CORRESP 1 filename1.txt [INSERT COMPANY LETTERHEAD] June 15, 2007 VIA HAND DELIVERY AND EDGAR TRANSMISSION Ms. Sally Samuel Senior Counsel Office of Insurance Products Division of Investment Management U.S. Securities and Exchange Commission 100 F Street, N.E. Washington, DC 20549 Re: Commonwealth Annuity and Life Insurance Company Commonwealth Annuity Separate Account A Pre-Effective Amendments to the Registration Statements on Form N-4 FILE NOS. 333-141019 AND 333-141045/811-22024____________________ Dear Ms. Samuel: On behalf of Commonwealth Annuity and Life Insurance Company (the "Company") and Commonwealth Annuity Separate Account A (the "Account"), enclosed for your convenience are courtesy copies of Pre-Effective Amendment No. 1 (the "Amendments") to the above-captioned registration statements on Form N-4. The Amendments were filed with the Securities and Exchange Commission (the "Commission") on June [ ], 2007. For your convenience, the enclosed copies have been marked to highlight changes made from the initial registration statements. The Amendments incorporate changes made in response to comments raised by the Commission staff in a letter to the Company dated May 1, 2007 on the registration statements originally filed with the Commission. The Amendments also contain updated information on certain product features and include other information necessary to complete the registration statements, such as financial statements and the remainder of the required exhibits. The Amendments also reflect clarifying or stylistic changes. Acceleration requests from the Company, on behalf of the Account, and from the principal underwriter accompany the filings. The following paragraphs provide the Company's response to each comment raised by the Commission staff. For the staff's convenience, each of the staff's comments is set forth in full below, and then the response follows. Each response applies to both of the above-referenced registration statements, unless otherwise indicated. Ms. Sally Samuel June 15, 2007 Page 2 1. COVER COMMENT: Please move all required cover page information, currently shown on page 2, to the cover, except that the list of funds may be shown on the inside cover if it is too long to fit on the cover. RESPONSE: The Company has moved all required cover page information to the cover page (except for the list of funds, which is too long to fit on the cover). 2. DEFINITIONS COMMENT: Please correct the typographical error in line 4 of the definition of "Contingent Beneficiary" (I.E. "wills" to "will"). Also, please explain the language "as well as each day otherwise required" added at the end of the definition of "Valuation Date." RESPONSE: The Company has corrected the typographical error in line 4 of the definition of "Contingent Beneficiary." Also, the Company has deleted the language "as well as each day otherwise required" from the definition of "Valuation Date." 3. CONTRACT OWNER TRANSACTION EXPENSES (PAGES 7-8) (a). COMMENT: Please explain how earnings attributable to Purchase Payment Bonuses are excluded when calculating the withdrawal charges. Please provide an example of this calculation in the discussion of withdrawal charges in the prospectus, and cross-reference that discussion through a footnote in the table. Please also include a representation that the withdrawal charges will never exceed 9% of purchase payments as required by Rule 6c-8 under the Investment Company Act of 1940 (1940 Act). RESPONSE: When calculating the withdrawal charge under the Preferred Plus annuity, the Company applies the charge to Purchase Payments, Purchase Payment Bonuses, and earnings attributable to Purchase Payments and Purchase Payment Bonuses. The Company has revised the Preferred Plus annuity prospectus so that this is clear. The Company also has revised each prospectus to include an example of the withdrawal charge calculation, and has revised the footnote to the withdrawal charge in the fee table to provide a cross-reference to the withdrawal charge calculation set forth in the Contract Charges and Expenses section of the prospectus. The Company also has revised each prospectus to include a representation that the withdrawal charges will never exceed 9% of Purchase Payments. Ms. Sally Samuel June 15, 2007 Page 3 (b). COMMENT: Please include the range of premium taxes that are deducted in the table. Please also include a footnote referencing the "Premium Taxes" disclosure in the prospectus. RESPONSE: The Company has revised each prospectus to include the range of premium taxes in the fee table and has included a footnote referencing the "Premium Taxes" disclosure in the prospectus. (c). COMMENT: Please revise the table in accordance with Item 3, Instruction 2, which instructs that a registrant assume that the annuity contract is owned during the accumulation period. The existence of a Commutation Charge during the annuity period can be disclosed in a brief narrative footnote which provides a cross-reference to the portion of the prospectus describing the charge. RESPONSE: The Company has revised each prospectus to disclose the Commutation Charge in a brief narrative footnote with a cross-reference to the portion of the prospectus describing the charge. (d). COMMENT: So as not to obscure the information required to be disclosed by Item 3, please place all footnotes at the bottom of the appropriate page or at the end of the Item 3 disclosure. In this regard, please note Instruction 9 permits a tabular presentation, within the larger table, of the range of contingent deferred sales loads over time. RESPONSE: The Company has revised each prospectus to place all footnotes at the bottom of the appropriate page. (e). COMMENT: Please include the net interest rates for loans in the table, with a footnote referencing the more complete disclosure later in the prospectus. RESPONSE: The Company has revised each prospectus to include the net interest rates for loans in the fee table and has added a footnote with a cross reference to the prospectus section that provides more complete disclosure on loans. Ms. Sally Samuel June 15, 2007 Page 4 4. PERIODIC EXPENSES (PAGES 8-9) (a). COMMENT: Please add a line item showing the highest combination of base contract and optional feature charges. RESPONSE: The fee table for each prospectus does contain a line item showing the highest combination of base contract and optional feature charges that are a percentage of Separate Account Contract Value ("Total Separate Account Annual Expenses including Step-Up Death Benefit"). However, the Company is unable to add a line item showing the highest combination with all optional feature charges because the other optional feature charges are not based only on Separate Account Contract Value. The Company calculates the Guaranteed Lifetime Withdrawal Benefit Rider charge as a percentage of the Lifetime Income Base and the No Withdrawal Charge Rider charge as a percentage of Contract Value. Accordingly, the Guaranteed Lifetime Withdrawal Benefit Rider charge and the No Withdrawal Charge Rider cannot be combined with the base contract charges and the Step-Up Death Benefit charge. (b). COMMENT: Please confirm that all acquired fund fees will be included in the "Total Annual Fund Operating Expenses" figures shown in the table. RESPONSE: The Company confirms that all acquired fund fees have been included in the "Total Annual Fund Operating Expenses" figures shown in the table. 5. SUMMARY (PAGE 12) COMMENT: In those states that require a return of Purchase Payments, please explain why you are not returning the greater of Contract Value or Purchase Payment. SEE Section 1(32) of the 1940 Act. See also "Free Look Period" on page 18. RESPONSE: The Company returns the Purchase Payment rather than Contract Value in accordance with state laws or regulations that require a return of Purchase Payment in the event a contract owner exercises his or her "free look" right. The Company is not aware of any state that requires a return of the greater of Contract Value or Purchase Payment. 6. FIXED ACCOUNT (PAGE 16) COMMENT: Please indicate that disclosures regarding the Fixed Account in the prospectus ARE subject to the federal --- securities law, rather than "may be." Ms. Sally Samuel June 15, 2007 Page 5 RESPONSE: The Company has revised each prospectus to indicate that the disclosures regarding the Fixed Account in the prospectus ARE subject to the general provisions of the federal securities laws relating to the accuracy and completeness of statements made in prospectuses. 7. THE ACCUMULATION PERIOD (PAGE 20) COMMENT: Please use the close of business on the Valuation Date, rather than 3:00 p.m. Central time, as the cut-off time to avoid conflicts in the event the NYSE closes earlier or is not open on a given date. This change should also be reflected in the third paragraph on page 23 and elsewhere as applicable. RESPONSE: The Company has revised each prospectus to use the close of business on the Valuation Date, rather than 3:00 p.m. Central time, as the cut-off time for all applicable transaction requests. 8. DISRUPTIVE TRADING (PAGE 25) COMMENT: In the first paragraph on this page, please delete the third sentence or explain your basis for including this language. RESPONSE: The Company has included this disclosure as it believes it is in the interest of contract owners to be informed that the Company may not be able to apply the Funds' excessive trading policies and procedures. As a general note, Rule 22c-2 does not require an intermediary to apply the market timing policies and procedures of the Funds. Rather, the purpose of the rule is to provide the Funds the information that they need to apply their own policies and procedures. Intermediaries are not required to monitor investor trades to determine if they violate frequency, numerical limits, holding period requirements, or any other policies and procedures of the Funds. Intermediaries are only required to provide information, and then block trades by an investor IDENTIFIED BY THE FUND. 9. WITHDRAWALS AND SURRENDERS (PAGE 26) COMMENT: Please disclose that the contract value may be transferred to another investment option as permitted under the Texas Optional Retirement System. Ms. Sally Samuel June 15, 2007 Page 6 RESPONSE: The Company has revised each prospectus to disclose that participants under the Texas Optional Retirement System may transfer Contract Value among the Investment Options. 10. GUARANTEED LIFETIME WITHDRAWAL BENEFIT (PAGE 31) COMMENT: Please move the definitions shown on pages 32-34 before the discussion. RESPONSE: The Company has moved the definitions in each prospectus to precede the discussion. 11. TAKING WITHDRAWALS (PAGES 39) COMMENT: Since you reserve the right to impose a withdrawal charge on Non-Excess Withdrawals, please disclose the amount of that charge. SEE ALSO page 56, fifth paragraph. RESPONSE: The Company has revised each prospectus to clarify that if it does assess a withdrawal charge on a Non-Excess Withdrawal or an Excess Withdrawal (or a required minimum distribution), the Company will calculate and impose the charge in the same manner that it would for any partial withdrawal. The amount of the charge depends on several factors including the contribution year and is calculated separately for each Purchase Payment. Therefore, the Company does not believe it is possible to disclose the amount of the charge for a Non-Excess Withdrawal or a required minimum distribution. However, the Company has added examples to illustrate the assessment of the withdrawal charge on several types of withdrawals. 12. BENEFIT PHASE EXAMPLE (PAGES 44 - 45) COMMENT: Please explain the basis for using 34 payments in the examples under "If the Benefit Phase Start Date Occurs Before [or ON OR AFTER] the Lifetime Income Date." RESPONSE: There is no particular significance in choosing to use 34 payments in the examples. The Company chose this number at random and uses it throughout the examples for consistency. 13. REDUCTION OR ELIMINATION OF CERTAIN CHARGES (PAGE 60) COMMENT: Please provide your basis for reducing the mortality and expense risk charge and other asset based charges for certain sales. RESPONSE: The Company has decided not to reduce the mortality and expense risk charge or other asset based charges for certain sales and has revised each prospectus accordingly. Ms. Sally Samuel June 15, 2007 Page 7 14. PART C (a). COMMENT: Please specifically identify the Financial Statements included in Part B. RESPONSE: The Company has revised the Part C to specifically identify the Financial Statements included in Part B. (b). COMMENT: Please identify the Company as Commonwealth Annuity and Life Insurance Company in the representation as to fees and charges. Also, please add the word "deducted" before "under the Contracts." RESPONSE: The Company has revised the Part C to identify the Company by name in the representation as to fees and charges. The Company also has added the word "deducted" before "under the Contracts." COMMENT: The actual participation agreement with each underlying fund should be filed as an exhibit to each registration statement. RESPONSE: The Company has filed the actual participation agreement with each underlying fund as an exhibit to each registration statement. (d). COMMENT: In each registration statement, please file a Power of Attorney that relates specifically to that registration statement. SEE Rule 483(b) of the Securities Act of 1933. RESPONSE: The Company has filed as an exhibit to each registration statement Powers of Attorneys that relate specifically to the applicable registration statement. Each Power of Attorney meets this requirement by listing the applicable registration statement's 1933 Act filing number. 15. FINANCIAL STATEMENTS, EXHIBITS, AND OTHER INFORMATION COMMENT: Financial statements, exhibits, and other required or missing disclosure not included in the registration statements must be filed in a pre-effective amendment to the registration statements. RESPONSE: The Company has included the financial statements, exhibits, and other required or missing disclosure in the Amendments. Ms. Sally Samuel June 15, 2007 Page 8 16. TANDY COMMENT COMMENT: We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filings reviewed by the staff to be certain that they have provided all information investors require for an informed decision. Since the fund and its management are in possession of all facts relating to the fund's disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made. Notwithstanding our comments, in the event the fund requests acceleration of the effective date of the pending registration statements, it should furnish a letter, at the time or such request, acknowledging that - should the Commission or the staff, acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with respect to the filing; - the action of the Commission or the staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the fund from its full responsibility for the adequacy and accuracy of the disclosure in the filing; and - the fund may not assert this action as defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. In addition, please be advised that the Division of Enforcement has access to all information you provide to the staff of the Division of Investment Management in connection with our review of your filings or in response to our comments on your filings. We will consider a written request for acceleration of the effective date of the registration statements as a confirmation of the fact that those requesting acceleration are aware of their respective responsibilities. We will act on the request and, pursuant to delegated authority, grant acceleration of the effective date. RESPONSE: The Company has submitted a letter for each registration statement under separate cover acknowledging the above statements. 17. ADDITIONAL ORAL COMMENT COMMENT: Clarify fees and services rendered under the section "Administrative, Marketing, and Support Service Fees." Ms. Sally Samuel June 15, 2007 Page 9 RESPONSE: The Company has finalized this disclosure - now titled "Certain Payments We Receive With Regard to the Funds" - including the fee ranges that were previously bracketed. We believe that the Amendments are complete and respond to all Commission staff comments. We respectfully request that the staff review these materials as soon as possible. As noted above, requests for acceleration from the Company, on behalf of the Account, and from the principal underwriter accompany the Amendments and seek acceleration of the effectiveness of the registration statements to July 9, 2007 or as soon as practicable thereafter. Any assistance you can provide to the Company to assist it in meeting this request would be very much appreciated. If you have any questions or comments, please call the undersigned at (508) 460-2408 or Elisabeth M. Bentzinger at (202) 383-0717. We greatly appreciate the staff's efforts in assisting the Company with these filings. Sincerely, /s/ Jon-Luc Dupuy ------------------------------------ Jon-Luc Dupuy Assistant General Counsel and Vice President Attachments cc: Stephen E. Roth Elisabeth M. Bentzinger As filed with the Securities and Exchange Commission on June 15, 2007 Registration Nos. 333-141019/811-22024 Preferred Plus UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Pre-Effective Amendment No. 1 and/or REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 Amendment No. 2 COMMONWEALTH ANNUITY SEPARATE ACCOUNT A OF COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY (Exact Name of Registrant) COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY (Name of Depositor) 132 Turnpike Road, Suite 210 Southborough, Massachusetts 01772 Telephone: (508) 460-2400 (Address of Depositor's Principal Executive Office) Jon-Luc Dupuy, Vice President, Assistant General Counsel and Assistant Corporate Secretary Commonwealth Annuity and Life Insurance Company 132 Turnpike Road, Suite 210 Southborough, Massachusetts 01772 Telephone: (508) 460-2400 (Name and Address of Agent for Service of Process) APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: As soon as practicable after effectiveness of the Registration Statement. Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until Registrant shall file a further amendment which specifically states that this Registration Statement shall become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date or dates as the Commission, acting pursuant to said Section 8(a) may determine. TITLE & SECURITIES BEING REGISTERED: Interests in a separate account funding variable annuity contracts. PROSPECTUS FOR FLEXIBLE PREMIUM FIXED AND VARIABLE DEFERRED ANNUITY CONTRACTS -------------------------------------------------------------------------------- COMMONWEALTH ANNUITY SEPARATE ACCOUNT A -------------------------------------------------------------------------------- COMMONWEALTH ANNUITY VARIABLE ANNUITY PREFERRED PLUS ISSUED BY COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY HOME OFFICE: SERVICE CENTER MAILING ADDRESS: 132 Turnpike Road, Suite 210 P.O. Box 758550 Southborough, MA 01772 Topeka, Kansas 66675-8550 [phone number] [phone number] This Prospectus describes flexible premium fixed and variable deferred annuity contracts (the "Contract") issued by Commonwealth Annuity and Life Insurance Company ("we" "Company" or "Commonwealth Annuity"). The Contract is designed to provide annuity benefits for retirement which may or may not qualify for certain federal tax advantages. This Prospectus describes both Qualified Contracts and Non-Qualified Contracts, and the Contract may be purchased by natural persons, or by trusts or custodial accounts that hold the Contract as agent for and for the sole benefit of a natural person. The Contract is not available for sale to other types of purchasers without our prior approval. INVESTING IN THE CONTRACT INVOLVES RISKS, INCLUDING POSSIBLE LOSS OF SOME OR ALL OF YOUR INVESTMENT. REPLACING YOUR EXISTING ANNUITY OR LIFE INSURANCE POLICY WITH THE CONTRACT MAY NOT BE TO YOUR ADVANTAGE. The Contract may be purchased only if the older Owner and Annuitant have not attained age 80. This is a bonus annuity. The overall expenses for the Contract may be higher than the expenses for a similar contract that does not credit a Purchase Payment Bonus ("PPB"). The PPB is paid for with higher withdrawal charges and higher mortality and expense risk charges. Over time, the value of the PPB could be more than offset by these charges. We offer other variable annuities with lower fees. You should carefully consider whether or not this Contract is the best product for you. THE CONTRACTS ARE NOT INSURED BY THE FDIC. THEY ARE OBLIGATIONS OF THE ISSUING INSURANCE COMPANY AND NOT A DEPOSIT OF, OR GUARANTEED BY, ANY BANK OR SAVINGS INSTITUTION AND ARE SUBJECT TO RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL. THIS PROSPECTUS CONTAINS IMPORTANT INFORMATION ABOUT THE CONTRACTS THAT YOU SHOULD KNOW BEFORE INVESTING. YOU SHOULD READ IT BEFORE INVESTING AND KEEP IT FOR FUTURE REFERENCE. WE HAVE FILED A STATEMENT OF ADDITIONAL INFORMATION ("SAI") WITH THE SECURITIES AND EXCHANGE COMMISSION. THE CURRENT SAI HAS THE SAME DATE AS THIS PROSPECTUS AND IS INCORPORATED BY REFERENCE IN THIS PROSPECTUS. YOU MAY OBTAIN A FREE COPY BY WRITING US AT OUR SERVICE CENTER OR CALLING [PHONE NUMBER]. A TABLE OF CONTENTS FOR THE SAI APPEARS AT THE END OF THIS PROSPECTUS. YOU MAY ALSO FIND THIS PROSPECTUS AND OTHER INFORMATION ABOUT THE SEPARATE ACCOUNT REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ("SEC") AT THE SEC'S WEB SITE AT http://www.sec.gov. THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE DATE OF THIS PROSPECTUS IS [JULY 9], 2007. 