Document:

ex_208178.htm

 

EXHIBIT 10.2

 

EMPLOYMENT AGREEMENT

 

 

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made as of the 13th day of December 2019 by and between Standex International Corporation, a Delaware corporation with executive offices located at 11 Keewaydin Drive, Salem, New Hampshire 03079 (the “Employer”) and, James A. Hooven, an individual residing at 15 Union Street, Concord, MA 01742 (the “Employee”).

 

1.     Employment; Term; Location.

 

	 	
			(a)

				
			Commencing on or about February 17, 2020 (the actual start date hereinafter being referred to as the “Effective Date”), Employer hereby agrees to employ Employee, and Employee hereby agrees to serve Employer on a full-time basis as Vice President of Supply Chain and Operations (or such other designated title as may be assigned from time to time by the Employer) of the Employer, subject to the direction and control of the President/Chief Executive Officer of the Employer, through June 30, 2020 (the “Initial Term”). Thereafter the Agreement shall automatically renew for successive one (1) year terms commencing on July 1st of each year and ending on June 30th of the next succeeding year (the “Renewal Term”) unless otherwise terminated pursuant to Section 1(b) of this Agreement. The Initial Term, together with any Renewal Terms shall hereinafter be referred to as the “Term” of this Agreement.

			

 

	 	
			(b)

				
			Subject to the provisions for termination otherwise included in Section 5 herein, either the Employer or the Employee shall have the right to terminate this Agreement by giving the other party thirty (30) days advance written notice (the “Notice Period”), at any time during the Term, stating his/its intention to terminate the Agreement. Such termination will be effective at the end of the Notice Period. In the event of notice of termination by the Employer, the provisions of Section 6 shall apply.

			

 

	 	
			(c)

				
			Employee’s principle office location shall be the corporate headquarters of the Employer in Salem, NH. Employee shall be expected to engage in such business travel as may reasonably be necessary in order for Employee to effectively carry out the responsibilities of his position.

			

 

2.     Best Efforts. Employee agrees, as long as this Agreement is in effect, to devote his best efforts, time and attention to the business of Employer, and to the performance of such executive, managerial and supervisory duties as may be required of him during the Term of this Agreement.

 

3.      Non-Compete. Except as set forth in the third paragraph of this Section 3, Employee shall not, while this Agreement is in effect, engage in, or be interested in, in an active capacity, any business other than that of the Employer or any affiliate, associate or subsidiary corporation of Employer. It is the express intent of the Employer and Employee that: (i) the covenants and affirmative obligations of this Section be binding obligations to be enforced to the fullest extent permitted by law; (ii) in the event of any determination of unenforceability of the scope of any covenant or obligation, its limitation which a court of competent jurisdiction deems fair and reasonable, shall be the sole basis for relief from the full enforcement thereof; and (iii) in no event shall the covenants or obligations in this Section be deemed wholly unenforceable.

 

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In addition, except as set forth in the third paragraph of this Section 3, Employee shall not, for a period of one (1) year after termination of employment (whether such termination is by reason of the expiration of this Agreement or for any other reason), on a worldwide basis, directly or indirectly, control, manage, operate, join or participate in the control, management or operation of any business which directly or indirectly competes with any business of the Employer at the time of such termination. The Employee shall not during the term of this non-competition provision (i) contact any employee of the Employer or its subsidiaries for the purpose of inducing or otherwise encouraging said employee to leave their employment with the Employer and/or such subsidiary or (ii) contact any customers or former customers of the Employer and/or its subsidiaries, in any manner, for the purpose of soliciting or accepting any competing business or request, induce or advise any customers of the Employer and/or its subsidiaries to withdraw, curtail or cancel their respective business with the Employer and/or its subsidiaries.

 

No provision contained in this section shall restrict Employee from making investments in other ventures which are not competitive with Employer, or restrict Employee from engaging, during non-business hours, in any other such non-competitive business or restrict Employee from owning less than five (5) percent of the outstanding securities of companies which compete with any present or future business of Employer and which are listed on a national stock exchange or actively traded on the NASDAQ National Market System.

 

4.      Compensation; Fringe Benefits.

 

	 	
			(a)

				
			Base Compensation. Employer agrees to compensate the Employee for his services during the period of his employment hereunder at a minimum base salary of Three Hundred Thirty Thousand Dollars ($330,000) per annum, payable semi-monthly. Employee shall be entitled to receive such increases in this minimum base salary, as the Compensation Committee of the Board of Directors of Employer, upon recommendation of the President and CEO, shall, in its sole discretion determine.

			

 

	 	
			(b)

				
			Signing Bonus. Employer shall make a one-time cash payment, subject to payroll taxes, to Employee of Twenty-Five Thousand Dollars ($25,000) (the “Sign-on Payment”). The Sign-on Payment shall be made within thirty (30) days of the Effective Date and shall be subject to repayment by Employee to Employer in its entirety in the event that Employee’s employment is terminated prior to the first anniversary of the Effective Date either voluntarily by Employee or involuntarily by Employer under Section 5(c) below.

			

 

	 	
			(c)

				
			Initial Sign-On Stock Grant. On the Effective Date, the Employer will grant Employee a restricted stock award under its 2018 Omnibus Incentive Plan having a value equal to equal to $300,000 based on the closing price of the Employer’s common stock as reported by the New York Stock Exchange on the Effective Date. This award shall vest as follows: (i) forty percent (40%) of the restricted shares shall vest on the first anniversary of the Effective Date, and (ii) the remaining sixty percent (60%) of the restricted shares shall vest on the second anniversary of the Effective Date. The award and payouts made will be governed by the terms of the Omnibus Incentive Plan of the Employer.

			

 

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			(d)

				
			Annual Incentive Compensation. Employee shall receive an annual incentive bonus opportunity payable each September after the close of the fiscal year, at a target of 45% of base compensation and variable from 0% to 200% of target based on the achievement of certain financial and strategic metrics set by the Compensation Committee of the Board of Directors of the Employer. Currently, 75% of the bonus opportunity is based on financial metrics and 25% is based on strategic metrics. For the Company’s 2020 fiscal year (i.e., July 1, 2019 – June 30, 2020), Employee will be eligible to receive seventy-five percent (75%) of the actual bonus he would have received had he been employed by the Company for the full 2020 fiscal year.

			

 

	 	
			(e)

				
			Annual Long-Term Incentive Compensation. Commencing with the Employer’s 2021 fiscal year, Employee shall receive a long-term incentive opportunity pursuant to the terms of the 2018 Omnibus Incentive Plan of the Employer at a target of 50% of base compensation in such form as the Compensation Committee of the Employer’s Board of Directors shall determine with respect to other senior executives of the Employer. Currently, such awards consist 50% of grants of time- based restricted stock and 50% performance based restricted stock units. Grants are normally made in the first week of September each year following approval of the Compensation Committee. Actual stock earned with respect to the performance based restricted stock units is variable from 0% to 200% of target based on achievement of certain metrics established by the Compensation Committee of the Board of Directors of the Employer.

			

 

	 	
			(f)

				
			Vacation. Employee shall be entitled to twenty (20) days of paid vacation during each fiscal year of the Employer.

			

 

	 	
			(g)

				
			Other Benefit Plans and Programs. Employee shall also be entitled to participate in the Standex Management Stock Purchase Program, the Standex Retirement Savings Plan and such other incentive, welfare and defined contribution retirement benefit plans as are made available, from time to time to senior executives of the Employer.

			

 

5.     Termination. In addition to the provisions concerning notice of termination in the second paragraph of Section 1, this Agreement shall terminate upon the following events:

 

	 	(a)	Death: Employee’s employment shall terminate upon his death, and all liability of Employer shall thereupon cease except for (i) compensation for past services remaining unpaid, (ii) any benefits due to Employee’s estate or others under the terms of any benefit plan of Employer then in effect in which Employee participated and (iii) any rights with respect to outstanding unvested equity awards in accordance with the award agreements underlying such awards.

 

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			(b)

				
			Disability: In the event that Employee becomes substantially disabled during the Term of this Agreement for a period of six consecutive months so that he is unable to perform the services as contemplated herein, then Employer, at its option, may terminate Employee’s employment upon written notification to Employee. Until such termination option is exercised, Employee will continue to receive his full salary and fringe benefits during any period of illness or other disability, regardless of duration. Upon exercise of such termination option, all liability of Employer shall thereupon cease except for (i) compensation for past services remaining unpaid, (ii) any benefits due to Employee or others under the terms of any benefit plan of Employer then in effect in which Employee participated and (iii) any rights with respect to outstanding unvested equity awards in accordance with the award agreements underlying such awards. Whether or not Employee has become substantially disabled and the duration of such disability shall be subject to the Employer’s good faith determination taking into account the nature of the disability and the scope of services provided by Employee hereunder.

