Document:

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EXHIBIT 4(e)

                     Peoples Benefit Life Insurance Company
   A Stock Company
   Home Office located at: 4333 Edgewood Road N.E., Cedar Rapids, Iowa 52499
   (Hereafter called the Company, we, our or us)              (800)-866-6007

                                    ANNUITANT:
                                    OWNER(S):
                                    POLICY NUMBER:
                                    POLICY DATE:

                                    WE AGREE
 .   To provide annuity payments as set forth in Section 10 of this policy,

 .   Or to pay Withdrawal benefits in accordance with Section 5 of this policy,

 .   Or to pay death proceeds in accordance with Section 9 of this policy.

Withdrawals, Transfers and amounts applied to a Payment Option may be subject to
an Excess Interest Adjustment in accordance with Sections 5, 8, and 10,
respectively, of this policy.

These agreements are subject to the provisions of this policy. This policy is
issued in consideration of the application, or information provided in lieu
thereof, and payment of the initial premium. This policy may be applied for and
issued to qualify as a tax-qualified annuity under the applicable sections of
the Internal Revenue Code.

                             20 DAY RIGHT TO CANCEL

You may cancel this policy by delivering or mailing a written notice or sending
a telegram to us. You must return the policy before midnight of the twentieth
day after the day You receive it. Notice given by mail and return of the policy
by mail are effective on being postmarked, properly addressed and postage
prepaid.

We will pay You an amount equal to the sum of:

 .   the premiums paid; and
 .   the accumulated gains or losses, if any, in the Separate Account on the date
    of cancellation; unless otherwise required by law.

                        Signed for us at our home office.

              /s/ Craig D. Vermie               /s/ Bart Herbert, Jr.

                  SECRETARY                          PRESIDENT

    This policy is a legal contract between the policyowner and the Company.
                           READ YOUR POLICY CAREFULLY

                   Flexible Premium Deferred Variable Annuity
                   Income Payable At Annuity Commencement Date
            Benefits Based On The Performance Of The Separate Account
Are Variable And Are Not Guaranteed As To Dollar Amount (See Sections 6 and 10C)
                                Non-Participating

AV516 101 131 600
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                                      INDEX

<TABLE>
<CAPTION>
                                                  Page                                                          Page
                                                  ----                                                          ----
<S>                                               <C>         <C>                                             <C>
Accumulation Units..................................9         Guaranteed Periods.................................10
Age or Sex Corrections.............................22         Incontestability...................................22
Annuity Commencement Date..........................23         Modification of Policy.............................22
Annuity Payments...................................15         Non-participating..................................22
Adjusted Policy Value...............................5         Partial Withdrawals.................................7
Assignment.........................................23         Payee..............................................15
Beneficiary........................................23         Payment of Premiums.................................5
Cash Value..........................................6         Payment Option Tables...........................18-21
Contract...........................................22         Policy Data Page....................................3
Death Proceeds.....................................12         Policy Value........................................5
Definitions.........................................4         Proof of Age.......................................15
Dollar Cost Averaging Option.......................11         Protection of Proceeds.............................23
Evidence of Survival...............................22         Right to Cancel.....................................1
Excess Interest Adjustment..........................6         Rights of Owner....................................22
Fixed Account......................................10         Separate Account....................................8
Guaranteed Minimum Death Benefit...................12         Service Charge......................................6
Guaranteed Return of Fixed Account..................8         Settlement.........................................22
Premium Payments....................................5         Transfers..........................................11
</TABLE>

                                    Page 2
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                             SECTION 1 - POLICY DATA

    POLICY NUMBER:                              ANNUITANT:

    INITIAL PREMIUM
    PAYMENT:                                 ISSUE AGE/SEX:

    POLICY DATE:                                  OWNER(S):

    ANNUITY
    COMMENCEMENT
    DATE:                                      BENEFICIARY:

    DEATH BENEFIT
    OPTION:

Fixed Account Guaranteed Minimum Effective Annual Interest Rate:      3%

Before the Annuity Commencement Date:

    Return of Premium Death Benefit Option
    Mortality and Expense Risk Fee and Administrative Charge:      1.45%

    6 Year Step-Up Death Benefit Option
    Mortality and Expense Risk Fee and Administrative Charge:      1.50%

    Double Enhanced Death Benefit Option
    Mortality and Expense Risk Fee and Administrative Charge:      1.60%

After the Annuity Commencement Date:

Mortality and Expense Risk Fee and Administrative Charge:          1.45%

                                    Page 3
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                             SECTION 2 - DEFINITIONS

ADJUSTED POLICY VALUE - The Policy Value increased or decreased by any Excess
Interest Adjustment.

ANNUITANT - The person to whom annuity payments will be made, unless another
Payee is named.

ANNUITY COMMENCEMENT DATE - The Date the Annuitant will begin receiving payments
from this policy, which may not be later than the last day of the policy month
starting after the Annuitant attains age 85, except as expressly allowed by us
(within state restrictions), but in no event later than the last day of the
month in which the Annuitant attains age 98.

CASH VALUE - Amount, defined in Section 5, that can be withdrawn if the annuity
is Surrendered.

CUSTODIAL CARE - Care designed essentially to help a person with the activities
of daily living which does not require the continuous attention of trained
medical or paramedical personnel.

DISTRIBUTION - A Withdrawal or disbursement of funds from the Policy Value or
Cash Value. Policy Value or Cash Value will be reduced by any Distribution.

HOSPITAL - An institution which 1) is operated pursuant to the laws of the
jurisdiction in which it is located, 2) operates primarily for the care and
treatment of sick and injured persons on an inpatient basis, 3) provides 24-hour
nursing service by or under the supervision of registered graduate professional
nurses, 4) is supervised by a staff of one or more licensed Physicians, and 5)
has medical, surgical and diagnostic facilities or access to such facilities.

INVESTMENT OPTIONS - Any of the Guaranteed Period Options of the Fixed Account,
the Dollar Cost Averaging Fixed Account Option, and any of the Subaccounts of
the Separate Account.

NURSING FACILITY - A facility which 1) is operated pursuant to the laws of the
jurisdiction in which it is located, 2) provides Nursing Care or Custodial Care,
3) primarily provides Nursing Care under the direction of a licensed Physician,
registered graduate professional nurse, or licensed vocational nurse, except
when receiving Custodial Care, and 4) is not other than incidentally a Hospital,
a home for the aged, a retirement home, a rest home, a community living center
or a place mainly for the treatment of alcoholism, mental illness or drug abuse.

NURSING CARE - Care prescribed by a Physician and performed or supervised by a
registered graduate nurse. Such care includes nursing and rehabilitation
services available 24 hours.

PAYEE - The person to whom annuity payments will be made.

PAYMENT OPTIONS - Options through which the Distribution of the Adjusted Policy
Value can be directed.

PHYSICIAN - Doctor of Medicine or Doctor of Osteopathy who is licensed as such
and operating within the scope of the license.

POLICY ANNIVERSARY - The anniversary of the Policy Date for each year the policy
remains in force.

POLICY DATE - The date shown on page 3 of this policy and the date on which this
policy becomes effective.

POLICY YEAR - The 12-month period following the Policy Date shown on the Policy
Data page. The first Policy Year starts on the Policy Date. Each subsequent year
starts on the anniversary of the Policy Date.

SEPARATE ACCOUNT - The separate investment account established by us, as
described in Section 6.

SUBACCOUNT - A division of the Separate Account, as described in Section 6.

SURRENDER - A Distribution of funds from the Policy Value or Cash Value. Policy
Value or Cash Value will be reduced by any Surrender.

TERMINAL CONDITION - A condition resulting from an accident or illness which, as
determined by a Physician, has reduced life expectancy to not more than 12
months, despite appropriate medical care.

WITHDRAWAL - A partial Distribution of funds from the Policy Value or Cash
Value. Policy Value or Cash Value will be reduced by any Withdrawal.

YOU, YOUR - The owner of this policy. Unless otherwise specified on the Policy
Data page, the Annuitant and the owner shall be one and the same person.

                                    Page 4
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                          SECTION 3 - PREMIUM PAYMENTS

PAYMENT OF PREMIUMS
Premium payments may be made any time while this policy is in force before the
Annuity Commencement Date. You may start or stop, increase or decrease, or skip
any premium payments.

MAXIMUM AND MINIMUM PREMIUM PAYMENT
The premium payments may not be more than the amount permitted by law if this is
a tax-qualified annuity. The minimum initial premium payment is $10,000. If this
policy is being used as a tax-qualified annuity, the minimum initial premium is
$1,000, except that no minimum initial premium payment will be required for
403(b) annuities. The minimum subsequent premium payment we will accept is $500,
or $25 if it is a tax-qualified annuity. The maximum total premium payments
which we will accept without prior Company approval is $1,000,000.

PREMIUM PAYMENT DATE
The premium payment date is the date on which the premium payment is credited to
the policy. The initial premium payment less any applicable premium taxes will
be credited to the policy within two business days of receipt of the premium
payment and the information needed. Subsequent additional premium payments will
be credited to the policy as of the business day when the premium payment and
required information are received. A business day is any day that the New York
Stock Exchange is open for trading.

SYSTEMATIC PREMIUM PAYMENTS
Beginning in the first Policy Year, Systematic Premium Payments can be made on a
monthly, quarterly, semi-annual or annual basis. These premium payments must
meet minimum premium requirements, and must be sent through electronic funds
transfer. Systematic Premium Payments may be stopped or started at any time;
however, 30 days' written notice is required to stop them.

ALLOCATION OF PREMIUM PAYMENTS
Premium payments may be applied to various Investment Options which we make
available. You must indicate what percent of each premium payment to allocate to
various Investment Options. Each percent may be either zero or any whole number;
however, the allocation among all accounts must total 100%.

CHANGE OF ALLOCATION
You may change the allocation of premium payments to various Investment Options.
You must tell us in a notice You sign which gives us the facts that we need.
Premium payments received after the date on which we receive Your notice will be
applied on the basis of the new allocation.

PREMIUM TAXES
Your state may impose a premium tax. It may be imposed either when a premium
payment is made, on the Annuity Commencement Date, on the date of death, or on
the date of full Surrender. When permitted by state law, we will not deduct the
premium tax until the Annuity Commencement Date, date of death, or date of full
Surrender.

                            SECTION 4 - POLICY VALUE

POLICY VALUE
On or before the Annuity Commencement Date, the Policy Value is equal to Your:
(a) premium payments; minus
(b) Gross Partial Withdrawals (as defined in Section 5); plus
(c) interest credited to the Fixed Account (see Section 7); plus
(d) accumulated gains in the Separate Account (see Section 6); minus
(e) accumulated losses in the Separate Account (see Section 6); minus
(f) service charges, premium taxes, transfer fees, and rider fees, if any.

ADJUSTED POLICY VALUE
The Adjusted Policy Value is the Policy Value increased or decreased by any
Excess Interest Adjustment. You may use the Adjusted Policy Value on the Annuity
Commencement Date to provide lifetime income or income for a period of no less
than 60 months under the Payment Options in Section 10.

                                    Page 5
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                         SECTION 4 - POLICY VALUE - CONT

SERVICE CHARGE
On each Policy Anniversary and at the time of Surrender during any Policy Year
before the Annuity Commencement Date, we reserve the right to assess a service
charge up to $30 for policy administration expenses. The Service Charge will be
deducted from each Investment Option in proportion to the portion of Policy
Value (prior to such charge) in each Investment Option. In no event will the
Service Charge exceed 2% of the Policy Value on the Policy Anniversary or at the
time of Surrender.

The Service Charge will not be deducted on a Policy Anniversary or at the time
of Surrender if, at either of these times, (1) the sum of all premium payments
less the sum of all Withdrawals taken is at least $50,000; (2) the Policy Value
equals or exceeds $50,000, or (3) the policy is tax-qualified.

                 SECTION 5 - CASH VALUE AND PARTIAL WITHDRAWALS

CASH VALUE
On or before the Annuity Commencement Date, the Cash Value is equal to the
Adjusted Policy Value. Information on the current amount of Your policy's Cash
Value is available upon request. The Cash Value may be partially withdrawn or
will be paid in the event of a full Surrender of the policy. We must receive
Your written partial Withdrawal or Surrender request before the Annuity
Commencement Date.

There is no Cash Value once an Annuity Payment Option has been selected.

EXCESS INTEREST ADJUSTMENT
Full Surrenders, Partial Withdrawals, Transfers, and amounts applied to a
Payment Option from the Fixed Account Guaranteed Period Options described in
Section 7 will be subject to an Excess Interest Adjustment except as provided
for in the Partial Withdrawals provision below.

An Excess Interest Adjustment applies in the following situations:
1) When You withdraw or transfer all or any portion of Your Cash Value,
2) When You exercise an Annuity Payment Option,
3) When death proceeds are calculated. However, death proceeds will not be
   reduced as a result of any Excess Interest Adjustment.

The Excess Interest Adjustment is only applied to transactions affecting the
Guaranteed Period Options of the Fixed Account (see Section 7) and is based on
any change in interest rates from the time the affected Guaranteed Period(s)
started until the time the Excess Interest Adjustment occurs. The Excess
Interest Adjustment is applied as follows:
1) The Excess Interest Adjustment is only applied when the transactions occur
   prior to the end of any Guaranteed Period Option;
2) Transfers to the Guaranteed Period Options of the Fixed Account are
   considered Premium Payments for purposes of determining the Excess Interest
   Adjustment;
3) The Excess Interest Adjustment may affect the death proceeds defined in
   Section 9;
4) If interest rates have decreased from the time the affected Guaranteed
   Period(s) started until the time the transaction occurs, the Excess Interest
   Adjustment will result in additional funds available to You;
5) If interest rates have increased from the time the affected Guaranteed
   Period(s) started until the time the transaction occurs, the Excess Interest
   Adjustment will result in a decrease in the funds available to You.
6) Certain amounts are not subject to the Excess Interest Adjustment as provided
   in Sections 5, 7 and 8.

The formula for determining the amount of the Excess Interest Adjustment is as
follows:

Excess Interest Adjustment = Sx(G-C)x(M/12)

where:   S     is the gross (that is, before premium taxes, if any) amount
               being Surrendered, partially withdrawn, transferred, or applied
               to a Payment Option that is subject to the Excess Interest
               Adjustment.

