |_|2000 ______% or $______ |_|2004 ______% or $______ |_|2008 ______% or $______
|_|1997 ______% or $______ |_|2001 ______% or $______ |_|2005 ______% or $______ |_|2009 ______% or $______
|_|1998 ______% or $______ |_|2002 ______% or $______ |_|2006 ______% or $______ |_|2010 ______% or $______
|_|1999 ______% or $______ |_|2003 ______% or $______ |_|2007 ______% or $______
TOTAL INITIAL CONTRIBUTION: 100% OR $_______________
- ------------------------------------------------------------------------------------------------------------------------------------
====================================================================================================================================
EQUITABLE LIFE, INCOME MANAGEMENT GROUP, P.O. BOX 13014, NEWARK, N.J. 07188-0014
(800)789-7771
NQSEC
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
9. |_| PERIODIC WITHDRAWALS (Optional)
(The minimum withdrawal amount is $250, not to exceed 2.25% quarterly and 9% annually of the Annuity Account Value.) WITHDRAWAL: |_|
__________% of Annuity Account Value or |_| $_____________
<S> <C> <C> <C> <C>
FREQUENCY: |_| Quarterly |_| Annually START DATE: ___________________ (Month, Day)
WITHHOLDING ELECTION INFORMATION
A. |_| I do not want to have Federal income tax withheld. (U.S. residence address and Social Security No.\TIN required)
B. |_| I want to have 10% Federal income tax withheld from each withdrawal. (You may also designate an additional amount in
line "C.")
C. |_| I want the following additional amount withheld from each withdrawal $______________. (You must also complete line
"B.")
See the prospectus for Withholding Election Instructions.
Unless you specify otherwise, withdrawals and withdrawal charges will be withdrawn on a pro rata basis from the Annuity Account
Value in the Investment Funds.
- ------------------------------------------------------------------------------------------------------------------------------------
10. TELEPHONE TRANSFER AUTHORIZATION (Optional) __________________ Owner's Initials
I authorize Equitable Life to act upon transfer instructions given by telephone from _________________________ (name of your
registered representative) upon furnishing the proper identification. Neither Equitable Life nor any person authorized by Equitable
Life will be responsible for any claim, loss, liability or expense in connection with transfer instructions received by telephone
from such person if Equitable Life or such other person acted on such telephone instructions in good faith in reliance upon this
authorization. Equitable Life will continue to act upon this authorization until such time as I notify Equitable Life otherwise in
writing.
- ------------------------------------------------------------------------------------------------------------------------------------
11. SPECIAL INSTRUCTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
12. SUITABILITY
A. Did you receive THE INCOME MANAGER NQ prospectus? |_| Yes |_| No
------------------------------------ -----------------------------------
Date of Prospectus Date(s) of any Supplement(s) to
Prospectus
B. Will any existing insurance or annuity be (or has it been) replaced or
changed, assuming the Certificate applied for will be issued? |_| Yes |_| No
If Yes, complete the following:
<S> <C> <C> <C>
---------- --------------- ------------------------------- ------------------------
Year Issued Type of Plan Company Certificate/Contract Number
-------------------------------------------------------------------------------------------------------
Company Address
- ------------------------------------------------------------------------------------------------------------------------------------
13. AGREEMENT
All information and statements furnished in this application are true and complete to the best of my knowledge and belief. I
understand and acknowledge that no registered representative has the authority to make or modify any Certificate on behalf of
Equitable Life, or to waive or alter any of Equitable Life's rights and regulations. I understand that the Annuity Account Value
attributable to allocations to the Investment Funds and variable annuity benefit payments may increase or decrease and are not
guaranteed as to dollar amount. I understand that amounts allocated to the Guaranteed Period Account may increase or decrease in
accordance with a market value adjustment and are not guaranteed unless held to the Expiration Date.