			

 

	 	
			(c)

				
			Material Breach: In the event of the commission of any material breach of the terms of this Agreement by the Employee or Employer, the non-breaching party may cause this Agreement to be terminated on ten (10) days written notice. Employer may remove Employee from all duties and authority commencing on the first day of any such notice period, however, payment of compensation and participation in all benefits shall continue through the last day of such notice period. For purposes of this Agreement, material breach by Employee shall be defined as:

			

 

	 	
			(i)

				
			an act or acts of dishonesty on the Employee’s part which are intended to result in his substantial personal enrichment at the expense of the Employer; or

			

 

	 	
			(ii)

				
			the Employee willfully, deliberately and continuously fails to materially and substantially perform his duties hereunder and which results in material injury to the Employer (other than such failure resulting from the Employee’s incapacity due to physical or mental disability) after demand for substantial performance is given by the Employer to the Employee specifically identifying the manner in which the Employer believes the Employee has not materially and substantially performed his duties hereunder; or

			

 

	 	
			(iii)

				
			the Employee willfully and deliberately fails to comply with the Employer’s code of conduct, financial corporate policies or other significant, written corporate policies of the Employer; or

			

 

	 	
			(iv)

				
			the Employee, through his conduct and actions (whether willful or not and in the good faith discretion of the Employer), creates a threatening, intimidating or hostile work place environment and, upon written notice from Employer, has failed to satisfactorily and permanently address the conduct and actions giving rise to such environment.

			

 

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No action, or failure to act, shall be considered “willful” if it is done by the Employee in good faith and with reasonable belief that his action or omission was in the best interest of the Employer. Termination pursuant to Section 5(c) above shall not qualify for any severance under Section 6 below.

 

6.          Severance.

 

(a) In the event that Employee’s employment is terminated by Employer pursuant to Section 1 of this Agreement (exclusive of a termination after a change in control where severance is governed by the provisions contained in Section 14 herein and exclusive of termination pursuant to Section 5), the Employee shall receive one (1) year of severance pay following termination of employment. Severance will be paid in accordance with normal and customary payroll practices of the Employer. The aggregate severance will be equal to the Employee’s then current, annual base compensation. In addition, in the event that Employee elects to continue health insurance under COBRA, Employee also shall be entitled to monthly reimbursement of COBRA premiums for a period of up to twelve (12) months. The Employer’s obligation with respect to such severance and COBRA payments is conditioned upon the Employee’s continued compliance with the provisions of Section 3 of this Agreement. Employee is not obligated to seek other employment in mitigation of the severance provided for herein nor will subsequent employment with another employer impact the severance obligations of the Employer herein.

 

(b) In the event that Employee’s employment is terminated by the Employee pursuant to Section 1 of this Agreement (exclusive of a termination after a change in control where severance is governed by the provisions contained in Section 14 herein), Employee’s entitlement to compensation and benefits shall cease on the effective date of such termination and Employee shall not be entitled to any severance or other post-employment benefits except as may be provided for under applicable law (e.g., vested 401(k) benefits).

 

7.     Invention and Trade Secret Agreement. Employee agrees to enter into the Employer’s standard form of Invention and Trade Secret Agreement to be effective as of the Effective Date. To the extent, however, that the non-compete clause of the Invention and Trade Secret Agreement is inconsistent with Section 3 of this Agreement, the provisions of Section 3 of this Agreement shall be controlling.

 

8.     Specific Performance. It is acknowledged by both parties that damages will be an inadequate remedy to Employer in the event that Employee breaches or threatens to breach his commitments under Section 3 or under the Invention and Trade Secret Agreement. Therefore, it is agreed that Employer may institute and maintain an action or proceeding to compel the specific performance of the promises of Employee contained herein and therein. Such remedy shall, however, be cumulative, and not exclusive, to any other remedy, which Employer may have.

 

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9.     Third Party Restrictive Covenants. If at any time during the Term of this Agreement the Employer is made aware that the Employee remains obligated under any alleged non-compete restriction from his former employer, and in the event that the Employer receives notice of the threat of the commencement of litigation to enforce such non-compete covenant, then at Employer's sole discretion, Employee may be placed on administrative leave of absence without pay pending his release from his non-compete obligations or receives a final judgment, for which the time period to appeal has expired and no appeal has been taken, in his favor with respect to those restrictive covenants. In the event that Employer or any of its subsidiaries, affiliates or divisions is named as a party to any such litigation, the Employee agrees to indemnify, defend and hold Employer harmless from claims and demands for damages, indemnity, costs, attorneys' fees, interest, loss or injury of every nature and kind whatsoever arising under any federal, state, or local law, or the common law directly or indirectly arising out of or in connection with any alleged claim by a former employer of a violation of any non-competition restriction. In the event that Employee cannot promptly obtain a release from such restrictive covenants, Employer shall have the right to terminate this Agreement pursuant to Section 5(c) above.

 

10.     Entire Agreement; Amendment. This Agreement supersedes any employment understanding or agreement (except the Invention and Trade Secret Agreement) which may have been previously made by Employer or its respective subsidiaries or affiliates with Employee, and this Agreement, together with the Invention and Trade Secret Agreement, represents all the terms and conditions and the entire agreement between the parties hereto with respect to such employment. This Agreement may be modified or amended only by a written document signed by Employer and Employee.

 

11.     Assignment. This Agreement is personal between Employer and Employee and may not be assigned; provided, however, that Employer shall have the absolute right at any time, or from time to time, to sell or otherwise dispose of its assets or any part thereof, to reconstitute the same into one or more subsidiary corporations or divisions or to merge, consolidate or enter into similar transactions. In the event of any such assignment, the term “Employer” as used herein shall mean and include such successor corporation.

 

12.     Governing Law; Binding Nature of Agreement.   This Agreement shall be governed by, and construed in accordance with, the laws of the State of New Hampshire, excluding its choice of law provisions. This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, executors, administrators, successors and assigns.

 

13.     Survival. The obligations contained in Sections 3, 6, 7 and 14 herein shall survive the termination of this Agreement. In addition, the termination of this Agreement shall not affect any of the rights or obligations of either party arising prior to or at the time of the termination of this Agreement or which may arise by any event causing the termination of this Agreement.

 

14.     Change of Control.

 

	 	
			(a)

				
			In the event of a change in control of Employer required to be reported under Item 6(e) of Schedule 14A of Regulation 14A of the Securities Exchange Act of 1934:

			

 

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	 	(i)  	Employer may terminate Employee's employment only upon conclusive evidence of substantial and indisputable intentional personal malfeasance in office such as a conviction for embezzlement of Employer's funds; and
	 	 	 
	 	
			(ii)

				
			Employee may terminate his employment at any time if there is a change in his general area of responsibility, title or place of employment, or if his salary or benefits are lessened or diminished.

			

 

	 	
			(b)

				
			Following a change of control of Employer, in the event of any termination of Employee's employment either by Employee pursuant to Section 14(a)(ii) or by Employer under any circumstances other than involving conclusive evidence of substantial and indisputable intentional personal malfeasance in office, then:

			

 

	 	(i)	Employee shall be promptly paid a lump sum payment equal to two times his current annual base salary plus two times the higher of the most recent annual bonus paid to him under the Annual Incentive Program or his target bonus amount under the Annual Incentive Program as of the date immediately prior to the change in control;
	 	 	 
	 	(ii)	Employee shall receive a lump sum payment equivalent to the greater of [(i) the target annual incentive bonus for Employee or (ii) the level of bonus accrual on the Company’s books as of the date of termination] times the percentage of the Company’s then current fiscal year that has elapsed as of the time of such termination.
	 	 	 
	 	
			(iii)

				
			Employee shall become 100% vested in all benefit plans in which he participates including but not limited to the Standex Retirement Savings Plan, the Management Stock Purchase Program and all restricted stock awards and performance share units granted under the 2018 Omnibus Incentive Program and any other stock-based awards of the Employer; and

			

 

	 	
			(iv)

				
			All life insurance and medical plan benefits covering the Employee and his dependents shall be continued at the expense of Employer for the two-year period following such termination as if the Employee were still an employee of the Employer.

			
	 	 	 
	 	(v)	The benefits set forth in clauses (i) through (iv) above shall be conditioned upon the Employee’s continued compliance with the provisions of Section 3 of this Agreement.

 

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	 	(vi)	In the event that any payment or distribution of any type to or for the benefit of the Employee made by the Employer, by any of its affiliates, by any person or entity which acquires ownership or effective control or ownership of a substantial portion of the Employer’s assets within the meaning of Section 280G of the Code, and all related regulations or any similar federal tax that may hereinafter be imposed, whether paid or payable or distributed or distributable pursuant to this Agreement or otherwise (collectively called the “Total Payments”), would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, and all related regulations or any similar federal tax that may hereinafter be imposed or any interest or penalties with respect to such excise tax (such excise tax, together with any such interest or penalties are hereinafter collectively referred to as the “Excise Tax”), then the amount paid to the Employee shall be reduced, in such manner as is determined by the Compensation Committee of the Board of Directors of the Employer, to the maximum amount that can be paid to the Employee without requiring the payment of an excise tax, as described in Section 4999 of the Code on “excess parachute payments,” as defined therein, if and to the extent necessary for the Employee to receive a greater after-tax benefit than if the amounts otherwise received by the Employee would require payment of the excise tax described in Section 4999 of the Code.

 

15.     Notices. Any notice to be given pursuant to this Agreement shall be sent by certified mail, postage prepaid, by facsimile (with a copy mailed via first class mail, postage pre-paid), delivery in person to the parties at the addresses set forth in the preamble to this Agreement, by email to such email address as designated in writing from time to time by either Employer or Employee, or at such other address as either party may from time to time designate in writing.

 

16.     Covenants Several. In the event that any covenant of this Agreement shall be determined invalid or unenforceable and the remaining provisions can be given effect, then such remaining provisions shall remain in full force and effect.