1 You may allocate Purchase Payments and/or transfer Contract Value to the Fixed Account or to one or more of the variable Investment Options, each of which is a Subaccount of the Commonwealth Annuity Separate Account A. Currently, you may choose among Subaccounts that invest in the following Insurance Funds: GOLDMAN SACHS VARIABLE INSURANCE TRUST (CLASS S) - Goldman Sachs VIT Capital Growth Fund - Goldman Sachs VIT Core Fixed Income Fund - Goldman Sachs VIT Equity Index Fund Goldman Sachs VIT Government Income Fund - Goldman Sachs VIT Growth & Income Fund - Goldman Sachs VIT Growth Opportunities Fund - Goldman Sachs VIT Money Market Fund - Goldman Sachs VIT Strategic International Equity Fund - Goldman Sachs VIT Structured Small Cap Equity Fund - Goldman Sachs VIT Structured U.S. Equity Fund AIM VARIABLE INSURANCE FUNDS (SERIES II) - AIM V.I. Core Equity Fund - AIM V.I. Leisure Fund ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. (CLASS B) - AllianceBernstein VPS Americas Government Income Portfolio - AllianceBernstein VPS International Value Portfolio - AllianceBernstein VPS Small Cap Growth Portfolio - AllianceBernstein VPS Small/Mid Cap Value Portfolio FRANKLIN TEMPLETON INSURANCE PRODUCTS TRUST (CLASS 2) - FT VIP Templeton Global Asset Allocation Fund - FT VIP Franklin Global Communications Fund - FT VIP Templeton Growth Securities Fund - FT VIP Franklin Income Securities Fund - FT VIP Franklin Mutual Discovery Securities Fund - FT VIP Franklin Mutual Shares Securities Fund - FT VIP Franklin Small Cap Value Securities Fund JANUS ASPEN SERIES (SERVICE SHARES) - Janus Aspen Forty Portfolio - Janus Aspen Midcap Growth Portfolio - Janus Aspen Midcap Value Portfolio - Janus Aspen Small Company Value Portfolio OPPENHEIMER VARIABLE ACCOUNT FUNDS (SERVICE SHARES) - Oppenheimer Balanced Fund/VA - Oppenheimer Global Securities Fund/VA - Oppenheimer Main Street Small Cap Fund/VA - Oppenheimer Strategic Bond Fund/VA PIONEER VARIABLE CONTRACTS TRUST (CLASS II) - Pioneer Cullen Value VCT Portfolio - Pioneer Emerging Markets VCT Portfolio - Pioneer Growth Opportunities VCT Portfolio - Pioneer Mid Cap Value VCT Portfolio In addition, Qualified Contracts also may choose among Subaccounts that invest in the following Publicly-Available Funds: - Goldman Sachs Balanced Strategy Portfolio (Class A) - Goldman Sachs Equity Growth Strategy Portfolio (Class A) - Goldman Sachs Growth and Income Strategy Portfolio (Class A) - Goldman Sachs Growth Strategy Portfolio (Class A) - Goldman Sachs International Real Estate Security Fund (Class A) - Goldman Sachs Real Estate Security Fund (Class A) - Goldman Sachs Tollkeeper Fund (Class A) Many of the Publicly-Available Funds are also available for direct purchase outside of an annuity or life insurance policy. If you purchase shares of these funds directly from a broker-dealer or mutual fund 2 company, you will not pay Contract fees or charges, but you also will not have Annuity Options available. Because of the additional Contract fees and charges, which affect Contract Value and Subaccount returns, you should refer only to performance information regarding the Publicly-Available Funds available through us, rather than to information that may be available through alternate sources. If you elect the Guaranteed Lifetime Withdrawal Benefit (GLWB) Rider, we will restrict the Investment Options to which you may allocate Purchase Payments and transfer Contract Value. (See "Guaranteed Lifetime Withdrawal Benefit.") 3 TABLE OF CONTENTS PAGE ---- DEFINITIONS SUMMARY SUMMARY OF EXPENSES CONDENSED FINANCIAL INFORMATION DISTRIBUTION COSTS COMMONWEALTH ANNUITY, THE SEPARATE ACCOUNT AND THE FUNDS FIXED ACCOUNT THE CONTRACTS CONTRACT CHARGES AND EXPENSES THE ANNUITY PERIOD PAYMENTS TO CONTRACT OWNERS FEDERAL TAX MATTERS DISTRIBUTION OF CONTRACTS VOTING RIGHTS REPORTS TO CONTRACT OWNERS AND INQUIRIES DOLLAR COST AVERAGING AUTOMATIC ASSET REBALANCING SYSTEMATIC WITHDRAWAL PLAN SPECIAL CONSIDERATIONS LEGAL PROCEEDINGS TABLE OF CONTENTS--STATEMENT OF ADDITIONAL INFORMATION FINANCIAL STATEMENTS APPENDIX A - COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY DEFERRED FIXED AND VARIABLE ANNUITY IRA, ROTH IRA AND SIMPLE IRA DISCLOSURE STATEMENT APPENDIX B - GLWB EXAMPLE APPENDIX C - GLWB EXAMPLE APPENDIX D - GLWB EXAMPLE 4 DEFINITIONS The following terms as used in this Prospectus have the indicated meanings: ACCUMULATION PERIOD--The period between the Date of Issue of a Contract and the Annuity Date. ACCUMULATION UNIT--A unit of measurement used to determine the value of each Subaccount during the Accumulation Period. Each Subaccount will have an Accumulation Unit for each combination of charges. ANNUITANT-- The person(s) during whose lifetime the annuity is to be paid. When two people are named as joint Annuitants, the term "Annuitant" means the joint Annuitants or the survivor. ANNUITY DATE--The Valuation Date on which annuity payments are to commence. Subject to state variation, the Annuity Date may not be after the Valuation Date on or next following the later of the original older Owner's or Annuitant's 90th birthday. ANNUITY OPTION--One of several forms in which annuity payments can be made. ANNUITY PERIOD--The period starting on the Annuity Date during which we make annuity payments to you. ANNUITY UNIT--A unit of measurement used to determine the amount of Variable Annuity payments after the first payment. BENEFICIARY--The person designated to receive any benefits under a Contract upon your death. (see Primary Beneficiary and Contingent Beneficiary). CODE--The Internal Revenue Code of 1986, as amended. COMPANY ("WE", "US", "OUR", "COMMONWEALTH ANNUITY")--Commonwealth Annuity and Life Insurance Company. CONTINGENT BENEFICIARY--The person designated to receive any benefits under a Contract upon your death should all Primary Beneficiaries predecease you. In the event that a Contingent Beneficiary predeceases you, the benefits will be distributed pro rata to the surviving Contingent Beneficiaries. If there are no surviving Contingent Beneficiaries, the benefits will be paid to your estate (see Beneficiary and Primary Beneficiary). CONTRACT--A Flexible Premium Fixed and Variable Deferred Annuity Contract. CONTRACT ANNIVERSARY--The same date each year as the Date of Issue. If there is no Valuation Date in a year that coincides with the Date of Issue, the Contract Anniversary is the next Valuation Date. CONTRACT VALUE--The sum of your Fixed Account Contract Value and Separate Account Contract Value. CONTRACT YEAR--A period of twelve consecutive months starting on the Date of Issue or on any Contract Anniversary. CONTRIBUTION YEAR--Each Contract Year in which a Purchase Payment is made and each later year measured from the start of the Contract Year when the Purchase Payment was made. We only refer to Contribution Years for purposes of calculating the withdrawal charge. For example, if you make an initial Purchase Payment of $15,000 and then during the fourth Contract Year you make an additional Purchase Payment of $10,000, the fifth Contract Year will be the fifth Contribution Year with respect to the initial Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and 5 PPB) and the second Contribution Year with respect to the $10,000 Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and PPB). DATE OF ISSUE--The date on which the first Contract Year commences. DEBT--The principal of any outstanding loan from the Fixed Account Contract Value, plus any accrued interest. FIXED ACCOUNT-- A portion of a Contract that is supported by the assets of our General Account. We guarantee a minimum rate of interest on Purchase Payments (and corresponding PPBs) allocated and Contract Value transferred to the Fixed Account. FIXED ACCOUNT CONTRACT VALUE--The value of your interest in the Fixed Account. FIXED ANNUITY--An annuity under which we guarantee the amount of each annuity payment; it does not vary with the investment experience of a Subaccount. FREE WITHDRAWAL AMOUNT--The guaranteed amount you may withdraw each Contract Year without incurring a withdrawal charge. FUND OR FUNDS-- An investment company or separate series thereof, in which Subaccounts of the Separate Account invest. GENERAL ACCOUNT--All our assets other than those allocated to any legally segregated separate account. INVESTMENT OPTION--The Subaccounts and the Fixed Account available under the Contract for allocation of Purchase Payments and/or transfers of Contract Value. MONTHIVERSARY--The same date each month as the Date of Issue. If the Date of Issue falls on the 29th, 30th, or 31st and there is no corresponding date in a subsequent month, the Monthiversary will be the last date of that month. If there is no Valuation Date in the calendar month that coincides with the Date of Issue, the Monthiversary is the next Valuation Date. NON-QUALIFIED CONTRACT--A Contract which does not receive favorable tax treatment under Section 401, 403, 408, 408A or 457 of the Code. OWNER ("CONTRACT OWNER", "YOU", "YOUR", "YOURS")--The person designated in the Contract as having the privileges of Ownership. The Contract may be owned by natural persons, or by trusts or custodial accounts that hold the Contract as agent for and for the sole benefit of a natural person. When two people are named as joint Owners, the term "Owner" means the joint Owners or the survivor. Joint Owners are not permitted if the Contract is owned by a non-natural person. PRIMARY BENEFICIARY --The person designated to receive any benefits under a Contract upon your death. In the event that a Primary Beneficiary predeceases you, the benefits will be distributed pro rata to the surviving Primary Beneficiaries. In the event that all Primary Beneficiaries predecease you, proceeds will be paid to the surviving Contingent Beneficiaries (see Beneficiary and Contingent Beneficiary). PURCHASE PAYMENTS--The dollar amount we receive in U.S. currency to buy the benefits the Contract provides. Purchase Payments do not include corresponding Purchase Payment Bonuses. PURCHASE PAYMENT BONUS ("PPB")-- An additional amount we credit to your Contract Value with each Purchase Payment you make. Purchase Payment Bonuses are not part of your Purchase Payments. 6 QUALIFIED CONTRACT--A Contract issued in connection with a retirement plan which receives favorable tax treatment under Sections 401, 403, 408, 408A or 457 of the Code. SEPARATE ACCOUNT--Commonwealth Annuity Separate Account A. SEPARATE ACCOUNT CONTRACT VALUE--The sum of your interests in the Subaccount(s). SERVICE CENTER--P.O. Box 758550, Topeka, Kansas 66675-8550, [phone number]. SUBACCOUNTS--The subdivisions of the Separate Account, the assets of which consist solely of shares of the corresponding Fund. VALUATION DATE--Each day when the New York Stock Exchange is open for trading. The close of business on each Valuation Date is generally 3:00 p.m. Central time. VALUATION PERIOD--The interval of time between two consecutive Valuation Dates. VARIABLE ANNUITY--An annuity with payments varying in amount in accordance with the investment experience of the Subaccount(s) in which you have an interest. WITHDRAWAL VALUE--The amount you will receive upon full surrender or the amount applied upon annuitization of the Contract. It is equal to the Contract Value minus Debt, any applicable withdrawal charge, premium taxes, and minus any applicable contract fee and pro rata portion of the GLWB Rider charge. Federal and state income taxes and penalty taxes also may reduce the amount you receive if you surrender the Contract. 7 SUMMARY OF EXPENSES THE FOLLOWING TABLES DESCRIBE THE FEES AND EXPENSES THAT YOU WILL PAY WHEN BUYING, OWNING, AND SURRENDERING THE CONTRACT. THE FIRST TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU WILL PAY AT THE TIME THAT YOU BUY THE CONTRACT, SURRENDER THE CONTRACT, OR TRANSFER CONTRACT VALUE AMONG INVESTMENT OPTIONS. CONTRACT OWNER TRANSACTION EXPENSES(1) Sales Load Imposed on Purchase Payments None Maximum Withdrawal Charge(2) (as a percentage of Purchase Payments (and PPBs and earnings attributable to Purchase Payments and PPBs) withdrawn, surrendered, or annuitized): 8% Qualified Plan Loan Interest Rate Charged:(3) Loans not subject to ERISA 5.50% Loans subject to ERISA Moody's Corporate Bond Yield Average -- Monthly Average Corporates (rounded to the nearest 0.25%) State Premium Taxes(4) 0% to 3.50% ---------- (1) During the Annuity Period, we deduct a commutation charge if you request a lump sum payment with respect to: 1) any remaining annuity payments in the certain period under Annuity Options 1, 3, or 5 upon the death of an Annuitant; or 2) any remaining annuity payments under Annuity Option 1. Please see "Commutation Charge." (2) In certain circumstances we may reduce or waive the withdrawal charge. In addition, a Contract Owner may withdraw the Free Withdrawal Amount each Contract Year without incurring a withdrawal charge. If you withdraw more than the Free Withdrawal Amount, we may impose a withdrawal charge on the excess. We impose a withdrawal charge on the withdrawal of each Purchase Payment (and PPB and earnings attributable to that Purchase Payment and PPB) made within the previous 8 Contribution Years, as follows: CONTRIBUTION YEAR WITHDRAWAL CHARGE ----------------- ----------------- First 8% Second 8% Third 7% Fourth 6% Fifth 5% Sixth 4% Seventh 3% Eighth 2% Ninth+ 0% Total withdrawal charges assessed under a Contract will never exceed 9% of the total Purchase Payments (not including PPBs) made under the Contract. For more information on the withdrawal charge, including an example of how we calculate the withdrawal charge, see "Withdrawal Charge." (3) Loans are only available under certain qualified plans, and the interest rate depends on whether the plan is subject to the Employee Retirement Income Security Act of 1974 ("ERISA"). (See "Loans".) (4) For a discussion of state premium taxes, please see "State Premium Taxes." 8 THE NEXT TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU WILL PAY PERIODICALLY DURING THE TIME THAT YOU OWN THE CONTRACT, NOT INCLUDING FUND FEES AND EXPENSES. PERIODIC EXPENSES* Annual Contract Fee (deducted from Contract Value)(5) $30.00 Separate Account Annual Expenses (as a percentage of Separate Account Contract Value) Mortality and Expense Risk Charge 1.35% Administration Charge 0.15% ---- Total Separate Account Annual Expenses without the Step-Up Death Benefit 1.50% ==== Optional Step-Up Death Benefit Charge(6) 0.20% ---- Total Separate Account Annual Expenses including Step-Up Death Benefit 1.70% ==== Additional Rider Charges: Guaranteed Lifetime Withdrawal Benefit (GLWB) Rider (as a percentage of the Lifetime Income Base): GLWB Plus For One(7) Maximum Charge: 1.00% Current Charge: 0.50% GLWB Plus For Two(8) Maximum Charge: 1.50% Current Charge: 0.75% ---------- (5) We will waive this fee for Contracts with Contract Value of $50,000 or more as of the Valuation Date we would otherwise deduct the fee. We assess the contract fee at the end of each calendar quarter and upon surrender or annuitization. (6) The Optional Step-Up Death Benefit Charge does not apply to amounts allocated to the Fixed Account. (7) We reserve the right to increase the charge to a maximum of 1.00% on an annual basis if we Step-Up the Lifetime Income Base to equal the Contract Value. (8) We reserve the right to increase the charge to a maximum of 1.50% on an annual basis if we Step-Up the Lifetime Income Base to equal the Contract Value. 9 THE NEXT TABLE SHOWS THE LOWEST AND HIGHEST TOTAL OPERATING EXPENSES CHARGED BY THE FUNDS FOR THE YEAR ENDED DECEMBER 31, 2006 THAT YOU MAY PAY PERIODICALLY DURING THE TIME THAT YOU OWN THE CONTRACT. CURRENT AND FUTURE EXPENSES COULD BE HIGHER OR LOWER THAN THOSE SHOWN IN THE FOLLOWING TABLE. MORE DETAIL CONCERNING EACH FUND'S FEES AND EXPENSES IS CONTAINED IN THE PROSPECTUS FOR EACH FUND. LOWEST -- HIGHEST Total Annual Fund Operating Expenses(5) (expenses that are deducted from Fund assets, including management fees, distribution and/or service (12b-1) fees, and other expenses, prior to any fee waivers or expense reimbursements) 0.67% -- 2.20% The advisers and/or other service providers of certain Funds have agreed to reduce their fees and/or reimburse the Funds' expenses in order to keep the Funds' expenses below specified limits. The expenses of certain Funds are reduced by contractual fee reduction and expense reimbursement arrangements, while other Funds have voluntary fee reduction and/or expense reimbursement arrangements that may be terminated at any time. The lowest and highest Total Annual its. The expenses Fund Operating Expenses for all Funds after all fee reductions and expense reimbursements are 0.40% and 1.75% respectively for the year ended December 31, 2006. Each fee reduction and/or expense reimbursement arrangement is described in the relevant Fund's prospectus. THE FUND'S INVESTMENT MANAGER OR ADVISER PROVIDED THE ABOVE EXPENSES FOR THE FUNDS. WE HAVE NOT INDEPENDENTLY VERIFIED THE ACCURACY OF THE INFORMATION. EXAMPLE THIS EXAMPLE IS INTENDED TO HELP YOU COMPARE THE COST OF INVESTING IN THE CONTRACT WITH THE COST OF INVESTING IN OTHER VARIABLE ANNUITY CONTRACTS. THESE COSTS INCLUDE CONTRACT OWNER TRANSACTION EXPENSES, CONTRACT FEES, SEPARATE ACCOUNT ANNUAL EXPENSES, AND FUND FEES AND EXPENSES. The Example assumes that you invest $10,000 in the Contract for the time periods indicated and that your Contract includes the Step-Up Death Benefit, and the GLWB Plus For Two Rider (at the maximum charges). If these features were not elected, the expense figures shown below would be lower. The Example also assumes that your investment has a 5% return each year and assumes the maximum fees and expenses of any ACTION EXPENSES, C of the Funds, prior to any fee he maximum charge) waivers or expense reimbursements. If these arrangements were considered, the expenses shown would be lower. Although your actual costs may be higher or lower, based on these assumptions, your costs would be: IF YOU SURRENDER YOUR CONTRACT AT THE END OF THE APPLICABLE PERIOD: 1 YEAR 3 YEARS 5 YEARS 10 YEARS ----------------------------------------- 1,328.03 2,405.05 3,408.98 6,000.26 IF YOU ANNUITIZE YOUR CONTRACT AT THE END OF THE APPLICABLE PERIOD UNDER ANNUITY OPTION 2,3, 4, OR 5, OR UNDER ANNUITY OPTION 1 FOR A PERIOD OF 10 YEARS OF MORE: 1 YEAR 3 YEARS 5 YEARS 10 YEARS --------------------------------------- 584.26 1,765.60 2,961.85 6,000.26 IF YOU ANNUITIZE YOUR CONTRACT AT THE END OF THE APPLICABLE PERIOD UNDER ANNUITY OPTION 1 FOR A PERIOD OF LESS THAN 10 YEARS: 1 YEAR 3 YEARS 5 YEARS 10 YEARS ----------------------------------------- 1,328.03 2,405.05 3,408.98 6,000.26 10 IF YOU DO NOT SURRENDER YOUR CONTRACT AT THE END OF THE APPLICABLE PERIOD: 1 YEAR 3 YEARS 5 YEARS 10 YEARS --------------------------------------- 584.26 1,765.60 2,961.85 6,000.26 The fee table and Example should not be considered a representation of past or future expenses and charges of the Subaccounts. Your actual expenses may be greater or less than those shown. The Example assumes no transfers were made and does not include the deduction of state premium taxes, which may be assessed before or upon surrender or annuitization or any taxes or penalties you may be required to pay if you surrender the Contract. Similarly, the 5% annual rate of return assumed in the Example is not intended to be representative of past or future performance of any Subaccount. CONDENSED FINANCIAL INFORMATION Because the Contract was not offered for sale as of December 31, 2006, condensed financial information for the Separate Account is not available. DISTRIBUTION COSTS For information concerning the compensation we pay for sales of the Contract, see "Distribution of Contracts." SUMMARY The summary does not contain all information that may be important. Read the entire Prospectus and the Contract before deciding to invest. States may require variations to the Contract. If a state variation applies, it will appear in the Contract, an endorsement to the Contract, or a supplement to this Prospectus. This is a bonus annuity. This means we will increase your Contract Value by 4% of each Purchase Payment you make. We use a portion of the mortality and expense risk charge and the withdrawal charge to pay for the PPB. These and other expenses for the Contract may be higher than the expenses for a similar contract that does not credit a PPB. Over time, the value of the PPB could be more than offset by these charges. We offer variable annuity contracts that do not provide a PPB and, therefore, have lower fees. You should carefully consider whether this Contract is the best product for you. Generally, the Contract is most suited to those who intend to hold it for a relatively long time. Carefully consider your need to make withdrawals or surrender this Contract in the short-term as your expenses can outweigh the benefits of the PPB. The Contract provides for tax-deferred investments and annuity benefits. Both Qualified Contracts and Non-Qualified Contracts are described in this Prospectus. You may make Purchase Payments under the Contract, subject to certain minimum limitations and other restrictions. You may make Purchase Payments to Non-Qualified Contracts and Contracts issued as Individual Retirement Annuities ("IRAs") by authorizing us to draw on your account via check or electronic debit ("Pre-Authorized Checking (PAC) Agreement"). (See "Purchase Payments.") We do not deduct a sales charge from any Purchase Payment. We provide for variable accumulations and benefits for amounts allocated to one or more Subaccounts selected by you. Each Subaccount invests in a corresponding Fund. (See "The Funds.") Purchase Payments (and corresponding PPBs) and Contract Value allocated to the Separate Account will vary with the investment performance of the Funds you select. 