         G     is the guaranteed interest rate for the Guaranteed Period
               applicable to S.

         M     is the number of months remaining in the Guaranteed Period for S,
               rounded up to the next higher whole number of months.

         C     is the current guaranteed interest rate then being offered on new
               Premium Payments for the next longer Guaranteed Period than "M".
               If this policy form or such a Guaranteed Period Option is no
               longer offered, "C" will be the U.S. Treasury rate for the next
               longer maturity (in whole years) than "M" on the 25th day of the
               previous calendar month, plus up to 2%.

                                    Page 6
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              SECTION 5 - CASH VALUE AND PARTIAL WITHDRAWALS- CONT

Upon full Surrender, the Excess Interest Adjustment (EIA) for each Guaranteed
Period Option will not reduce the Adjusted Policy Value for that Guaranteed
Period Option below the amount paid into, less any prior Withdrawals and
transfers from, that Guaranteed Period Option, plus interest at the 3%
guaranteed effective annual interest rate.

PARTIAL WITHDRAWALS
We will pay You a portion of the Cash Value as a Partial Withdrawal provided we
receive Your written request while the policy is in effect and before the
Annuity Commencement Date. When You request a Partial Withdrawal You must tell
us how it is to be allocated from among the Investment Options. If Your request
for a Partial Withdrawal from any Investment Option is less than or equal to the
Cash Value in that option, we will pay the amount of Your request. However, if
Your request for a Partial Withdrawal from any Investment Option is greater than
the Cash Value in that option, we will pay You the Cash Value of that Investment
Option.

The Gross Partial Withdrawal is the total amount which will be deducted from
Your Policy Value as a result of each Partial Withdrawal. The Gross Partial
Withdrawal may be more or less than Your requested Partial Withdrawal amount,
depending on whether Excess Interest Adjustments apply at the time You request
the Partial Withdrawal.

The formula for determining the Gross Partial Withdrawal is as follows:
Gross Partial Withdrawal = R - E
where:  R   is the requested Partial Withdrawal; and
        E   is the Excess Interest Adjustment.

If any Partial Withdrawal reduces the Cash Value below $500, we reserve the
right to pay the full Cash Value and terminate the policy.

We may delay payment of the Cash Value from the Fixed Account for up to 6 months
after we receive the request. If the owner dies after we receive the request,
but before the request is processed, the request will be processed before the
death proceeds are determined.

Partial Withdrawals may be made free from Excess Interest Adjustments as
follows:

LUMP SUM
      Beginning in the first Policy Year, Partial Withdrawals are available as
      Lump Sum Distributions in one or more Withdrawals during a Policy Year.

      Any of these Withdrawals taken from the Fixed Accounts in excess of 10% of
      the cumulative premium payments immediately prior to the Partial
      Withdrawal will be subject to an Excess Interest Adjustment. The minimum
      Withdrawal is $500.

SYSTEMATIC PAYOUT OPTION
      Beginning in the first Policy Year, a Systematic Payout Option (SPO) is
      available on a monthly, quarterly, semi-annual or annual basis. SPO
      payouts must be at least $50 and may not exceed 10% of the cumulative
      premium payments at the time a SPO payout is made divided by the number of
      payouts made per year (e.g. 12 for monthly). No Excess Interest Adjustment
      will apply to the SPO payout. Monthly and quarterly payouts must be sent
      through electronic funds transfer directly to Your checking or savings
      account. You may start or stop SPO payouts at any time; however, 30 days'
      written notice is required to stop SPO payouts. Once stopped, You must
      wait until the first day of the next Policy Year to begin a new SPO.

      Once You have elected a SPO, You must wait a minimum time before the first
      SPO payment:: 1 month for a monthly SPO, 3 months for quarterly, 6 months
      for semi-annual, or 12 months for annual.

MINIMUM REQUIRED DISTRIBUTION
      For tax-qualified plans, Partial Withdrawals taken to satisfy minimum
      Distribution requirements under Section 401(a)(9) of the Internal Revenue
      Code (IRC) are available with no Excess Interest Adjustments. The amount
      available from this policy with respect to the minimum Distribution
      requirement is based solely on this policy.

      The owner must be at least 70 1/2 years old in the calendar year of
      Distribution, must submit a written request to us and must take the
      Distribution before year-end. If the owner attains age 70 1/2 in the
      calendar year of Distribution, a written request which is postmarked no
      later than the end of the current calendar year must be submitted to us.

      Systematic minimum Distributions must be at least $50 or a lump sum
      Distribution is available if minimum required Distributions are less than
      $50.

                                    Page 7
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              SECTION 5 - CASH VALUE AND PARTIAL WITHDRAWALS-CONT

      Any amount requested in excess of the (IRC) minimum required Distribution
      will have the appropriate Excess Interest Adjustments applied, unless the
      excess Distribution qualifies as Excess Interest Adjustment-free under any
      additional options provided.

NURSING CARE AND TERMINAL CONDITION WITHDRAWAL OPTION

      Beginning in the first Policy Year, if the owner or owner's spouse
      (Annuitant or Annuitant's spouse if the owner is not a natural person) has
      been 1) confined in a Hospital or Nursing Facility for 30 consecutive days
      or 2) diagnosed as having a Terminal Condition, You may elect to withdraw
      all or a portion of the Policy Value without an Excess Interest
      Adjustment. The minimum Withdrawal under this option is $1000.

      For Nursing Care, we must receive each Withdrawal request and proof of
      eligibility with each request no later than 90 days following the date
      that confinement has ceased, unless it can be shown that it was not
      reasonably possible to provide the notice and proof within the above time
      period and that the notice and proof were given as soon as reasonably
      possible. However, in no event, except the absence of legal capacity,
      shall the notice and proof be provided later than one year following the
      date that confinement has ceased. For a Terminal Condition, we must
      receive each Withdrawal request and the applicable proof of eligibility no
      later than one year following diagnosis of the Terminal Condition. Proof
      of a Terminal Condition is required only with the initial Withdrawal
      request and must be furnished by the Annuitant, Annuitant's spouse, owner,
      or owner's spouse's Physician. Proof of confinement may be a Physician's
      statement or a statement from a Hospital or Nursing Facility
      administrator.

UNEMPLOYMENT WAIVER

      Beginning in the first Policy Year, You may withdraw all or a portion of
      the Policy Value free of any Excess Interest Adjustment if the owner or
      owner's spouse (Annuitant or Annuitant's spouse, if the owner is not a
      natural person) becomes unemployed. In order to qualify, You 1) must have
      been employed full-time for at least two years prior to Your becoming
      unemployed, 2) must have been employed full-time on Your Policy Date, 3)
      must have been unemployed for at least 60 consecutive days at the time of
      Withdrawal and 4) must have a minimum Cash Value of $5000 at the time of
      Withdrawal. Proof of unemployment will consist of providing us with a
      determination letter from the applicable State's Department of Labor which
      verifies that You qualify for and are receiving unemployment benefits at
      the time of Withdrawal. The determination letter must be received by us no
      later than 15 days following the date of the Withdrawal request

GUARANTEED RETURN OF FIXED ACCOUNT PREMIUM PAYMENTS
Upon full Surrender of the policy, You will always receive at least the premium
payments made to, less prior Withdrawals and transfers from, the Fixed Account.

MINIMUM VALUES
Benefits available under this policy are not less than those required by any
statute of the state in which the policy is delivered.

                          SECTION 6 - SEPARATE ACCOUNT

SEPARATE ACCOUNT
We have established and will maintain a Separate Account, under the laws of the
state of Iowa. Any realized or unrealized income, net gains and losses from the
assets of the Separate Account are credited to or charged against it without
regard to our other income, gains or losses. Assets are put in the Separate
Account for this policy, as well as for other variable annuity policies. Any
Separate Account may invest assets in shares of one or more mutual fund
portfolios, or in the case of a managed Separate Account, direct investments in
stocks or other securities as permitted by law. Fund Shares refer to shares of
underlying mutual funds or prorata ownership of the assets held in a Subaccount
of a managed Separate Account. Fund shares are purchased, redeemed and valued on
behalf of the Separate Account.

The Separate Account is divided into Subaccounts. Each Subaccount invests
exclusively in shares of one of the portfolios of an underlying mutual fund. We
reserve the right to add or remove any Subaccount of the Separate Account.

                                    Page 8
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                       SECTION 6 - SEPARATE ACCOUNT - CONT

The assets of the Separate Account are our property. These assets will equal or
exceed the reserves and other contract liabilities of the Separate Account.
These assets will not be chargeable with liabilities arising out of any other
business we conduct. We reserve the right, subject to regulations governing the
Separate Account, to transfer assets of a Subaccount, in excess of the reserves
and other contract liabilities with respect to that Subaccount, to another
Subaccount or to our General Account.

We will determine the fair market value of the assets of the Separate Account in
accordance with a method of valuation which we establish in good faith.
Valuation Period means the period of time from one determination of the value of
each Subaccount to the next. Such determinations are made when the value of the
assets and liabilities of each Subaccount is calculated. This is generally the
close of business on each day on which the New York Stock Exchange is open.

We also reserve the right to transfer assets of the Separate Account, which we
determine to be associated with the class of policies to which this policy
belongs, to another Separate Account. If this type of transfer is made, the term
"Separate Account", as used in the policy, shall then mean the Separate Account
to which the assets were transferred.

We also reserve the right, when permitted by law to:
(a)  deregister the Separate Account under the Investment Company Act of 1940;
(b)  manage the Separate Account under the direction of a committee at any time;
(c)  restrict or eliminate any voting rights of policy owners or other persons
     who have voting rights as to the Separate Account;
(d)  combine the Separate Account with one or more other Separate Accounts;
(e)  create new Separate Accounts;
(f)  add new Subaccounts to or remove existing Subaccounts from the Separate
     Account, or combine Subaccounts; and
(g)  add new underlying mutual funds, remove existing mutual funds, or
     substitute a new fund for an existing fund.

The Net Asset Value of a fund share is the per-share value calculated by the
mutual fund or, in the case of a managed Separate Account, by the Company. The
Net Asset Value is computed by adding the value of the Subaccount's investments,
cash and other assets, subtracting its liabilities, and then dividing by the
number of shares outstanding. Net Asset Values of fund shares reflect investment
advisory fees and other expenses incurred in managing a mutual fund or a managed
Separate Account.

CHANGE IN INVESTMENT OBJECTIVE OR POLICY OF A MUTUAL FUND
If required by law or regulation, an investment policy of the Separate Account
will only be changed if approved by the appropriate insurance official of the
state of Iowa or deemed approved in accordance with such law or regulation. If
so required, the process for obtaining such approval is filed with the insurance
official of the state or district in which this policy is delivered.

CHARGES AND DEDUCTIONS
The Mortality and Expense Risk Fee and the Administrative Charge are each
deducted both before and after the Annuity Commencement Date to compensate for
changes in mortality and expenses not anticipated by the mortality and
administration charges guaranteed in the policy.

The Service Charge is deducted prior to the Annuity Commencement Date only.

If the Mortality and Expense Risk Fee is more than sufficient, the Company will
retain the balance as profit or may reduce this fee in the future.

ACCUMULATION UNITS
The Policy Value in the Separate Account before the Annuity Commencement Date is
represented by accumulation units. The dollar value of accumulation units for
each Subaccount will change from day to day reflecting the investment experience
of the Subaccount.

Premium Payments allocated to and any amounts transferred to the Subaccounts
will be applied to provide accumulation units in those Subaccounts. The number
of accumulation units purchased in a Subaccount will be determined by dividing
the amount allocated to or transferred to that Subaccount, by the value of an
accumulation unit for that Subaccount on the premium payment or transfer date.

The number of accumulation units withdrawn or transferred from the Subaccounts
will be determined by dividing the amount withdrawn or transferred by the value
of an accumulation unit for that Subaccount on the Withdrawal or transfer date.

The value of an accumulation unit on any business day is determined by
multiplying the value of that unit at the end of the immediately preceding
valuation period by the net investment factor for the valuation period.

                                     Page 9
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                       SECTION 6 - SEPARATE ACCOUNT - CONT

The net investment factor used to calculate the value of an accumulation unit in
each Subaccount for the Valuation Period is determined by dividing (a) by (b)
and subtracting (c) from the result, where:
(a) is the result of:
    (1) the net asset value of a fund share held in that Subaccount determined
        as of the end of the current valuation period; plus
    (2) the per share amount of any dividend or capital gain Distributions made
        by the fund for shares held in that Subaccount if the ex-dividend date
        occurs during the valuation period; plus or minus
    (3) a per share credit or charge for any taxes reserved for, which we
        determine to have resulted from the investment operations of that
        Subaccount.
(b) is the net asset value of a fund share held in that Subaccount determined as
    of the end of the immediately preceding valuation period.
(c) is a factor representing the Mortality and Expense Risk Fee and
    Administrative Charge before the Annuity Commencement Date. This factor is
    less than or equal to, on an annual basis, the percentage shown on page 3 of
    the daily net asset value of a fund share held in that Subaccount.
Since the net investment factor may be greater or less than one, the
accumulation unit value may increase or decrease.

                            SECTION 7 - FIXED ACCOUNT

FIXED ACCOUNT
Premium payments applied to and any amounts transferred to the Fixed Account
will reflect a fixed interest rate. The interest rates we set will be credited
for increments of at least one year measured from each premium payment or
transfer date. These rates will never be less than an effective annual interest
rate of 3%.

GUARANTEED PERIODS
We may offer optional Guaranteed Period Options, into which premium payments may
be paid or amounts transferred. The current interest rate we set for funds
entering each Guaranteed Period Option (GPO) is guaranteed until the end of that
option's Guaranteed Period. At that time, the premium payment made or amount
transferred into the GPO, less any Withdrawals or transfers from that GPO, plus
accrued interest, will be rolled into a new GPO or may be transferred to any
Subaccount(s) within the Separate Account(s).