LAWS IN YOUR STATE MAY MAKE IT A CRIME TO FILL OUT AN
INSURANCE OR ANNUITY APPLICATION WITH INFORMATION YOU
KNOW IS FALSE OR TO LEAVE OUT MATERIAL FACTS.
<S> <C>
- ---------------------------------------------------------------- ------------------------------
Proposed Annuitant's Signature Date Signed at (City, State)
- ---------------------------------------------------------------- ------------------------------
Signature of Owner (If Other than Proposed Annuitant) Date Signed at (City, State)
- ------------------------------------------------------------------------------------------------------------------------------------
Do you have reason to believe that the Certificate applied for will replace any existing annuity or life insurance on the life
of the annuitant? |_| Yes |_| No (In Florida only) Florida License ID No. ____________
- ------------------------------------------------------------------------------------------------------------------------------------
Registered Representative Signature Print Name & No. of Registered Representative
- ------------------------------------------------------------------------------------------------------------------------------------
Registered Representative Soc. Sec. No./TIN Broker-Dealer/Branch Client Account No.
- ------------------------------------------------------------------------------------------------------------------------------------
NQSEC
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FIXED ANNUITY APPLICATION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. OWNER(S) (First, Middle, Last Name) Street, City, State, Zip Code Date of Birth (Month/Day/Year)
Phone Number(s): Social Security No./TIN
|_| Male |_| Female
- ------------------------------------------------------------------------------------------------------------------------------------
2. ANNUITANT (If other than Owner) Street, City, State, Zip Code Date of Birth (Month/Day/Year)
Relationship to Owner: Phone Number(s): Social Security No./TIN
|_| Male |_| Female
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
3. (A) PRIMARY BENEFICIARY(IES) (If more than one - indicate %) Relationship to Annuitant:
(B) SUCCESSOR BENEFICIARY(IES) (If any) (If more than one - indicate %) Relationship to Annuitant:
- ------------------------------------------------------------------------------------------------------------------------------------
4. SUCCESSOR ANNUITANT/OWNER INFORMATION (Can only be elected if the Owner and Annuitant are the same person) Must be Annuitant's
spouse and the sole primary Beneficiary named in Number 3(a) above. Complete the following:
________________________________ _______________________________________
Spouse's Social Security No. Spouse's Date of Birth (Month/Day/Year)
- ------------------------------------------------------------------------------------------------------------------------------------
5. SUCCESSOR OWNER INFORMATION (Available only when the Annuitant and Owner are different persons)
<S> <C> <C>
First, Middle, Last Name Street, City, State, Zip Code Date of Birth (Month/Day/Year)
Social Security No./TIN
|_| Male |_| Female
- ------------------------------------------------------------------------------------------------------------------------------------
6. AGE AT WHICH ANNUITY PAYMENTS ARE TO COMMENCE __________________
- ------------------------------------------------------------------------------------------------------------------------------------
7. TYPE OF PROGRAM (Choose one)
|_| PLAN A You must indicate initial contribution allocation to the Guarantee Periods in Section 8 below.
|_| PLAN B The initial contribution allocation to the Guarantee Periods will be determined for you. Do not complete Section 8.
Complete the following:
|_| Initial Contribution Amount $____________ for Fixed Period of _______ years
- ------------------------------------------------------------------------------------------------------------------------------------
8. INITIAL CONTRIBUTION ALLOCATION (Complete under Plan A only)
INITIAL CONTRIBUTION AMOUNT: $_____________ Indicate the initial contribution allocation to the Guarantee Periods below. Each
Guarantee Period expires on February 15 of the maturity year. See the prospectus for allocation restrictions which apply to
Annuitants age 65 and above.