11 We also provide for fixed accumulations and benefits for amounts allocated to the Fixed Account. We credit Purchase Payments (and corresponding PPBs) and Contract Value allocated to the Fixed Account with interest daily at a rate periodically declared by us at our discretion, but not less than the minimum guaranteed rate. (See "Fixed Account.") The investment risk under the Contract is borne by you, except to the extent that Purchase Payments (and corresponding PPBs) and Contract Value are allocated to the Fixed Account and are therefore guaranteed to earn at least the minimum guaranteed rate. Transfers among Subaccounts are permitted before and after the Annuity Date, if allowed by your qualified plan and subject to limitations. Restrictions apply to transfers into and out of the Fixed Account. (See "Transfers During the Accumulation Period" and "Transfers During the Annuity Period.") You may make partial withdrawals from the Contract or surrender the Contract, subject to certain restrictions. (See "Withdrawals and Surrenders During the Accumulation Period.") You may withdraw up to the Free Withdrawal Amount in any Contract Year without assessment of a withdrawal charge. If you withdraw an amount in excess of the Free Withdrawal Amount, the excess may be subject to a withdrawal charge. We also may assess a withdrawal charge upon surrender of the Contract, although we will first apply the Free Withdrawal Amount. The withdrawal charge is assessed as a percentage of each Purchase Payment, as well as the PPB and earnings attributable to that Purchase Payment and PPB, withdrawn or surrendered during the first 8 Contribution Years following our receipt of the Purchase Payment. The withdrawal charge starts at 8% in the first and second Contribution Years and reduces each subsequent Contribution Year. We do not assess a withdrawal charge on any Purchase Payment (or PPB or earnings attributable to that Purchase Payment and PPB) withdrawn or surrendered more than eight Contribution Years following our receipt of that Purchase Payment. We also may apply a withdrawal charge upon annuitization to amounts attributable to Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in their eight Contribution Year or earlier. (See "Withdrawal Charge.") Withdrawals and surrenders will have tax consequences, which may include the amount of the withdrawal being subject to income tax and in some circumstances an additional 10% penalty tax. Withdrawals also reduce your Contract Value and your death benefit. Certain withdrawals also may reduce the value of the guarantees provided by the GLWB Rider. (See "Guaranteed Lifetime Withdrawal Benefit.") Withdrawals are permitted from Contracts issued in connection with Section 403(b) qualified plans only under limited circumstances. (See "Withdrawals and Surrenders During the Accumulation Period" and "Federal Tax Matters.") We offer Automatic Asset Rebalancing, Dollar Cost Averaging, and a Systematic Withdrawal Plan. (See "Automatic Asset Rebalancing," "Dollar Cost Averaging," and "Systematic Withdrawal Plan.") If you die before the Annuity Date, we will pay the Beneficiary a death benefit. We also offer for an additional charge the Step-Up Death Benefit, which provides an optional enhanced death benefit if certain conditions are met. See "Death Benefits." We provide for an additional charge a Guaranteed Lifetime Withdrawal Benefit Rider ("GLWB Rider"), which, subject to certain conditions, makes the following guarantees: Prior to the Lifetime Income Date, we will make the Guaranteed Withdrawal Amount available for Non-Excess Withdrawals each Contract Year or we will pay it in monthly installments as Settlement Payments if your Contract enters the Benefit Phase before the Lifetime Income Date, until the Guaranteed Withdrawal Balance is reduced to zero. If your Contract Value is greater than zero on the Lifetime Income Date, we will make the Lifetime Income Amount available for Non-Excess Withdrawals each Contract Year on and after the Lifetime Income Date (if you have not annuitized your Contract) or we will pay it in monthly installments as Settlement Payments on and after the Maximum Annuity Date (if you elect the GLWB Rider annuitization option on the Maximum Annuity Date) or if your Contract enters the Benefit Phase prior to the Maximum Annuity Date. This guarantee applies on and after the Lifetime Income Date, while a Covered Person is living or until the Guaranteed Withdrawal Balance is reduced to zero, if later. After the Covered Person's 12 death (or the death of the last surviving Covered Person in the case of the GLWB Plus for Two), your Beneficiary will receive the remaining Guaranteed Withdrawal Balance as a lump sum death benefit (if greater than the standard death benefit or any optional death benefit you elected) in certain cases or in monthly installments as Settlement Payments (until the Guaranteed Withdrawal Balance is reduced to zero) in others. This guarantee applies even if the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) on or after the Maximum Annuity Date, if you elect the GLWB Rider annuitization option on the Maximum Annuity Date. Currently, the GLWB Rider is only available to Qualified Contracts. You should consult with a qualified tax adviser prior to electing the Rider for further information on tax rules affecting Qualified Contracts, including IRAs. (See "Guaranteed Lifetime Withdrawal Benefit.") In addition to the withdrawal charge, we assess a mortality and expense risk charge, an administration charge, a contract fee, and applicable premium taxes. (See "Contract Charges and Expenses.") We also charge for the Step-Up Death Benefit (see "Death Benefits") and the GLWB Rider (see "Guaranteed Lifetime Withdrawal Benefit"). The Funds will incur certain management fees and other expenses. (See "Summary of Expenses," "Investment Management Fees and Other Expenses," and the Funds' prospectuses.) We may assess a commutation charge during the Annuity Period when calculating lump sum payments with respect to any remaining periodic payments in the certain period under Annuity Options 1, 3 and 5 upon the death of an Annuitant during the Annuity Period and, for Annuity Option 1, upon election to cancel remaining payments. (See "Annuity Period--Annuity Options.") Currently, the Contracts may be purchased in connection with retirement plans qualifying either under Section 401 or 403(b) of the Code or as individual retirement annuities including Roth IRAs. The Contracts are also available in connection with state and municipal deferred compensation plans and non-qualified deferred compensation plans. A Contract purchased in connection with a qualified plan does not provide any additional tax deferred treatment of earnings beyond the treatment that is already provided by the qualified plan itself. (See "Taxation of Annuities in General" and "Qualified Plans.") Therefore, the tax deferral provided by the Contract is not necessary for Contracts used in qualified plans, so for such plans the Contract should be purchased for other features and benefits, such as the Fixed Account's minimum interest rate guarantee, the standard death benefit, the Step-Up Death Benefit, the GLWB Rider, or the Annuity Options. You have the right within the "free look" period (generally ten days, subject to state variation) after receiving the Contract to cancel the Contract by delivering or mailing it to us. If you decide to return your Contract for a refund during the "free look" period, also include a letter instructing us to cancel the Contract. Upon receipt by us, the Contract will be cancelled and amounts refunded. The amount of the refund depends on the state where issued. Generally the refund will be the Contract Value as of the Valuation Date on which we receive your Contract at our Service Center minus the PPB adjusted for any negative or positive investment performance. We will also return the mortality and expense risk charge, the administration charge, and any other charges proportionately attributable to the PPB. Some states require the return of the Purchase Payment (not including the PPB). Thus, if you return the Contract during the "free look" period, you will not receive the PPB. In addition, a special "free look" period applies in some circumstances to Contracts issued as Individual Retirement Annuities, Simplified Employee Pensions--IRAs or as Roth Individual Retirement Annuities. (See "Free Look Period.") Certain provisions of the Contract may be different than the general description in this Prospectus, and certain riders and options may not be available, because of legal restrictions in your state. See your Contract for specific variations since any such state variations will be included in your Contract or in riders or endorsements attached to your Contract. See your agent or contact us for specific information that may be applicable to your state. You can generally exchange all or a portion of one annuity contract for another, or a life insurance policy for an annuity contract, in a `tax-free exchange' under Section 1035 of the Code. If you are thinking about a 1035 exchange, you should compare the old contract and the Contract described in this Prospectus carefully. Remember that if you exchange another contract for the Contract described in this Prospectus, you might have to pay a withdrawal charge and tax, including a possible penalty tax, on your old contract, 13 AND there will be a new withdrawal charge period for the Contract. Also, other charges may be higher (or lower) and the benefits may be different. If the exchange does not qualify for Section 1035 treatment, you may have to pay federal income and penalty taxes on the exchange. You should not exchange another contract for the Contract described in this Prospectus unless you determine, after knowing all the facts, that the exchange is in your best interest (the person selling you the Contract will generally earn a commission if you buy the Contract through an exchange or otherwise). If you contemplate such an exchange, you should consult a tax adviser to discuss the potential tax effects of such a transaction. We offer other variable annuity contracts that have different policy features. However, these other contracts also have different charges that would affect your Subaccount performance and Contract Value. To obtain more information about these other contracts, contact our Service Center or your agent. COMMONWEALTH ANNUITY, THE SEPARATE ACCOUNT AND THE FUNDS COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY Commonwealth Annuity and Life Insurance Company ("we," "Commonwealth Annuity" or the "Company") is a life insurance company organized under the laws of Delaware in July 1974. Prior to December 31, 2002, Commonwealth Annuity (then known as Allmerica Financial Life Insurance and Annuity Company or "Allmerica Financial") was a direct subsidiary of First Allmerica Financial Life Insurance Company ("First Allmerica"), which in turn was a direct subsidiary of The Hanover Insurance Group ("THG," formerly Allmerica Financial Corporation). Effective December 31, 2002, the Company became a Massachusetts domiciled insurance company and a direct subsidiary of THG. On December 30, 2005, THG completed the closing of the sale of the Company to The Goldman Sachs Group, Inc. ("Goldman Sachs"), 85 Broad Street, New York, NY 10004. On September 1, 2006, Allmerica Financial officially changed its name to Commonwealth Annuity and Life Insurance Company. Commonwealth Annuity is subject to the laws of the state of Massachusetts governing insurance companies and to regulation by the Commissioner of Insurance of Massachusetts. In addition, Commonwealth Annuity is subject to the insurance laws and regulations of other states and jurisdictions in which it is licensed to operate. As of December 31, 2006, Commonwealth Annuity had over $11 billion in combined assets and over $13 billion of life insurance in force. Its principal office is located at 132 Turnpike Road, Suite 210, Southborough, MA 01772, telephone [phone number]. Subject to the provisions of the Contract, units of the Subaccounts under the Contract are offered on a continuous basis. THE SEPARATE ACCOUNT We established the Commonwealth Annuity Separate Account A on February 15, 2007 pursuant to Massachusetts law. The SEC does not supervise the management, investment practices or policies of the Separate Account or Commonwealth Annuity. Benefits provided under the Contracts are our obligations. Although the assets in the Separate Account are our property, they are held separately from our other assets and are not chargeable with liabilities arising out of any other business we may conduct. Income, capital gains and capital losses, whether or not realized, from the assets allocated to the Separate Account are credited to or charged against the Separate Account without regard to the income, capital gains and capital losses arising out of any other business we may conduct. Each Subaccount of the Separate Account invests exclusively in shares of one of the corresponding Funds. We may add or delete Subaccounts in the future. Not all Subaccounts may be available in all jurisdictions, under all Contracts or in all retirement plans. The Separate Account purchases and redeems shares from the Funds at net asset value. We redeem shares of the Funds as necessary to provide benefits, to deduct Contract charges and fees, and to transfer 14 assets from one Subaccount to another as requested by Owners. All dividends and capital gains distributions received by the Separate Account from a Fund are reinvested in that Fund at net asset value and retained as assets of the corresponding Subaccount. THE FUNDS SELECTION OF FUNDS. We select the Funds offered through the Contract, and we may consider various factors, including, but not limited to asset class coverage, the strength of the investment adviser's (and/or subadviser's) reputation and tenure, brand recognition, performance, and the capability and qualification of each investment firm. We also consider whether the Fund or one of its service providers (E.G., the investment adviser, administrator, distributor, and/or their affiliates) will make payments to us or our affiliates, as described below. We review the Funds periodically and may remove a Fund or limit its availability to new Purchase Payments and/or transfers of Contract Value if we determine that the Fund no longer meets one or more of the selection criteria, and/or if the Fund has not attracted significant allocations from Contract Owners. You are responsible for choosing the Subaccounts and the amounts allocated to each that are appropriate for your own individual circumstances and your investment goals, financial situation, and risk tolerance. Since you bear the investment risk of investing in the Subaccounts, we encourage you to thoroughly investigate all of the information regarding the Funds that is available to you, including each Fund's prospectus, statement of additional information, and annual and semi/annual reports. Other sources such as the Fund's website or newspapers and financial and other magazines provide more current information, including information about any regulatory actions or investigations relating to a Fund. After you select Subaccounts for your initial Purchase Payment, you should monitor and periodically reevaluate your allocations to determine if they are still appropriate. YOU BEAR THE RISK OF ANY DECLINE IN YOUR CONTRACT VALUE RESULTING FROM THE PERFORMANCE OF THE SUBACCOUNTS YOU HAVE CHOSEN. We do not provide investment advice and we do not recommend or endorse any of the particular Funds available as Investment Options in the Contract. THE FUNDS. The Separate Account invests in shares of registered, open-end management investment companies. There are two types of Funds generally offered under the Contract: - INSURANCE FUNDS: Insurance Funds are available solely to variable annuity or life insurance contracts and certain qualified retirement plans. (See "Federal Tax Matters.") Nonqualified Contracts generally can invest only in Insurance Funds. All Contracts, both Qualified and Nonqualified, may choose among Subaccounts that invest in the following Insurance Funds: GOLDMAN SACHS VARIABLE INSURANCE TRUST (CLASS S) - Goldman Sachs VIT Capital Growth Fund - Goldman Sachs VIT Core Fixed Income Fund - Goldman Sachs VIT Equity Index Fund Goldman Sachs VIT Government Income Fund - Goldman Sachs VIT Growth & Income Fund - Goldman Sachs VIT Growth Opportunities Fund - Goldman Sachs VIT Money Market Fund - Goldman Sachs VIT Strategic International Equity Fund - Goldman Sachs VIT Structured Small Cap Equity Fund - Goldman Sachs VIT Structured U.S. Equity Fund AIM VARIABLE INSURANCE FUNDS (SERIES II) - AIM V.I. Core Equity Fund - AIM V.I. Leisure Fund ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. (CLASS B) - AllianceBernstein VPS Americas Government Income Portfolio - AllianceBernstein VPS International Value Portfolio - AllianceBernstein VPS Small Cap Growth Portfolio - AllianceBernstein VPS Small/Mid Cap Value Portfolio FRANKLIN TEMPLETON INSURANCE PRODUCTS TRUST (CLASS 2) - FT VIP Templeton Global Asset Allocation Fund - FT VIP Franklin Global Communications Fund - FT VIP Templeton Growth Securities Fund - FT VIP Franklin Income Securities Fund - FT VIP Franklin Mutual Discovery Securities Fund - FT VIP Franklin Mutual Shares Securities Fund - FT VIP Franklin Small Cap Value Securities Fund JANUS ASPEN SERIES (SERVICE SHARES) - Janus Aspen Forty Portfolio - Janus Aspen Midcap Growth Portfolio - Janus Aspen Midcap Value Portfolio - Janus Aspen Small Company Value Portfolio 15 OPPENHEIMER VARIABLE ACCOUNT FUNDS (SERVICE SHARES) - Oppenheimer Balanced Fund/VA - Oppenheimer Global Securities Fund/VA - Oppenheimer Main Street Small Cap Fund/VA - Oppenheimer Strategic Bond Fund/VA PIONEER VARIABLE CONTRACTS TRUST (CLASS II) - Pioneer Cullen Value VCT Portfolio - Pioneer Emerging Markets VCT Portfolio - Pioneer Growth Opportunities VCT Portfolio - Pioneer Mid Cap Value VCT Portfolio The Insurance Funds provide investment vehicles for variable life insurance and variable annuity contracts and, in some cases, certain qualified retirement plans. Shares of the Insurance Funds are sold only to insurance company separate accounts and qualified retirement plans. In addition to selling shares to our separate accounts, shares of the Insurance Funds may be sold to separate accounts of other insurance companies. It is conceivable that in the future it may be disadvantageous for variable life insurance separate accounts and variable annuity separate accounts of other companies, or for variable life insurance separate accounts, variable annuity separate accounts, and qualified retirement plans to invest simultaneously in the Insurance Funds. Currently, neither we nor the Insurance Funds foresee any such disadvantages to variable life insurance Owners, variable annuity Owners, or qualified retirement plans. The Insurance Funds must monitor events to identify material conflicts between such Owners and determine what action, if any, should be taken. In addition, if we believe an Insurance Fund's response to any of those events or conflicts insufficiently protects Owners, we will take appropriate action. - PUBLICLY-AVAILABLE FUNDS. Publicly-Available Funds are "publicly-available," I.E., shares can be purchased by the public directly without purchasing a variable annuity or life insurance contract. ONLY QUALIFIED CONTRACTS MAY INVEST IN THESE PUBLICLY-AVAILABLE FUNDS. - Goldman Sachs Balanced Strategy Portfolio (Class A) - Goldman Sachs Equity Growth Strategy Portfolio (Class A) - Goldman Sachs Growth and Income Strategy Portfolio (Class A) - Goldman Sachs Growth Strategy Portfolio (Class A) - Goldman Sachs International Real Estate Security Fund (Class A) - Goldman Sachs Real Estate Security Fund (Class A) - Goldman Sachs Tollkeeper Fund (Class A) The Publicly-Available Funds are also available for direct purchase outside of an annuity or life insurance policy. If you purchase shares of these funds directly from a broker-dealer or mutual fund company, you will not pay Contract fees or charges, but you also will not have Annuity Options available. Because of the additional Contract fees and charges, which affect Contract Value and Subaccount returns, you should refer only to performance information regarding the Publicly-Available Funds available through us, rather than to information that may be available through alternate sources. NOTE: If you elect the GLWB Rider, we will restrict the Investment Options to which you may allocate Purchase Payments and transfer Contract Value. (See "Guaranteed Lifetime Withdrawal Benefit.") SEC REGISTRATION DOES NOT INVOLVE SEC SUPERVISION OF THE FUNDS' MANAGEMENT, INVESTMENT PRACTICES OR POLICIES. THE ASSETS OF EACH FUND ARE HELD SEPARATE FROM THE ASSETS OF THE OTHER FUNDS, AND EACH FUND HAS ITS OWN DISTINCT INVESTMENT OBJECTIVE AND POLICIES. EACH FUND OPERATES AS A 16 SEPARATE INVESTMENT FUND, AND THE INVESTMENT PERFORMANCE OF ONE FUND HAS NO EFFECT ON THE INVESTMENT PERFORMANCE OF ANY OTHER FUND.