You may choose the Investment Option(s) You want the funds rolled into by giving
us a written notice within 30 days before the end of the expiring option's
Guaranteed Period. However, any Guaranteed Period elected may not extend beyond
the maximum Annuity Commencement Date defined in Section 11. In the absence of
such election, the funds will be rolled into a new GPO which is the same as the
expiring GPO unless that GPO is no longer offered, in which case, the next
shorter GPO offered will be used. You will be mailed a notice of completion of
the rollover with the new interest rate applicable. The new GPO will be deemed
as accepted if we do not receive a written rejection within 30 days from the
postmark date of the completion notice.

We reserve the right for new premium payments, transfers, or rollovers to offer
or not to offer any GPO, except that we will always offer at least a one-year
GPO.

For purposes of crediting interest when funds are withdrawn from or transferred
into a GPO, the amount of the oldest premium payment or rollover into that GPO
is considered to be withdrawn first. If the amount withdrawn exceeds this
amount, the next oldest premium payment or rollover is considered to be
withdrawn next, and so on until the most recent premium payment or rollover is
considered to be withdrawn (this is a "First-In, First-Out" or FIFO procedure).
Premium payment(s) or rollover(s) are deemed to be withdrawn first, then
credited interest.

Partial Withdrawals, Surrenders, transfers, and amounts applied to a Payment
Option from the Guarantee Period Option(s) are subject to an Excess Interest
Adjustment as described in Section 5.

DOLLAR COST AVERAGING FIXED ACCOUNT OPTION
We may offer a Dollar Cost Averaging (DCA) Fixed Account Option separate from
the Guaranteed Period Options. This option will have a one-year interest rate
guarantee. The current interest rate we set for the DCA Fixed Account may differ
from the rates credited on the one-year GPO in the Fixed Account. In addition,
the current interest rate we credit may vary on different portions of the DCA
Fixed Account. The credited interest rate will never be less than the minimum
effective annual interest rate of 3%. The DCA Fixed Account Option will only be
available under a Dollar Cost Averaging program as described in Section 8.

                                    Page 10
<PAGE>

                              SECTION 8 - TRANSFERS

A.    TRANSFERS BEFORE THE ANNUITY COMMENCEMENT DATE
Prior to the Annuity Commencement Date, You may transfer the value of the
accumulation units from one Investment Option to another. You must sign a notice
to transfer which gives us the facts that we need.

Transfers of Policy Value from the Guaranteed Period Options (GPO) of the Fixed
Account prior to the end of that GPO are subject to an Excess Interest
Adjustment. If the Excess Interest Adjustment at the time of such Policy Value
transfer is a negative adjustment, then the maximum Policy Value transfer is 25%
of that GPO's Policy Value, less Policy Values previously transferred out of
that GPO during the current Policy Year. If the Excess Interest Adjustment at
the time of such Policy Value transfer is a positive adjustment, no maximum will
apply to such Policy Values transferred from the GPO. No Excess Interest
Adjustment will apply to Policy Value transfers at the end of a Guaranteed
Period.

Transfers of interest credited in the GPOs to other Investment Options are
allowed on a "First-In, First-Out" basis. Such transfers may be made monthly,
quarterly, semi-annually, or annually. Each such transfer must be at least $50
and will not be subject to an Excess Interest Adjustment.

Transfers of Policy Value from the Separate Account are subject to a minimum of
$500 or the entire Subaccount Policy Value, if less. However, if the remaining
Subaccount Policy Value is less than $500, we reserve the right to include that
amount as part of the transfer.

You may choose which GPO to transfer to or from, however, any GPO elected may
not extend beyond the maximum Annuity Commencement Date defined in Section 11.

No transfers will be allowed out of the Dollar Cost Averaging Fixed Account
Option except through the Dollar Cost Averaging Option.

We reserve the right to limit transfers to no more than 12 in any one Policy
Year. Any transfers in excess of 12 per Policy Year may be charged a $10 per
transfer fee. Transfers among multiple Investment Options will be treated as one
transfer in determining the number of transfers that have occurred. We also
reserve the right to prohibit transfers to the Fixed Account if we are crediting
an effective annual interest rate of 3%.

DOLLAR COST AVERAGING OPTION
Prior to the Annuity Commencement Date, You may instruct us to automatically
transfer a specified amount from the Money Market Subaccount or the Dollar Cost
Averaging (DCA) Fixed Account Option to any other Subaccount(s) of the Separate
Account. The automatic transfers can occur monthly or quarterly. If the Dollar
Cost Averaging request is received prior to the 28th day of any month, the first
transfer will occur on the 28th day of that month. If the Dollar Cost Averaging
request is received on or after the 28th day of any month, the first transfer
will occur on the 28th day of the following month. Changes to the Subaccounts to
which these transfers are allocated are not restricted. Transfers must be
scheduled for at least 6, but not more than 24 months or for at least 4, but not
more than 8 quarters each time the Dollar Cost Averaging program is started or
restarted following termination of the program for any reason.

Dollar Cost Averaging from the Dollar Cost Fixed Account
Prior to the Annuity Commencement Date, no transfers, (except through Dollar
Cost Averaging) will be allowed from a DCA Fixed Account. Transfers will
continue until the DCA Fixed Account value is depleted. The amount transferred
each time must be at least $500. All transfers from the DCA account will be the
same amount as the initial transfer. Changes to the amount transferred will only
be allowed when additional premium is allocated or a new amount is transferred
into the DCA Fixed Account. The Dollar Cost Averaging option from the DCA Fixed
Account may be discontinued after satisfying the minimum number of required
transfers by sending written notice to us.

Dollar Cost Averaging from the Money Market Account
Transfers from the Money Market Account will continue until Your original
request is met. If on any transfer date, the value in the Money Market Account
is equal to or less than the amount You have elected to have transferred, We
will transfer the entire amount and the option will end. The amount transferred
each time must be at least $500. All transfers from the Money Market Account
will be the same amount as the initial transfer. Changes to the amount
transferred are allowed once each Policy Year provided we receive written notice
at least seven days prior to the next transfer date. The Dollar Cost Averaging
option may be discontinued at any time provided we receive written notice at
least seven days prior to the next transfer date.

                                    Page 11
<PAGE>

                          SECTION 8 - TRANSFERS - CONT

Dollar Cost Averaging results in the purchase of more accumulation units when
the value of the accumulation unit is low, and fewer accumulation units when the
value of the accumulation unit is high. However, there is no guarantee that the
Dollar Cost Averaging program will result in higher Policy Values or will
otherwise be successful. While Dollar Cost Averaging is in effect, Asset
Rebalancing is not available.

ASSET REBALANCING
Prior to the Annuity Commencement Date, You may instruct us to automatically
transfer amounts among the Subaccounts of the Separate Account on a regular
basis to maintain a desired allocation of the Policy Value among the various
Subaccounts offered. Rebalancing will occur on a monthly, quarterly, semi-annual
or annual basis, beginning on a date selected by You. You must select the
percentage of the Policy Value desired in each of the various Subaccounts
offered (totaling 100%). Any amounts in the Fixed Account are ignored for the
purposes of Asset Rebalancing. Rebalancing can be started, stopped or changed at
any time. Asset Rebalancing is not available while Dollar Cost Averaging is in
effect. Rebalancing will cease as soon as we receive a request for any other
transfer.

B.    TRANSFERS AFTER THE ANNUITY COMMENCEMENT DATE
After the Annuity Commencement Date, You may transfer the value of the variable
annuity units from one Subaccount to another within the Separate Account or to
the Fixed Account. If You want to transfer the value of the variable annuity
units, You must tell us in a signed notice which gives us the facts that we
need. We reserve the right to limit transfers between the Subaccounts or to the
Fixed Accounts to once per Policy Year.

The minimum amount which may be transferred is the lesser of $10 monthly income
or the entire monthly income of the variable annuity units in the Subaccount
from which the transfer is being made. If the monthly income of the remaining
units in a Subaccount is less than $10, we have the right to include the value
of those variable annuity units as part of the transfer.

After the Annuity Commencement Date, no transfers may be made from the Fixed
Account to any other Investment Options.

                           SECTION 9 - DEATH PROCEEDS

A.    DEATH PROCEEDS PRIOR TO ANNUITY COMMENCEMENT DATE
The amount of death proceeds will be the greatest of (a), (b) or (c) where:
(a)  is the Policy Value on the date we receive due proof of death and an
     election of a method of settlement;
(b)  is the Cash Value on the date we receive due proof of death and an election
     of a method of settlement, and;
(c)  is the Guaranteed Minimum Death Benefit (GMDB), if any, plus any additional
     premium payments received, less any Gross Partial Withdrawals from the date
     of death to the date of payment of death proceeds.

If You have not selected a payment option by the date of death, the beneficiary
may make such election within one year of the date we receive due proof of the
owner's or Annuitant's death as described in C below. The beneficiary may elect
to receive the death proceeds as a lump sum payment or may use the death
proceeds to provide any of the annuity Payment Options described in Section 10.
Interest on death proceeds will be paid as required by law.

B.    GUARANTEED MINIMUM DEATH BENEFIT
The amount of the Guaranteed Minimum Death Benefit (GMDB) is based on the death
benefit option shown on page 3. You may not change the GMDB option after the
policy is issued.

    Option: Return of Premium Death Benefit
    This GMDB is equal to the total premiums paid for this policy, less any
    Adjusted Partial Withdrawals (as described below), as of the date of death.
    Available for issue ages 0-85.

    Option:  6 Year Step-Up Death Benefit
    This GMDB is the higher of the initial premium or the Adjusted Policy Value
    on the 6th, 12th, 18th, etc., Policy Anniversary prior to the earlier of the
    date of death or the Annuitant's 81st birthday plus premiums paid, less
    partial Withdrawals subsequent to the date of the 6th Policy Anniversary
    with the largest Policy Value. Available for issue ages 0-75.

                                    Page 12
<PAGE>

                        SECTION 9 - DEATH PROCEEDS - CONT

    Option:  Double Enhanced Death Benefit
    This GMDB is the greater of (1) and (2) where:
    (1)  is a 5% annually compounding death benefit, equal to the cumulative
         Premium Payments, minus Adjusted Partial Withdrawals, plus interest
         accumulated at 5% per annum from the payment or Withdrawal date to the
         earlier of the Annuitant's date of death or the Annuitant's 81st
         birthday, and
    (2)  is an annual Step-Up Death Benefit, equal to the largest Policy Value
         on the Policy Date or on any Policy Anniversary prior to the earlier of
         the Annuitant's date of death or the Annuitant's 81st birthday, plus
         any Premium Payments (minus Adjusted Partial Withdrawals) since the
         date of the Policy Anniversary with the largest Policy Value. Available
         for issue ages 0-79.

If the owner is a non-natural person, or if the owner has elected to have the
death proceeds paid upon the death of the Annuitant, the GMDB will be based upon
the Annuitant's age.

A Partial Withdrawal taken as provided in Section 5 will reduce the Guaranteed
Minimum Death Benefit by an amount referred to as the "Adjusted Partial
Withdrawal". The Adjusted Partial Withdrawal may be a different amount than the
Gross Partial Withdrawal described in Section 5. The Adjusted Partial Withdrawal
is the total amount deducted from the GMDB as a result of a Partial Withdrawal
as used in the GMDB provision. It is equal to the Gross Partial Withdrawal
described in Section 5, multiplied by an Adjustment Factor. The Adjustment
Factor is equal to the amount of the death proceeds prior to the Partial
Withdrawal divided by the Policy Value prior to the Partial Withdrawal.

C.      DEATH PRIOR TO ANNUITY COMMENCEMENT DATE
Death proceeds are payable contingent upon the relationships between the owner,
Annuitant, owner's designated beneficiary and beneficiary as outlined below. The
policy must be Surrendered upon settlement or on proof of death.

I.  Annuitant and owner are the same.

    When we have due proof that the owner died before the Annuity Commencement
    Date, we will provide the death proceeds to the beneficiary.

    a)   Beneficiary is the deceased owner's surviving spouse. The beneficiary
         may elect to continue this policy as owner and Annuitant rather than
         receiving the death proceeds. If the policy is continued, an amount
         equal to the excess, if any, of the Guaranteed Minimum Death Benefit,
         if any, over the Policy Value will then be added to the Policy Value.
         This is a one-time only Policy Value adjustment applied at the time the
         policy is continued, and the Guaranteed Minimum Death Benefit will
         continue on as applicable. If this beneficiary elects to have the death
         proceeds paid, the death proceeds must be distributed:
         (1)  by the end of 5 years after the date of the deceased owner's
              death, or
         (2)  payments must begin no later than one year after the deceased
              owner's death and must be made for a period certain or for this
              beneficiary's lifetime, so long as any period certain does not
              exceed this beneficiary's life expectancy.
    b)   Beneficiary is not the deceased owner's surviving spouse. The death
         proceeds must be distributed as provided in I.a)(1) or I.a)(2) above.
    c)   Death proceeds which are not paid to or for the benefit of a natural
         person must be distributed by the end of 5 years after the date of the
         deceased owner's death.

II.     Annuitant and owner are different and the Annuitant dies.

        When we have due proof that the Annuitant dies prior to the Annuity
        Commencement Date, the owner will become the new Annuitant and no death
        proceeds are payable. If the owner is also the deceased Annuitant's
        surviving spouse, an amount equal to the excess, if any, of the
        Guaranteed Minimum Death Benefit, if any, value over the Policy Value
        will then be added to the Policy Value. This is a one-time only Policy
        Value adjustment applied at the time the policy is continued, and the
        Guaranteed Minimum Death Benefit will continue on as applicable.

        However, in lieu of becoming the new Annuitant, the owner may elect to
        have the death proceeds distributed to the Annuitant's beneficiary on
        the death of the Annuitant. This election must be in writing and must be
        received by us prior to the Annuitant's death. In such case, when we
        have due proof that the Annuitant died prior to the Annuity Commencement
        Date, we will provide the death proceeds to the Annuitant's beneficiary.