 

17.     Compliance with Section 409A of the Code. Notwithstanding any other provisions of this Agreement herein to the contrary and to the extent applicable, the Agreement shall be interpreted, construed and administered so as to comply with the provisions of Section 409A of the Internal Revenue Code and any related Internal Revenue Service guidance promulgated thereunder. Employee and Employer acknowledge that it may be necessary to amend the Agreement, within the time period permitted by the applicable Treasury Regulations, to make changes so as to cause payments and benefits under this Agreement not to be considered “deferred compensation” for purposes of Section 409A of the Code, to cause the provisions of the Agreement to comply with the requirements of Section 409A of the Code, or a combination thereof, so as to avoid the imposition of taxes and penalties on Employee pursuant to Section 409A of the Code. Employee hereby agrees that the Company may, without any further consent from Employee, make any and all such changes to the Agreement as may be necessary or appropriate to avoid the imposition of penalties on Employee pursuant to Section 409A of the Code, while not substantially reducing the aggregate value to Employee of the payments and benefits to, or otherwise adversely affecting the rights of, Employee under the Agreement.

 

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IN WITNESS WHEREOF, Employer has caused this Agreement to be executed on its behalf by its authorized officers and Employee has executed this Agreement as of the day and year first above written.

 

 

STANDEX INTERNATIONAL CORPORATION

 

	By:	 	 	 
	 	David Dunbar	 	James A. Hooven
	Its:	Chairman, President & CEO	 	 

 

 

9rila285102820

[Home Office:             [Service Center:  1  Corporate Way          P.O. Box 24068  Lansing, Michigan 48951   Lansing, MI 48909-4068     1 -800-644-4565]          www.jackson.com]                            Jackson National Life Insurance Company®      Thank you for choosing Jackson National Life Insurance Company, also referred to as "the   Company" or "Jackson®."                            READ YOUR CONTRACT CAREFULLY.      This annuity contract is issued by the Company and is a legal agreement between the Owner   ("You") and Jackson.      PLEASE NOTE THAT THIS CONTRACT HAS REFERENCES TO AND UTILIZATION OF   EXTERNAL INDEXES. WHILE THE CONTRACT VALUES MAY BE AFFECTED BY THE   EXTERNAL INDEXES, THE CONTRACT DOES NOT DIRECTLY PARTICIPATE IN ANY   STOCK OR EQUITY INVESTMENTS. AN INDEX ADJUSTMENT TO THE INDEX ACCOUNT   IS NOT GUARANTEED AND MAY VARY BASED UPON THE PERFORMANCE OF THE   INDEXES.      WHEN ALL OR ANY PORTION OF THE INDEX ACCOUNT VALUE IS WITHDRAWN,   ANNUITIZED, OR TRANSFERRED TO THE FIXED ACCOUNT, IT MAY BE SUBJECT TO A   MARKET VALUE ADJUSTMENT (MVA) AS SET FORTH IN THE CONTRACT DATA PAGES.   THE WITHDRAWAL VALUE AVAILABLE UNDER THIS CONTRACT IS EQUAL TO THE   CONTRACT VALUE ADJUSTED FOR ANY APPLICABLE MVA.      NOTICE OF RIGHT TO EXAMINE CONTRACT   YOU MAY RETURN THIS CONTRACT TO THE FINANCIAL PROFESSIONAL WHO SOLD   YOU THE CONTRACT OR THE COMPANY WITHIN [10] DAYS AFTER YOU RECEIVE IT   ([30] DAYS AFTER YOU RECEIVE IT IF IT WAS PURCHASED AS A REPLACEMENT   CONTRACT). THE COMPANY WILL REFUND THE PREMIUM PAID TO THE FIXED   ACCOUNT, LESS THE AMOUNT OF ANY PARTIAL WITHDRAWALS FROM THE FIXED   ACCOUNT, PLUS THE INDEX ACCOUNT VALUE WITHOUT DEDUCTION FOR ANY FEES   AND CHARGES. RETURNED CONTRACTS ARE VOID.      The Telephone Number for the [Issue State] Department of Insurance is [Insurance Department   telephone number].           INDIVIDUAL SINGLE PREMIUM DEFERRED         This Contract is signed by the Company  REGISTERED  INDEX-LINKED ANNUITY.                                               DEATH  BENEFIT AVAILABLE.  INCOME  OPTION AVAILABLE.  NON -PARTICIPATING.                                                                                                                                                                                                                                        President                                                                                                                                                                                                                                             Secretary   RILA285 

 

                          TABLE OF CONTENTS                     Provision                            Page Number                Contract Data Pages                                   [3a                Definitions                                             4                General Provisions                                      8                Contract Option Provisions                            12                Withdrawal Provisions                                 14                Death Benefit Provisions                              16                Income Provisions                                     19                Termination Provisions                                22]          If You have questions about this Contract or require information about coverage or complaint  resolutions, You may contact the Company's Service Center identified on the Contract's cover  page.            RILA285                               2 

 

                        CONTRACT DATA PAGES    Contract Number:                [1234567890]                                    Owner:                          [John Doe]                                    Owner Issue Age:                [45]                                    Joint Owner:                    [No Joint Owner]                                    Joint Owner Issue Age:          [N/A]                                    Annuitant:                      [John Doe]                                    Annuitant Issue Age:            [45]                                    Joint Annuitant:                [No Joint Annuitant]                                    Joint Annuitant Issue Age:      [N/A]                                    Issue Date:                     [January 15, 2021]                                    Issue State:                    [MI]                                    Premium Amount:                 [$25,000]                                    Income Date:                    [January 15, 2071]                                    Primary Beneficiary(ies):       [Brian Doe]                                    Contingent Beneficiary(ies):    [Jane Doe]                                                                                                                                                                                                                                                                                                                                                          RILA285-FB1                           3a 

 

                  CONTRACT DATA PAGES (CONT'D)    FIXED ACCOUNT INFORMATION:    Fixed Account Minimum Interest Rate (FAMIR): [1.00%]    Fixed Account Minimum Value Percentage: [87.50%]    Fixed Account Minimum Value Annual Expense Allowance: [$50]    INTEREST RATE FOR ADJUSTMENTS DUE TO MISSTATEMENT OF AGE OR SEX: [1.00%]    WITHDRAWALS:    Minimum partial withdrawal amount unless as a scheduled part of an automatic  withdrawal program: [$500]    Minimum partial withdrawal amount as a scheduled part of an automatic withdrawal  program: [$50]    Minimum Contract Value remaining after a partial withdrawal: [$2,000]    MVA Free Withdrawal Percentage: [10%]     PREMIUM:    Premium is money paid into this Contract for allocation into a Contract Option. This is a single  Premium Contract. The Company may waive minimum and maximum Premium at any time, on  a nondiscriminatory basis.     Minimum Premium:        [$25,000]    Maximum Premium:        [$1,000,000]    SEPARATE ACCOUNT:    [RILA Separate Account]      RILA285-FB1                           3b 

 

                  CONTRACT DATA PAGES (CONT'D)    MARKET VALUE ADJUSTMENT (MVA):    An MVA is a positive or negative adjustment the Company applies to amounts You remove from  an Index Account Option due to withdrawals, annuitizations or transfers to the Fixed Account  during the MVA Period. In the event of a total withdrawal, any applicable MVA is applied to the  Index Account value, less any MVA Free Withdrawal amount available at the time of the total  withdrawal.    MVA Period: First [six (6)] Contract Years.    The MVA reflects the movement in the MVA Reference Rate since the Issue Date.    The MVA may:  1. reduce the value of the amount paid, annuitized or transferred if the MVA Reference Rate     on the date You remove Index Account value from an Index Account Option is greater than     the MVA Reference Rate on the Issue Date of Your Contract; or  2. increase the value of the amount paid, annuitized or transferred if the MVA Reference Rate     on the date You remove Index Account value from an Index Account Option is less than the     MVA Reference Rate on the Issue Date of Your Contract.    The Company applies the same MVA formula regardless of whether the formula results in an  increase or decrease to amounts You remove from an Index Account Option.    MVA formula. The Company calculates the MVA by multiplying the amount You withdraw less  any applicable charges by the result of the formula below:                                     (m/12)                                          [1+  ]                                  I                                                      (m/12) -1                             [1+J ]                      where:    I  is the MVA Reference Rate on the Issue Date  J  is the MVA Reference Rate on the date of withdrawal  m  is the number of complete months remaining from the date of the removal to the end of the        MVA Period.    The Company will not apply an MVA to:  1. death benefit proceeds;  2. payment of charges or fees;   3. amounts You allocate to an Income Option that is life contingent or results in payments     spread over at least five (5) years;  4. transfers within the Index Account;  5. exercise of Your Notice of Right to Examine Contract Provision;  6. withdrawals taken under the MVA Free Withdrawal provision;  7. withdrawals taken to satisfy the Required Minimum Distribution (RMD);  8. amounts You remove on the Latest Income Date;  9. amounts You remove from Your Contract after the end of MVA Period; or  10. withdrawals or transfers from the Fixed Account.    RILA285-FB1                           3c 

 

                  CONTRACT DATA PAGES (CONT'D)    MARKET VALUE ADJUSTMENT (MVA) (continued):    MVA Reference Rate: [Bloomberg Barclays U.S. Intermediate Corporate Bond Index Yield to  Maturity]    The MVA Reference Rate applied on any day will be the MVA Reference Rate published on the  prior Business Day.    If the MVA Reference Rate is not published on the Business Day before the MVA is calculated,  the Company will use the MVA Reference Rate for the most recent Business Day it was  published.    Discontinuation of or Substantial Change to the MVA Reference Rate. In the event that the  MVA Reference Rate is no longer published, is discontinued, or if the calculation is substantially  changed on the date You remove Contract Value from Your Contract then the Company may  substitute a comparable method for determining the MVA Reference Rate. The Company will  obtain approval from Your state insurance department and will notify You and any assignee  before using a substitute method to calculate the MVA.                                                                                                       RILA285-FB1                           3d 