INSURANCE FUND PORTFOLIO NAME INVESTMENT OBJECTIVE INVESTMENT ADVISER -------------- -------------- -------------------- ------------------ Goldman Sachs Goldman Sachs VIT Seeks long term growth of capital. Goldman Sachs Variable Insurance Capital Growth Fund Asset Management, Trust (Service LP Shares) Goldman Sachs Goldman Sachs VIT Seeks a total return consisting of Goldman Sachs Variable Insurance Core Fixed Income capital appreciation and income that Asset Management, Trust (Service Fund exceeds the total return of the Lehman LP Shares) Brothers Aggregate Bond Index. Goldman Sachs Goldman Sachs VIT Seeks to achieve investment results that Goldman Sachs Variable Insurance Equity Index Fund correspond to the aggregate price and Asset Management, Trust (Service yield performance of a benchmark index LP Shares) that measures the investment returns of large capitalization stocks. Goldman Sachs Goldman Sachs VIT Seeks a high level of current income, Goldman Sachs Variable Insurance Government Income consistent with safety of principal. Asset Management, Trust (Service Fund LP Shares) Goldman Sachs Goldman Sachs VIT Seeks long-term growth of capital and Goldman Sachs Variable Insurance Growth & Income Fund growth of income. Asset Management, Trust (Service LP Shares) Goldman Sachs Goldman Sachs VIT Seek long term growth of capital. Goldman Sachs Variable Insurance Growth Opportunities Asset Management, Trust (Service Fund LP Shares) Goldman Sachs Goldman Sachs VIT Seeks to maximize current income to the Goldman Sachs Variable Money Market extent consistent with the preservation Asset Insurance Trust (Service Fund of capital and the maintenance of Management, LP Shares) liquidity by investing exclusively in high quality money market instruments. Goldman Sachs Goldman Sachs VIT Seeks long-term capital appreciation. Goldman Sachs Variable Insurance Strategic Asset Management Trust (Service International Equity International Shares) Fund Goldman Sachs Goldman Sachs VIT Seeks long-term growth of capital. Goldman Sachs Variable Insurance Structured Small Cap Asset Management, Trust (Service Equity Fund LP Shares) Goldman Sachs Goldman Sachs VIT Seeks long-term growth of capital and Goldman Sachs Variable Insurance Structured U.S. dividend income. Asset Management, Trust (Service Equity Fund LP Shares) AIM Variable Insurance AIM V.I. Core Equity Seeks growth of capital. AIM Advisors, Funds (Series II Shares) Fund Incorporated AIM Variable Insurance AIM V.I. Leisure Fund Seeks capital growth. AIM Advisors, Funds (Series II Shares) Incorporated 17 AllianceBernstein AllianceBernstein VPS Seeks to maximize current income. AllianceBernstein L.P Variable Products Series Americas Government Fund, Inc. (Class B) Income Portfolio AllianceBernstein AllianceBernstein VPS Seeks long term growth of AllianceBernstein L.P Variable Products Series International Value capital. Fund, Inc. (Class B) Portfolio AllianceBernstein AllianceBernstein VPS Seeks long term growth of AllianceBernstein L.P Variable Products Series Small Cap Growth capital. Fund, Inc. (Class B) Portfolio AllianceBernstein AllianceBernstein VPS Seeks long term growth of AllianceBernstein L.P Variable Products Series Small/Mid Cap Value capital. Fund, Inc. (Class B) Portfolio Franklin Templeton FT VIP Templeton Seeks high total return. Templeton Investment Variable Insurance Global Asset Council, LLC Products Trust (Class2) Allocation Fund Franklin Templeton FT VIP Franklin Seeks capital appreciation and Franklin Advisers, Variable Insurance Global Communications current income. Inc. Products Trust (Class2) Fund Franklin Templeton FT VIP Templeton Seeks long-term capital growth. Templeton Global Variable Insurance Growth Securities Fund Advisors Limited Products Trust (Class2) Franklin Templeton FT VIP Franklin Seeks to maximize income while Franklin Advisers, Variable Insurance Income Securities Fund maintaining prospects for Inc. Products Trust (Class2) capital appreciation. Franklin Templeton FT VIP Franklin Seeks capital appreciation. Franklin Mutual Variable Insurance Mutual Discovery Advisers, LLC Products Trust (Class2) Securities Fund Franklin Templeton FT VIP Franklin Seeks capital appreciation, with Franklin Mutual Variable Insurance Mutual Shares income as a secondary goal. Advisers, LLC Products Trust (Class2) Securities Fund Franklin Templeton FT VIP Franklin Small Seeks long-term total return. Franklin Advisory Variable Insurance Cap Value Securities Services, LLC Products Trust (Class2) Fund Goldman Sachs Variable Goldman Sachs VIT Seeks long term growth of Goldman Sachs Asset Insurance Trust (Service Capital Growth Fund capital. Management, LP Shares) Goldman Sachs Variable Goldman Sachs VIT Seeks a total return consisting Goldman Sachs Asset Insurance Trust (Service Core Fixed Income Fund of capital appreciation and Management, LP Shares) income that exceeds the total return of the Lehman Brothers Aggregate Bond Index. Goldman Sachs Variable Goldman Sachs VIT Seeks to achieve investment Goldman Sachs Asset Insurance Equity Index Fund results that correspond to the Management, LP 18 Trust (Service Shares) aggregate price and yield performance of a benchmark index that measures the investment returns of large capitalization stocks. Goldman Sachs Variable Goldman Sachs VIT Seeks a high level of current Goldman Sachs Asset Insurance Trust (Service Government Income Fund income, consistent with safety Management, LP Shares) of principal. Goldman Sachs Variable Goldman Sachs VIT Seeks long-term growth of Goldman Sachs Asset Insurance Trust (Service Growth & Income Fund capital and growth of income. Management, LP Shares) Goldman Sachs Variable Goldman Sachs VIT Seek long term growth of capital. Goldman Sachs Asset Insurance Trust (Service Growth Opportunities Management, LP Shares) Fund Goldman Sachs Variable Goldman Sachs VIT Seeks to maximize current income Goldman Sachs Asset Insurance Trust (Service Money Market Fund to the extent consistent with Management, LP Shares) the preservation of capital and the maintenance of liquidity by investing exclusively in high quality money market instruments. Goldman Sachs Variable Goldman Sachs VIT Seeks long-term capital Goldman Sachs Asset Insurance Trust (Service Strategic appreciation. Management Shares) International Equity International Fund Goldman Sachs Variable Goldman Sachs VIT Seeks long-term growth of Goldman Sachs Asset Insurance Trust (Service Structured Small Cap capital. Management, LP Shares) Equity Fund Goldman Sachs Goldman Sachs VIT Seeks long-term growth of Goldman Sachs Asset Variable Insurance Trust Structured U.S. capital and dividend income. Management, LP (Service Shares) Equity Fund Janus Aspen Series Janus Aspen Forty Seeks long term growth of Janus Capital (Service Shares) Portfolio capital. Management LLC Janus Aspen Series Janus Aspen Midcap Seeks long term growth of Janus Capital (Service Shares) Growth Portfolio capital. Management LLC Janus Aspen Series Janus Aspen Midcap Seeks capital appreciation. Janus Capital (Service Shares) Value Portfolio Management LLC Janus Aspen Series Janus Aspen Small Seeks capital appreciation. Janus Capital (Service Shares) Company Value Management LLC Portfolio Oppenheimer Variable Oppenheimer Balanced Seeks a high total investment OppenheimerFunds, Inc. Account Funds (Service Fund/VA return, which includes current Shares) income and capital appreciation in the value of its shares. Oppenheimer Variable Oppenheimer Global Seeks long-term capital OppenheimerFunds, Inc. Account Funds (Service Securities Fund/VA appreciation by investing a substantial portion of its assets 19 Shares) in securities of foreign issuers, "growth-type" companies, cyclical industries and special situations that are considered to have appreciation possibilities. Oppenheimer Variable Oppenheimer Main Seeks capital appreciation. OppenheimerFunds, Inc. Account Funds (Service Street Small Cap Shares) Fund/VA Oppenheimer Variable Oppenheimer Strategic Seeks a high level of current OppenheimerFunds, Inc. Account Funds (Service Bond Fund/VA income principally derived from Shares) interest on debt securities. Pioneer Variable Pioneer Cullen Value Seeks capital appreciation by Pioneer Investment Contracts Trust (Class VCT Portfolio investing in equity securities Management, Inc. II) of medium-and large-capitalization companies. Secondarily, the portfolio may seek income. Pioneer Variable Pioneer Emerging Seeks long-term growth of Pioneer Investment Contracts Trust (Class Markets VCT Portfolio capital. Management, Inc. II) Pioneer Variable Pioneer Growth Seeks growth of capital by Pioneer Investment Contracts Trust (Class Opportunities VCT investing primarily in equity Management, Inc. II) Portfolio securities of companies considered to be reasonably priced or undervalued, with above average growth potential. Pioneer Variable Pioneer Mid Cap Value Seeks capital appreciation by Pioneer Investment Contracts Trust (Class VCT Portfolio investing in a diversified Management, Inc. II) portfolio of securities consisting primarily of common stocks.
RETAIL FUND* INVESTMENT OBJECTIVE INVESTMENT ADVISER ------------ -------------------- ------------------ Goldman Sachs Balanced Seeks current income and long-term capital Goldman Sachs Asset Strategy Portfolio (Class A) appreciation. Management, LP Goldman Sachs Equity Growth Seeks long-term capital appreciation. Goldman Sachs Asset Strategy Portfolio (Class A) Management, LP Goldman Sachs Growth and Seeks long-term capital appreciation and current Goldman Sachs Asset Income Portfolio (Class A) income. Management, LP Goldman Sachs Growth Seeks long-term capital appreciation and secondarily Goldman Sachs Asset Strategy Portfolio (Class A) current income. Management, LP Goldman Sachs International Seeks total return comprised of long-term growth of Goldman Sachs Asset Real Estate capital and dividend income. Management, LP Security Fund (Class A) 20 Goldman Sachs Real Estate Seeks total return comprised of long-term growth of Goldman Sachs Asset Security Fund (Class A) capital and dividend income. Management, LP Goldman Sachs Tollkeeper Seeks long-term growth of capital. Goldman Sachs Asset Fund (Class A) Management, LP
* Each retail fund's most recently ended fiscal year is December 31, 2006. THE FUNDS MAY NOT ACHIEVE THEIR STATED OBJECTIVES. MORE DETAILED INFORMATION, INCLUDING A DESCRIPTION OF RISKS INVOLVED IN INVESTING IN THE FUNDS, IS FOUND IN THE FUNDS' PROSPECTUSES ACCOMPANYING THIS PROSPECTUS AND STATEMENTS OF ADDITIONAL INFORMATION AVAILABLE FROM US UPON REQUEST. Although the investment objectives and policies of certain Funds are similar to the investment objectives and policies of other funds that may be managed or sponsored by the same investment adviser, subadviser, manager, or sponsor, we do not represent or assure that the investment results will be comparable to those of any other fund, even where the investment adviser, subadviser, or manager is the same. Certain Funds available through the Contract have names similar to funds not available through the Contract. The performance of a fund not available through the Contract does not indicate performance of a similarly named Fund available through the Contract. Differences in fund size, actual investments held, fund expenses, and other factors all contribute to differences in fund performance. For all these reasons, you should expect investment results to differ. PLEASE NOTE THAT THERE CAN BE NO ASSURANCE THAT ANY MONEY MARKET FUND WILL BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE PER SHARE. DURING EXTENDED PERIODS OF LOW INTEREST RATES, AND DUE IN PART TO CONTRACT FEES AND EXPENSES, THE YIELDS OF ANY SUBACCOUNT INVESTING IN A MONEY MARKET FUND MAY ALSO BECOME EXTREMELY LOW AND POSSIBLY NEGATIVE. CERTAIN PAYMENTS WE RECEIVE WITH REGARD TO THE FUNDS. We and our distributor, [____], (the "Distributor") may receive payments from the Funds or their service providers (E.G., the investment adviser, administrator, distributor, and/or their affiliates). These payments may be used for a variety of purposes, including payment of expenses that we (and our affiliates) incur in promoting, marketing, and administering the Contract and, in our role as an intermediary, the Funds. We (and our affiliates) may profit from these payments. The amount of payments we receive from the Fund's service providers is based on a percentage of the assets of the particular Fund attributable to the Contract as well as certain other variable insurance products that we and/or our affiliates may issue or administer. These percentages are negotiated and vary with each Fund. These payments may be derived, in whole or in part, from the investment advisory fee deducted from Fund assets. Contract Owners, through their indirect investment in the Funds, bear the costs of these investment advisory fees (see the Funds' prospectuses for more information). Some service providers may pay us significantly more than others and the amount we receive may be substantial. These percentages currently range from 0.00% to 0.46%, and as of the date of this prospectus, we were receiving payments from each Fund's service providers. Additionally, certain of the Funds make payments to us or the Distributor under their distribution plans (12b-1 plans). The payment rates currently range from 0.09% to 0.25% based on the amount of assets invested in those Funds. Payments made out of the assets of the Funds will reduce the amount of assets that otherwise would be available for investment, and will reduce the return on your investment. The dollar amount of future asset-based fees is not predictable because these fees are a percentage of the Fund's average net assets, which can fluctuate over time. If, however, the value of the Funds goes up, then so 21 would the payment to us or to the Distributor. Conversely, if the value of the Fund goes down, payments to us or to the Distributor would decrease. We and/or the Distributor also may directly or indirectly receive additional amounts or different percentages of assets under management from some of the Funds' service providers with regard to other variable insurance products we or our affiliates may issue or administer. CHANGE OF INVESTMENTS We reserve the right to make additions to, deletions from, or substitutions for the shares held by the Separate Account or that the Separate Account may purchase. If investment in the Funds is no longer possible, in our judgment becomes inappropriate for the purposes of the Contract, or for any other reason in our sole discretion, we may substitute another fund without your consent. The substituted fund may have different fees and expenses. Substitution may be made with respect to existing investments or the investment of future premiums, or both. However, no such substitution will be made without the approval of the Securities and Exchange Commission, if required. Furthermore, we may close Subaccounts to allocations of Purchase Payments or Contract Value, or both, at any time in our sole discretion. The Funds, which sell their shares to the Subaccounts pursuant to participation agreements, also may terminate these agreements and discontinue offering their shares to the Subaccounts. We may establish additional Subaccounts of the Separate Account, each of which would invest in a new fund, or in shares of another investment company. New Subaccounts may be established when, at our discretion, marketing needs or investment conditions warrant. New Subaccounts may be made available to existing Owners as we determine. We may also eliminate or combine one or more Subaccounts, transfer assets, or substitute one Subaccount for another Subaccount, if, in our discretion, marketing, tax, or investment conditions warrant. We will notify you of any such changes. If we deem it to be in the best interests of persons having voting rights under the Contract, we may deregister the Separate Account under the Investment Company Act of 1940 (the "1940 Act"), make any changes required by the 1940 Act, operate the Separate Account as a management investment company under the 1940 Act or any other form permitted by law, transfer all or a portion of the assets of a Subaccount or separate account to another Subaccount or separate account pursuant to a combination or otherwise, and create new separate accounts. Before we make certain changes we may need approval of the Securities and Exchange Commission and applicable state insurance departments. We will notify you of any changes. FIXED ACCOUNT Amounts allocated or transferred to the Fixed Account are part of our General Account, supporting insurance and annuity obligations. Interests in the Fixed Account are not registered under the Securities Act of 1933 ("1933 Act"), and the Fixed Account is not registered as an investment company under the 1940 Act. Accordingly, neither the Fixed Account nor any interests therein generally are subject to the provisions of the 1933 or 1940 Acts. We have been advised that the staff of the SEC has not reviewed the disclosures in this Prospectus relating to the Fixed Account. Disclosures regarding the Fixed Account, however, are subject to the general provisions of the federal securities laws relating to the accuracy and completeness of statements made in prospectuses. This Prospectus describes only the aspects of the Contract involving the Separate Account unless we refer to fixed accumulation and annuity elements. The Fixed Account Contract Value includes: 1. your Purchase Payments (and corresponding PPBs) allocated to the Fixed Account; 2. amounts transferred from a Subaccount to the Fixed Account at your request; and 3. the interest credited to amounts so allocated or transferred. We reduce the Fixed Account Contract Value when you make transfers and withdrawals from the Fixed Account, as well as when we assess Contract fees and charges against the Fixed Account. 