<S> <C> <C> <C>
|_|1996 ______% or $______ |_|2000 ______% or $______ |_|2004 ______% or $______ |_|2008 ______% or $______
|_|1997 ______% or $______ |_|2001 ______% or $______ |_|2005 ______% or $______ |_|2009 ______% or $______
|_|1998 ______% or $______ |_|2002 ______% or $______ |_|2006 ______% or $______ |_|2010 ______% or $______
|_|1999 ______% or $______ |_|2003 ______% or $______ |_|2007 ______% or $______
- ------------------------------------------------------------------------------------------------------------------------------------
9. |_| PERIODIC WITHDRAWALS (Available under Plan A only)
Subject to a maximum of 7% annually of the Annuity Account Value. The minimum withdrawal amount is $1,000. Periodic Withdrawals will
be made on February 15 of each calendar year.
WITHDRAWAL: |_| __________% of Annuity Account Value or |_| $_______________
WITHHOLDING ELECTION INFORMATION
A. |_| I do not want to have Federal income tax withheld. (U.S. residence address and Social Security No./TIN required)
B. |_| I want to have Federal income tax withheld from each withdrawal. (You may also designate an additional amount in
line "C.")
C. |_| I want the following additional amount withheld from each withdrawal $______________. (You must also complete
line "B.")
See the prospectus for Withholding Election Instructions.
- ------------------------------------------------------------------------------------------------------------------------------------
====================================================================================================================================
EQUITABLE LIFE, INCOME MANAGEMENT GROUP, P.O. BOX 13014, NEWARK, N.J. 07188-0014
(800) 789-7771
FASEC
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
10. |_| PLAN B WITHHOLDING ELECTION
A. |_| I do not want to have Federal income tax withheld. (U.S. residence address and Social Security No./TIN required)
B. |_| I want to have Federal income tax withheld from each payment. (You may also designate an additional amount in line
"C.")
C. |_| I want the following additional amount withheld from each payment $______________. (You must also complete line "B.")
See the prospectus for Withholding Election Instructions.
- ------------------------------------------------------------------------------------------------------------------------------------
11. TELEPHONE TRANSFER AUTHORIZATION ________________ Owner's Initials
I authorize Equitable Life to act upon transfer instructions given by telephone from _____________________________ (name of your
registered representative) upon furnishing the proper identification. Neither Equitable Life nor any person authorized by Equitable
Life will be responsible for any claim, loss, liability or expense in connection with transfer instructions received by telephone
from such person if Equitable Life or such other person acted on such telephone instructions in good faith in reliance upon this
authorization. Equitable Life will continue to act upon this authorization until such time as I notify Equitable Life otherwise in
writing.
- ------------------------------------------------------------------------------------------------------------------------------------
12. SPECIAL INSTRUCTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
13. SUITABILITY
A. Did you receive THE INCOME MANAGER F.A. prospectus? |_| Yes |_| No
-------------------------------- ------------------------------------------
Date of Prospectus Date(s) of any Supplement(s) to Prospectus
------------------ ------------------------------------------
B. Will any existing insurance or annuity be (or has it been) replaced or changed, assuming the Certificate applied for will be
issued? |_| Yes |_| No If Yes, complete the following:
<S> <C> <C> <C>
---------- --------------- ------------------------------- ------------------------
Year Issued Type of Plan Company Certificate/Contract Number
----------------------------------------------------------------------------------------------------
Company Address
- ------------------------------------------------------------------------------------------------------------------------------------
14. AGREEMENT
All information and statements furnished in this application are true and complete to the best of my knowledge and belief. I
understand and acknowledge that no registered representative has the authority to make or modify any Certificate on behalf of
Equitable Life, or to waive or alter any of Equitable Life's rights and regulations. I understand that the Annuity Account Value may
increase or decrease to reflect any market value adjustment and amounts are not guaranteed unless held to the Expiration Date.
LAWS IN YOUR STATE MAY MAKE IT A CRIME TO FILL OUT AN
INSURANCE OR ANNUITY APPLICATION WITH INFORMATION YOU
KNOW IS FALSE OR TO LEAVE OUT MATERIAL FACTS.