 

                                               CONTRACT DATA PAGES (CONT'D)                                                                                                                                                          TABLE OF INCOME OPTIONS                        The following table shows income values for each $1,000 of net proceeds applied to the Income            Option.                           UNDER OPTION 4                                                        MONTHLY INSTALLMENTS UNDER OPTIONS 1 OR 3                                                                                                                                                                                                                                                                                                                                            No. of     Monthly     Age of           No. of Mos.          Age of           No. of Mos.            Age of           No. of Mos.           Age of           No. of Mos.  Monthly     Install-   Annui-             Certain            Annui-             Certain              Annui-             Certain             Annui-              Certain  Install-    ments        tant                                 tant                                    tant                                   tant  ments                          Male       Life     120     240       Male       Life     120       240     Female       Life     120     240      Female       Life      120      240    60        17.09        40       2.33     2.32     2.31       68       4.72      4.57     4.02        40       2.22     2.22     2.21        68        4.36      4.26     3.86    72        14.31        41       2.37     2.36     2.35       69       4.90      4.72     4.09        41       2.26     2.26     2.25        69        4.52      4.40     3.94    84        12.33        42       2.41     2.41     2.39       70       5.09      4.89     4.16        42       2.30     2.30     2.29        70        4.69      4.55     4.02    96        10.84        43       2.45     2.45     2.43       71       5.31      5.06     4.23        43       2.34     2.34     2.32        71        4.87      4.70     4.09    108        9.68        44       2.50     2.50     2.47       72       5.54      5.24     4.29        44       2.38     2.38     2.36        72        5.06      4.87     4.16    120        8.76        45       2.55     2.54     2.52       73       5.79      5.43     4.34        45       2.42     2.42     2.40        73        5.28      5.04     4.22    132        8.00        46       2.60     2.59     2.56       74       6.06      5.63     4.39        46       2.47     2.47     2.45        74        5.51      5.23     4.28    144        7.37        47       2.65     2.64     2.61       75       6.35      5.83     4.43        47       2.52     2.51     2.49        75        5.76      5.42     4.34    156        6.84        48       2.71     2.70     2.66       76       6.67      6.04     4.47        48       2.57     2.56     2.54        76        6.03      5.62     4.38    168        6.38        49       2.77     2.76     2.71       77       7.02      6.26     4.50        49       2.62     2.61     2.59        77        6.33      5.83     4.43    180        5.98        50       2.83     2.82     2.76       78       7.40      6.48     4.52        50       2.67     2.67     2.64        78        6.65      6.04     4.46    192        5.64        51       2.89     2.88     2.82       79       7.81      6.70     4.54        51       2.73     2.72     2.69        79        7.01      6.26     4.49    204        5.33        52       2.96     2.94     2.88       80       8.27      6.92     4.56        52       2.79     2.78     2.74        80        7.40      6.48     4.52    216        5.06        53       3.03     3.01     2.94       81       8.76      7.13     4.57        53       2.85     2.84     2.80        81        7.83      6.70     4.54    228        4.82        54       3.10     3.08     3.00       82       9.30      7.34     4.58        54       2.92     2.91     2.85        82        8.29      6.92     4.56    240        4.60        55       3.18     3.16     3.06       83       9.89      7.53     4.58        55       2.99     2.98     2.91        83        8.80      7.13     4.57    252        4.40        56       3.26     3.23     3.13       84       10.54     7.72     4.59        56       3.07     3.05     2.98        84        9.35      7.33     4.58    264        4.22        57       3.35     3.32     3.19       85       11.26     7.88     4.59        57       3.14     3.12     3.04        85        9.95      7.52     4.58    276        4.06        58       3.44     3.40     3.26       86       12.05     8.03     4.59        58       3.23     3.20     3.11        86       10.59      7.70     4.59    288        3.90        59       3.54     3.49     3.34       87       12.91     8.17     4.59        59       3.31     3.29     3.18        87       11.28      7.87     4.59    300        3.77        60       3.64     3.59     3.41       88       13.86     8.28     4.60        60       3.40     3.37     3.25        88       12.03      8.02     4.59    312        3.64        61       3.74     3.69     3.48       89       14.88     8.38     4.60        61       3.50     3.46     3.32        89       12.84      8.15     4.59    324        3.52        62       3.86     3.79     3.56       90       15.99     8.46     4.60        62       3.60     3.56     3.40        90       13.71      8.27     4.60    336        3.41        63       3.98     3.91     3.64       91       17.17     8.53     4.60        63       3.71     3.66     3.47        91       14.66      8.37     4.60    348        3.31        64       4.11     4.02     3.71       92       18.43     8.58     4.60        64       3.82     3.77     3.55        92       15.70      8.45     4.60    360        3.21        65       4.24     4.15     3.79       93       19.78     8.63     4.60        65       3.95     3.88     3.63        93       16.86      8.53     4.60                           66       4.39     4.28     3.87       94       21.20     8.66     4.60        66       4.07     4.00     3.71        94       18.13      8.58     4.60                           67       4.55     4.42     3.95       95       22.67     8.68     4.60        67       4.21     4.12     3.79        95       19.53      8.63     4.60                                     Note: Due to the volume of relevant information, the Table does not provide income values for            Option 2 described in the Income Provisions. Those values are available from the Company's            Service Center upon request. You may contact the Company's Service Center as shown on the            cover page of the Contract.                        BASIS OF COMPUTATION. The [2012 Individual Annuity Mortality Period Table, with an            interest rate of 1.00% and a 0% expense load], provides the actuarial basis for the Table of            Income Options. The Table of Income Options does not include any applicable tax.              RILA285-FB1                                                                 3e 

 

                               DEFINITIONS    ANNUITANT. The natural person(s) so designated on the Contract Data Pages, or by  subsequent designation, on whose life the Company determines the amount of Income  Payments provided by the Contract. References to the Annuitant include all Joint Annuitants, if  applicable.    BENEFICIARY(IES). The natural person(s) or legal entity(ies) You designate as Primary or  Contingent Beneficiary(ies) to receive any death benefit provided by the Contract. The initial  Beneficiary(ies) are shown on the Contract Data Pages.    BUSINESS DAY. Any day that the Company and the New York Stock Exchange (NYSE) are  open for business. The Business Day ends when the NYSE closes for the day.    CONTRACT. The Individual Single Premium Deferred Registered Index-Linked Annuity  described herein.    CONTRACT ANNIVERSARY. Each one-year anniversary of the Issue Date.    CONTRACT OPTION(S). The Contract Options for this Contract are the Fixed Account and the  Index Account.     CONTRACT VALUE. The Contract Value is equal to the sum of the Fixed Account value and  the Index Account value. See the Contract Option Provisions for details of how the Fixed  Account value and Index Account value are determined.     CONTRACT YEAR. The twelve-month period beginning on the Issue Date and on any Contract  Anniversary thereafter while the Contract remains in force.    CREDITING METHOD. A method of calculating the Index Adjustment. See the Supplemental  Contract Data Pages and Crediting Method Endorsements for details.     DUE PROOF. Evidence of death, including but not limited to a certified death certificate issued  by the governmental authority for the location of the death, or other lawful evidence the  Company requires.    FIXED ACCOUNT. A Contract Option in which amounts earn a declared rate of interest for a  certain period.    FIXED ACCOUNT MINIMUM INTEREST RATE (FAMIR). The Fixed Account Minimum Interest  Rate is the minimum annual percentage at which Your money allocated to the Fixed Account  will grow. The Company uses this rate to determine the Fixed Account Minimum Value (FAMV).  The FAMIR is shown on the Contract Data Pages and is guaranteed for the life of the Contract.    RILA285                               4 

 

                          DEFINITIONS (CONT'D)    FIXED ACCOUNT MINIMUM VALUE (FAMV). The FAMV is equal to all amounts allocated to  the Fixed Account, net of applicable taxes, multiplied by the Fixed Account Minimum Value  Percentage, and;  1. reduced by partial withdrawals and transfers from the Fixed Account, and the Fixed     Account Minimum Value Annual Expense Allowance; then  2. accumulated at the FAMIR.    FIXED ACCOUNT MINIMUM VALUE ANNUAL EXPENSE ALLOWANCE. An annual  deduction from the FAMV. On each Contract Anniversary, the Company will deduct the Fixed  Account Minimum Value Annual Expense Allowance from the FAMV. The Fixed Account  Minimum Value Annual Expense Allowance is shown on the Contract Data Pages.    FIXED ACCOUNT MINIMUM VALUE PERCENTAGE. The Fixed Account Minimum Value  Percentage is multiplied by Premiums and transfers allocated to the Fixed Account in the  determination of the FAMV. The Fixed Account Minimum Value Percentage is shown on the  Contract Data Pages.    GOOD ORDER. The Company's receipt of all Premium, information, documentation, and/or  instructions the Company requires before it will issue the Contract, credit any interest, or  execute any transaction.     INCOME DATE. The date on which Income Payments are scheduled to begin as described in  the Income Provisions. The Income Date is shown on the Contract Data Pages.    INCOME OPTION. Payment options as provided under the Income Provisions.     INDEX(ES). A benchmark used to determine the Index Adjustment, if any, for a particular Index  Account Option. See the Supplemental Contract Data Pages for the available Indexes as of the  Issue Date.     INDEX ACCOUNT. A Contract Option in which amounts are subject to an Index Adjustment for  a specified period of time. See the Supplemental Contract Data Pages and Crediting Method  Endorsements for detailed descriptions of the Index Account Options within the Index Account.  Index Account Option availability is subject to change at the discretion of the Company on a  non-discriminatory basis.    INDEX ACCOUNT OPTION. An option within the Index Account for allocation of Contract  Value. Each Index Account Option is defined by its term, Index and Crediting Method.    INDEX ACCOUNT OPTION ANNIVERSARY. The Business Day concurrent with or immediately  following each anniversary of the Issue Date.      RILA285                               5 