22 We reserve the right to not allow you to allocate Purchase Payments or transfer Contract Value to the Fixed Account if the Fixed Account interest rate applicable to such amounts would be less than or equal to 3%. We guarantee that Purchase Payments (and corresponding PPBs) allocated and Contract Value transferred to the Fixed Account earn, on a daily basis, a minimum fixed interest rate not less than the minimum interest rate allowed by state law. At our discretion, we may credit interest in excess of the minimum guaranteed rate. With respect to each Purchase Payment allocation or Contract Value transfer to the Fixed Account, we reserve the right to change the rate of excess interest credited, although we will not declare or change any excess interest rate more frequently than once every twelve months. We also reserve the right to declare different rates of excess interest depending on when amounts are allocated or transferred to the Fixed Account and whether the source of the amount is Purchase Payments (and corresponding PPBs) allocated or Contract Value transferred. This means that amounts at any designated time may be credited with a different rate of excess interest than the rate previously credited to such amounts and to amounts allocated or transferred at any other designated time, and that these rates of excess interest may differ based on the source of the amount. You bear the risk that no excess interest will be credited. We will declare a current Fixed Account interest rate for each Purchase Payment (and corresponding PPB) allocated and for each transfer of Contract Value to the Fixed Account. The amount allocated or transferred will be credited that rate through the end of the calendar month in which the Purchase Payment or transfer request is received and for twelve additional calendar months thereafter. At the beginning of each subsequent guarantee period of twelve calendar months, we will declare the Fixed Account interest rate applicable for that period. We reserve the right to declare the current Fixed Account interest rate based upon: the Date of Issue; the date we receive a Purchase Payment, the date of any transfer of Contract Value to the Fixed Account, and whether the source is a Purchase Payment (and corresponding PPB) allocated or Contract Value transferred. While there is a loan, we will credit the portion of the Fixed Account Contract Value securing the Debt with interest at the daily equivalent of the annual loan interest rate charged reduced by 2.5%, instead of the current interest rate credited to the Fixed Account. However, this rate will never be lower than the minimum guaranteed Fixed Account interest rate. If you elect the GLWB Rider, you may not allocate Purchase Payments or transfer Contract Value to the Fixed Account. (See "Guaranteed Lifetime Withdrawal Benefit.") Any amounts in the Fixed Account or amounts that we guarantee in excess of your Contract Value are subject to our financial strength and claims-paying ability. THE CONTRACTS A. GENERAL INFORMATION. We reserve the right to accept or refuse to issue the Contract at our sole discretion. 1. PURCHASE PAYMENTS. You may make Purchase Payments under the Contract during the Accumulation Period, subject to the restrictions set forth below. We will not accept Purchase Payments after the date of death of an Owner or on or after the older Owner's or Annuitant's 80th birthday. We reserve the right to waive or modify any Purchase Payment limitation and to not accept any Purchase Payment. Please note that if you elect the GLWB Rider, there may be additional limitations on Purchase Payments (see "Guaranteed Lifetime Withdrawal Benefit"). 23 The minimum initial and subsequent Purchase Payment for a Qualified Contract is $50. However, if annualized contribution amounts from a payroll or salary deduction plan are equal to or greater than $600, we accept a periodic payment under $50. For a Non-Qualified Contract the minimum initial Purchase Payment is $2,500 and the minimum subsequent Purchase Payment is $500. You may make Purchase Payments to Non-Qualified Contracts and Contracts issued as IRAs by authorizing us to draw on your account via check or electronic debit through a Pre-Authorized Checking (PAC) Agreement. For Purchase Payments made pursuant to a PAC Agreement, the following minimum Purchase Payment provisions apply: |_| The minimum initial Purchase Payment to an IRA made pursuant to a PAC Agreement is $100. |_| The minimum initial Purchase Payment to a Non-Qualified Contract made pursuant to a PAC Agreement is $1,000 unless you also own an existing Contract, in which case the minimum is $100. |_| The minimum subsequent Purchase Payment made pursuant to a PAC Agreement is $100. The maximum cumulative Purchase Payments that may be made under the Contract is $1,000,000 without Company approval. We will aggregate multiple Contracts you own for purposes of the $1,000,000 limitation. In addition, for Qualified Contracts, the maximum annual amount of Purchase Payments may be limited by the retirement plan funded by the Contract. You may allocate your Purchase Payments to the Subaccounts and/or the Fixed Account. The minimum amount of Purchase Payments that may be allocated to any Subaccount is $50. The maximum amount of Purchase Payments that may be allocated to the Fixed Account in any Contract Year is $1,000,000 for Qualified Contracts and $100,000 for Non-Qualified Contracts. We will aggregate multiple Contracts you own for purposes of this limitation. Purchase Payments that are made under a systematic investment program that has been approved by us are not subject to this limitation. However, we reserve the right to modify or terminate this provision and subject all Purchase Payments to the $100,000 limitation. We do not include PPBs credited to your Contract Value when calculating any of these limits. We reserve the right to not allow you to allocate Purchase Payments to the Fixed Account if the Fixed Account interest rate applicable to such Purchase Payments would be less than or equal to 3%. 2. FREE LOOK PERIOD. You may examine a Contract and return it for a refund during the "free look" period. The length of the free look period depends upon the state in which the Contract is issued. However, it will be at least 10 days from the date you receive the Contract. Upon receipt by us, the Contract will be cancelled and amounts refunded. The amount of the refund depends on the state in which the Contract is issued. Generally the refund will be the Contract Value as of the Valuation Date on which we receive your Contract at our Service Center minus the PPB adjusted for any negative or positive investment performance. We will also return the mortality and expense risk charge, the administration charge, and any other charges proportionately attributable to the PPB. Some states require the return of the Purchase Payment (not including the PPB). Thus, if you return the Contract during the "free look" period, you will not receive the PPB. In addition, a special "free look" period applies in some circumstances to Contracts issued as Individual Retirement Annuities, Simplified Employee Pensions--IRAs or as Roth Individual Retirement Annuities. If you decide to return your Contract for a refund during the "free look" period, please also include a letter instructing us to cancel your Contract. 24 3. OWNERS, ANNUITANTS, AND BENEFICIARIES. Please note that naming different persons as Owner(s), Annuitant(s), and Beneficiary(ies) can have important impacts on whether death benefits, annuity payments, and rider benefits are paid and on whose life payments are based. Carefully consider the potential consequences under various scenarios when naming Owners, Annuitants, and Beneficiaries, and consult your agent. If you elect the GLWB Rider, there are restrictions on naming and changing Owners, Annuitants, and Beneficiaries. (See "Guaranteed Lifetime Withdrawal Benefit.") BENEFICIARIES. You designate the Beneficiary. During the Accumulation Period and prior to the death of an Owner, you may change a Beneficiary at any time by signing our form. After the Annuity Date, the Beneficiary may be changed prior to the death of an Owner or the Annuitant. However, in the case of joint Owners, the surviving joint Owner is automatically the Primary Beneficiary and cannot be changed. No Beneficiary change is binding on us until we receive it. We assume no responsibility for the validity of any Beneficiary change. Under a Qualified Contract, the provisions of the applicable plan may prohibit a change of Beneficiary. (See "Federal Tax Matters.") You may change the Beneficiary if you send a written change form to our Service Center. Changes are subject to the following: 1. The change must be filed while you are alive 2. The Contract must be in force at the time you file a change; 3. Such change must not be prohibited by the terms of an existing assignment, Beneficiary designation, or other restriction; 4. Such change will take effect when we receive it. However, action taken by us before the change form was received will remain in effect; 5. The request for change must provide information sufficient to identify the new Beneficiary; and 6. In the case of joint Owners, we will consider the designation of a Beneficiary other than the surviving joint Owner to be a Contingent Beneficiary. In the event that all Primary Beneficiaries predecease you, we will pay the death benefit proceeds to the surviving Contingent Beneficiaries. In the event that a Contingent Beneficiary predeceases you, we will distribute the benefits pro rata to the surviving Contingent Beneficiaries. If there are no surviving Contingent Beneficiaries, we will pay the benefits to your estate. When multiple Beneficiaries are involved, we can not determine the death benefit proceeds until we receive the complete death benefit claim in good order, that is, receipt of proper elections from all Beneficiaries as well as proof of death. The Valuation Date on which we receive all required paperwork is the date the Contract is tendered for redemption and the date for calculation of the benefits. OWNERS. You may add or change an Owner by written request to our Service Center with our prior approval, prior to the death of an Owner. Any replacement or additional Owner must not have attained age 80 prior to the Valuation Date we receive your request. ANNUITANTS. For Contracts with natural Owners, prior to the Annuity Date, you may add or change an Annuitant, by written request to our Service Center. For Contracts with non-natural Owners, prior to the Annuity Date, you may add or change an Annuitant with our prior approval. Additionally, for Contracts with non-natural Owners, any replacement or additional Annuitant must not have attained age 80 prior to the Valuation Date we receive your request. On or after the Annuity Date, you may not change or add an Annuitant for Contracts with natural or non-natural Owners. There must be at least one Annuitant at all times. If an Annuitant who is not an Owner dies prior to the Annuity Date, the youngest Owner will become the new Annuitant unless there is a surviving joint 25 Annuitant or a new Annuitant is otherwise named. We will not pay a death benefit upon the death of an Annuitant unless the sole Owner is a non-natural person. We will pay a death benefit of Withdrawal Value upon a change of Annuitant if the sole Owner is a non-natural person. Joint Annuitants are only permitted in Non-Qualified Contracts. 4. ASSIGNMENT. During the Accumulation Period and prior to the death of an Owner, you may assign a Non-Qualified Contract at any time by signing our form. No assignment is binding on us until we receive it, and we assume no responsibility for the validity of any assignment. Generally, an interest in a Qualified Contract may not be assigned. If an assignment of the Contract is in effect on the Annuity Date, we reserve the right to pay the assignee, in one sum, that portion of the Withdrawal Value to which the assignee appears to be entitled. Also, amounts payable during the Annuity Period may not be assigned or encumbered (to the extent permitted by law, annuity payments are not subject to levy, attachment or other judicial process for the payment of the payee's debts or obligations). An assignment may subject you to immediate tax liability and may subject you to a 10% tax penalty. (See "Federal Tax Matters.") B. PURCHASE PAYMENT BONUS. Each time you make a Purchase Payment , we will credit an additional amount to your Contract Value - the PPB. Each PPB we calculate is equal to 4% of the Purchase Payment. All PPBs become part of the Contract Value at the same time and are allocated in the same manner and percentage as the corresponding Purchase Payment. PPBs are not considered to be Purchase Payments. We use a portion of the mortality and expense risk charge and the withdrawal charge to fully or partially offset PPBs credited to the Contract. These and other expenses for the Contract may be higher than the expenses for a similar contract that does not credit a PPB. Over time, the amount of the PPBs credited to your Contract may be more than offset by the higher withdrawal charges and mortality and expense risk charges. We expect to make a profit from these charges. It is important to remember that this Contract is a long-term investment. Carefully consider your need to make withdrawals from or surrender the Contract in the short-term as your expenses can outweigh the benefits of the PPB. We issue other variable annuity contracts that do not offer PPBs but have lower fees and charges and may provide larger contract values upon surrender than the Contract, depending on the performance of your chosen Subaccounts and the differences in fees and charges. You should carefully consider whether the Contract is the best product for you. Generally the Contract is most suited for those who intend to hold it for a relatively long time. We encourage you to talk with your agent and determine whether or not the Contract is appropriate for you. The PPB is not considered to be an "investment in the contract" for income tax purposes. (See "Federal Income Taxes.") C. LIMITATIONS ON YOUR PURCHASE PAYMENT BONUS. There are important limitations on your PPB. These limitations are: |_| We will recapture the PPB credited to your Contract Value if you return the Contract during the free look period. However, we will assume the risk of loss (and keep the investment gain) on the PPB. We will also return the mortality and expense risk charge, the administration charge, and any other charges proportionality attributable to the PPB. |_| We reserve the right to not credit your Contract Value with a PPB if at the time a Purchase Payment is made, the sum of partial withdrawals and loans made under the Contract exceeds the sum of Purchase Payments and loan repayments. 26 D. THE ACCUMULATION PERIOD. 1. APPLICATION OF PURCHASE PAYMENTS. You select allocation of Purchase Payments to the Subaccount(s) and the Fixed Account, if permitted. The PPB will be allocated in the same manner and proportion as the Purchase Payment allocation. When you allocate Purchase Payments and corresponding PPBs to a Subaccount, we credit Accumulation Units to that Subaccount based on the value of an Accumulation Unit, as computed after we receive the Purchase Payment at our Service Center. If we receive a Purchase Payment at our Service Center before the close of business on the Valuation Date, we will credit Accumulation Units based on Accumulation Unit values determined at the end of that Valuation Date. If we receive a Purchase Payment at our Service Center on or after the close of business on the Valuation Date, we will credit Accumulation Units based on Accumulation Unit values determined at the end of the next Valuation Date. Purchase Payments (and corresponding PPBs) allocated to the Fixed Account begin earning interest one day after we receive them. We will credit an initial Purchase Payment (and corresponding PPB) no later than the end of the second Valuation Date following the Valuation Date we receive the Purchase Payment at our Service Center, provided that the Purchase Payment is preceded or accompanied by an application that contains sufficient information to establish an account and properly credit such Purchase Payment. After the initial purchase, we determine the number of Accumulation Units credited by dividing the Purchase Payment (and corresponding PPB) allocated to a Subaccount by the Subaccount's Accumulation Unit value, as computed after we receive the Purchase Payment. After we determine the number of Accumulation Units credited, the number of Accumulation Units will not change due to investment experience. Accumulation Unit value varies to reflect the investment experience of the Subaccount and the assessment of charges against the Subaccount. We reduce the number of Accumulation Units when we assess the contract fee and the GLWB Rider charge. If we are not provided with information sufficient to establish a Contract or to properly credit the initial Purchase Payment, we will promptly request the necessary information. If the requested information is not furnished within five business days after we receive the initial Purchase Payment, or if we determine that we cannot otherwise issue the Contract within the five day period, we will return the initial Purchase Payment to you, unless you consent to our retaining the initial Purchase Payment until the application is completed. If we receive the information sufficient to establish a Contract, we will issue the Contract and allocate the Purchase Payment no later than the end of the second Valuation Date following the Valuation Date we receive the missing information. We may issue a Contract without a signed application if: |_| an agent's broker-dealer provides us with application information, electronically or in writing, |_| we receive the initial Purchase Payment, and |_| you confirm in writing, after the Contract is delivered, that all information in the Contract is correct. If you submit your application, initial Purchase Payment, and/or subsequent Purchase Payments to your agent, we will not begin processing your purchase order until we receive the application and Purchase Payment from your agent's broker-dealer. Some of the Funds reserve the right to delay or refuse purchase requests from the Separate Account, as may be further described in their prospectuses and/or statements of additional information. Therefore, if you request a transaction under your Contract that is part of a purchase request delayed or refused by a Fund, we will be unable to process your request. In that event, we will notify you promptly in writing or by telephone. 27 If you elect the GLWB Rider, we will restrict the Investment Options to which you may allocate Purchase Payments. (See "Guaranteed Lifetime Withdrawal Benefit.") 2. ACCUMULATION UNIT VALUE. Each Subaccount has Accumulation Unit values for each combination of asset based charges. When Purchase Payments (and corresponding PPBs) are allocated to a Subaccount, the number of units credited is based on the Subaccount's applicable Accumulation Unit value at the end of the current Valuation Period. When amounts are transferred out of or deducted from a Subaccount, units are redeemed in a similar manner. Generally, we determine the value of an Accumulation Unit as of the close of business on each Valuation Date. The Accumulation Unit value at the end of each subsequent Valuation Period is the relevant investment experience factor for that Valuation Period times the Accumulation Unit value for the preceding Valuation Period. Each Subaccount has its own investment experience factor for each combination of charges. The investment experience of the Separate Account is calculated by applying the investment experience factor to the Accumulation Unit value in each Subaccount during a Valuation Period. The investment experience factor of a Subaccount for any Valuation Period is determined by the following formula: (1 divided by 2) minus 3, where: (1) is: |_| the net asset value per share of the Fund held in the Subaccount as of the end of the current Valuation Period; plus |_| the per share amount of any dividend or capital gain distributions made by the Fund held in the Subaccount, if the "ex-dividend" date occurs during the current Valuation Period; plus or minus |_| a charge or credit for any taxes reserved for the current Valuation Period which we determine have resulted from the investment operations of the Subaccount; (2) is the net asset value per share of the Fund held in the Subaccount as of the end of the preceding Valuation Period; and (3) is the factor representing asset-based charges (the mortality and expense risk charge, the administration charge, and the Step-Up Death Benefit charge (if you elect the Step-Up Death Benefit). 3. CONTRACT VALUE. On any Valuation Date, the Contract Value equals the total of: |_| the number of Accumulation Units credited to each Subaccount, times |_| the value of a corresponding Accumulation Unit for each Subaccount, plus |_| your interest in the Fixed Account. 