                                    Page 13
<PAGE>

                        SECTION 9 - DEATH PROCEEDS - CONT

        a)   If the owner has elected to have the death proceeds paid as a lump
             sum, the beneficiary must, within 60 days' of our receipt of due
             proof of the Annuitant's death, either:
             1)  receive the lump sum proceeds; or
             2)  elect to receive annuity payments. Such payments must begin
                 within one year of our receipt of due proof of the Annuitant's
                 death and must be made for a period certain or for this
                 beneficiary's lifetime, so long as any period certain does not
                 exceed this beneficiary's life expectancy.
        b)   Death proceeds which are not paid to or for the benefit of a
             natural person must be distributed by the end of 5 years after the
             date of the Annuitant's death.

III.    Annuitant and owner are different and the owner dies.

        If the owner dies prior to the Annuity Commencement Date and before the
        entire interest in the policy is distributed, the owner's designated
        beneficiary will become the new owner. The remaining portion of any
        interest in the policy must be distributed to the extent provided below
        in III.a), III.b), III.c), or III.d).
        a)   Owner designated beneficiary is the deceased owner's surviving
             spouse. The owner designated beneficiary may elect to continue
             this policy rather than receive the Adjusted Policy Value. If the
             owner designated beneficiary elects to receive the Adjusted Policy
             Value, the Adjusted Policy Value must be distributed:

             (1)  by the end of 5 years after the date of the deceased owner's
                  death, or

             (2)  payments must begin no later than one year after the deceased
                  owner's death and must be made for a period certain or for the
                  owner designated beneficiary's lifetime, so long as any period
                  certain does not exceed the owner designated beneficiary's
                  life expectancy.

        b)   Owner designated beneficiary is not the deceased owner's surviving
             spouse. The Adjusted Policy Value must be distributed as provided
             in III.a)(1) or III.a)(2) above.
        c)   Owner designated beneficiary is not a natural person. The Adjusted
             Policy Value must be distributed as provided in III.a)(1) above.
        d)   No owner designated beneficiary survives the deceased owner. The
             deceased owner's estate will become the new owner (or the estate
             may name a new owner). The Executor or Administrator must be named
             in a form acceptable to us. The Adjusted Policy Value must be
             distributed by the end of 5 years after the date of the deceased
             owner's death.

IV.   More than one Owner.

      If there is more than one owner, then the death of any owner will be
      treated the same as the death of the owner.

D.      DEATH ON OR AFTER THE ANNUITY COMMENCEMENT DATE
The death proceeds on or after the Annuity Commencement Date depend on the
payment option selected. If any owner dies on or after the Annuity Commencement
Date, but before the entire interest in the policy is distributed, the remaining
portion of such interest in the policy will be distributed to the beneficiary at
least as rapidly as under the method of distribution being used as of the date
of that owner's death.

E.       AN OWNER IS NOT AN INDIVIDUAL
In the case of a non tax-qualified annuity, if any owner or beneficial owner, is
not an individual, then for purposes of the federal income tax mandatory
Distribution provisions in subsection C or D above, (1) the primary Annuitant
will be treated as the owner of the policy, and (2) if there is any change in
the primary Annuitant, such a change will be treated as the death of the owner.

                                    Page 14
<PAGE>

                          SECTION 10 - ANNUITY PAYMENTS

A.   GENERAL PAYMENT PROVISIONS
Payment
If this policy is in force on the Annuity Commencement Date, we will use the
Fixed Account portion and/or the Separate Account portion of the Adjusted Policy
Value to make annuity payments to the Payee under Option 3 and/or 3-V,
respectively, with 10 years certain, or if elected, under one or more of the
other options described in this section. However, the option(s) elected must
provide for lifetime income or income for a period of at least 60 months. You
will become the Annuitant at the Annuity Commencement Date. Payments will be
made at 1, 3, 6 or 12 month intervals. We reserve the right to change the
frequency of payments to avoid making payments of less than $50.00.

Before the Annuity Commencement Date, if the death proceeds become payable or if
You Surrender this policy, we will pay any proceeds in one sum, or if elected,
all or part of these proceeds may be placed under one or more of the options
described in this section. If we agree, the proceeds may be placed under some
other method of payment instead.

Adjusted Age
Payments under Options 3 and 5 and the first payment under Options 3-V and 5-V
are determined based on the adjusted age of the Annuitant. The adjusted age is
the Annuitant's actual age on the Annuitant's nearest birthday, at the Annuity
Commencement Date, adjusted as follows:

    Annuity
Commencement Date                   Adjusted Age
-----------------                   ------------
  Before 2010                     Actual Age
  2010 - 2019                     Actual Age minus      1
  2020 - 2026                     Actual Age minus      2
  2027 - 2033                     Actual Age minus      3
  2034 - 2040                     Actual Age minus      4
  After 2040                      Determined by us

Election of Optional Method of Payment
Before the Annuity Commencement Date You can elect or change a payment option.
You may elect, in a notice You sign which gives us the facts that we need,
annuity payments that may be either variable, fixed, or a combination of both.
If You elect a combination, You must also tell us what part of the policy
proceeds on the Annuity Commencement Date are to be applied to provide each type
of payment. (You must also specify which Subaccounts.) The amount of a combined
payment will be the sum of the variable and fixed payments. Payments under a
variable payment option will reflect the investment performance of the selected
Subaccount of the Separate Account.

Payee
Unless You specify otherwise, the Payee shall be the Annuitant, or the
beneficiary as defined in the Beneficiary provision.

Proof of Age
We may require proof of the age of any person who has an annuity purchased under
Options 3, 3-V, 5 and 5 -V of this section before we make the first payment.

Minimum Proceeds
If the proceeds are less than $2,000, we reserve the right to pay them out as a
lump sum instead of applying them to a payment option.

Premium Tax
We may be required by law to pay premium tax on the amount applied to a payment
option. If so, we will deduct the premium tax before applying the proceeds.

Supplementary Contract
Once proceeds become payable and a payment option has been selected, this policy
will terminate and we will issue a supplementary contract to reflect the terms
of the selected option. The contract will name the Payee(s) and will describe
the payment schedule.

B.   FIXED ACCOUNT PAYMENTS
Guaranteed Payment Options
The fixed account payment is determined by multiplying each $1,000 of policy
proceeds allocated to a fixed payment option by the amounts shown on page 18 for
the option You select. Options 1, 2 and 4 are based on a guaranteed interest
rate of 3%.

Options 3 and 5 are based on a guaranteed interest rate of 3% and the "Annuity
2000" (male, female, and unisex if required by law) mortality table projected
for improvement using projection scale G.

Option 1 - Interest Payments
We will pay the interest on the amount we use to provide annuity payments in
equal payments or this amount may be left to accumulate for a period of time we
and You agree to. We and You will agree on Withdrawal rights when You elect this
option. The interest rate we declare for this option may be different than the
interest rate(s) credited prior to the Annuity Commencement Date.

Option 2 - Income for a Specified Period
We will make level payments only for the fixed period You choose. In the event
of the death of the person receiving payments prior to the end of the fixed
period elected, payments will be continued to that person's beneficiary or their
present value may be paid in a single sum. No funds will remain at the end.
                      SECTION 10 - ANNUITY PAYMENTS - CONT

                                    Page 15
<PAGE>

                     SECTION 10 - ANNUITY PAYMENTS - CONT

Option 3 - Life Income - You may choose between:
1.  "No Period Certain" - We will make level payments only during the
    Annuitant's lifetime.
2.  "10 Years Certain" - We will make level payments for the longer of the
    Annuitant's lifetime or ten years.
3.  Guaranteed Return of Policy Proceeds - We will make level payments for the
    longer of the Annuitant's lifetime or until the total dollar amount of
    payments we made to You equals the amount applied to this option.

Option 4 - Income of a Specified Amount
Payments are made for any specified amount until the amount applied to this
option, with interest, is exhausted. This will be a series of level payments
followed by a smaller final payment. In the event of the death of the person
receiving payments prior to the time proceeds with interest are exhausted,
payments will be continued to that person's beneficiary or their present value
may be paid in a single sum.

Option 5 - Joint and Survivor Annuity
Payments are made during the joint lifetime of the Payee and a joint Payee of
Your selection. Payments will be made as long as either person is living.

Current Payment Options
The amounts shown in the tables on page 18 are the guaranteed amounts. Current
amounts offered to individuals of the same class may be obtained from us.

C.       VARIABLE ACCOUNT PAYMENT OPTIONS
Variable Annuity Units
The policy proceeds You tell us to apply to a variable payment option will be
used to purchase variable annuity units in Your chosen Subaccounts. The dollar
value of variable annuity units in Your chosen Subaccounts will increase or
decrease reflecting the investment experience of Your chosen Subaccounts. The
value of a variable annuity unit in a particular Subaccount on any business day
is equal to (a) multiplied by (b) multiplied by (c), where:
(a) is the variable annuity unit value for that Subaccount on the immediately
    preceding business day;
(b) is the net investment factor for that Subaccount for the Valuation Period;
    and
(c) is the Assumed Investment Return adjustment factor for the Valuation Period.

The Assumed Investment Return adjustment factor for the valuation period is the
product of discount factors of .99986634 per day to recognize the 5.0% effective
annual Assumed Investment Return.

The net investment factor used to calculate the value of a variable annuity unit
in each Subaccount for the Valuation Period is determined by dividing (a) by (b)
and subtracting (c) from the result, where:
(a)  is the net result of:
     (1)  the net asset value of a fund share held in that Subaccount determined
          as of the end of the current valuation period; plus
     (2)  the per share amount of any dividend or capital gain Distributions
          made by the fund for shares held in that Subaccount if the ex-dividend
          date occurs during the Valuation Period; plus or minus
     (3)  a per share credit or charge for any taxes reserved for, which we
          determine to have resulted from the investment operations of the
          Subaccount.
(b)  is the net asset value of a fund share held in that Subaccount determined
     as of the end of the immediately preceding Valuation Period.
(c)  is a factor representing the Mortality and Expense Risk Fee and
     Administrative Charge applicable after the Annuity Commencement Date.
     This factor is less than or equal to, on an annual basis, the percentage
     shown on page 3 of the daily net asset value of a fund share held in the
     Separate Account for that Subaccount.

Determination of the First Variable Payment
The amount of the first variable payment is determined by multiplying each
$1,000 of policy proceeds allocated to a variable payment option by the amounts
shown on page 20 for the variable option You select. The tables are based on a
5% effective annual Assumed Investment Return and the "Annuity 2000" (male,
female, and unisex if required by law) mortality table projected for improvement
using projection scale G.

Option 3-V - Life Income An election may be made between:
1.   "No Period Certain" - Payments will be made during the lifetime of the
     Annuitant.
2.   "10 Years Certain" - Payments will be made for the longer of the
     Annuitant's lifetime or ten years. In the event of the death of the person
     receiving payments prior to the end of the guarantee period for which the
     election was made, payments will be continued to that person's beneficiary
     or their present value may be paid in a single sum.

                                    Page 16
<PAGE>

                      SECTION 10 - ANNUITY PAYMENTS - CONT

Option 5-V - Joint and Survivor Annuity
Payments are made as long as either the Annuitant or the joint Annuitant is
living.

Determination of Subsequent Variable Payments
The amount of each variable annuity payment after the first will increase or
decrease according to the value of the variable annuity units which reflect the
investment experience of the selected Subaccounts. Each variable annuity payment
after the first will be equal to the number of variable annuity units in the
selected Subaccounts multiplied by the variable annuity unit value on the date
the payment is made. The number of variable annuity units in each selected
Subaccount is determined by dividing the first variable annuity payment
allocated to the Subaccount by the variable annuity unit value of that
Subaccount on the Annuity Commencement Date.

                                    Page 17
<PAGE>

                    GUARANTEED FIXED ACCOUNT PAYMENT OPTIONS

  The amounts shown in these tables are the guaranteed amounts for each $1,000
  of the proceeds. Higher current amounts may be available at the time of
  settlement.