 

                          DEFINITIONS (CONT'D)    INDEX ACCOUNT OPTION TERM ANNIVERSARY. The Business Day concurrent with or  immediately following the end of an Index Account Option term.    INDEX ADJUSTMENT (IA). The adjustment amount to an Index Account Option on the Index  Account Option Term Anniversary. This adjustment can be positive or negative, depending on  Index performance and Crediting Method.    INDEX ADJUSTMENT FACTOR(S). Parameters used to determine the Index Adjustment.  These parameters are specific to the applicable Crediting Method(s). See the Supplemental  Contract Data Pages and Crediting Method endorsements for additional details.    INTERIM VALUE. The quantity used to adjust the Index Account Option value for withdrawals  prior to the end of the Index Account Option term. The Interim Value uses prorated Index  Adjustment Factors based on the elapsed portion of the Index Account Option term and the  Interim Value Proration Factor (IVPF). For detailed information on the Interim Value, see the  Crediting Method endorsements and the Supplemental Contract Data Pages.    ISSUE DATE. The date the Company issued the Contract. The Issue Date is shown on the  Contract Data Pages.    JOINT ANNUITANT. Each of multiple Annuitants.    JOINT OWNER. Each of multiple Owners.    LATEST INCOME DATE (LID). The Contract Anniversary on which You will be 95 years old, or  such earlier date required by a Qualified Plan, law or regulation.    MARKET VALUE ADJUSTMENT (MVA). A positive or negative adjustment to amounts You  remove from an Index Account Option due to withdrawals, annuitizations or transfers to the  Fixed Account during the MVA Period. The MVA formula and the MVA Period are shown on the  Contract Data Pages.    NON-QUALIFIED PLAN. A retirement plan which does not qualify for favorable tax treatment  under Sections 401, 403, 408, or 408A of the Internal Revenue Code, as amended.    OWNER ("YOU," "YOUR"). The natural person(s) or legal entity(ies) that has all rights under  the Contract, and is shown on the Contract Data Pages, or by subsequent designation. In this  Contract, "You" and "Your" also mean the Owner. References to the Owner include all Joint  Owners, if applicable.    PREMIUM. Money paid into this Contract for allocation into the Contract Options.    QUALIFIED PLAN. A retirement plan which qualifies for favorable tax treatment under Sections  401, 403, 408, or 408A of the Internal Revenue Code, as amended.      RILA285                               6 

 

                          DEFINITIONS (CONT'D)    REQUIRED MINIMUM DISTRIBUTION (RMD). For certain Qualified Plan contracts, the RMD is  the amount defined by the Internal Revenue Code and the implementing regulations as the  minimum distribution requirement that applies to this Contract only.    SERVICE CENTER. The Company's administrative address and telephone number as identified  on the Contract's cover page or as the Company may designate from time to time.    WITHDRAWAL VALUE. The amount available upon a total withdrawal. The Withdrawal Value is  equal to the Contract Value, adjusted for any applicable MVA.      RILA285                               7 

 

                         GENERAL PROVISIONS    ANNUITANT. You may change the Annuitant at any time before the Income Date, unless the  Contract is owned by a legal entity. If the Contract is owned by a legal entity, the Company will  use the oldest Annuitant's age for all Contract purposes unless otherwise specified in the  Contract. Unless You specify otherwise, a change of Annuitant will take effect on the date the  request is signed by You, subject to any payments the Company has made or other actions the  Company has taken before the Company receives and records Your request. The Company  reserves the right to limit the number of Joint Annuitants to two (2). When the Owner is a legal  entity, the Annuitant may not be changed.    ASSIGNMENT. To the extent allowed by state law, the Company may refuse consent to any  assignment at any time, on a nondiscriminatory basis, if the assignment or ownership change  would result in noncompliance with any applicable state or federal regulation. Unless restricted  by endorsement, You may assign ownership of this Contract subject to the interests of  assignees and irrevocable Beneficiaries. The Company will only be bound by an assignment if a  request is submitted in a form acceptable to the Company, received in Good Order at the  Company's Service Center, recorded and acknowledged by the Company. Unless You specify  otherwise, an assignment will take effect on the date the request is signed by You, subject to  any payments the Company has made or other actions the Company has taken before the  Company receives and records Your request.     The Company assumes no responsibility for the validity or tax consequences of any  assignment. If You make an assignment, You may have to pay taxes. The Company  encourages You to seek legal and/or tax advice.    BENEFICIARY. You may change the Beneficiaries, subject to the interest of assignees and  irrevocable Beneficiaries. The Company will only be bound by a change in Beneficiary if a  request is submitted in a form acceptable to the Company, received in Good Order at the  Company's Service Center and recorded. Any previously designated irrevocable Beneficiary  must consent in writing to any change in Beneficiary. Unless You specify otherwise, a change of  Beneficiary will take effect on the date the request is signed by You, subject to any payments  the Company has made or other actions the Company has taken before the Company receives  and records Your request, and while You are alive.    CONFORMITY WITH LAWS. This Contract will be interpreted under the law of the state in  which it is issued and any applicable federal laws. Any provision that is in conflict with the laws  of the state in which the Contract is issued, or any federal law is amended to conform to the  minimum requirements of such law.    DEFERRAL OF PAYMENTS. If approved in writing by the chief insurance regulator of the  Company's state of domicile, the Company may defer payment of Your request for a partial  and/or total withdrawal from the Contract for a period not exceeding six (6) months. The  Company will credit interest on deferred amounts as required by law. The Company will not  defer payment of death benefits.      RILA285                               8                                        

 

                    GENERAL PROVISIONS (CONT'D)    ENTIRE CONTRACT. The Contract, application, if any, and any attached endorsements and  amendments together make up the entire Contract between You and the Company. All  statements made by the applicant to procure the Contract will, in the absence of fraud, be  deemed representations and not warranties.    INCONTESTABILITY. The Company may only contest this Contract when an applicant has  procured the Contract by fraud, and only if permitted by law in the state in which the Company  delivered the Contract or issued the Contract for delivery.    MINIMUM VALUES. Any Withdrawal Values and death benefits that may be available under  this Contract are not less than the minimum benefits required by any statute of the state in  which the Contract is delivered.    MISSTATEMENT OF AGE AND/OR SEX. If Your or the Annuitant's age and/or sex is misstated  at the time the Contract's Income Payments become payable, the Company will adjust the  payments to reflect income consistent with the correct age and/or sex. Immediately upon  discovery, the Company will adjust the next payment due as a credit or charge, as appropriate,  for any underpayments or overpayments using the Interest Rate for Adjustments Due to  Misstatement of Age or Sex shown on the Contract Data Pages.    MODIFICATION OF CONTRACT. No financial professional has authority to change or waive  any of this Contract's provisions. No change to or waiver of this Contract's terms is valid unless  in writing and signed by the Company's President, Vice President, Secretary or Assistant  Secretary; provided, however, that the Company may amend any Contract term, and administer  the Contract, to conform to the Internal Revenue Code.    NONPARTICIPATING. This Contract is nonparticipating and does not share in the Company's  surplus or earnings.    OWNER. To the extent allowed by state law, the Company may refuse consent to an ownership  change at any time, on a nondiscriminatory basis, if the ownership change would result in  noncompliance with any applicable state or federal regulation. Unless restricted by  endorsement, You may change the Owner or any Joint Owner. The Company will use the oldest  Owner's age for all Contract purposes unless otherwise specified in the Contract. The Company  will only be bound by a change of ownership if submitted in a form acceptable to the Company,  received in Good Order at the Company's Service Center, recorded and acknowledged by the  Company. No person whose age exceeds the maximum issue age in effect for this Contract as  of the Issue Date may become a new Owner. Unless You specify otherwise, a change of  ownership will take effect on the date the request is signed by You, subject to any payments the  Company has made or other actions the Company has taken before the Company receives and  records Your request. Joint Owners have equal ownership rights; therefore, each Owner must  authorize any exercise of Contract rights unless the Joint Owners instruct the Company in  writing to act upon authorization of an individual Joint Owner. The Company reserves the right  to limit the number of Joint Owners to two (2).    The Company assumes no responsibility for the validity or tax consequences of any  ownership change. If You make an ownership change, You may have to pay taxes. The  Company encourages You to seek legal and/or tax advice.   RILA285                               9 

 