28 4. TRANSFERS DURING THE ACCUMULATION PERIOD. During the Accumulation Period, you may transfer Contract Value among the Subaccounts and the Fixed Account subject to the following provisions: |_| The minimum amount which may be transferred is $500 for each Subaccount and Fixed Account or, if smaller, the remaining amount in the Fixed Account or a Subaccount. |_| No partial transfer will be made if the remaining Contract Value of the Fixed Account or any Subaccount will be less than $100 unless the transfer will eliminate your interest in such account. |_| Total transfers out of the Fixed Account in any Contract Year may not exceed 25% of the value of the Fixed Account as of the prior Contract Anniversary or, in the case of transfers in the first Contract Year, the Date of Issue. Transfers made under a systematic investment program approved by us are not currently subject to this limitation, but we reserve the right to impose this or a modified limitation on such transfers in the future. The entire Fixed Account Contract Value may be transferred if a transfer out of the Fixed Account would otherwise result in a Fixed Account Contract Value less than $5,000. |_| We will limit a transfer out of the Fixed Account to an amount that equals the Fixed Account Contract Value less Debt, less any premium taxes and withdrawal charge that would apply to the total withdrawal of the Fixed Account Contract Value at the time that you make the transfer, and less interest for one calendar year on any loan at the time that you make the transfer. |_| Total transfers into the Fixed Account in any Contract Year, that would be credited a current interest rate of 3% or less, may not exceed 25% of Contract Value as of the prior Contract Anniversary or, in the case of transfers in the first Contract Year, the Date of Issue. Transfers made under a systematic investment program approved by us are not currently subject to this limitation, but we reserve the right to impose this or a modified limitation on such transfers in the future. |_| We reserve the right to not allow any transfer into the Fixed Account if the Fixed Account interest rate applicable to such transfer would be less than or equal to 3%. If you request a transfer from a specific Subaccount or from the Fixed Account, we will transfer Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) previously allocated or transferred to that Subaccount or to the Fixed Account, in the chronological order in which we received such Purchase Payments in the Contract. Otherwise, we will transfer Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) previously allocated or transferred to all Subaccounts and the Fixed Account in which you have an interest, in the chronological order in which we received such Purchase Payments in the Contract. |_| You must request transfers in excess of $250,000 per Contract, per day, through standard United States mail. We reserve the right to require transfers into and out of one Subaccount in excess of $50,000, per Contract, per day, to be requested through standard United States mail. Any transfer request must clearly specify the amount which is to be transferred and the names of the Subaccounts and/or the Fixed Account that are affected. If you authorize a third party to transact transfers on your behalf, we will reallocate the Contract Value pursuant to the third party's instructions. However, we take no responsibility for any third party asset allocation or investment advisory service or program. We may suspend, limit, or cancel acceptance of a 29 third party's instructions at any time and may restrict the Investment Options available for transfer under third party authorizations. We will make transfers pursuant to proper written or telephone instructions to our Service Center that specify in detail the requested changes. Transfers involving a Subaccount will be based upon the Accumulation Unit values determined following our receipt of complete transfer instructions. If we receive a transfer request at our Service Center before the close of business on the Valuation Date, we will process the request based on Accumulation Unit values determined at the end of that Valuation Date. If we receive a transfer request at our Service Center on or after the close of business on the Valuation Date, we will process the request based on Accumulation Unit values determined at the end of the next Valuation Date. If you or your authorized representative call us to request a telephone transfer but have not given instructions to us prior to the close of business on the Valuation Date, even if due to our delay in answering your call, we will consider your telephone transfer request to be received after the close of business on the Valuation Date. We may suspend, modify or terminate the transfer provisions. If you submit a request for a transfer that is no longer permitted, we will notify you in writing that the transaction is not permissible. Some of the Funds reserve the right to delay or refuse purchase requests from the Separate Account, as may be further described in their prospectuses and/or statements of additional information. Therefore, if you request a transaction under your Contract that is part of a purchase request delayed or refused by a Fund, we will be unable to process your request. In that event, we will notify you promptly in writing or by telephone. If you elect the GLWB Rider, we will restrict the Investment Options to which you may transfer Contract Value. (See "Guaranteed Lifetime Withdrawal Benefit.") 5. DISRUPTIVE TRADING. The Contract is not designed for use by individuals, professional market timing organizations, or other entities that engage in short-term trading, frequent transfers, programmed transfers or transfers that are large in relation to the total assets of a Fund (collectively, "Disruptive Trading"). These activities may require the Fund to maintain undesirable large cash positions or frequently buy or sell portfolio securities. Such transfers may dilute the value of the Fund's shares, interfere with the efficient management of the Fund's portfolio, and increase brokerage and administrative costs of the Funds. As a result, Disruptive Trading may adversely affect a Fund's ability to invest effectively in accordance with its investment objectives and policies, and may harm other Contract Owners and other persons who may have an interest in the Contract (e.g. Annuitants and Beneficiaries.) In order to protect our Contract Owners and the Funds from potentially harmful trading activity, we utilize certain policies and procedures that are designed to detect and prevent disruptive trading among the Funds (the "Disruptive Trading Procedures"). Our Disruptive Trading Procedures consider certain factors in order to identify Disruptive Trading activity, including the following: - the number of transfers made over a period of time; - the length of time between transfers; - whether the transfers follow a pattern that appears to be designed to take advantage of short term market fluctuations, particularly within certain Funds; - the dollar amount(s) requested for transfers; and - whether the transfers are part of a group of transfers made by a third party on behalf of several individual Contract Owners; and - the investment objectives and/or size of the Funds. We may increase our monitoring of Contract Owners who engage in what we perceive to be disruptive trading, including investigating the transfer patterns within multiple contracts owned by the same Contract 30 Owners. We may also investigate any patterns of disruptive trading identified by the Funds that may not have been captured by our Disruptive Trading Procedures. If we determine you are engaged in disruptive trading, we may take one or more actions in an attempt to halt such trading. Your ability to make transfers is subject to modification or restriction if we determine, in our sole opinion, that your exercise of the transfer privilege may disadvantage or potentially harm the rights or interests of other Contract Owners (or others having an interest in the Contract). Our restrictions may take various forms, but under our current Disruptive Trading Procedures will include loss of telephone, fax, overnight mail, or Internet transfers. This means that we would accept only written transfer requests with an original signature transmitted to us at our Service Center and only by standard United States mail. We may also restrict the transfer privileges of others acting on your behalf, including your agent or an asset allocation or investment advisory service. We may also limit the number of transfers you may make during a calendar year and we may limit the number of times you may transfer Contract Value into particular Subaccounts during a calendar year. Subject to the terms of the Contract, we reserve the right to impose, without prior notice, additional or alternate restrictions on allocations and transfers that we determine, in our sole discretion, will disadvantage or potentially hurt the rights or interests of other Contract Owners or other holders of the Funds. We will reverse any transactions inadvertently processed in contravention of our restrictions within two days of the date the inadvertently processed transaction occurred. Our Disruptive Trading Procedures may vary among the Subaccounts. Some of the Funds have reserved the right to temporarily or permanently refuse payments or transfer requests from us if, in the judgment of the Fund's investment adviser, the Fund would be unable to invest effectively in accordance with its investment objective or policies, or would otherwise potentially be adversely affected. If a Fund refuses a transfer request from us, we may not be able to effect certain allocations or transfers that a Contract Owner has requested. Some Funds may impose redemption fees on short-term trading (i.e., redemptions of mutual fund shares within a certain number of business days after purchase). We reserve the right to administer and collect any such redemption fees on behalf of the Funds. The Funds may have adopted their own policies and procedures with respect to excessive trading of their respective shares, and we reserve the right to enforce these policies and procedures. The prospectuses for the Funds describe any such policies and procedures, which may be more or less restrictive than the policies and procedures we have adopted. You should be aware that we currently may not have the contractual obligation or the operational capacity to apply the Funds' excessive trading policies and procedures. However, under SEC rules, we are required to: (1) enter into a written agreement with each Fund or its principal underwriter that obligates us to provide to the Fund promptly upon request certain information about the trading activity of individual Contract Owners, and (2) execute instructions from the Fund to restrict or prohibit further purchases or transfers by specific Contract Owners who violate the excessive trading policies established by the Fund. You should be aware that the purchase and redemption orders received by the Funds generally are "omnibus" orders from intermediaries such as retirement plans or separate accounts funding variable insurance contracts. The omnibus orders reflect the aggregation and netting of multiple orders from individual retirement plan participants and/or individual Owners of variable insurance contracts. The omnibus nature of these orders may limit the Funds' ability to apply their respective disruptive trading policies and procedures. We cannot guarantee that the Funds (and thus our Contract Owners) will not be harmed by transfer activity relating to the retirement plans and/or other insurance companies that may invest in the Funds. In addition, if a Fund believes that an omnibus order we submit may reflect one or more transfer requests from Contract Owners engaged in disruptive trading activity, the Fund may reject the entire omnibus order. We will apply our Disruptive Trading Procedures consistently without special arrangement, waiver, or exception. However, the Company's ability to detect and deter Disruptive Trading and to consistently apply the Disruptive Trading Procedures may be limited by operational systems and technological limitations. Contract Owners seeking to engage in such transfer activities may employ a variety of strategies to avoid detection. Because identifying Disruptive Trading involves judgments that are 31 inherently subjective, the Company cannot provide assurances that its Disruptive Trading Procedures will detect every Contract Owner who engages in disruptive trading. In addition, the terms of some contracts previously issued by the Company, historical practices or actions, litigation, or certain regulatory restrictions may limit the Company's ability to apply transfer or other restrictions. If we are unable to detect Disruptive Trading or are unable to restrict Disruptive Trading because of contract provisions or other reasons, you may experience dilution in the value of your Fund shares. There may be increased brokerage and administrative costs within the Funds, which may result in lower long-term returns for your investments. Additionally, because other insurance companies and/or retirement plans may invest in the Funds, we cannot guarantee that the Funds will not suffer harm from disruptive trading within the variable contracts issued by other insurance companies or among Investment Options available to retirement plan participants. 6. WITHDRAWALS AND SURRENDERS DURING THE ACCUMULATION PERIOD. You may make a partial withdrawal subject to the restrictions set forth below. You also may withdraw all of the Withdrawal Value and surrender the Contract. You should carefully consider taking partial withdrawals or surrendering your Contract, as the following may apply: - You may withdraw up to the Free Withdrawal Amount in any Contract Year and we will not assess a withdrawal charge. However, if you withdraw more than the Free Withdrawal Amount in any Contract Year, the excess amount withdrawn may be subject to a withdrawal charge. We also may assess a withdrawal charge upon surrender of the Contract, although we will first apply the Free Withdrawal Amount. (See "Withdrawal Charge.") - Withdrawals and surrenders may be subject to federal and state income tax and a 10% penalty tax. (See "Federal Tax Matters.") - Partial withdrawals reduce your Contract Value and your death benefit. (See "Death Benefits.") Certain withdrawals also may reduce the value of the guarantees provided by the GLWB Rider. (See "Guaranteed Lifetime Withdrawal Benefit.") - Your ability to withdraw or surrender may be limited by the terms of a qualified plan such as Section 403(b) plans. (See "Federal Tax Matters.") - We may assess the contract fee and a pro rata portion of the GLWB Rider charge upon full surrender. (See "Contract Fee" and "GLWB Rider Charge.") - We may assess premium taxes on partial withdrawals and surrenders. (See "State Premium Taxes.") You may request a partial withdrawal subject to the following: |_| The partial withdrawal must be at least $500 from each Investment Option from which the withdrawal is requested, or the full amount of the Investment Option, if smaller. |_| You must leave at least $100 in each Investment Option after a withdrawal unless the account is eliminated by the withdrawal. |_| We will limit a withdrawal from the Fixed Account to an amount that equals the Fixed Account Contract Value less Debt, less any premium taxes and withdrawal charge that would apply to the total withdrawal of the Fixed Account Contract Value at the time that you make the withdrawal, and less interest for one calendar year on any loan at the time that you make the withdrawal. |_| At least $500 of Contract Value must remain in the Contract after the withdrawal or we will surrender your Contract (which means that withdrawal charges, federal and state income taxes and tax penalties, and premium taxes may apply). 32 |_| Direct transfers, rollovers, and 1035 exchanges are not permitted if there is an outstanding loan. |_| If you request a withdrawal from a specific Subaccount or from the Fixed Account, we will reduce Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) previously allocated or transferred to that Subaccount or to the Fixed Account, in the chronological order in which we received such Purchase Payments in the Contract. Otherwise, withdrawals will reduce Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) previously allocated or transferred to all Subaccounts and the Fixed Account in which you have an interest, in the chronological order in which we received such Purchase Payments in the Contract. Election to withdraw (including the withdrawal amount) shall be made in writing to us at our Service Center and should be accompanied by the Contract if surrender is requested. The Withdrawal Value attributable to the Subaccounts is determined on the basis of the Accumulation Unit values calculated after we receive the request. If we receive a withdrawal or surrender request at our Service Center before the close of business on the Valuation Date, we will process the request based on Accumulation Unit values determined at the end of that Valuation Date. If we receive a withdrawal or surrender request at our Service Center on or after the close of business on the Valuation Date, we will process the request based on Accumulation Unit values determined at the end of the next Valuation Date. A participant in the Texas Optional Retirement Program ("ORP") must obtain a certificate of termination from the participant's employer before a Contract can be redeemed. The Attorney General of Texas has ruled that participants in the ORP may redeem their interest in a Contract issued pursuant to the ORP only upon termination of employment in Texas public institutions of higher education, or upon retirement, death or total disability. In those states adopting similar requirements for optional retirement programs, we will follow similar procedures. Please note that the ORP does not restrict transfers within a Contract, and thus participants are permitted to make transfers of Contract Value among the Investment Options. If you elect the GLWB Rider, special withdrawal rules apply. (See "Guaranteed Lifetime Withdrawal Benefit.") 7. DEATH BENEFITS. The following section describes the death benefits we currently make available under the Contract if an Owner dies before the Annuity Date. We will calculate the death benefit on the Valuation Date we receive due proof of the Owner's death. Any death benefit payment we make in excess of your Contract Value is subject to our financial strength and claims-paying ability. STANDARD DEATH BENEFIT If you have not elected the Step-Up Death Benefit and an Owner's death occurs prior to the older Owner's 75th birthday, the death benefit will be equal to the greater of (A) or (B), less any premium taxes, where: (A) = The Contract Value less Debt, on the Valuation Date we receive due proof of death; (B) = The Purchase Payment Value (described below) less Debt, on the Valuation Date we receive due proof of death. If you have not elected the Step-Up Death Benefit and an Owner's death occurs on or after the older Owner's 75th birthday, the death benefit will be equal to (A) above, less any premium taxes. The Purchase Payment Value on the Date of Issue is equal to the initial Purchase Payment (not including the corresponding PPB), less any premium taxes. We will increase the Purchase Payment Value 33 by the amount of each subsequent Purchase Payment (not including the corresponding PPB), less any premium taxes. The Purchase Payment Value after a withdrawal will be equal to the lesser of: (a) The Purchase Payment Value immediately prior to the withdrawal minus the amount of the withdrawal (including any withdrawal charges, premium taxes, and federal and state income taxes and penalty taxes); or (b) The Purchase Payment Value immediately prior to the withdrawal multiplied by the Proportional Reduction Factor below. The Proportional Reduction Factor is equal to (1) divided by (2), where: (1) is the Contract Value after the withdrawal, and (2) is the Contract Value immediately prior to the withdrawal. EXAMPLE: Contract Value = $80,000 Purchase Payment Value = $100,000 Debt = $0 If a withdrawal (including any withdrawal charges, premium taxes, and federal and state income taxes and penalty taxes) of $20,000 is taken, we follow the steps below to recalculate the Purchase Payment Value after the withdrawal: - STEP 1: We calculate the Contract Value after the withdrawal. This is the Contract Value immediately prior the withdrawal minus the amount of the withdrawal (including any withdrawal charges, premium taxes, and federal and state income taxes and penalty taxes). ($80,000 - $20,000 = $60,000) - STEP 2: We calculate the Proportional Reduction Factor. The Proportional Reduction Factor is the Contract Value after the withdrawal divided by the Contract Value immediately prior to the withdrawal.