<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------------------------------
     Option 2, Table I                  Option 3, Table II            Option 3, Table III             Option 3, Table IV
-------------------------------------------------------------------------------------------------------------------------------
 Number of     Amount of
   Years        Monthly               Monthly Installment For     Monthly Installment For Life   Monthly Installment For Life
  Payable     Installment             Life No Period Certain            10 Years Certain         Guaranteed Return Of Proceeds
-------------------------------------------------------------------------------------------------------------------------------
                            Age*     Male    Female     Unisex     Male      Female    Unisex      Male     Female     Unisex
-------------------------------------------------------------------------------------------------------------------------------
<S>           <C>           <C>      <C>     <C>        <C>        <C>       <C>       <C>         <C>     <C>         <C>
                              50      $3.82    $3.70    $3.74      $3.80      $3.69    $3.72       $3.70   $ 3.62      $3.65
                              51       3.89     3.76     3.80       3.86       3.74     3.78        3.75     3.67       3.70
                              52       3.95     3.81     3.86       3.92       3.80     3.84        3.81     3.72       3.75
                              53       4.02     3.88     3.92       3.99       3.86     3.90        3.87     3.78       3.80
     5         $17.91         54       4.10     3.94     3.99       4.06       3.92     3.96        3.93     3.83       3.86
     6          15.14         55       4.18     4.01     4.06       4.13       3.99     4.03        3.99     3.89       3.92
     7          13.16         56       4.26     4.08     4.14       4.21       4.06     4.10        4.06     3.95       3.98
     8          11.68         57       4.35     4.16     4.22       4.29       4.13     4.18        4.13     4.02       4.05
     9          10.53         58       4.44     4.24     4.30       4.38       4.21     4.26        4.20     4.08       4.12
     10          9.61         59       4.54     4.33     4.39       4.47       4.29     4.35        4.27     4.16       4.19
     11          8.86         60       4.64     4.42     4.49       4.57       4.38     4.44        4.36     4.23       4.27
     12          8.24         61       4.76     4.52     4.59       4.67       4.47     4.53        4.44     4.31       4.35
     13          7.71         62       4.88     4.63     4.70       4.78       4.57     4.63        4.53     4.39       4.43
     14          7.26         63       5.01     4.74     4.82       4.89       4.67     4.74        4.62     4.48       4.52
     15          6.87         64       5.15     4.86     4.94       5.01       4.78     4.85        4.72     4.57       4.62
     16          6.53         65       5.30     4.98     5.08       5.14       4.89     4.97        4.83     4.67       4.72
     17          6.23         66       5.46     5.12     5.22       5.27       5.02     5.09        4.94     4.78       4.82
     18          5.96         67       5.63     5.27     5.37       5.41       5.14     5.22        5.05     4.89       4.94
     19          5.73         68       5.81     5.42     5.54       5.55       5.28     5.36        5.17     5.00       5.05
     20          5.51         69       6.00     5.59     5.71       5.70       5.42     5.51        5.30     5.13       5.18
                              70       6.21     5.78     5.90       5.86       5.58     5.66        5.43     5.26       5.31
                              71       6.43     5.97     6.11       6.02       5.74     5.82        5.58     5.39       5.45
                              72       6.66     6.19     6.33       6.18       5.90     5.99        5.72     5.54       5.59
                              73       6.91     6.42     6.56       6.35       6.08     6.16        5.88     5.70       5.75
                              74       7.18     6.67     6.82       6.53       6.26     6.34        6.05     5.86       5.92
                              75       7.46     6.94     7.09       6.70       6.45     6.53        6.22     6.04       6.09
                              76       7.77     7.23     7.39       6.88       6.65     6.72        6.40     6.22       6.27
                              77       8.10     7.55     7.71       7.07       6.85     6.91        6.60     6.42       6.47
                              78       8.45     7.89     8.05       7.25       7.05     7.11        6.80     6.63       6.68
                              79       8.83     8.26     8.43       7.43       7.26     7.31        7.01     6.85       6.90
                              80       9.23     8.66     8.83       7.61       7.46     7.51        7.24     7.08       7.13
                              81       9.66     9.10     9.27       7.79       7.66     7.70        7.47     7.33       7.37
                              82      10.13     9.57     9.74       7.97       7.86     7.89        7.72     7.59       7.63
                              83      10.62    10.09    10.24       8.13       8.05     8.07        7.98     7.86       7.90
                              84      11.15    10.64    10.79       8.29       8.23     8.25        8.26     8.15       8.18
                              85      11.72    11.24    11.38       8.44       8.40     8.41        8.55     8.45       8.48
                              86      12.32    11.89    12.02       8.59       8.56     8.56        8.85     8.77       8.80
                              87      12.97    12.59    12.70       8.72       8.70     8.71        9.17     9.11       9.12
                              88      13.65    13.33    13.42       8.84       8.83     8.83        9.50     9.45       9.47
                              89      14.38    14.11    14.19       8.95       8.95     8.95        9.85     9.82       9.83
                              90      15.16    14.94    15.00       9.06       9.05     9.05       10.22    10.19      10.20
                              91      15.97    15.80    15.85       9.15       9.15     9.15       10.61    10.59      10.59
                              92      16.84    16.70    16.74       9.23       9.23     9.23       11.01    11.00      11.00
                              93      17.75    17.63    17.67       9.31       9.31     9.31       11.45    11.42      11.43
                              94      18.72    18.60    18.64       9.37       9.37     9.37       11.92    11.88      11.89
                              95      19.77    19.62    19.66       9.43       9.43     9.43       12.42    12.36      12.38
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                    Page 18
<PAGE>

                                Option 5, Table V
                                -----------------
<TABLE>
<CAPTION>

                                          Monthly Installment For Joint and Full Survivor
-------------------------------------------------------------------------------------------------------------------------------
     Age of                                                 Age of Female Annuitant*
                   ------------------------------------------------------------------------------------------------------------
      Male            15 Years        12 Years        9 Years         6 Years         3 Years        Same As        3 Years
                     Less Than       Less Than       Less Than       Less Than       Less Than         Male        More Than
   Annuitant*           Male            Male            Male           Male             Male                          Male
-------------------------------------------------------------------------------------------------------------------------------
   <S>               <C>             <C>             <C>             <C>             <C>            <C>            <C>
       50              $3.06           $3.12           $3.19          $3.25            $3.31          $3.38          $3.44
       55               3.20            3.27            3.35           3.44             3.52           3.61           3.69
       60               3.37            3.47            3.57           3.68             3.79           3.91           4.02
       65               3.59            3.72            3.86           4.01             4.16           4.32           4.47
       70               3.88            4.06            4.25           4.45             4.67           4.89           5.11
-------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
                                          Monthly Installment For Unisex Joint and Full Survivor
-------------------------------------------------------------------------------------------------------------------------------
     Age of                                                  Age of Joint Annuitant*
                   ------------------------------------------------------------------------------------------------------------
      First           15 Years        12 Years        9 Years         6 Years         3 Years        Same As        3 Years
                     Less Than       Less Than       Less Than    Less Than First    Less Than        First        More Than
   Annuitant*          First           First           First                           First                         First
-------------------------------------------------------------------------------------------------------------------------------
   <S>              <C>              <C>             <C>          <C>                <C>             <C>           <C>
       50              $3.07           $3.13           $3.19          $3.25            $3.31          $3.37          $3.43
       55               3.20            3.28            3.36           3.44             3.52           3.60           3.67
       60               3.38            3.48            3.58           3.68             3.79           3.89           4.00
       65               3.61            3.73            3.87           4.01             4.16           4.30           4.44
       70               3.90            4.07            4.26           4.46             4.66           4.86           5.05
-------------------------------------------------------------------------------------------------------------------------------
*Adjusted Age as defined in Section 10.A.
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Dollar amounts of monthly, quarterly, semi-annual, and annual installments not
shown in the above tables will be calculated on the same basis as those shown
and may be obtained from the Company.

                                    Page 19
<PAGE>

                            VARIABLE PAYMENT OPTIONS
                       BASED ON ASSUMED INVESTMENT RETURN

  The amounts shown in these tables are the initial payment amounts based on a
  5.0% Assumed Investment Return for each $1,000 of the proceeds.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
                                       Option 3-V, Table II                       Option 3-V, Table III
-------------------------------------------------------------------------------------------------------------------------------
                                   Monthly Installment for Life               Monthly Installment for Life
                                        No Period Certain                           10 Years Certain
-------------------------------------------------------------------------------------------------------------------------------
                   Age*         Male         Female         Unisex          Male         Female         Unisex
                   <S>          <C>          <C>            <C>             <C>          <C>            <C>
                    50          $5.07        $4.93          $4.98           $5.04         $4.92          $4.95
                    51           5.13         4.99           5.03            5.09          4.96           5.00
                    52           5.19         5.04           5.08            5.15          5.01           5.05
                    53           5.26         5.10           5.14            5.21          5.07           5.11
                    54           5.33         5.16           5.21            5.27          5.12           5.17
                    55           5.40         5.22           5.27            5.34          5.18           5.23
                    56           5.48         5.29           5.35            5.41          5.25           5.30
                    57           5.57         5.36           5.42            5.49          5.32           5.37
                    58           5.66         5.44           5.50            5.57          5.39           5.44
                    59           5.75         5.52           5.59            5.66          5.47           5.52
                    60           5.85         5.61           5.68            5.75          5.55           5.61
                    61           5.97         5.70           5.78            5.85          5.63           5.70
                    62           6.09         5.81           5.89            5.95          5.72           5.79
                    63           6.21         5.91           6.00            6.06          5.82           5.89
                    64           6.35         6.03           6.13            6.17          5.92           6.00
                    65           6.50         6.16           6.26            6.29          6.03           6.11
                    66           6.66         6.29           6.40            6.42          6.15           6.23
                    67           6.83         6.43           6.55            6.55          6.27           6.36
                    68           7.01         6.59           6.71            6.69          6.40           6.49
                    69           7.21         6.76           6.89            6.83          6.54           6.63
                    70           7.41         6.94           7.08            6.98          6.69           6.77
                    71           7.63         7.14           7.28            7.13          6.84           6.93
                    72           7.87         7.35           7.50            7.28          7.00           7.09
                    73           8.12         7.58           7.74            7.45          7.17           7.25
                    74           8.39         7.83           8.00            7.61          7.34           7.42
                    75           8.68         8.11           8.28            7.78          7.52           7.60
                    76           8.99         8.40           8.58            7.95          7.71           7.78
                    77           9.32         8.72           8.90            8.12          7.90           7.97
                    78           9.68         9.07           9.25            8.29          8.09           8.16
                    79          10.06         9.45           9.63            8.47          8.29           8.34
                    80          10.47         9.85          10.04            8.64          8.48           8.53
                    81          10.91        10.30          10.48            8.80          8.67           8.71
                    82          11.38        10.78          10.96            8.97          8.86           8.89
                    83          11.88        11.30          11.47            9.12          9.04           9.06
                    84          12.42        11.87          12.03            9.27          9.21           9.23
                    85          12.99        12.48          12.63            9.41          9.37           9.38
                    86          13.60        13.13          13.27            9.54          9.51           9.52
                    87          14.26        13.84          13.96            9.67          9.65           9.65
                    88          14.95        14.59          14.70            9.78          9.77           9.77
                    89          15.69        15.39          15.48            9.89          9.88           9.88
                    90          16.47        16.23          16.30            9.98          9.98           9.98
                    91          17.29        17.10          17.16           10.07         10.07          10.07
                    92          18.16        18.01          18.05           10.15         10.15          10.15
                    93          19.07        18.95          18.98           10.22         10.22          10.22
                    94          20.05        19.92          19.96           10.28         10.28          10.28
                    95          21.09        20.94          20.99           10.34         10.33          10.33
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>

                               Option 5V, Table V
                               ------------------

<TABLE>
<CAPTION>
                                            Monthly Installment For Joint and Full Survivor
-------------------------------------------------------------------------------------------------------------------------------
     Age of                                                  Age of Female Annuitant*
                   ------------------------------------------------------------------------------------------------------------
      Male            15 Years        12 Years        9 Years         6 Years         3 Years         Same As      3 Years More
                      Less Than       Less Than      Less Than       Less Than       Less Than         Male          Than Male
   Annuitant*           Male            Male            Male           Male             Male
-------------------------------------------------------------------------------------------------------------------------------
   <S>                <C>             <C>            <C>             <C>             <C>              <C>          <C>
       50              $4.37           $4.42           $4.46          $4.51            $4.56          $4.62            $4.67
       55               4.48            4.54            4.60           4.67             4.74           4.81             4.88
       60               4.62            4.70            4.79           4.88             4.98           5.08             5.18
       65               4.81            4.92            5.04           5.17             5.31           5.46             5.61
       70               5.07            5.23            5.40           5.59             5.79           6.00             6.22
-------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
                                           Monthly Installment For Unisex Joint and Full Survivor
-------------------------------------------------------------------------------------------------------------------------------
     Age of                                                   Age of Joint Annuitant*
                   ------------------------------------------------------------------------------------------------------------
      First           15 Years        12 Years        9 Years         6 Years         3 Years         Same As         3 Years
                     Less Than        Less Than      Less Than       Less Than       Less Than         First         More Than
   Annuitant*           Male            Male            Male           Male             Male                           First
-------------------------------------------------------------------------------------------------------------------------------
   <S>               <C>              <C>            <C>            <C>              <C>              <C>            <C>
       50              $4.38           $4.42           $4.47          $4.51            $4.56          $4.61            $4.66
       55               4.48            4.54            4.60           4.67             4.73           4.80             4.87
       60               4.63            4.70            4.79           4.88             4.97           5.07             5.16
       65               4.82            4.93            5.05           5.17             5.30           5.44             5.57
       70               5.09            5.24            5.41           5.59             5.78           5.97             6.16
-------------------------------------------------------------------------------------------------------------------------------
*Adjusted Age as defined in Section 10.A
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Dollar amounts of monthly, quarterly, semi-annual, and annual installments not
shown in the above tables will be calculated on the same basis as those shown
and may be obtained from the Company.

                                    Page 21
<PAGE>

                         SECTION 11 - GENERAL PROVISIONS

THE CONTRACT
The entire contract consists of this policy, including any riders or
endorsements.

MODIFICATION OF POLICY
No change in this policy is valid unless made in writing by us and approved by
one of our officers. No Registered Representative has authority to change or
waive any provision of Your policy.

TAX QUALIFICATION
This policy is intended to qualify as an annuity contract for federal income tax
purposes. The provisions of this policy are to be interpreted to maintain such
qualification, notwithstanding any other provisions to the contrary. To maintain
such tax qualification, we reserve the right to amend this policy to reflect any
clarifications that may be needed or are appropriate to maintain such tax
qualification or to conform this policy to any applicable changes in the tax
qualification requirements. We will send You a copy in the event of any such
amendment. If You refuse such an amendment it must be by giving us written
notice, and Your refusal may result in adverse tax consequences.

NON-PARTICIPATING
This policy will not share in our surplus earnings.

AGE OR SEX CORRECTIONS
If the age or sex of the Annuitant has been misstated, the benefits will be
those which the premiums paid would have purchased for the correct age and sex.
If required by law to ignore differences in the sex of the Annuitant, the
annuity payments will be determined using the unisex factors in Section 10.

Any underpayment made by us will be paid with the next payment. Any overpayment
made by us will be deducted from future payments. Any underpayment or
overpayment, will include interest at 5% per year, from the date of the wrong
payment to the date of the adjustment.

INCONTESTABILITY
This policy shall be incontestable from the Policy Date.

EVIDENCE OF SURVIVAL
We have the right to require satisfactory evidence that a person was alive if a
payment is based on that person being alive. No payment will be made until we
receive the evidence.

SETTLEMENT
Any payment by us under this policy is payable at our Home Office.

RIGHTS OF OWNER
The owner may, while the Annuitant is living:
  1.    Assign this policy.
  2.    Surrender the policy to us.
  3.    Amend or modify the policy with our consent.
  4.    Receive annuity payments or name a Payee to receive the payments,
  5.    Exercise, receive and enjoy every other right and benefit contained in
        the policy.

The use of these rights may be subject to the consent of any assignee or
irrevocable beneficiary; and of the spouse in a community or marital property
state.

Unless we have been notified of a community or marital property interest in this
policy, we will rely on our good faith belief that no such interest exists and
will assume no responsibility for inquiry.

OWNER DESIGNATED BENEFICIARY
An owner designated beneficiary can be named in the application, or information
provided in lieu thereof, or in a notice You sign which gives us the facts that
we need. The owner designated beneficiary will become the new owner when You
die, if You die before the Annuitant. If no owner designated beneficiary
survives You and You die before the Annuitant, Your estate will become the new
owner.