<S> <C>
- ------------------------------------------------------------------- ------------------------------
Proposed Annuitant's Signature Date Signed at (City, State)
- ------------------------------------------------------------------- ------------------------------
Signature of Owner (If Other than Proposed Annuitant) Date Signed at (City, State)
- ------------------------------------------------------------------------------------------------------------------------------------
Do you have reason to believe that the Certificate applied for will replace any existing annuity or life insurance on the life
of the annuitant? |_| Yes |_| No (In Florida only) Florida License ID No. ____________
- ------------------------------------------------------------------------------------------------------------------------------------
Registered Representative Signature Print Name & No. of Registered Representative
- ------------------------------------------------------------------------------------------------------------------------------------
Registered Representative Soc. Sec. No./TIN Broker-Dealer/Branch Client Account No.
- ------------------------------------------------------------------------------------------------------------------------------------
FASEC
</TABLE>
ENDORSEMENT
APPLICABLE TO LIFE CONTINGENT ANNUITY
DESCRIBED HEREIN
[If this Endorsement is issued in connection with an IRA Certificate, all
provisions of the Life Contingent Annuity Endorsement and applicable Data pages
will conform to the requirements contained in the Endorsement Applicable to IRA
Certificates. Specifically, all items contained in the IRA Endorsement, except
item 4, will continue to apply to the Certificate.]
[If this Endorsement is issued in connection with a Non-Qualified Certificate,
the terms of this Endorsement apply, notwithstanding any terms to the contrary
contained in the Certificate, if you have elected the Life Contingent Annuity
described herein.]
Under the terms of this Endorsement, we provide this Annuity Benefit in
consideration of the purchase payment(s) made. The effective date of this
Endorsement is the date we receive the initial purchase payment. We pay an
Annuity Benefit during the lifetime of the Annuitant(s). The Annuity Benefit
ends upon the death of the Annuitant(s). IF THE DEATH OF THE ANNUITANT(S) OCCURS
BEFORE THE FIRST ANNUITY BENEFIT PAYMENT IS DUE, WE WILL NOT MAKE ANY PAYMENTS
NOR WILL WE REFUND ANY PURCHASE PAYMENT. THE TERMS OF THIS ENDORSEMENT DO NOT
CREATE A CASH VALUE BENEFIT.
1. ANNUITANT(S)
The Annuitant is named in the Data pages. If this Annuity Benefit is
purchased on a survivorship basis as described below, then more than
one Annuitant will be named. "You" in this Endorsement means the Owner.
2. PURCHASE PAYMENTS
Purchase payments must be made according to our rules shown in the Data
pages. Purchase payments may be paid directly or applied from the
Annuity Account Value under the Certificate. No purchase payments may
be paid after the earliest of (a) the Initial Benefit Payment Date
under this Endorsement, (b) the date the Certificate is surrendered for
the Cash Value, and (c) the Annuity Commencement Date under the
Certificate. Purchase payments do not create a cash value under the
Certificate.
Each purchase payment (less any charges shown in the Data pages) will
provide a guaranteed amount of annuity which when added to all other
guaranteed amounts of annuity so purchased with respect to the
Annuitant, equals the guaranteed Annuity Benefit to be provided under
the terms of this Endorsement.
No. 95ENLCAI 1
<PAGE>
3. ANNUITY BENEFIT PAYMENTS
Annuity Benefit payments will be paid to the payee specified in the
Data pages. Annuity Benefit payments under the Life Contingent Annuity
begin at the Initial Benefit Payment Date stated in the Data pages and
continue (a) for the lifetime of the Annuitant or (b) if the Annuity
Benefit is purchased on a survivorship basis as elected by you, for as
long as at least one of the Annuitants named in the Data pages is
living. The Annuity Benefit form elected by you at issue will be set
forth in the Data pages. The form of the Annuity Benefit may not be
changed. Exceptions to this rule, if any, will be set forth in the Data
pages.
Annuity Benefit payments will be made monthly, quarterly or annually,
as set forth in the Data pages. We reserve the right to change the
frequency to meet our minimum payment rules, as described in the Data
pages.