( $60,000 / $80,000 = 75%) - STEP 3: We calculate the Purchase Payment Value after the withdrawal. This is the lesser of: (a) The Purchase Payment Value immediately prior to the withdrawal minus the amount of the withdrawal (including any withdrawal charges, premium taxes, and federal and state income taxes and penalty taxes) = $100,000 - $20,000 = $80,000 (b) The Purchase Payment Value immediately prior to the withdrawal multiplied by the Proportional Reduction Factor = $100,000 x 75% = $75,000 = Lesser of $80,000 and $75,000 = $75,000 If you elect the GLWB Rider, we may pay a death benefit in excess of the standard death benefit. (See "Guaranteed Lifetime Withdrawal Benefit.") STEP-UP DEATH BENEFIT We currently offer one optional enhanced death benefit under the Contract - the Step-Up Death Benefit. We may discontinue the offering of the Step-Up Death Benefit at any time. The Step-Up Death Benefit may not be available in all states. The calculation of benefits under the Step-Up Death Benefit changes after you attain age 81 and certain increases in benefits cease after that age. Therefore, the Step-Up Death Benefit may not be appropriate depending on your proximity to age 81. Prior to electing the Step-Up Death Benefit, you should 34 carefully consider the benefits available based on your age and consult with your financial adviser to assist you in determining whether to elect the Step-Up Death Benefit. You may elect the Step-Up Death Benefit only if the older Owner is age 79 or younger at the Date of Issue. We deduct a daily charge from your Contract Value for the Step-Up Death Benefit equal to 0.20%, on an annual basis. (See "Step-Up Death Benefit Charge.") We do not assess a charge for the Step-Up Death Benefit on amounts allocated to the Fixed Account. You may elect the Step-Up Death Benefit only on the initial Contract application. You cannot elect the Step-Up Death Benefit after the Date of Issue. If you elect the Step-Up Death Benefit, the death benefit will be equal to the greater of (A) or (B), less any premium taxes, where: (A) = The Contract Value less Debt, on the Valuation Date we receive due proof of death; (B) = The Step-Up Value (described below) less Debt, on the Valuation Date we receive due proof of death. The Step-Up Value on the Date of Issue is equal to the initial Purchase Payment (not including the corresponding PPB), less any premium taxes. We will increase the Step-Up Value by the amount of each subsequent Purchase Payment (not including the corresponding PPB), less any premium taxes. The Step-Up Value after a withdrawal will be equal to the lesser of: 1) The Step-Up Value immediately prior to the withdrawal minus the amount of the withdrawal (including any withdrawal charges, premium taxes, and federal and state income taxes and penalty taxes); or 2) The Step-Up Value immediately prior to the withdrawal multiplied by the Proportional Reduction Factor below. The Proportional Reduction Factor is equal to (a) divided by (b), where: a) is the Contract Value after the withdrawal, and b) is the Contract Value immediately prior to the withdrawal. On each Contract Anniversary prior to the older Owner's 81st birthday, we will recalculate the Step-Up Value to equal the greater of: 1) The Contract Value on that Contract Anniversary; and 2) The current Step-Up Value on that Contract Anniversary. If an Owner dies prior to a Contract Anniversary and the Valuation Date we receive due proof of death falls on or after that anniversary, we will not recalculate the Step-Up Value on that anniversary. See the "Standard Death Benefit" above for an example of how we adjust the death benefit values for withdrawals. You may not terminate the Step-Up Death Benefit once it is in effect. It will remain in force unless it is terminated as set forth below. The Step-Up Death Benefit will automatically terminate on the earliest of: 1. the Annuity Date; 2. the Valuation Date that we receive due proof of death of the Owner (in the case of a spousal continuation, the spouse may elect the Step-Up Death Benefit if we offer it at that time) ; or 3. termination or surrender of the Contract. All charges for the Step-Up Death Benefit will cease upon termination. 35 If you elect the GLWB Rider, we may pay a death benefit in excess of the Step-Up Death Benefit. (See "Guaranteed Lifetime Withdrawal Benefit.") PAYMENT OF DEATH BENEFITS If there is only one Owner under the Contract, we will pay the death benefit to the Beneficiary upon the death of such Owner before the Annuity Date. Upon the death of a joint Owner before the Annuity Date, we will pay the death benefit to the surviving joint Owner. We will pay the death benefit upon the first to die of any joint Owners. If any Owner is not a natural person, we will treat each Annuitant under the Contract as an Owner for death benefit payment purposes and we will pay the death benefit upon the death of any Annuitant. If any Owner is not a natural person, we will treat each Annuitant under the Contract as an Owner for death benefit payment purposes and we will pay the death benefit of Withdrawal Value upon the change of any Annuitant. We will pay the death benefit to the Beneficiary (or joint Owner, if applicable) after we receive due proof of death. We will then have no further obligation under the Contract. The Valuation Date on which we receive all required paperwork is the date the Contract is tendered for redemption and the date for calculation of the benefits. Due proof of death means our receipt of a certified death certificate and all necessary claim paperwork, the return of the Contract and such other information we may require to process the death benefit. If we receive due proof of death at our Service Center before the close of business on the Valuation Date, we will calculate the death benefit based on Accumulation Unit values determined at the end of that Valuation Date. If we receive a due proof of death at our Service Center on or after the close of business on the Valuation Date, we will calculate the death benefit based on Accumulation Unit values determined at the end of the next Valuation Date. When multiple Beneficiaries are involved, death benefits cannot be determined until we receive the complete death benefit claim in good order, that is, receipt of proper elections from all Beneficiaries as well as proof of death. The death benefit may be paid in a lump sum. The Beneficiary (or the surviving joint Owner) may defer this sum for up to five years from the date of death. Instead of a lump sum payment, the Beneficiary or the surviving joint Owner, as the case may be, may elect to have the death benefit distributed as stated in Annuity Option 1 for a period not to exceed the Beneficiary's (or the surviving joint Owner's) life expectancy; or Annuity Option 2 or 3 based upon the life expectancy of the Beneficiary (or the surviving joint Owner) provided with respect to Annuity Option 3 that such life expectancy exceeds the certain period of 10 years. (See "The Annuity Period" for a description of the Annuity Options.) The Beneficiary (or the surviving joint Owner) must make this election within 60 days of the time we receive due proof of death, and distribution under these annuity payment options must commence within one year of the date of death. If the death benefit is requested in a form other than a lump sum and the death benefit is greater than the Contract Value, we will credit the amount of the death benefit that exceeds the Contract Value to the Goldman Sachs VIT Money Market Subaccount. If, however, the Goldman Sachs VIT Money Market Subaccount is not available as an Investment Option under the Contract at that time, then we will credit the death benefit among the Investment Options in the same proportion that the value of each Investment Option bears to the total Contract Value. In most cases, when a death benefit is paid in a lump sum, we will pay the death benefit by establishing an interest bearing account for the Beneficiary, in the amount of the death benefit. We will send the Beneficiary a checkbook, and the Beneficiary will have access to the account simply by writing a check for all or any part of the amount of the death benefit. The account is part of our General Account. It is not a bank account and it is not insured by the FDIC or any other government agency. As part of our general account, it is subject to the claims of our creditors. We receive a benefit from all amounts left in the account. 36 If the Beneficiary is not a natural person, the Beneficiary must elect that the entire death benefit be distributed within five years of your death. If your spouse is the only Primary Beneficiary when you die, your surviving spouse may elect to be the successor Owner of the Contract by completing the spousal continuation section of the claim form submitted with due proof of your death. The date of continuance of the Contract will be the Valuation Date we receive due proof of your death. Your surviving spouse will become the Annuitant if no Annuitant is living at the time of your death. Spousal continuation will not satisfy minimum required distribution rules for Qualified Contracts other than IRAs. If your surviving spouse elects to become the successor Owner of the Contract on your death, thereby waiving claim to the death benefit otherwise payable, we will not pay out a death benefit on your death. Instead, we will increase the Contract Value on the Valuation Date we receive due proof of your death to equal the death benefit amount otherwise payable (if the death benefit is greater than the Contract Value), subject to the following: |_| We will credit the amount of the death benefit that exceeds the Contract Value to the Goldman Sachs VIT Money Market Subaccount. If, however, the Goldman Sachs VIT Money Market Subaccount is not available as an Investment Option under the Contract at that time, then we will credit the death benefit among the Investment Options in the same proportion that the value of each Investment Option bears to the total Contract Value. |_| We will terminate the Step-Up Death Benefit if in effect as of the Valuation Date we receive due proof of your death. |_| On the date of continuance, your surviving spouse may elect the Step-Up Death Benefit or any optional enhanced death benefit then offered by us. All such death benefits will be subject to the terms and conditions then in effect at the time of continuance. All charges and benefits will be calculated as if the coverage was issued to the surviving spouse on the date of continuance and the Contract Value on the date of continuance resulted from receipt of an initial Purchase Payment in that amount. |_| We will assess withdrawal charges, if any, only on Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) we receive after the date of continuance. |_| Any subsequent spouse of the surviving spouse will not be entitled to continue the Contract upon the death of the surviving spouse. If any Owner dies on or after the Annuity Date, and before the entire interest in the Contract has been distributed, any remaining portion of such interest will be distributed at least as rapidly as under the method of distribution being used as of the date of death. In all events, we will pay or apply the Contract's death benefit in accordance with Sections 72(s) or 401(a)(9) of the Code, as applicable. 8. GUARANTEED LIFETIME WITHDRAWAL BENEFIT (GLWB) RIDER - GLWB PLUS FOR ONE AND GLWB PLUS FOR TWO The following are definitions of important terms we use in connection with describing the Guaranteed Lifetime Withdrawal Benefit (GLWB) Rider: 37 DEFINITIONS COVERED PERSON is: - The person (or persons in the case of GLWB Plus For Two) whose life we use to determine the Lifetime Income Date and the duration of the monthly Settlement Payments on and after the Benefit Phase Start Date (if such date occurs on or after the Lifetime Income Date) or the Maximum Annuity Date (if you elect the GLWB Rider annuitization option on the Maximum Annuity Date). The Rider's benefits are based on the life of the Covered Person(s). If the Contract is owned by a non-natural person, we will treat the older Annuitant on the Date of Issue as the older Owner for purposes of determining the Covered Person. MAXIMUM ANNUITY DATE means: - The latest Valuation Date on which annuity payments may commence. GUARANTEED WITHDRAWAL BALANCE means: - The total amount we guarantee to be available to you (or your Beneficiary after your death) as Non-Excess Withdrawals or as monthly Settlement Payments if you meet the Rider's conditions. - On the Date of Issue, the initial Guaranteed Withdrawal Balance is equal to your initial Purchase Payment (less any premium taxes and not including the corresponding PPB). See "Guaranteed Amounts" below for information on how the Guaranteed Withdrawal Balance is affected by Non-Excess and Excess Withdrawals and additional Purchase Payments. GUARANTEED WITHDRAWAL AMOUNT means: - The ANNUAL amount we guarantee to make available for Non-Excess Withdrawals each Contract Year prior to the Lifetime Income Date or to pay in monthly installments as Settlement Payments on and after the Benefit Phase Start Date (if such date occurs before the Lifetime Income Date), until the Guaranteed Withdrawal Balance is reduced to zero. - On the Date of Issue, the initial Guaranteed Withdrawal Amount is equal to 5% of the initial Guaranteed Withdrawal Balance. See "Guaranteed Amounts" below for information on how the Guaranteed Withdrawal Amount is affected by Non-Excess and Excess Withdrawals and additional Purchase Payments. LIFETIME INCOME BASE means: - The amount that is used to determine the Lifetime Income Amount on and after the Lifetime Income Date and the charge for the GLWB Rider. - On the Date of Issue, the initial Lifetime Income Base is equal to your initial Purchase Payment (less any premium taxes and not including the corresponding PPB). See "Guaranteed Amounts" below for information on how the Lifetime Income Base is affected by Non-Excess and Excess Withdrawals, additional Purchase Payments, and any Bonuses or Step-Ups. LIFETIME INCOME AMOUNT means: - The ANNUAL amount we guarantee to make available for Non-Excess Withdrawals each Contract Year on and after the Lifetime Income Date or to pay in monthly installments as Settlement Payments on and after the Benefit Phase Start Date (if such date occurs on or after the Lifetime Income Date) or the Maximum Annuity Date (if you elect the GLWB Rider annuitization option on the Maximum Annuity Date), while a Covered Person is living or until the Guaranteed Withdrawal Balance is reduced to 38 zero, if later. - On the Lifetime Income Date, the initial Lifetime Income Amount is equal to 5% of your Lifetime Income Base on that date (subject to a maximum of $250,000). We do not calculate the Lifetime Income Amount prior to the Lifetime Income Date. See "Guaranteed Amounts" below for information on how the Lifetime Income Amount is affected by Non-Excess and Excess Withdrawals, additional Purchase Payments, and any Bonuses or Step-Ups. LIFETIME INCOME DATE means: - The Contract Anniversary on or after the Covered Person reaches age 65, or the Date of Issue if the Covered Person is age 65 or older at the time of purchase of the Contract. In the case of GLWB Plus For Two, we use the life of the older Covered Person to determine the Lifetime Income Date. If the older Covered Person dies before the Lifetime Income Date and the surviving Covered Person chooses to continue the Contract, we will use the life of the surviving Covered Person to redetermine the Lifetime Income Date. GROSS WITHDRAWAL means: - The amount of a partial or full withdrawal from the Contract. This amount will be subject to any withdrawal charges, premium taxes, federal and state income taxes and penalty taxes, and, in the case of a full surrender, the contract fee and a pro rata portion of the GLWB Rider charge, as applicable. NON-EXCESS WITHDRAWAL means a Gross Withdrawal that: - does NOT cause total Gross Withdrawals during a Contract Year beginning PRIOR TO the Lifetime Income Date to exceed the Guaranteed Withdrawal Amount; or - does NOT cause total Gross Withdrawals during a Contract Year beginning on or after the Lifetime Income Date to exceed the Lifetime Income Amount; or - is taken under a "life expectancy" program established by us (see "Life Expectancy Distributions" below) if no Gross Withdrawals are taken that are not part of the program. Any Gross Withdrawals that are taken that are not part of the program and any future "life expectancy" program withdrawals that are taken during that Contract Year may be considered Excess Withdrawals. EXCESS WITHDRAWAL means a Gross Withdrawal that: - causes total Gross Withdrawals during a Contract Year beginning PRIOR TO the Lifetime Income Date to exceed the Guaranteed Withdrawal Amount (or if such total withdrawals have already exceeded the Guaranteed Withdrawal Amount); or - causes total Gross Withdrawals during a Contract Year beginning ON OR AFTER the Lifetime Income Date to exceed the Lifetime Income Amount (or if such total withdrawals have already exceeded the Lifetime Income Amount). - Note: If Gross Withdrawals are currently being taken under a "life expectancy" program established by us (see "Life Expectancy Distributions" below), any Gross Withdrawals that are taken that are not part of the program and any future "life expectancy" program withdrawals 39 that are taken during that Contract Year may be considered Excess Withdrawals. SETTLEMENT PAYMENTS mean: - Payments we make to you on and after the Benefit Phase Start Date or the Maximum Annuity Date (if you elect the GLWB Rider annuitization option on the Maximum Annuity Date). These payments may be subject to premium taxes as well as federal and state income taxes and penalty taxes. BENEFIT PHASE occurs: - when the Contract Value is reduced to zero due to: - a Non-Excess Withdrawal; OR - poor market performance; OR - the assessment of Contract fees and charges, including the GLWB Rider charge - AND either the Guaranteed Withdrawal Balance or the Lifetime Income Amount immediately after any of the above occurs is greater than zero. STEP-UP means: - An increase in the Lifetime Income Base on certain anniversary dates due to positive market performance as reflected in your Contract Value. BONUS means: - An increase in the Lifetime Income Base if you do not take withdrawals during a specified period of time. CURRENTLY, THE GLWB RIDER IS ONLY AVAILABLE TO QUALIFIED CONTRACTS. YOU SHOULD CONSULT WITH A QUALIFIED TAX ADVISER PRIOR TO ELECTING THE RIDER FOR FURTHER INFORMATION ON TAX RULES AFFECTING QUALIFIED CONTRACTS, INCLUDING IRAS. If you are concerned that poor investment performance in the Subaccounts may adversely impact the amount of money you can withdraw from your Contract, we offer for an additional charge an optional Guaranteed Lifetime Withdrawal Benefit Rider ("GLWB Rider"). In general, and subject to certain conditions, the GLWB Rider guarantees the following: 1. Prior to the Lifetime Income Date: We will make the GUARANTEED WITHDRAWAL AMOUNT available for Non-Excess Withdrawals each Contract Year or we will pay it in monthly installments as Settlement Payments if your Contract enters the Benefit Phase before the Lifetime Income Date, until the Guaranteed Withdrawal Balance is reduced to zero. If you limit your withdrawals to Non-Excess Withdrawals, we will only decrease the Guaranteed Withdrawal Balance by the amount of each withdrawal and we will not decrease the Guaranteed Withdrawal Amount. If you begin receiving monthly Settlement Payments, we will reduce the Guaranteed Withdrawal Balance by the amount of each payment. Your initial Guaranteed Withdrawal Balance is equal to your initial Purchase Payment (less any premium taxes and not including any PPB). Your initial Guaranteed Withdrawal Amount is equal to 5% of your initial Guaranteed Withdrawal Balance. 2. If your Contract Value is greater than zero on the Lifetime Income Date: We will make the LIFETIME INCOME AMOUNT available for Non-Excess Withdrawals each Contract Year on and after the Lifetime Income Date (if you have not annuitized your Contract) or we will pay it in monthly installments as Settlement Payments on and after the Maximum Annuity Date (if you 40 elect the GLWB Rider annuitization option on the Maximum Annuity Date) or if your Contract enters the Benefit Phase prior to the Maximum Annuity Date. This guarantee applies on and after the Lifetime Income Date, while a Covered Person is living or until the Guaranteed Withdrawal Balance is reduced to zero, if later. If you limit your withdrawals to Non-Excess Withdrawals, we will only decrease the Guaranteed Withdrawal Balance by the amount of each withdrawal and we will not decrease the Lifetime Income Amount. If you begin receiving monthly Settlement Payments, we will reduce the Guaranteed Withdrawal Balance by the amount of each payment. 3. After the Covered Person's death (or the death of the last surviving Covered Person in the case of the GLWB Plus for Two), your Beneficiary will receive the remaining Guaranteed Withdrawal Balance as a lump sum death benefit (if greater than the standard death benefit or any optional death benefit you elected) in certain cases or in monthly installments as Settlement Payments (until the Guaranteed Withdrawal Balance is reduced to zero) in others. This guarantee applies even if the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) on or after the Maximum Annuity Date, if you elect the GLWB Rider annuitization option on the Maximum Annuity Date. The Guaranteed Withdrawal Amount is only available prior to the Lifetime Income Date. The Lifetime Income Amount is only available on and after the Lifetime Income Date (if your Contract Value is greater than zero on the Lifetime Income Date). If you take ANY withdrawals prior to the Lifetime Income Date, the Lifetime Income Amount may be lower than the Guaranteed Withdrawal Amount that was previously available. If we increase the Lifetime Income Base for a Bonus or a Step-Up, we will increase the Lifetime Income Amount and it may be higher than the Guaranteed Withdrawal Amount that was previously available. We will increase the Guaranteed Withdrawal Balance, Lifetime Income Base, and Lifetime Income Amount (on or after the Lifetime Income Date) when you make additional Purchase Payments, subject to limits. We may increase the Guaranteed Withdrawal Amount (prior to the Lifetime Income Date) when you make additional Purchase Payments. We make the above guarantees subject to the rules below: a) You limit your withdrawals each Contract Year to Non-Excess Withdrawals. b) You do not annuitize under one of the Annuity Options in the Contract. c) You do not terminate or surrender the Contract. d) There is no divorce prior to the Benefit Phase Start Date e) In the case of the GLWB Plus For One, a Non-Qualified Contract with joint Owners must be continued if the Owner who is not the Covered Person dies. f) In the case of the GLWB Plus For Two, if a Covered Person who is an Owner dies, the other Covered Person (if living) must continue the Contract. THE GUARANTEED LIFETIME WITHDRAWAL BENEFIT DOES NOT GUARANTEE CONTRACT VALUE OR THE PERFORMANCE OF ANY INVESTMENT OPTION. IMPORTANT: We offer two coverage options: where the GLWB Rider covers one Covered Person ("GLWB Plus For One") and where the GLWB Rider covers two Covered Persons ("GLWB Plus For Two"). If both Owners of a Non-Qualified Contract are spouses, or if there is one Owner and a spouse who is the sole Beneficiary, you must choose whether there will be one or two Covered Persons. Please pay careful attention to this designation, as it will impact the GLWB Rider charge and whether the guarantees provided by the GLWB Rider will continue for the life of the surviving spouse. 