CHANGE OF OWNERSHIP
In the case of a non-tax qualified annuity, You can change the owner of this
policy, from yourself to a new owner, in a notice You sign which gives us the
facts that we need. When this change takes effect, all rights of ownership in
this policy will pass to the new owner.

A change of owner or owner designated beneficiary will not be effective until it
is recorded in our records. After it has been so recorded, the change will take
effect as of the date You signed the notice. However, if the Annuitant dies
before the notice has been so recorded, it will not be effective as to those
proceeds we have paid before the change was recorded in our records.

We may require that the change be endorsed in the policy. Changing the owner or
naming a new owner designated beneficiary cancels any prior choice of owner
designated beneficiary, but does not change the beneficiary or the Annuitant.

A change of ownership may result in adverse tax consequences.

                                    Page 22
<PAGE>

                     SECTION 11 - GENERAL PROVISIONS - CONT

ANNUITY COMMENCEMENT DATE
The Annuity Commencement Date is the date annuity payments begin. This date may
not be later than the last day of the policy month starting after the Annuitant
attains age 85, except as expressly allowed by us (within state restrictions),
but in no event later than the last day of the policy month following the month
in which the Annuitant attains age 98. You may change the Annuity Commencement
Date at any time before the Annuity Commencement Date by giving us 30 days'
written notice.

ASSIGNMENT
(a)  In the case of a non tax-qualified annuity, this Policy may be assigned.
     The assignment must be in writing and filed with us.

(b)  We assume no responsibility for the validity of any assignment. Any claim
     made under an assignment shall be subject to proof of interest and the
     extent of the assignment.

(c)  This policy may be applied for and issued to qualify as a tax-qualified
     annuity under certain sections of the Internal Revenue Code. Ownership of
     this policy is then restricted so that it will comply with provisions of
     the Internal Revenue Code.

Assignment of this policy may result in adverse tax consequences.

BENEFICIARY
Death proceeds, when payable in accordance with Section 9, are payable to the
designated beneficiary or beneficiaries. Such beneficiary(ies) must be named in
the application, or information provided in lieu thereof, and may be changed
without consent (unless irrevocably designated or required by law) by notifying
us in writing on a form acceptable to us. The change will take effect upon the
date You sign it, whether or not You are living when we receive it. The notice
must have been postmarked (or show other evidence of delivery that is acceptable
to us) on or before the date of death. Your most recent change of beneficiary
notice will replace any prior beneficiary designations. No change will apply to
any payment we made before the written notice was received. If an irrevocable
beneficiary dies, You may designate a new beneficiary.

You may direct that the beneficiary shall not have the right to withdraw, assign
or commute any sum payable under an option. In the absence of such election or
direction, the beneficiary may change the manner of payment or make an election
of any option.

If any primary or contingent beneficiary dies before the Annuitant, that
beneficiary's interest in this policy ends with that beneficiary's death. Only
those beneficiaries living at the time of the Annuitant's death will be eligible
to receive their share of the Death Proceeds. In the event no contingent
beneficiaries have been named and all primary beneficiaries have died before the
death proceeds become payable, the owner(s) will become the beneficiary(ies)
unless elected otherwise in accordance with Section 9. If both primary and
contingent beneficiaries have been named, payment will be made to the named
primary beneficiaries living at the time the death proceeds become payable. If
there is more than one beneficiary and You failed to specify their interest,
they will share equally. Payment will be made to the named contingent
beneficiary(ies) only, if all primary beneficiaries have died before the death
proceeds become payable. If any primary beneficiary is alive at the time the
death proceeds become payable, but dies before receiving their payment, their
share will be paid to their estate.

In cases where the Annuitant dies and the owner (who is not the Annuitant)
elected to receive the death benefit in accordance with Section 9, if the
Annuitant's estate has been named as beneficiary, then payment will be made to
the owner.

PROTECTION OF PROCEEDS
Unless You so direct by filing written notice with us, no beneficiary may assign
any payments under this policy before the same are due. To the extent permitted
by law, no payments under this policy will be subject to the claims of creditors
of any beneficiary.

DEFERMENT
We will pay any Partial Withdrawals or Surrender proceeds from the Separate
Account within 7 days after we receive all requirements that we need. However,
it may happen that the New York Stock Exchange is closed for trading (other than
the usual weekend or holiday closings), or the Securities and Exchange
Commission restricts trading or determines that an emergency exists. If so, it
may not be practical for us to determine the investment experience of the
Separate Account. In that case, we may defer transfers among the Subaccounts and
to the Fixed Account, and determination or payment of Partial Withdrawals or
Surrender proceeds.

                                    Page 23
<PAGE>

                     SECTION 11 - GENERAL PROVISIONS - CONT

When permitted by law, we may defer paying any Partial Withdrawals or Surrender
proceeds from the Fixed Account for up to 6 months from the date we receive Your
request. If the owner dies after the request is received, but before the request
is processed, the request will be processed before the death proceeds are
determined. Interest will be paid on any amount deferred for 30 days or more.
This rate will be 3% per year unless otherwise required by law.

REPORTS TO OWNER
We will give You an annual report at least once each Policy Year. This report
will show the number and value of the accumulation units held in each of the
Subaccounts as well as the value of the Fixed Account. It will also give You the
Death Benefit, Cash Value, and any other facts required by law or regulation.

                                    Page 24
<PAGE>

                    Peoples Benefit Life Insurance Company
   Home Office located at 4333 Edgewood Road N.E., Cedar Rapids, Iowa 52499

                       Flexible Premium Variable Annuity
                  Income Payable At Annuity Commencement Date
           Benefits Based On The Performance Of The Separate Account
            Are Variable And Are Not Guaranteed As To Dollar Amount
                           (See Sections 6 and 10C.)
                               Non-Participating<PAGE>

                                                                    EXHIBIT 10.1
                                                                    ------------

                        COMMON STOCK PURCHASE AGREEMENT

     This COMMON STOCK PURCHASE AGREEMENT (the "Agreement") is dated as of
August 24, 2000, by and among ObjectSoft Corporation, a corporation organized
under the laws of the State of Delaware (the "Company") (NASDAQ: "OSFT"), and
the Purchaser whose name is set forth on Exhibit A hereto (the "Purchaser").

     WHEREAS, the parties desire that, upon the terms and subject to the
conditions contained herein, the Company shall issue and sell to the Purchaser
and the Purchaser shall purchase up to 450,000 shares Company's common stock,
$.0001 par value per share (the "Common Stock"); and

     WHEREAS, such purchase and sale will be made in reliance upon the
provisions of Section 4(2) and Rule 506 of Regulation D ("Regulation D") of the
United States Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder (the "Securities Act"), or upon such other exemption from
the registration requirements of the Securities Act as may be available with
respect to any or all of the purchases of Common Stock to be made hereunder.

     The parties hereto agree as follows:

                                   ARTICLE I

                          Purchase and Sale of Stock

     Section 1.1  Purchase and Sale of Common Shares.  Upon the following terms
                  ----------------------------------
and subject to the conditions contained herein, the Company shall, on the date
hereof, issue and sell to the Purchaser, and the Purchaser shall purchase from
the Company, an aggregate of 450,000 shares of Common Stock (the "Common
Shares"), pursuant to the terms set forth on Exhibit B hereto, which terms are
incorporated herein and shall be considered part of the agreement between the
parties hereto.

     Section 1.2  Closing.  The closing of the purchase and sale of the Common
                  -------
Shares (the "Closing") to be acquired by the Purchaser from the Company shall
take place at the offices of Parker Chapin LLP, The Chrysler Building, 405
Lexington Avenue, New York, New York 10174 at 10:00 a.m., eastern time, on the
date hereof (the "Closing Date").

                                  ARTICLE II

                        Representations and Warranties

     Section 2.1  Representations and Warranties of the Company.  In order to
                  ---------------------------------------------
induce the Purchaser to enter into this Agreement and to purchase the Common
Shares, the Company hereby makes the following representations and warranties to
the Purchaser:
<PAGE>

          (a)  Organization, Good Standing and Power.  The Company is a
               -------------------------------------
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and has the requisite corporate power to own,
lease and operate its properties and assets and to conduct its business as it is
now being conducted and to enter into this Agreement and to perform its
obligations hereunder.

          (b)  Authorization; Enforcement.  The Company has the requisite
               --------------------------
corporate power and authority to enter into and perform this Agreement and the
Escrow Agreement (collectively, the "Transaction Documents") and to issue and
sell the Common Shares in accordance with the terms hereof. The execution,
delivery and performance of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby have been
duly and validly authorized by all necessary corporate action, and no further
consent or authorization of the Company or its Board of Directors or
stockholders is required. Each of the Transaction Documents has been duly
executed and delivered by the Company. Each of the Transaction Documents
constitutes, or shall constitute when executed and delivered, a valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditor's rights and remedies or by other
equitable principles of general application.

          (c)  Issuance of Shares.  The Common Shares to be issued at the
               ------------------
Closing have been duly authorized by all necessary corporate action and, when
paid for or issued in accordance with the terms hereof, the Common Shares shall
be validly issued and outstanding, fully paid and nonassessable.

          (d)  SEC Documents.  As of their respective dates, none of the SEC
               -------------
Documents (as defined below) contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading.

          (e)  No Conflicts.  The execution, delivery and performance of the
               ------------
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated herein and therein do not and will not (i) violate any
provision of the Company's Certificate of Incorporation ("Articles") or Bylaws,
(ii) conflict with, or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, mortgage, deed of trust, indenture, note, bond, license, lease
agreement, instrument or obligation to which the Company is a party or by which
any of its respective properties or assets are bound, (iii) create or impose a
lien, mortgage, security interest, charge or encumbrance of any nature
whatsoever on any property of the Company under any agreement or any commitment
to which the Company is a party or by which the Company is bound or by which any
of its respective properties or assets are bound, or (iv) result in a violation
of any rule, regulation, order, judgment or decree applicable to the Company or
by which any property or asset of the Company is bound or affected, except, in
all cases other than violations pursuant to clause (i) above, for such
conflicts, defaults, terminations, amendments, acceleration, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect. "Material Adverse Effect" shall mean any effect on the business,
operations, properties, prospects, or financial condition of

                                      -2-
<PAGE>

the Company that is material and adverse to the Company and its subsidiaries and
affiliates, taken as a whole.

          (f)  Certain Fees.  The Company has not employed any broker or finder
               ------------
or incurred any liability for any brokerage or investment banking fees,
commissions, finders' or structuring fees, financial advisory fees or other
similar fees in connection with the Transaction Documents.

     Section 2.2  Representations and Warranties of the Purchaser.  The
                  -----------------------------------------------
Purchaser hereby makes the following representations and warranties to the
Company:

          (a)  Organization and Standing of the Purchasers.  If the Purchaser is
               -------------------------------------------
an entity, the Purchaser is a corporation, limited liability company or
partnership duly incorporated or organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization, and the Purchaser was not formed for the specific purpose of
acquiring the Common Shares.

          (b)  Authorization and Power.  The Purchaser has the requisite power
               -----------------------
and authority to enter into and perform the Transaction Documents and to
purchase the Common Shares being sold to it hereunder. The execution, delivery
and performance of the Transaction Documents by the Purchaser and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate, limited liability company or partnership
action, as applicable (if the Purchaser is an entity), and no further consent or
authorization of the Purchaser or its Board of Directors, stockholders, members,
managers or partners, as the case may be, is required. Each of the Transaction
Documents has been duly executed and delivered by the Purchaser on the Closing
Date. Each of the Transaction Documents constitutes a valid and binding
obligation of the Purchaser enforceable against the Purchaser in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, or similar laws relating to, or affecting generally the
enforcement of, creditors' rights or remedies or by other equitable principles
of general application.

          (c)  No Conflicts.  The execution, delivery and performance of the
               ------------
Transaction Documents and the consummation by the Purchaser of the transactions
contemplated herein and therein do not and will not (i) result in a violation of
the Purchaser's charter documents, bylaws, partnership agreement, operating
agreement or other organizational documents, or (ii) conflict with, constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of any agreement, indenture or instrument to which
the Purchaser is a party of by which the Purchaser is bound, or result in a
violation of any law, rule, or regulation, or any order, judgment or decree of
any court or governmental agency applicable to the Purchaser or its properties
(except for such conflicts, defaults and violations as would not, individually
or in the aggregate, have a material adverse effect on the Purchaser).

          (d)  Acquisition for Investment.  The Purchaser is purchasing the
               --------------------------
Common Shares solely for its own account for the purpose of investment and not
with a view to or for sale in connection with distribution. The Purchaser does
not have a present intention to sell the Common Shares, nor a present
arrangement (whether or not legally binding) or intention to effect any
distribution of the Common Shares to or through any person or entity; provided,
                                                                      --------

                                      -3-
<PAGE>

however, that by making the representations herein and subject to Exhibit A
-------
hereto and Section 2.2(f) below, the Purchaser does not agree to hold the Common
Shares for any minimum or other specific term and reserves the right to dispose
of the Common Shares at any time in accordance with federal securities laws
applicable to such disposition. The Purchaser acknowledges that it is able to
bear the financial risks associated with an investment in the Common Shares and
that it has been given full access to such records of the Company and to the
officers of the Company as it has deemed necessary or appropriate to conduct its
due diligence investigation.

          (e)  Accredited Purchasers.  The Purchaser is an "accredited investor"
               ---------------------
as defined in Regulation D promulgated under the Securities Act and is a
resident of the jurisdiction indicated on Exhibit A hereto. The Purchaser has
such knowledge and experience in financial and business matters that the
Purchaser is capable of evaluating the merits and risks of the Purchaser's
investment in the Company.

          (f)  Rule 144.  The Purchaser understands that the Common Shares must
               --------
be held indefinitely unless such Shares are registered under the Securities Act
or an exemption from registration is available. The Purchaser acknowledges that
the Purchaser is familiar with Rule 144 of the rules and regulations of the
Commission, as amended, promulgated pursuant to the Securities Act ("Rule 144"),
and that the Purchaser has been advised that Rule 144 permits resales only under
certain circumstances. The Purchaser understands that to the extent that Rule
144 is not available, the Purchaser will be unable to sell any Shares without
either registration under the Securities Act or the existence of another
exemption from such registration requirement.