4. AMOUNT OF ANNUITY BENEFIT
Guaranteed Annuity Benefit payments purchased with each purchase
payment will be based on 3% interest and the 1983 "a" Individual
Annuity Mortality Table projected with Scale "G", or current mortality
and interest rates at the time each purchase payment is made, if more
favorable. The schedule in the Data pages shows the guaranteed purchase
rates for the Initial Benefit Payment Date selected. Before the Initial
Benefit Payment Date, we will report annually the amount of payments to
be provided at such Date.
5. INITIAL BENEFIT PAYMENT DATE
You may elect to change the Initial Benefit Payment Date subject to
conditions shown in the Data pages. If you wish to change such Date,
your request must be received at least 30 days in advance of the new
Initial Benefit Date. You must do this in writing. The change will not
take effect until written notice is received and accepted by us at our
Processing Office. A new Annuity Benefit will be determined on the date
the change takes effect. The new Annuity Benefit will be determined as
follows: (i) we determine the present value of Annuity Benefits as of
the prior Initial Benefit Payment Date using the current purchase rates
in effect as of the date of the calculation (see item 4); and (ii) we
apply the amount determined in (i) as a purchase payment and calculate
the amount of the new Annuity Benefit using the current purchase rates
in effect as of the date of the calculation.
[Applicable if this Endorsement is issued in connection with the
Endorsement Applicable to IRA Certificates:]
[If this Endorsement is purchased as a Joint and Survivor Form of
Annuity, the Annuitant and the Annuitant's spouse must both elect the
recalculation of life expectancies to apply in determining the required
distributions as described in item 5 of the Endorsement Applicable to
IRA Certificates. If this Endorsement is purchased as a Single Life
Form
No. 95ENLCAI 2
<PAGE>
of Annuity, the recalculation of life expectancies will apply as stated
in item 5 of the Endorsement Applicable to IRA Certificates.]
6. TRANSFERS/WITHDRAWALS
This Endorsement has no Annuity Account Value. No transfers or
withdrawals, described in Part IV and V of the Certificate, will apply
under this Endorsement.
7. DEATH BENEFITS
Payments will continue as long as an Annuitant survives. There will be
no death benefits payable to any beneficiary under this Endorsement.
If the death of the Annuitant(s) occurs before the due date of the
first Annuity Benefit payment, we will not make any payments under the
Annuity Benefit nor will we refund any part of the purchase payments
paid for it.
8. ASSIGNMENT
This Annuity may not be sold, assigned, discounted or pledged as
collateral for a loan or as security for the performance of an
obligation or for any other purpose, and except as otherwise permitted
by law, no sum payable under this Annuity may be transferred, assigned
or encumbered, or will in any way be subject to any legal process to
subject the same to the payment of any claim against the person to whom
any sum is payable.
9. PAYMENT
All payments by us under this Annuity will be made by check (in United
States dollars) and will be payable at the Processing Office.
10. CONDITIONS
We may require proof acceptable to us that the person(s) on whose life
the Annuity Benefit payment is based is alive when each payment is due.
We will require proof of the age of any such person.
If the Annuity Benefit was based on information that is later found not
to be correct, such Benefit will be adjusted on the basis of the
correct information. The adjustment will be made in the amount of the
Annuity Benefit payments, or any amount used to provide the Annuity
Benefit, or any combination. Overpayments by us will be charged against
future payments. Underpayments will be added to future payments. Our
liability is limited to the correct information and the actual amounts
used to provide the Annuity Benefit.
If the age or sex of any person upon whose life the Annuity Benefit
depends has been misstated, the Annuity Benefit payments will be those
which would have been purchased
No. 95ENLCAI 3
<PAGE>
at the correct age or sex. Any overpayments or underpayments made by us
will be charged or credited with interest at the rate shown in the Data
pages; we will choose which rate will apply on a uniform basis for like
Certificates. Such interest will be deducted from or added to future
payments.