                    GENERAL PROVISIONS (CONT'D)    PROOF OF AGE, SEX AND/OR SURVIVAL. The Company may require proof of age and/or  sex, satisfactory to the Company at any time. If any payment required by this Contract depends  on a living Annuitant, Owner, or Beneficiary, the Company may require proof of that person's  survival satisfactory to the Company.    PROTECTION OF PROCEEDS. A Beneficiary may not assign Contract proceeds before the  proceeds are payable. Contract proceeds are not subject to the claims of creditors or to legal  process unless required by applicable law.    REPORTS. The Company will send a report to Your last address in the Company's records at  least annually before the Income Date. In the case of Joint Owners, the Company will send  reports only to the primary Owner's address. If You have elected electronic delivery, a report  may be provided in the form of an email to Your last email address in the Company's records, or  a notice to You of a document's availability on the Company's website. Each report will provide  at least the following information:  1. the dates that begin and end the reporting period;   2. the Contract Value at the beginning and at the end of the current reporting period prior to the     application of any MVA;  3. the Withdrawal Value at the end of the reporting period;   4. the MVA amount the Company used to determine the Withdrawal Value;   5. the amounts the Company has credited to and deducted from the Contract Value during the     reporting period;  6. the death benefit at the end of the reporting period; and  7. any other information state and federal law require.     You may receive copies of reports the Company provides upon request at no additional charge.    You will receive a confirmation statement for certain transactions at the time they occur.    SEPARATE ACCOUNT. The Company holds certain investments supporting the assets  allocated to the Index Account in a non-insulated, non-unitized Separate Account. The Separate  Account is established pursuant to the laws of the Company's domiciliary state solely for the  purpose of supporting obligations under the Contract. You do not directly participate in the  performance of assets held in the Separate Account; and do not have any direct claim on them.  Assets of the Separate Account are chargeable with the claims of any of the Company's  contract owners as well as the Company's creditors and are subject to the liabilities arising out  of any other business the Company conducts. The Separate Account is not registered under the  Investment Company Act of 1940. The name of the Separate Account is shown on the Contract  Data Pages.    TAXES. This Contract is intended to be treated as an annuity contract for federal income tax  purposes. Accordingly, for all Non-Qualified Contracts all provisions of this Contract shall be  interpreted and administered in accordance with the requirements of Section 72(s) of the  Internal Revenue Code. The Company will deduct any taxes attributed to the Contract and  payable to a government entity from the Contract Value. The Company reserves the right to  deduct any amounts the Company might advance to pay taxes from the Contract Value. The  Company will withhold taxes required by law from any amounts payable from this Contract.   RILA285                               10 

 

                    GENERAL PROVISIONS (CONT'D)    WRITTEN NOTICE. Written information or instructions You intend to give the Company must be  in Good Order and delivered to the Company's Service Center, unless the Company advises  You otherwise. Instructions included in the Written Notice will take effect on the date the  Company receives the notice in Good Order at the Company's Service Center, unless otherwise  provided in the notice or in this Contract, or unless the Company advises You otherwise.    The Company will deliver any notice or communication to Your last address in the Company's  records unless You request otherwise in writing. If You have elected electronic delivery,  communication may be provided in the form of an email to Your last email address in the  Company's records, or a notice to You of a document's availability on the Company's website.  You are responsible for notifying the Company of any address change, email address change,  or any error in a Company notice sent to You. In the case of Joint Owners, the Company will  send notices and other communications to the primary Owner's address.    RILA285                               11 

 

                    CONTRACT OPTION PROVISIONS    The Contract contains two (2) types of Contract Options: Fixed Account and Index Account.    Upon Good Order, all Premium will be allocated to the Contract Options as elected on the  application. The Company reserves the right to restrict or prohibit allocation of Premium to the  Fixed Account at its discretion, on a non-discriminatory basis, at any time. No Premium will be  accepted after the Issue Date.    TRANSFERS.    Transfers may only occur on the Contract Anniversary, when transferring out of the Fixed  Account, and on the Index Account Option Term Anniversary when transferring out of an Index  Account Option. When the Contract Anniversary or Index Account Option Term Anniversary  occurs on a non-Business Day, the transfer will be effective on the following Business Day using  the following Business Day's values. You will receive notice thirty (30) days prior to the Index  Account Option Term Anniversary. The notice will include information on the Contract Options  available to You. You may request a transfer to or from the Fixed Account and to or from the  Index Account Options. You may also request transfers among the available Index Account  Options within the Index Account. Transfers from an Index Account Option to the Fixed Account  may incur an MVA. A request for a transfer must be received in Good Order prior to the Index  Account Option Term Anniversary. If no transfer request is received on or prior to the Index  Account Option Term Anniversary, the Fixed Account value will remain in the Fixed Account and  the Index Account Option value(s) will be reallocated to the same Index Account Option(s) for the  same term, Crediting Method and Index, if available.    If the Crediting Method, or Index is no longer available as of the Index Account Option Term  Anniversary, the Index Account Option value(s) will be reallocated to the Fixed Account, without  being subject to an MVA, until further instruction is received.     If You do not select an Index Account Option term within thirty (30) days prior to the end of the  expired Index Account Option term:  1. if the same Index Account Option term is available at the time and does not extend beyond     the Income Date, the Company will renew the Index Account Option into the same Index     Account Option term.  2. if the same Index Account Option term is available at the time but extends beyond the Income     Date, the Company will select the available Index Account Option term that ends closest to     but before the Income Date.  3. if the same Index Account Option term is not available at the time but would not extend     beyond the Income Date were it available, the Company will select the available Index     Account Option term with the period closest to but less than the Index Account Option term     that just ended.    Unless specified otherwise, transfers will be taken from the Index Account Options and the Fixed  Account in proportion to their current value. The Company reserves the right, to restrict or prohibit  transfers from the Index Account Option to the Fixed Account, at its discretion, on a  nondiscriminatory basis, at any time.    RILA285                               12 

 

              CONTRACT OPTION PROVISIONS (CONT'D)    Transfers from a Fixed Account will reduce the Fixed Account value by the transfer amount  requested. Transfers into a Fixed Account will increase the Fixed Account value by the transfer  amount requested. Transfers from an Index Account Option will reduce the Index Account  Option value by the transfer amount requested. Transfers into an Index Account Option will  increase the Index Account Option value by the transfer amount requested.    Fixed Account. The Fixed Account is an annually renewable fixed account. The Company will  credit interest to amounts allocated to the Fixed Account. Such interest will be credited at such  rate(s) as the Company prospectively declares on a periodic basis, at the sole discretion of the  Company. On each Contract Anniversary the interest rate for the Fixed Account is subject to  change. In no event will the interest rate credited by the Company to the Fixed Account be less  than the FAMIR, as shown on the Contract Data Pages, per annum.    Index Account Option. An option within the Index Account for allocation of Contract Value,  defined by term, Index, and Crediting Method. The terms, Indexes, and Crediting Methods  available as of the Issue Date are shown on the Supplemental Contract Data Pages. Availability  of terms, Indexes, and Crediting Methods are subject to change at the sole discretion of the  Company on a non-discriminatory basis.    Fixed Account Value. The Fixed Account value is equal to (1) the value of Premium and any  amounts transferred from the Index Account into the Fixed Account, adjusted for any applicable  MVA; (2) plus interest credited daily at a rate not less than the FAMIR, as shown on the  Contract Data Pages, per annum; (3) less any gross partial withdrawals; (4) less any amounts  transferred out of the Fixed Account. The Fixed Account Value will never be less than the  FAMV.    Index Account Value. The Index Account value is equal to the sum of the Index Account  Option values.    The Index Account Option value at the beginning of the Index Account Option term is equal to  the amount allocated or transferred to the Index Account Option less the amount transferred out  of the Index Account Option. Transfers out of the Index Account Option to the Fixed Account will  be adjusted for any applicable MVA.    During the Index Account Option term, the Index Account Option value is equal to the Interim  Value, which is the greater of the Index Account Option value at the beginning of the term  reduced for any partial withdrawals from the Index Account Option during the Index Account  Option term, including any MVA, in the same proportion as the Interim Value was reduced on  the date of the withdrawal, plus the prorated Index Adjustment subject to prorated Index  Adjustment Factors and the IVPF, or zero. Additional detail on Index Adjustment Factors can be  found in the Crediting Method endorsements and Supplemental Contract Data Pages.    On the Index Account Option Term Anniversary, the Index Account Option value is equal to the  greater of the Index Account Option value at the beginning of the Index Account Option term,  reduced for any partial withdrawals from the Index Account Option during the Index Account  Option term, including any MVA, in the same proportion as the Interim Value was reduced on  the date of the withdrawal, plus the Index Adjustment subject to Index Adjustment Factors, or  zero. Additional detail on Index Adjustment Factors can be found in the Crediting Method  endorsements and Supplemental Contract Data Pages.   RILA285                               13 

 