          (g)  No Broker-Dealer Affiliation.  The Purchasers is not a broker-
               ----------------------------
dealer registered with the Commission or an affiliate (as such term is defined
in Rule 144(a) promulgated under the Securities Act) of a broker-dealer
registered with the Commission.

          (h)  General.  The Purchaser understands that the Common Shares are
               -------
being offered and sold in reliance on a transactional exemption from the
registration requirement of federal and state securities laws and the Company is
relying upon the truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings of the Purchaser set forth herein
in order to determine the applicability of such exemptions and the suitability
of such Purchaser to acquire the Common Shares. The Purchaser understands that
no United States federal or state agency or any government or governmental
agency has passed upon or made any recommendation or endorsement of the Common
Shares.

          (i)  Commission Documents; Opportunities for Additional Information.
               --------------------------------------------------------------
The Purchaser acknowledges that the Company has made available to the Purchaser
through the SEC's Edgar site or otherwise prior to the date hereof, and that the
Purchaser has reviewed to its satisfaction, copies of the Company's (i) Form 10-
KSB for the year ended December 31, 1998, (ii) Form 10-KSB for the year ended
December 31, 1999, (iii) Forms 10-QSB for the quarters ended March 31, 2000 and
June 30, 2000, (iv) Registration Statements on Form S-3 (Registration Nos. 333-
92685, 333-92201, 333-30724, 333-36944, 333-41618 and 333-41620), (v) Current
Report on Form 8-K filed January 4, 2000, and (vi) Definitive Proxy Statements
filed September 15, 1999 and April 26, 2000 (collectively, the "SEC Documents").
The Purchaser has had full opportunity to review, and has reviewed to the
Purchaser's full satisfaction, the SEC Documents. The Purchaser acknowledges
that the Purchaser has had the opportunity to ask

                                      -4-
<PAGE>

questions of and receive answers from, or obtain additional information from,
the executive officers of the Company concerning the financial and other affairs
of the Company, and to the extent deemed necessary in light of the Purchaser's
personal knowledge of the Company's affairs, the Purchaser has asked such
questions and received answers to the full satisfaction of the Purchaser, and
the Purchaser desires to invest in the Company.

          (j)  No General Solicitation.  The Purchaser acknowledges that the
               -----------------------
Common Shares were not offered to the Purchaser by means of any form of general
or public solicitation or general advertising, or publicly disseminated
advertisements or sales literature, including (i) any advertisement, article,
notice or other communication published in any newspaper, magazine, or similar
media, or broadcast over television or radio, or (ii) any seminar or meeting to
which the Purchaser was invited by any of the foregoing means of communications.

          (k)  No Commissions or Similar Fees.  In connection with the purchase
               ------------------------------
of the Common Shares by the Purchaser, the Purchaser has not and will not pay,
and has no knowledge of the payment of, any commission or other direct or
indirect remuneration to any person or entity for soliciting or otherwise
coordinating the purchase of such securities, except to such persons or entities
as are duly licensed and/or registered to engage in securities offering and
selling activities (or are exempt from such licensing and/or registration
requirements) under applicable federal laws and the laws of the state(s) in
which such activities have taken place in connection with the transaction
contemplated by this Agreement.

                                  ARTICLE III

                                 Registration

     The Company covenants with the Purchaser that the Company, at its sole cost
and expense, will file a registration statement registering the resale of the
Common Shares no later than forty-five (45) days after the Closing Date and use
its best efforts to cause the registration statement to be declared effective
within ninety (90) days after the Closing Date and will keep such registration
statement effective until the Common Shares may be sold under Rule 144 without
regard to the volume limitations thereunder (the "Registration Period").  If the
Common Shares are not registered for resale on or before the 120th day after the
date hereof (the "Penalty Date"), or if after the Registration Statement becomes
effective, it is withdrawn, suspended or otherwise not available for more than
20 days on a cumulative basis for resale of the Common Shares prior to the
expiration of the Registration Period, then the Company will pay to the
Purchaser as liquidated damages a payment for the first 30 days equal to 2% of
the Closing Purchase Price apportioned to the Common Shares which the Purchaser
continues to hold (with a partial period being pro-rated) and 1% of the Closing
Purchase Price apportioned to the Common Shares which the Purchaser continues to
hold for each 30 days thereafter (pro-rated for a partial period).  The
foregoing liquidated damages will cease to accrue at such time that the
registration statement is declared effective or becomes available or the
Purchaser may rely on Rule 144 for the resale of the Common Shares without
limitations, whichever is earlier.  The provisions pertaining to the Company's
obligations pursuant to this Article III are set forth in the Registration
Rights Agreement attached hereto as Appendix X.  To the extent there is a
conflict between the provisions of this Article III and the terms of the
Registration Rights Agreement, the provisions of this Article III will control.

                                      -5-
<PAGE>

                                  ARTICLE IV

                          Transfer Agreement; Voting

     Section 4.1  Transfer Restrictions.  The Purchaser agrees to be bound by
                  ---------------------
the terms and conditions set forth in Exhibit B restricting the sale or transfer
of Common Shares.

     Section 4.2  Agreement to Vote.  For so long as the Company has not
                  -----------------
committed a material breach of this Agreement, and this Agreement has not been
terminated, the Purchaser agrees to vote all Common Shares beneficially held by
it in favor of all nominees to the Company's board of directors who are
nominated by the then current Board of Directors of the Company.

                                   ARTICLE V

                           Stock Certificate Legend

     Section 5.1  Legend.  Each certificate representing the Common Shares, as
                  ------
applicable and appropriate, shall be stamped or otherwise imprinted with a
legend in substantially the following form (in addition to any legend required
by applicable federal, provincial or state securities or "blue sky" laws):

     THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE "SECURITIES") HAVE
     NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
     "SECURITIES ACT") OR STATE SECURITIES LAWS AND MAY NOT BE SOLD,
     TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED OR OTHERWISE DISPOSED
     OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
     STATE SECURITIES LAWS OR OBJECTSOFT CORPORATION (THE "COMPANY") SHALL
     HAVE RECEIVED AN OPINION IN FORM, SCOPE AND SUBSTANCE REASONABLY
     ACCEPTABLE TO THE COMPANY, OF COUNSEL, WHO IS REASONABLY ACCEPTABLE TO
     THE COMPANY, THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES
     ACT AND UNDER THE PROVISIONS OF APPLICABLE FEDERAL AND STATE
     SECURITIES LAWS IS NOT REQUIRED.

     THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
     VOTING, TRANSFER AND OTHER AGREEMENTS SET FORTH IN A COMMON STOCK
     PURCHASE AGREEMENT DATED AS OF AUGUST 24, 2000 AMONG THE COMPANY AND
     CERTAIN PURCHASERS.

                                      -6-
<PAGE>

                                  ARTICLE VI

                                  Termination

     This Agreement may be terminated at any time prior to the Closing by the
mutual written consent of the Company and the Purchaser.

                                  ARTICLE VII

                                 Miscellaneous

     Section 7.1  Fees and Expenses.  Each party shall pay the fees and expenses
                  -----------------
of its advisors, counsel, accountants and other experts, if any, and all other
expenses, incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement.

     Section 7.2  Consent to Jurisdiction.
                  -----------------------

     Each of the Company and the Purchaser (i) hereby irrevocably submits to the
jurisdiction of the United States District Court sitting in the Southern
District of New York and the courts of the State of New York located in New York
county for the purposes of any suit, action or proceeding arising out of or
relating to this Agreement or any of the other Transaction Documents or the
transactions contemplated hereunder or thereunder and (ii) hereby waives, and
agrees not to assert in any such suit, action or proceeding, any claim that it
is not personally subject to the jurisdiction of such court, that the suit,
action or proceeding is brought in an inconvenient forum or that the venue of
the suit, action or proceeding is improper.  Each of the Company and the
Purchaser consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof.  Nothing in this
Section 7.2 shall affect or limit any right to serve process in any other manner
permitted by law.

     Section 7.3  Entire Agreement; Amendment.  This Agreement contains the
                  ---------------------------
entire understanding and agreement of the parties with respect to the matters
covered hereby and, except as specifically set forth herein or in the
Transaction Documents, neither the Company nor the Purchaser makes any
representation, warranty, covenant or undertaking with respect to such matters,
and they supersede all prior understandings and agreements with respect to said
subject matter, all of which are merged herein. No provision of this Agreement
may be waived or amended, except by a written instrument signed by the Company
and the Purchaser.

     Section 7.4  Notices.  Any notice, demand, request, waiver or other
                  -------
communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand delivery by telex (with correct answer back
received), telecopy or facsimile at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur.  The addresses for
such communications shall be:

                                      -7-
<PAGE>

If to the Company:    ObjectSoft Corporation
                      Continental Plaza III
                      433 Hackensack Avenue
                      Hackensack, NJ 07601
                      Attn.: David E.Y. Sarna
                      Tel.: (201) 343-9100
                      Fax:  (201) 270-5071

                      with copies to:

                      Parker Chapin LLP
                      The Chrysler Building
                      405 Lexington Avenue
                      New York, NY 10174
                      Attn: Melvin Weinberg
                      Tel: (212) 704-6000
                      Fax: (212) 704-6288

If to the Purchaser:  At the address of the Purchaser as set forth on
                      Exhibit A to this Agreement.

     Any party hereto may from time to time change its address for notices by
giving at least ten (10) days written notice of such changed address to the
other party hereto.

     Section 7.5  Waivers.  No waiver by either party of any default with
                  -------
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any other
provisions, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.

     Section 7.6  Headings.  The article, section and subsection headings in
                  --------
this Agreement are for convenience only and shall not constitute a part of this
Agreement for any other purpose and shall not be deemed to limit or affect any
of the provisions hereof.

     Section 7.7  Successors and Assigns.  This Agreement shall be binding upon
                  ----------------------
and inure to the benefit of the parties and their successors and assigns. No
rights or obligations hereunder may be assigned by either party hereto, except
that the rights and obligations of the Company may be assigned.

     Section 7.8  No Third Party Beneficiaries.  This Agreement is intended for
                  ----------------------------
the benefit of the parties hereto and their respective permitted successors and
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.

     Section 7.9  Governing Law.  This Agreement shall be governed by and
                  -------------
construed in accordance with the internal laws of the State of New York, without
giving effect to the choice of law provisions. This Agreement shall not be
interpreted or construed with any presumption against the party causing this
Agreement to be drafted.

                                      -8-
<PAGE>

     Section 7.10  Survival.  The representations, warranties, agreements and
                   --------
covenants set forth in this Agreement shall survive the execution and delivery
hereof and the Closing hereunder indefinitely.

     Section 7.11  Counterparts.  This Agreement may be executed in any number
                   ------------
of counterparts, all of which taken together shall constitute one and the same
instrument and shall become effective when counterparts have been signed by each
party and delivered to the other parties hereto, it being understood that all
parties need not sign the same counterpart.

     Section 7.12  Severability.  The provisions of this Agreement are severable
                   ------------
and, in the event that any court of competent jurisdiction shall determine that
any one or more of the provisions or part of the provisions contained in this
Agreement shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision or part of a provision of this Agreement, and this Agreement
shall be reformed and construed as if such invalid or illegal or unenforceable
provision, or part of such provision, had never been contained herein, so that
such provisions would be valid, legal and enforceable to the maximum extent
possible.

     Section 7.13  Further Assurances.  From and after the date of this
                   ------------------
Agreement, upon the request of the Purchaser or the Company, each of the Company
and the Purchaser shall execute and deliver such instruments, documents and
other writings as may be reasonably necessary or desirable to confirm and carry
out and to effectuate fully the intent and purposes of this Agreement.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      -9-
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorize officer as of the date first above
written.

                                    OBJECTSOFT CORPORATION

                                    By:   /s/ David E.Y. Sarna
                                       ---------------------------------
                                       Name:  David E.Y. Sarna
                                       Title: Chairman

                                    LA JOLLA COVE INVESTORS, INC.

                                    By:   /s/ Norman Lizt
                                       ---------------------------------
                                       Name:  Norman Lizt
                                       Title: President

                                      -10-
<PAGE>

                                   EXHIBIT A
                                    to the
                        COMMON STOCK PURCHASE AGREEMENT

                            OBJECTSOFT CORPORATION

<TABLE>
<CAPTION>
Purchaser                            Number of Common Shares     Initial Purchase Price
---------                            -----------------------     ----------------------
<S>                                  <C>                         <C>
La Jolla Cove Investors, Inc.         450,000 Common Shares            $410,690.70
7817 Herschel Avenue
Suite 200
La Jolla, California  92037
Attention:   Norman Lizt, President
Telecopier:  (858) 456-1924
Telephone:   (858) 456-9122
</TABLE>

                                      -11-
<PAGE>

                                   Exhibit B
                                   ---------

1.  On the date hereof, the Company will issue and sell to the Purchaser, and
    the Purchaser will purchase from the Company, the Common Shares at $.91265
    per Share (the "Closing Price Per Share") (which is 73% of the lower of (a)
    the closing bid price of the Common Stock on the last trading day prior to
    the date hereof or (b) the average of the closing bid prices for the five
    trading days prior to the date hereof), for a total purchase price for all
    of the Common Shares of $410690.7 (the "Closing Purchase Price"). Upon
    receipt of the shares, 30% of the Closing Purchase Price shall be paid by
    wire transfer directly to the Company and 70% of the Closing Purchase Price
    shall be paid into escrow (the "Initial Escrow Amount"). 20% of the original
    Closing Purchase Price (the "Initial Release Amount") shall be released from
    escrow to the Company on the date that the Company notifies (a) the
    Purchaser as to the effectiveness of the registration statement referred to
    in Article III (the "Registration Statement") and (b) its transfer agent
    that the Common Shares may be freely sold thereunder subject to the
    prospectus delivery requirements (the "Registration Date"), provided that
    the closing bid price of the Common Stock is at least $0.75 per share, based
    on an average of the five trading days preceding the effective date of the
    Registration Statement. (In the event that this $0.75 per share condition is
    not met, the 20% of the original Closing Purchase Price shall be released
    once such condition is met.) The remaining escrowed 50% of the Closing
    Purchase Price shall be distributed pursuant to the provisions of Section 4
    hereof. Notwithstanding anything herein to the contrary, if on the 140th day
    from the Closing Date, the Initial Release Amount has not been released from
    escrow because the Registration Statement has not become effective, the
    Initial Escrow Amount shall be delivered by the escrow agent to the
    Purchaser to be held by the Purchaser until the Company becomes entitled to
    the Initial Release Amount, at which time the Initial Release Amount shall
    be delivered to the Company and the remaining balance returned to the
    escrow.