11. STATUTORY COMPLIANCE
The benefits under this Endorsement have been determined without regard
to other benefits provided under the Certificate. They will not be less
than the minimum benefits required by any applicable state law.
No. 95ENLCAI 4
<PAGE>
DATA PAGES (CONT'D.)
PART D -- THIS PART LISTS THE TERMS WHICH APPLY TO THE ENDORSEMENT
APPLICABLE TO LIFE CONTINGENT ANNUITY (LCA).
JOINT ANNUITANT (SEE ITEM 1 OF LCA ENDORSEMENT): [Jane Doe] Age: [67]
Sex: [Female]
[Must be sole beneficiary named in Data Page, Part A]
ISSUE DATE FOR DATA PAGES, PART D: [February 15, 1995]
INITIAL PURCHASE PAYMENT (SEE ITEM 2 OF LCA ENDORSEMENT): [$20,430]
ADDITIONAL PURCHASE PAYMENTS: No subsequent purchase payments may be
applied.
PURCHASE PAYMENT RULES (SEE ITEM 2 OF LCA ENDORSEMENT):
We will determine the amount to be applied as purchase payments.
MINIMUM PURCHASE PAYMENT: [Not applicable]
FREQUENCY: Single purchase payment
CHARGES DEDUCTED FROM PURCHASE PAYMENTS (SEE ITEM 2 OF LCA ENDORSEMENT):
[Any applicable charge for premium tax.]
ANNUITY BENEFIT PAYEE (SEE ITEM 3 OF LCA ENDORSEMENT): [John Doe]
INITIAL BENEFIT PAYMENT DATE (SEE ITEM 3 OF LCA ENDORSEMENT): [February 15,
2011]
ANNUITY BENEFIT FORM (SEE ITEM 3 OF LCA ENDORSEMENT):
[Joint and Two-Thirds to Survivor]
FREQUENCY OF ANNUITY BENEFIT PAYMENTS (SEE ITEM 3 OF LCA ENDORSEMENT):
[Annually on February 15 of each year.]
MINIMUM BENEFIT PAYMENT RULES (SEE ITEM 3 OF LCA ENDORSEMENT): [$240 annually]
No. 94ICA/BLCA Data Page 8
<PAGE>
DATA PAGES (CONT'D.)
ANNUITY BENEFIT PURCHASED BY INITIAL PURCHASE PAYMENT:
Annually based on current rates effective as of [February 15, 1995]
[If both Annuitants are alive: $8,526]
[If one Annuitant is alive: $5,684]
GUARANTEED ANNUITY PURCHASE RATES (SEE ITEM 4 OF LCA ENDORSEMENT):
See Schedule attached.
CHANGE IN INITIAL BENEFIT PAYMENT DATE (SEE ITEM 5 OF LCA ENDORSEMENT):
[This date will be accelerated if a Lump Sum Withdrawal is taken.]
No. 94ICA/BLCA Data Page 9
<PAGE>
DATA PAGES (CONT'D.)
GUARANTEED ANNUITY PURCHASE RATE PER $100
OF INITIAL [LEVEL] MONTHLY INCOME
ATTAINED AGE(S) RATE
[70:67 $3,448.84
71:68 $3,610.81
72:69 $3,786.18
73:70 $3,976.60
74:71 $4,183.99
75:72 $4,410.62
76:73 $4,659.21
77:74 $4,932.98
78:75 $5,235.79
79:76 $5,572.25
80:77 $5,947.85
81:78 $6,369.13
82:79 $6,843.95
83:80 $7,381.76
84:81 $7,993.92]
Interest Basis: 3% Non-participating
Mortality: 1983 Individual Annuity Mortality Table "a" for [males/
females]; Projected with Scale "G".
[The above schedule shows the purchase payments required to purchase at the
attained ages shown a benefit of $100 a month commencing at age 85 (attained
age on the Initial Benefit Payment Date).]
No. 94ICA/BLCA Data Page 10