                       WITHDRAWAL PROVISIONS    On or before the Income Date, You may request a total or partial withdrawal of the Contract  Value by submitting a request to the Company's Service Center in a form acceptable to the  Company.    The withdrawal will be processed after a withdrawal request is received at the Service Center in  Good Order. If a total withdrawal is requested, You must submit the Contract to the Service  Center with the withdrawal request.    TOTAL WITHDRAWAL. During the MVA Period, the Withdrawal Value for a total withdrawal  from the Contract is equal to the Contract Value adjusted for any applicable MVA. After the  expiration of the MVA Period, the Withdrawal Value for a total withdrawal from the Contract is  equal to Contract Value. A total withdrawal terminates Your Contract.    In no event will a total withdrawal from the Fixed Account be less than the FAMV.    No withdrawal may exceed the Withdrawal Value.    PARTIAL WITHDRAWAL. Any partial withdrawal from an Index Account Option may be subject  to an MVA. At least the Minimum Contract Value remaining after a partial withdrawal, as shown  on the Contract Data Pages, must remain after any partial withdrawal. With the exception of an  MVA Free Withdrawal, unless You request otherwise, a gross partial withdrawal will be  deducted from the Fixed Account and the Index Account Option(s) in proportion to their current  values. The gross partial withdrawal deducted from the Index Account Option(s) will then be  adjusted for any applicable MVA.     If the gross amount of the partial withdrawal would reduce the Contract Value below the  Minimum Contract Value remaining after a partial withdrawal, as shown on the Contract Data  Pages, the Company will treat the withdrawal request as a total withdrawal and the Withdrawal  Value will be paid.    The amount payable as a result of the partial withdrawal will be determined at the end of the  Business Day on which the Company receives Your request for withdrawal in Good Order at the  Company's Service Center.     Partial Withdrawals will reduce each Index Account Option's value at the beginning of the term  in the same proportion that its Interim Value was reduced on the date of the withdrawal.    QUALIFIED PLAN CONTRACT REQUIRED MINIMUM DISTRIBUTIONS. Qualified Plan  Contract RMDs are based upon Your Contract Value, and applicable federal tax law  requirements. You may request a withdrawal for an RMD by submitting a written request to the  Service Center on a Company provided form.    RILA285                               14 

 

                 WITHDRAWAL PROVISIONS (CONT'D)    The Company will waive any MVA if the gross amount withdrawn does not exceed the  Contract's RMD amount. However, if a gross withdrawal amount is greater than the Contract's  RMD amount, the excess amount of the gross partial withdrawal is subject to an MVA in the  same proportion as the gross withdrawal amount is deducted from the Index Account Option(s).    AUTOMATIC WITHDRAWAL. You may elect to take an automatic withdrawal by withdrawing a  specific sum or a certain percentage of the Contract Value on a monthly, quarterly, semiannual  or annual basis, subject to the Minimum Partial Withdrawal amount made as a scheduled part of  an automatic withdrawal program, as shown on the Contract Data Pages. Automatic  withdrawals are treated as partial withdrawals and will be counted in determining the amount  taken as an MVA Free Withdrawal in any Contract Year. Automatic withdrawals in excess of the  MVA Free Withdrawal amount may be subject to an MVA. If an automatic withdrawal causes the  Withdrawal Value to fall to zero, future automatic withdrawals will terminate. If the automatic  withdrawal would reduce the Contract Value below the Minimum Contract Value remaining after  a partial withdrawal, as shown on the Contract Data Pages, the Company will treat the  automatic withdrawal as a total withdrawal and the Withdrawal Value will be paid.    MVA FREE WITHDRAWAL. During each Contract Year, certain partial withdrawals from the  Index Account will not incur an MVA. The amount of MVA Free Withdrawal available in any  Contract Year is equal to the greater of:  1. the MVA Free Withdrawal Percentage, as shown on the Contract Data Pages, multiplied by     the Index Account value at the beginning of the Contract Year; or   2. zero    The MVA Free Withdrawal can be taken as a single withdrawal or multiple withdrawals  throughout the Contract Year. The amount of Your MVA Free Withdrawal available will vary  throughout the Contract Year depending on previous withdrawals of Your MVA Free Withdrawal  amount. The amount of Your MVA Free Withdrawal available will reduce due to withdrawals  from the Index Account during the Contract Year.    MVA Free Withdrawals will be deducted from the Index Account Options in proportion to their  current values within the Index Account.    Any amount withdrawn to satisfy an RMD may reduce the amount of Your MVA Free  Withdrawal available.    No MVA Free Withdrawal may exceed the Withdrawal Value.    Withdrawals during the Contract Year in excess of the MVA Free Withdrawal may be subject to  any applicable MVA.    RILA285                               15 

 

                      DEATH BENEFIT PROVISIONS    NATURAL OWNER'S DEATH BEFORE THE INCOME DATE. Upon Your death or the death of  any Joint Owner, before the Income Date, the Company will pay the death benefit to the  Beneficiary(ies) designated by You.     Upon the death of the first Joint Owner, the surviving Joint Owner will become the Primary  Beneficiary and will receive the death benefit payable. Any other Beneficiary designation on  record at the Company's Service Center at the time of the first Joint Owner's death will be  treated as a Contingent Beneficiary.    ANNUITANT'S DEATH BEFORE THE INCOME DATE. Upon the death of an Annuitant who is  not an Owner before the Income Date, the Contract remains in force and the Owner becomes  the Annuitant. The Owner may designate a new Annuitant, subject to the Company's  administrative rules then in effect. No death benefit is payable on the death of an Annuitant who  is not also an Owner.     If the Contract is owned by a legal entity, upon the death of the Annuitant, (in the case of Joint  Annuitants, upon the death of the first Annuitant) the Company will pay the death benefit to the  Beneficiary(ies) designated by the Owner, or, if no Beneficiary(ies) survive the applicable death,  to the Owner.     DEATH BENEFIT AMOUNT BEFORE THE INCOME DATE. The death benefit amount before  the Income Date is equal to the greater of:  1. the current Contract Value; or  2. Premiums paid into the Contract, less any applicable taxes, adjusted for any withdrawals     (including any applicable charges and adjustments for such withdrawals) incurred since the     issuance of the Contract. All adjustments will occur at the time of the withdrawal. All     adjustments for amounts withdrawn will reduce this item in the same proportion that the     Contract Value was reduced on the date of such withdrawal.    DEATH BENEFIT PAYMENT OPTIONS BEFORE THE INCOME DATE. Unless You  designated a Pre-selected Death Benefit Option, a Beneficiary entitled to the death benefit  before the Income Date must request that the Company pay the death benefit according to one  of the death benefit options below:    Option 1 - single lump-sum payment;  Option 2 - payment of the entire death benefit distributed within five (5) years of the date of the           relevant death; or  Option 3 - Income Payments of the death benefit with distributions beginning within one (1) year          of the date of the relevant death:          (i) over the lifetime of the Beneficiary; or          (ii) over a period not extending beyond the life expectancy of the Beneficiary.    The Company may make available other death benefit payment options.    A Beneficiary that wishes to elect payment under Option 3 must do so no later than sixty (60)  days from the date the Company receives Due Proof of death in Good Order at the Company's  Service Center.    RILA285                               16 

 

                DEATH BENEFIT PROVISIONS (CONT'D)    Any portion of the death benefit not applied under Option 3 must be paid within five (5) years  from Your death. The death benefit will remain invested in accordance with the allocation  selected by You until a payout option is selected or the Beneficiary specifies otherwise.    DEATH BENEFIT PAYMENT OPTIONS FOR QUALIFIED PLANS. For Qualified Plans, the  death benefit payment options may be limited under the terms of the plan endorsement in order  to qualify under the Internal Revenue Code.    BENEFICIARY'S ENTITLEMENT TO DEATH BENEFIT BEFORE THE INCOME DATE. The  Company will pay the death benefit to Primary Beneficiaries or, if none exist, to Contingent  Beneficiaries, in equal shares (the "default allocation") unless You have designated otherwise  (the "designated allocation"). A Beneficiary that dies before or within ten (10) days (or different  period as prescribed by applicable law) of Your death is not entitled to any death benefit. In that  circumstance, the Company will pay the deceased Beneficiary's share of the death benefit to  surviving Beneficiaries in the same proportion as the designated allocation or, if applicable, the  default allocation. If no Beneficiary survives You, the Company will pay the death benefit to Your  estate.    PAYMENT OF DEATH BENEFIT. The Company will pay the death benefit to the Beneficiary  upon receipt of a request for payment with Due Proof of the relevant death in Good Order at the  Company's Service Center. If the Company has received Due Proof of death, the Company will  calculate the share of the death benefit due to a Beneficiary using Contract values established  at the end of the Business Day on the date the Company receives a claim form with a payment  option elected from that Beneficiary. If the Company has not received Due Proof of death or any  other required documentation, the Company will calculate the share of the death benefit due to  a Beneficiary using Contract values established at the end of the Business Day on the date the  Company receives any remaining required documentation. The Index Adjustments may cause  the calculation of a Beneficiary's death benefit share to differ from the calculation of another  Beneficiary's death benefit share. The Company will pay interest on a Beneficiary's death  benefit share as required by law.     Each Beneficiary entitled to the death benefit bears the investment risk associated with amounts  allocated to any Index Account Option until the Company calculates their share of the death  benefit.    If any death benefit is due to an Owner's estate, the Company will pay the benefit in a single  lump-sum payment.     If a single lump-sum payment is elected, the Contract will remain in force and will accrue  interest, at current rate(s) based on the Contract's current Crediting Method/Index combinations,  until the Company first receives Due Proof of death in Good Order. After that time, the rate of  interest will equal the rate of interest applicable to death benefit left on deposit with the  Company on the date of Your death.     The Company will pay the death benefit in accordance with applicable laws and regulations  governing death benefit payments and in accordance with the Company's administrative  procedures.    RILA285                               17                                       

 