2.  The Purchaser agrees that it may not sell or transfer the Common Shares
    before the date (the "Effective Date") which is the earlier of (a) the
    Registration Date and (b) one year after the date hereof. The Purchaser also
    agrees that, on and after the Effective Date, it will not sell or transfer
    any of the Common Shares except in accordance with the following schedule:
    beginning the Effective Date and on each 30th day thereafter until the 120th
    day after the Effective Date (the Effective Date and each such 30th day, a
    "Monthly Release Date"), the Purchaser may sell or transfer one-fifth
    (1/5th) of the original number of Common Shares (that is, 450,000 Common
    Shares) on and after each Monthly Release Date plus any amounts unsold from
    the prior month(s).

3.  On the 30th day after the Effective Date ("Initial Determination Date"),
    provided that (a) the Registration Statement is then effective or (b) all
    steps required to be taken on the part of the Company have been taken to
    allow Purchaser to effect a sale under Rule 144 which Purchaser has elected
    to make (the "Resale Conditions"), the Purchaser will pay to the Company the
    amount, if any, by which the Redetermined Purchase Price (as defined herein)
    of the Common Shares determined as of the Initial Determination Date exceeds
    one-third of the Closing Purchase Price (provided that such amount shall be
    paid only if, as of the Initial Determination Date, the Redetermined
    Purchase Price per share of the Common Shares exceeds the Closing Price Per
    Share by at least $.50). Thereafter, on the 75th day after the Effective
    Date provided that the Resale Conditions have been satisfied

                                      -12-
<PAGE>

    ("Interim Determination Date"), the Purchaser will pay to the Company the
    amount, if any, by which the Redetermined Purchase Price of the Common
    Shares determined as of the Interim Determination Date exceeds one-third of
    the Closing Purchase Price (provided that such amount shall be paid only if,
    as of the Interim Determination Date, the Redetermined Purchase Price per
    share of the Common Shares exceeds the Closing Price Per Share by at least
    $.50). In no event will the Company be required to make any payment or issue
    any shares of stock to the Purchaser as a result of any of the foregoing
    determinations (except to the extent provided in Section 4 in connection
    with the Final Determination Date (as defined herein)). 40% of each payment
    required to be made to the Company under this Section 3 will be paid
    directly to the Company by wire transfer of immediately available funds and
    60% of each such payment will be paid into the Escrow to be distributed
    pursuant to the provisions of Section 4 hereof. For purposes of this
    Agreement, the "Redetermined Purchase Price" for the Common Shares as of a
    particular date of determination shall mean (a) 73% of the average of the
    closing bid prices of the Common Stock for all of the trading days in the 30
    calendar days preceding the date of determination, multiplied by (b) one-
    third of the original number of shares of Common Stock representing the
    Common Shares.

4.  On the 120th day after the Effective Date ("Final Determination Date"), a
    final determination will be made as of such date based upon the following
    formula. The "Final Price" for the Common Shares will be 73% of (a) the
    average of all the closing bid prices for the Common Stock for all trading
    days in the 120 day period prior to the Final Determination Date, multiplied
    by (b) the original number of shares of Common Stock representing the Common
    Shares. If the Final Price for the Common Shares is less than the sum of the
    Closing Purchase Price and all amounts, if any, previously paid to the
    Company (including amounts paid into the Escrow) under Section 3 hereof,
    then the Company will pay to the Purchaser, no later than 10 days after the
    Final Determination Date, the amount of such difference (the "Deficiency")
    as follows: the amount in the Escrow shall first be used to pay the
    Deficiency and any Escrow balance shall be paid immediately to the Company.
    If the total amount in Escrow is insufficient to pay the Deficiency, then
    the Company shall pay the balance of the Deficiency, after the remaining
    escrowed amount is used, at the Company's sole discretion, either in cash,
    or in shares of Common Stock valued at 73% of the average of all of the
    closing bid prices of the Common Stock for the 15 trading days preceding the
    date of such payment (such discounted valuation herein referred to as the
    "Deficiency Share Price"), or by combination of cash and shares of Common
    Stock valued as aforesaid. (Notwithstanding anything herein to the contrary,
    the Company will not be permitted to issue shares of Common Stock under this
    Section 4 to the extent such issuance would exceed the maximum number of
    shares which the Company may issue under this Agreement without breaching
    the Company's obligations under Section 4310(c)(25)(H) of the Nasdaq
    Marketplace Rules or other similar requirement and, to such extent, the
    balance of the Deficiency must be paid in cash.) If the Final Price for the
    Common Shares is more than the sum of the Closing Purchase Price and all
    amounts, if any, previously paid to the Company (including amounts paid into
    the Escrow) under Section 3 hereof, then, Purchaser will pay to the Company,
    no later than 10 days after the Final Determination Date or, if the Resale
    Conditions have not been satisfied as of the Final Determination Date, ten
    days after the Resale Conditions have been satisfied, the amount of such

                                      -13-
<PAGE>

    difference in full and the remaining escrowed amount will be immediately
    released and paid to the Company.

5.  On the date hereof, the Company, the Purchaser and Loeb & Loeb LLP, as
    Escrow Agent (the "Escrow Agent"), have entered into an Escrow Agreement
    (the "Escrow Agreement") providing for the escrow to hold a portion of the
    cash otherwise payable to the Company. The parties hereto agree to give the
    Escrow Agent the joint instructions necessary to implement the provisions of
    Section 4 hereof. Income earned on escrowed amounts will be distributed
    along with the escrowed amount to the party receiving the distribution. The
    Company agrees, no later than 10 days after the Final Determination Date, to
    reimburse the Purchaser for one-half of the Escrow Agent's fees actually
    paid by the Purchaser in connection with the performance of the Escrow
    Agent's obligations under the Escrow Agreement, in an amount not to exceed
    $1,750; to the extent any amounts are payable to the Company by the
    Purchaser or the Escrow Agent under Section 4, this reimbursement obligation
    will be paid from, and offset against, the amounts so payable under Section
    4.

6.  The Company covenants with the Purchaser that, if the Company elects to
    issue shares of Common Stock to the Purchaser under Section 4 ("Deficiency
    Shares"), the Company, at its sole cost and expense, will file a
    registration statement registering the resale of the Deficiency Shares no
    later than forty-five (45) days after the Final Determination Date and use
    its best efforts to cause the registration statement to be declared
    effective within ninety (90) days after the Final Determination Date and
    will keep such registration statement effective until the Deficiency Shares
    may be resold under Rule 144 without regard to the volume limitation rules
    thereunder (the "Registration Period"). If the Deficiency Shares are not
    registered for resale on or before the 120th day after the Final
    Determination Date (the "Non-Registration Penalty Date") or if after the
    registration statement becomes effective, it is withdrawn, suspended or
    otherwise not available for more than twenty days on a cumulative basis for
    resale of the Deficiency Shares prior to the expiration of the Registration
    Period, then the Company will pay to the Purchaser as liquidated damages a
    payment for the first 30 days after the Non-Registration Penalty Date equal
    to 2% of the Deficiency Share Price apportioned to the Deficiency Shares
    which the Purchaser continues to hold (with a partial period being pro-
    rated) and 1% of the Deficiency Share Price apportioned to the Deficiency
    Shares which the Purchaser continues to hold for each 30 days thereafter
    (pro-rated for a partial period). The foregoing liquidated damages will
    cease to accrue at such time that the registration statement is declared
    effective or becomes available or the Purchaser may rely on Rule 144 for the
    resale of the Deficiency Shares without limitations, whichever is earlier.
    The provisions pertaining to the Company's obligations pursuant to this
    paragraph 6 are set forth in the Registration Rights Agreement.

7.  Examples illustrating the foregoing are set forth on Exhibit C to the Common
    Stock Purchase Agreement.

8.  All share and dollar amounts set forth herein shall be appropriately
    adjusted for any stock splits, stock dividends, recapitalizations and
    similar events

                                      -14-
<PAGE>

                                   Exhibit C
                                   ---------

     The following examples assume that the closing bid price of the Common
Stock on the Closing Date and for the five trading days prior to the Closing
Date is $1.50 per share and that the Purchaser purchases an aggregate of 400,000
shares of Common Stock (the "Common Shares").  Therefore, the Closing Purchase
Price would be $438,000 (face value of the Common Shares would be $600,000).  On
the Closing Date, the Purchaser would wire $131,400 to the Company (30% of the
Closing Purchase Price) and the remaining $306,600 to the escrow account.

Example 1
---------
From Effective Date until Final Determination Date, average closing bid price is
$1.50.
On Effective Date, $87,600 is released from escrow to the Company, leaving
$219,000.
On the 30/th/ day after Effective Date, $0.00 released to the Company.
On the 75/th/ day after Effective Date, $0.00 released to the Company.
On the Final Determination Date--The "Deficiency" (as defined) would be zero,
(400,000shrs x $1.50 x .73 - $438,000).  The $219,000 in escrow would be paid to
the Company.

Example 2
---------
From Effective Date until Final Determination Date, average closing bid is
$1.00.
On Effective Date, $87,600 is released from escrow to the Company, leaving
$219,000.
On the 30/th/ day after Effective Date, $0.00 released to the Company.
On the 75/th/ day after Effective Date, $0.00 released to the Company.
On the Final Determination Date--The Deficiency would be $146,000,
(400,000shrs x $1.00 x .73 - $438,000).  The Deficiency of $146,000 is released
to the Purchaser from escrow and the balance of $73,000 would be released to the
Company.

Example 3
---------
From Effective Date until Final Determination Date, average closing bid is $0.40
On Effective Date, $0.00 is released to the Company.
On the 30/th/ day after Effective Date, $0.00 released to the Company.
On the 75/th/ day after Effective Date, $0.00 released to the Company.
On the Final Determination Date--The Deficiency would be $321,200 (400,000shrs x
$0.40 x .73 - $438,000).  All escrowed monies ($306,600) would be released to
Purchaser and the balance of the Deficiency - $14,600 -- would be payable by the
Company to the Purchaser.  Furthermore, assuming that the average closing bid
price were $0.40 per share during the 15 trading days preceding the date of
payment, and the Company elected to make the payment in shares of the Company,
the share amount to be delivered would be 50,000 shares.

                                      -15-
<PAGE>

Example 4
---------
From Effective Date until Final Determination Date, average closing bid is
$2.0625.
On Effective Date, $87,600 is released to the Company (leaving $219,000 in
escrow).
On the 30/th/ day after Effective Date a $54,750 payment would be made by
Purchaser ($2.0625 x .73 x 1/3 of 400,000shrs) - (1/3 of $438,000).  Of this,
$21,900 would be paid to the Company and $32,850 would go to escrow, (making a
total of $251,850 in escrow).
On the 75/th/ day after the Effective Date a $54,750 payment would be made by
Purchaser ($2.0625 x .73 x 1/3 of 400,000shrs) - (1/3 of $438,000).  Of this,
$21,900 would be paid to the Company and $32,850 would go to escrow, (making a
total of $284,700 in escrow).
On the Final Determination Date--The Purchaser would be required to pay the
Company the additional amount of $54,750 (400,000shrs x $2.0625 x .73 -$438,000
-$54,750 -$54,750) and the entire amount of $284,700 would be released to the
Company from escrow.

Example 5
---------
From the Effective Date until the 30/th/ day after, the average closing bid is
$10.00.
From the 31/st/ day until the Final Determination Date the average closing bid
is $1.00
On the Effective Date, $87,600 is released from escrow to the Company, (leaving
$219,000 in escrow).
On the 30/th/ day after the Effective Date a $827,333.33 payment would be made
by Purchaser ($10.00 x .73 x 1/3 of 400,000shrs) - (1/3 of $438,000). Of this,
$330,933.33 would be paid to the Company and $496,400 would go to escrow, making
a total of $715,400 in escrow.
On the 75/th/ day after Effective Date, $0.00 released to the Company.
On the Final Determination Date--The Deficiency would be $316,333.33
(400,000shrs x $3.25 x .73 -$438,000 - $827,333.33) which would be paid to the
Purchaser from escrow, and the balance of $399,066.67 would be released to the
Company from escrow.

Example 6
---------
From the Effective Date until the 30/th/ day after, the average closing bid is
$2.0625.
From the 31/st/ day until the 75/th/ day after, the average closing bid is
$0.70.
From the 76/th/ day until the Final Determination Date the average closing bid
is $0.05.
On the Effective Date, $87,600 is released from escrow to the Company, (leaving
$219,000 in escrow).
On the 30/th/ day after the Effective Date a $54,750 payment would be made by
Purchaser ($2.0625 x .73 x 1/3 of 400,000shrs) - ($1/3 of $438,000).  Of this,
$21,900 would be paid to the Company and $32,850 would go to escrow (making a
total of $251,850 in escrow).
On the 75/th/ day after the Effective Date, $0.00 would be released to the
Company.
On the Final Determination Date--The Deficiency would be $260,026. (average
closing bid of $0.797 x .73 x 400,000shrs - $438,00-$54,750).  All escrowed
monies ($251,850) would be released to the Purchaser and the balance of $8,176
would be paid by the

                                      -16-
<PAGE>

Company to the Purchaser. Furthermore, assuming that the average closing bid
price were $0.05 per share during the 15 trading days preceding the date of
payment, and the Company elects to pay such balance in shares of the Company,
the share amount to be delivered would be 224,000.

                                      -17-

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