                DEATH BENEFIT PROVISIONS (CONT'D)    Spousal Continuation Option Instead of Death Benefit. Unless the Contract is subject to a  Pre-selected Death Benefit Option, a spouse who is a Joint Owner or Beneficiary of the  deceased Owner may elect to continue the Contract in his or her own name at an adjusted  Contract Value as described below and exercise the Owner's rights under the Contract instead  of taking the standard death benefit.    For purposes of the Spousal Continuation Option, the "continuation date" is the date on which  the Company receives the spouse's written request to elect the Spousal Continuation Option  and Due Proof of the relevant death in Good Order at the Company's Service Center.    If the Contract Value on the continuation date is less than the death benefit, an amount will be  added to the Contract Value to make up the difference. This amount is referred to as the  continuation adjustment. The Company will allocate the continuation adjustment to the Fixed  Account. The continuation adjustment will have no effect on the FAMV. The MVA will continue  with the same period as prior to the original Owner's death.     For purposes of determining the future death benefits for the surviving spouse under the  continuing Contract, the Contract Value following the application of any continuation adjustment  will be considered the initial Premium of the continuing Contract.    The Spousal Continuation Option is void in the event the original Contract Owner is no longer  the Contract Owner or in the event the Contract has been assigned. The Spousal Continuation  Option may be exercised only once and may not be available if You designated a Pre-selected  Death Benefit Option.    Pre-selected Death Benefit Option. Before the Income Date, You may designate the option  according to which the Company will pay the death benefit from the death benefit payment  options described in the Contract, or other death benefit options made available by the  Company. You may do so by submitting a designation in a form acceptable to the Company in  Good Order to the Company's Service Center. Pre-selected Death Benefit Options are effective  only after being recorded by the Company. The Company will pay the death benefit consistent  with Your Pre-selected Death Benefit Option unless the Internal Revenue Code requires  otherwise, or Your election requires payment over a period that exceeds the Beneficiary's life  expectancy as determined by the Company.    Only You may revoke or change a Pre-selected Death Benefit Option. To do so, You must  submit a request in a form acceptable to the Company to the Company's Service Center.  Revocations of and changes to a Pre-selected Death Benefit Option are effective only after  being recorded by the Company.    RILA285                               18                                       

 

                          INCOME PROVISIONS    INCOME DATE. Income Payments begin on the Income Date. If You do not select an Income  Date, the Income Date is the LID. You may change the Income Date to any date that is not later  than the LID by submitting Written Notice in Good Order to the Company's Service Center at  least seven (7) days before the Income Date.    INCOME PAYMENT. On or before the Income Date, You may elect payment in a single lump- sum. A single lump-sum payment is considered a total withdrawal and terminates the Contract.  The Company will make payment to You or another payee You specify. Alternatively, You may  elect an Income Option to begin on the Income Date. The Company will apply the Contract  Value, less applicable taxes, adjusted for any applicable MVA, to provide You income according  to Your selected Income Option.    INCOME OPTIONS. You may elect payment as provided in Options 1, 2, 3, or 4 below. You  may elect an Income Option up to thirty (30) days before the Income Date by submitting Written  Notice in Good Order to the Company's Service Center. The Company will make payment to  You or another payee You specify.    If You do not select an Income Option the Company will make payments as provided in Option 3  below, with 120 months certain. The Company will make payments monthly, quarterly,  semiannually or annually as You elect. However, if the Contract Value on the Income Date is  less than $2,000, the Company may pay out the Contract Value in one (1) lump-sum payment  instead of providing Income Payments according to the Income Option You elect. If the first  monthly payment provided would be less than $20, the Company may make payments  quarterly, semiannually or annually to achieve an initial payment of at least $20, or the  Company may pay out the Contract Value in one (1) single lump-sum payment.    At the time of their commencement, Income Payments will not be less than those that would be  provided by the application of an equivalent amount to purchase a single premium immediate  annuity contract from the Company at purchase rates the Company offered on the Income Date  to annuitants in the same class as the Annuitant.    YOU MAY NOT TAKE WITHDRAWALS DURING ANY PERIOD THE COMPANY IS MAKING  PAYMENTS FOR AN ANNUITANT'S LIFETIME.    OPTION 1 - LIFE INCOME. A monthly payment for the Annuitant's lifetime. All payments end  upon the Annuitant's death. However, in the event of the Annuitant's death before the first  monthly payment, the Company will pay the amount allocated to this Income Option to You or, if  You are deceased, to Your Beneficiary. No MVA applies to Contract Value applied to Option 1.    OPTION 2 - JOINT AND SURVIVOR INCOME. A monthly payment for the longer of the  Annuitant's lifetime or that of a second person You designate. Upon the occasion of the first  person to die, monthly payments continue during the survivor's lifetime at either the full amount  previously payable or as a percentage (either one-half or two-thirds) of the full amount, as You  select at the time You elect the Income Option.    All payments end upon the death of the last surviving Annuitant. However, in the event of the  deaths of the Annuitant and the designated second person before the first monthly payment, the  Company will pay the amount allocated to this Income Option to You or, if You are deceased,  Your Beneficiary. No MVA applies to Contract Value applied to Option 2.    RILA285                               19 

 

                     INCOME PROVISIONS (CONT'D)    OPTION 3 - LIFE INCOME WITH 120 OR 240 MONTHLY PAYMENTS GUARANTEED. A  monthly payment for the Annuitant's lifetime with the guarantee that the Company will make no  fewer than 120 or 240 monthly payments to You. If the Owner is an entity, at the Annuitant's  death, if fewer than the guaranteed number of payments have been made, the remaining  guaranteed payments will be made to the Owner as previously scheduled. If the Owner is the  Annuitant, in the event You die before the Company makes the specified number of guaranteed  payments, Your Beneficiary may elect to continue to receive the Income Payments according to  the terms of this Contract, or alternatively may elect to receive the present value of any  remaining guaranteed payments in a single lump-sum payment. The present value of any  remaining guaranteed payments will be based on the total Income Payments as of the date of  the calculation. The Company will determine the interest rate used in this present value  calculation, but in no instance will it be greater than (one) 1 percentage point higher than the  rate used to calculate the initial Income Payment. No MVA applies to Contract Value applied to  Option 3.     OPTION 4 - INCOME FOR A SPECIFIED PERIOD. A monthly payment for any whole number  of years ranging from 5 to 30. In the event You die before the Company makes the specified  number of payments, Your Beneficiary may elect to continue to receive the Income Payments  according to the terms of this Contract, or alternatively may elect to receive the present value of  any remaining guaranteed payments in a single lump-sum payment. The present value of any  remaining guaranteed payments will be based on the total Income Payments as of the date of  the calculation. The Company will determine the interest rate used in this present value  calculation, but in no instance will it be greater than (one) 1 percentage point higher than the  rate used to calculate the initial Income Payment. No MVA applies to Contract Value applied to  payments spread over five (5) years or more under Option 4.     ADDITIONAL INCOME OPTIONS. The Company may make available other Income Options.    DEATH BENEFIT AMOUNT AFTER THE INCOME DATE. If the Income Date precedes the  Latest Income Date, upon any Owner's death, any remaining Income Payments will be paid in  accordance with the Income Options of this Contract and will be paid at least as rapidly as the  payment method in effect as of the Owner's death.     If the Income Date is the LID, the death benefit amount is equal to the greater of zero or:    1. Premium paid into the Contract, less any applicable taxes, adjusted for any withdrawals     (including any applicable charges and adjustments for such withdrawals) incurred since the     issuance of the Contract through the LID. All adjustments will occur at the time of the     withdrawal. All adjustments for amounts withdrawn will reduce this item in the same portion     that the Contract Value was reduced on the date of such withdrawal; less  2. the Contract Value on the LID.   RILA285                               20 

 

                     INCOME PROVISIONS (CONT'D)    OWNER'S DEATH AFTER THE INCOME DATE. Upon the death of any Owner who is not also  an Annuitant after the Income Date, any remaining Income Payments due will continue at least  as rapidly as the payment method in effect as of the date of the Owner's death. Upon the death  of the last surviving Joint Owner after the Income Date, any remaining Income Payments will be  paid to the Beneficiary.    ANNUITANT'S DEATH AFTER THE INCOME DATE. Upon the death of the Annuitant after the  Income Date, the death benefit, if any, will be as specified in the Income Option elected. Any  life-contingent Income Payments cease on the death of the Annuitant.    BENEFICIARY'S ENTITLEMENT TO INCOME PAYMENTS AFTER THE INCOME DATE.  Upon the death of any Owner, the Company will pay any remaining Income Payments due to  Primary Beneficiaries or, if none exist, to the Contingent Beneficiaries, in equal shares (the  "default allocation") unless You have designated otherwise (the "designated allocation"). A  Beneficiary that dies before or within ten (10) days (or different period as prescribed by  applicable law) of Your death is not entitled to remaining Income Payments due; in that  circumstance, the Company will pay any remaining Income Payments due the deceased  Beneficiary to surviving Beneficiaries in the same proportion as the designated allocation or, if  applicable, the default allocation. If no Beneficiary survives You, the Company will pay  remaining Income Payments to Your estate.    RILA285                               21 

 

                       TERMINATION PROVISIONS    This Contract terminates and all Contract benefits, will end on the earlier of:  1. the date You take a total withdrawal;  2. the date the Contract Value is reduced to zero for any reason, or;  3. the date upon which the Company receives Due Proof of Your (or any Joint Owner's) death     and all Beneficiaries' election of a death benefit payment option in Good Order at the     Company's Service Center, unless the Contract is continued by the spouse under the     Spousal Continuation Option.    RILA285                               22

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