41 IMPORTANT CONSIDERATIONS THE ADDITION OF THE GLWB RIDER TO YOUR CONTRACT MAY NOT BE IN YOUR INTEREST SINCE AN ADDITIONAL MONTHLY CHARGE IS IMPOSED FOR THIS BENEFIT AND THE COVERED PERSON(S) MUST REACH THE LIFETIME INCOME DATE AND REMAIN LIVING TO RECEIVE CERTAIN BENEFITS. SINCE THE WITHDRAWAL BENEFIT OF THE GLWB RIDER IS ACCESSED THROUGH REGULAR NON-EXCESS WITHDRAWALS, THE GLWB RIDER MAY NOT BE APPROPRIATE FOR OWNERS WHO DO NOT FORESEE A NEED FOR LIQUIDITY AND WHOSE PRIMARY OBJECTIVE IS TO TAKE MAXIMUM ADVANTAGE OF THE TAX DEFERRAL ASPECT OF THE CONTRACT. CERTAIN QUALIFIED CONTRACTS MAY HAVE WITHDRAWAL RESTRICTIONS WHICH MAY LIMIT THE BENEFIT OF THE RIDER. YOU SHOULD CONSULT WITH YOUR TAX AND FINANCIAL PROFESSIONALS ON THIS MATTER, AS WELL AS OTHER TAX MATTERS ASSOCIATED WITH THE GLWB RIDER, AND DETERMINE WHETHER THE GLWB RIDER IS SUITABLE FOR YOU. ALSO, THE GLWB RIDER LIMITS THE INVESTMENT OPTIONS OTHERWISE AVAILABLE UNDER THE CONTRACT AND CONTAINS AGE CAPS, PURCHASE PAYMENT LIMITATIONS, AND RESTRICTIONS ON AN OWNER'S RIGHTS AND BENEFITS AT CERTAIN AGES AND VALUES. YOU SHOULD CAREFULLY CONSIDER EACH OF THESE FACTORS BEFORE DECIDING IF THE GLWB RIDER IS SUITABLE FOR YOUR NEEDS, ESPECIALLY AT OLDER AGES. Please carefully consider the following before electing the GLWB Rider: - All withdrawals, including Non-Excess Withdrawals and Excess Withdrawals, reduce your Contract Value and death benefit. Federal and state income taxes may apply, as well as a 10% federal penalty tax if a withdrawal occurs before the Owner(s) reach(es) age 59 1/2. - You may only allocate Purchase Payments and transfer Contract Value among certain Investment Options (see "Investment Option Restrictions" below). - We impose additional limitations on Purchase Payments (see "Making Additional Purchase Payments" below). - You may not cancel the Rider once it is issued. - You will begin paying the GLWB Rider charge as of the first Monthiversary following the Date of Issue, even if you do not begin taking withdrawals for many years. If you choose not to take withdrawals, we will not refund the GLWB Rider charge. - Unless the sole Owner is a non-natural person, the Owner and Annuitant must be the same individual (additional Annuitants are not permitted), and if your Contract has joint Owners, each Owner must be an Annuitant. - You cannot change or add any Owner, joint Owner, Annuitant, or joint Annuitant, unless such change is permitted by us in connection with death or divorce. If you elect GLWB Plus For Two, or you elect GLWB Plus For One and your Contract has joint Owners, you also cannot change or add any Beneficiary, unless such change is permitted by us in connection with death or divorce. - There are restrictions regarding who may be named as an Owner, joint Owner, Annuitant, joint Annuitant, and Beneficiary (see "Naming of Owners, Annuitants, and Beneficiaries" below). - Any Settlement Payments that we make are subject to our financial strength and claims-paying ability. YOU SHOULD NOT PURCHASE THE GLWB RIDER IF: - you expect to take Excess Withdrawals because such Excess Withdrawals may significantly reduce or eliminate the value of the guarantees provided by the Rider; or - you do not expect to begin taking Non-Excess Withdrawals before the Annuity Date. 42 PURCHASING THE GLWB RIDER Currently, the GLWB Rider is only available to Qualified Contracts. You may elect the Rider only on the initial Contract application. You cannot elect the Rider after the Date of Issue. In the case of GLWB Plus For One, you may only elect the Rider if the Covered Person has not attained age 76. In the case of joint Owners, the age of the older Owner determines eligibility. Where the Owner is a non-natural person, we determine eligibility by the age of the older Annuitant on the Date of Issue. In the case of GLWB Plus For Two, you may only elect the Rider if the older Covered Person has not attained age 76. Also, both Covered Persons must have birthdates less than 6 years apart from each other. For example, assume you purchase a Contract on November 1, 2007 and you wish to select GLWB Plus For Two: - EXAMPLE 1: You are born July 1, 1942 and your spouse is born June 1, 1948. Since your birthdates are 5 years and 11 months apart, you may elect GLWB Plus For Two. - EXAMPLE 2: You are born July 1, 1942 and your spouse is born August 1, 1948. Since your birthdates are 6 years and 1 month apart, you may NOT elect GLWB Plus For Two. We require due proof of age before issuing the Rider. We reserve the right to accept or refuse to issue the GLWB Rider at our sole discretion. We may discontinue offering the Rider at any time. The Rider may not be available in all states. COVERED PERSONS If both Owners of a Non-Qualified Contract are spouses, or if there is one Owner and a spouse who is the sole Beneficiary, you must choose whether there will be one or two Covered Persons. Please pay careful attention to this designation, as it will impact the GLWB Rider charge and whether the guarantees provided by the GLWB Rider will continue for the life of the surviving spouse. You must choose either the GLWB Plus For One or the GLWB Plus For Two when you elect the GLWB Rider. In the case of GLWB Plus For One, the Covered Person is the person whose life we use to determine the Lifetime Income Date and the duration of the monthly Settlement Payments on and after the Benefit Phase Start Date (if such date occurs on or after the Lifetime Income Date) or the Maximum Annuity Date (if you elect the GLWB Rider annuitization option on the Maximum Annuity Date). If there is more than one Owner, the Covered Person will be the older Owner on the Date of Issue. If the Contract is owned by a non-natural person, we will treat the older Annuitant on the Date of Issue as the older Owner for purposes of determining the Covered Person. In the case of GLWB Plus For Two, you and your spouse will be the Covered Persons whose lives we use to determine the Lifetime Income Date and the duration of the monthly Settlement Payments on and after the Benefit Phase Start Date (if such date occurs on or after the Lifetime Income Date) or the Maximum Annuity Date (if you elect the GLWB Rider annuitization option on the Maximum Annuity Date). We determine the Covered Person(s) at the time you elect the Rider. A Covered Person cannot be added or changed after the Date of Issue. NAMING OF OWNERS, ANNUITANTS, AND BENEFICIARIES Unless the sole Owner is a non-natural person, the Owner and Annuitant must be the same individual (additional Annuitants are not permitted), and if your Contract has joint Owners, each Owner must be an Annuitant. If the Owner is a non-natural person, we will treat each Annuitant as an Owner under the GLWB Rider, and all Owner provisions and restrictions apply to such Annuitants. 43 You cannot change or add any Owner, joint Owner, Annuitant, or joint Annuitant, unless such change is permitted by us in connection with death or divorce. If you elect GLWB Plus For Two, or you elect GLWB Plus For One and your Contract has joint Owners, you also cannot change or add any Beneficiary, unless such change is permitted by us in connection with death or divorce. IF YOU DO NOT HAVE A SPOUSE ON THE DATE OF ISSUE: - You may only elect GLWB Plus For One. You must be named as the sole Owner, and any Beneficiary (spouse or non-spouse) may be named. You will be the Covered Person. IF YOU HAVE A SPOUSE ON THE DATE OF ISSUE: For Qualified Contracts: - Under the Code, only one spouse may be named as the sole Owner. - If you elect GLWB Plus For One, any Beneficiary may be named (spouse or non-spouse). The Covered Person will be the sole Owner. - If you elect GLWB Plus For Two, the other spouse must be named as the sole Beneficiary. The Covered Persons will be the sole Owner and the sole Beneficiary. For Non-Qualified Contracts, you must choose one of the following options: 1) one spouse is named as the sole Owner - If you elect GLWB Plus For One, any Beneficiary may be named (spouse or non-spouse). The Covered Person will be the sole Owner. - If you elect GLWB Plus For Two, the other spouse must be named as the sole Beneficiary. The Covered Persons will be the sole Owner and the sole Beneficiary. OR: 2) both spouses are named as joint Owners and Beneficiaries - If you elect GLWB Plus For One, the Covered Person will be the older Owner - If you elect GLWB Plus For Two, the Covered Persons will be both Owners. A spouse must qualify as a "spouse" under the Code. INVESTMENT OPTION RESTRICTIONS If you elect the GLWB Rider, you may only allocate your Purchase Payments and transfer your Contract Value among the following Investment Options: - Goldman Sachs Balanced Strategy Portfolio (Class A) - Goldman Sachs Growth and Income Strategy Portfolio (Class A) - Goldman Sachs Growth Strategy Portfolio (Class A) - Goldman Sachs VIT Money Market Fund YOU MAY NOT ALLOCATE ANY PORTION OF YOUR PURCHASE PAYMENTS OR CONTRACT VALUE TO ANY INVESTMENT OPTION NOT LISTED ABOVE. YOU MAY NOT ALLOCATE PURCHASE PAYMENTS OR TRANSFER CONTRACT VALUE TO THE FIXED ACCOUNT. You should consult with your financial adviser to assist you in determining whether the Investment Options available with the GLWB Rider are best suited for your financial needs and risk tolerance. We reserve the right to impose additional restrictions on Investment Options at any time. 44 GLWB RIDER CHARGE We assess an additional monthly charge for the GLWB Rider that compensates us for the costs and risks we assume in providing the benefits under the Rider. - In the case of GLWB Plus For One, on the Date of Issue, the monthly GLWB Rider charge, which we will deduct from your Contract Value on each Monthiversary, is equal to 0.50%, of the Lifetime Income Base on that Monthiversary. - In the case of GLWB Plus For Two, on the Date of Issue, the monthly GLWB Rider charge, which we will deduct from your Contract Value on each Monthiversary, is equal to 0.75%, of the Lifetime Income Base on that Monthiversary. WE RESERVE THE RIGHT TO INCREASE THE GLWB RIDER CHARGE ON THE EFFECTIVE DATE OF EACH STEP-UP. WE GUARANTEE, HOWEVER, THAT THE MONTHLY GLWB RIDER CHARGE WILL NEVER EXCEED 1.00% FOR GLWB PLUS FOR ONE OR 1.50% FOR GLWB PLUS FOR TWO, OF THE LIFETIME INCOME BASE ON EACH MONTHIVERSARY. If we decide to increase the GLWB Rider charge at the time of a Step-Up, then you will receive advance notice and be given the opportunity of no less than 30 days to decline the automatic Step-Up by notifying us at our Service Center in writing. We will deduct a pro rata share of the monthly GLWB Rider charge from the amount otherwise due: 1) If you take an Excess Withdrawal on any date other than a Monthiversary and such withdrawal reduces the Contract Value to zero. 2) On the Annuity Date. 3) Upon surrender of the Contract. All charges for the GLWB Rider will cease upon termination (see "Terminating the GLWB Rider" below). When we deduct the charge for the GLWB Rider, we will reduce Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in the chronological order in which we received such Purchase Payments. GUARANTEED AMOUNTS THE GUARANTEED WITHDRAWAL BALANCE. On the Date of Issue, the initial Guaranteed Withdrawal Balance is equal to your initial Purchase Payment (less any premium taxes and not including the corresponding PPB). Your Guaranteed Withdrawal Balance can never be more than $5 million. Your Guaranteed Withdrawal Balance will never be less than zero. THE LIFETIME INCOME BASE. On the Date of Issue, the initial Lifetime Income Base is equal to your initial Purchase Payment (less any premium taxes and not including the corresponding PPB). The amount of the GLWB Rider charge and the Lifetime Income Amount will increase if the Lifetime Income Base increases. Your Lifetime Income Base can never be more than $5 million. Your Lifetime Income Base will never be less than zero. NOTE: The Guaranteed Withdrawal Balance and Lifetime Income Base are not cash values or surrender values, are not available to Owners, are not minimum returns for any Subaccount, and are not guarantees of any Contract Value. THE GUARANTEED WITHDRAWAL AMOUNT. On the Date of Issue, the initial Guaranteed Withdrawal Amount is equal to 5% of the initial Guaranteed Withdrawal Balance. Your Guaranteed Withdrawal Amount can never be more than $250,000. 45 THE LIFETIME INCOME AMOUNT. On the Lifetime Income Date, the initial Lifetime Income Amount is equal to 5% of your Lifetime Income Base on that date. We do not calculate the Lifetime Income Amount prior to the Lifetime Income Date. Your Lifetime Income Amount can never be more than $250,000. NOTE: If you take any withdrawals prior to the Lifetime Income Date, the initial amount of the Lifetime Income Amount may be less than the previously available Guaranteed Withdrawal Amount. Non-Excess Withdrawals, Excess Withdrawals, additional Purchase Payments, Bonuses, and Step-Ups may have an effect on the value of the Guaranteed Withdrawal Balance, the Lifetime Income Base, the Guaranteed Withdrawal Amount, and the Lifetime Income Amount, as follows: IF: THEN: -------------------------------------------------------------------------------- you take a Non-Excess Withdrawal - we will decrease your Guaranteed Withdrawal Balance; - prior to the Lifetime Income Date: - we will decrease your Lifetime Income Base; and - we will not change your Guaranteed Withdrawal Amount; - on or after the Lifetime Income Date: - we will not change your Lifetime Income Base; and - we will not change your Lifetime Income Amount. (See "Taking Withdrawals" below.) you take an Excess Withdrawal - we will decrease your Guaranteed Withdrawal Balance; - we will decrease your Lifetime Income Base; - prior to the Lifetime Income Date: - we will decrease your Guaranteed Withdrawal Amount; - on or after the Lifetime Income Date: - we will decrease your Lifetime Income Amount. (See "Taking Withdrawals" below.) you make an additional Purchase Payment - we will increase your Guaranteed Withdrawal Balance; - we will increase your Lifetime Income Base; - prior to the Lifetime Income Date: - we will recalculate your Guaranteed Withdrawal Amount; - on or after the Lifetime Income Date: - we will increase your Lifetime Income Amount. (See "Making Additional Purchase Payments" below.) we apply a Bonus and/or Step-Up - we will not change your Guaranteed Withdrawal Balance; - we will not change your Guaranteed Withdrawal Amount; - we will increase your Lifetime Income Base; and - on or after the Lifetime Income Date: - we will increase your Lifetime Income Amount; (See "Bonus" and "Step-Up" below.) 46 TAKING WITHDRAWALS IMPORTANT CONSIDERATIONS You may be assessed charges and penalties if you take withdrawals: - Although we currently do not assess a withdrawal charge on Non-Excess Withdrawals, we reserve the right to do so. We will assess a withdrawal charge on Excess Withdrawals if such withdrawals would otherwise be subject to a withdrawal charge. If we assess a withdrawal charge on a Non-Excess Withdrawal or an Excess Withdrawal, we will calculate and impose the charge in the same manner that we would for any partial withdrawal. All withdrawals, including Non-Excess Withdrawals and Excess Withdrawals, will reduce the remaining Free Withdrawal Amount in any Contract Year. (See "Withdrawal Charge.") - All withdrawals, including Non-Excess Withdrawals and Excess Withdrawals, reduce your Contract Value and death benefit. Federal and state income taxes may apply, as well as a 10% federal penalty tax if a withdrawal occurs before the Owner(s) reach(es) age 59 1/2. (See "Federal Tax Matters.") You should carefully consider when to begin taking Non-Excess Withdrawals. - You may reduce the value of the guarantees provided by the GLWB Rider, depending on when you begin taking Non-Excess Withdrawals. For example, because Non-Excess Withdrawals taken prior to the Lifetime Income Date reduce your Lifetime Income Base, such withdrawals will result in a lower initial Lifetime Income Amount (when calculated on the Lifetime Income Date). - If you delay taking Non-Excess Withdrawals, you may be paying for a benefit you are not using. Please consult your financial adviser as to the appropriate time for you to begin taking Non-Excess Withdrawals. NON-EXCESS WITHDRAWALS IF: THEN: -------------------------------------------------------------------------------- You take a Non-Excess 1. We will decrease the Guaranteed Withdrawal Balance Withdrawal prior to by the amount of the withdrawal. the Lifetime Income Date: 2. We will decrease the Lifetime Income Base to equal the greater of: - the Lifetime Income Base immediately prior to the withdrawal minus the amount of the withdrawal; or - the Lifetime Income Base immediately prior to the withdrawal multiplied by the Proportional Reduction Factor. 3. Your Guaranteed Withdrawal Amount will not change. THE PROPORTIONAL REDUCTION FACTOR IS EQUAL TO YOUR CONTRACT VALUE AFTER THE WITHDRAWAL DIVIDED BY YOUR CONTRACT VALUE IMMEDIATELY PRIOR THE WITHDRAWAL. 47 IF: THEN: -------------------------------------------------------------------------------- You take a Non-Excess 1. We will decrease the Guaranteed Withdrawal Balance Withdrawal on or by the amount of the withdrawal. after the Lifetime Income Date: 2. Your Lifetime Income Base will not change. 3. Your Lifetime Income Amount will not change. THE LIFETIME INCOME AMOUNT MAY BE LESS THAN THE GUARANTEED WITHDRAWAL AMOUNT PREVIOUSLY AVAILABLE IF YOU TAKE ANY WITHDRAWALS BEFORE YOUR LIFETIME INCOME DATE. NOTE: If you choose to receive only a part of, or none of, your Guaranteed Withdrawal Amount or Lifetime Income Amount, as applicable, in any given Contract Year, you should understand that annual Non-Excess Withdrawals are not cumulative. You cannot carry over any unused Non-Excess Withdrawals to any future Contract Years. EXCESS WITHDRAWALS IF: THEN: -------------------------------------------------------------------------------- You take an Excess 1. We will decrease the Guaranteed Withdrawal Balance Withdrawal prior to to equal the LESSER of: the Lifetime Income Date: - the Guaranteed Withdrawal Balance immediately prior to the withdrawal minus the amount of the withdrawal; OR - the Guaranteed Withdrawal Balance immediately prior to the withdrawal multiplied by the Proportional Reduction Factor. 2. We will decrease the Guaranteed Withdrawal Amount to equal the Guaranteed Withdrawal Amount immediately prior to the withdrawal multiplied by the Proportional Reduction Factor. 3. We will decrease the Lifetime Income Base to equal the Lifetime Income Base immediately prior to the withdrawal multiplied by the Proportional Reduction Factor. THE PROPORTIONAL REDUCTION FACTOR IS EQUAL TO YOUR CONTRACT VALUE AFTER THE WITHDRAWAL DIVIDED BY YOUR CONTRACT VALUE IMMEDIATELY PRIOR THE WITHDRAWAL. IF: THEN: -------------------------------------------------------------------------------- You take an Excess 1. We will decrease the Guaranteed Withdrawal Balance Withdrawal on or to equal the LESSER of: after the Lifetime Income Date: - the Guaranteed Withdrawal Balance immediately prior to the withdrawal minus the amount of the withdrawal; OR - the Guaranteed Withdrawal Balance immediately prior to the withdrawal multiplied by the 48 Proportional Reduction Factor. 2. We will decrease the Lifetime Income Base to equal the Lifetime Income Base immediately prior to the withdrawal multiplied by the Proportional Reduction Factor. 3. We will decrease the Lifetime Income Amount to equal 5% of the new Lifetime Income Base. THE PROPORTIONAL REDUCTION FACTOR IS EQUAL TO YOUR CONTRACT VALUE AFTER THE WITHDRAWAL DIVIDED BY YOUR CONTRACT VALUE IMMEDIATELY PRIOR THE WITHDRAWAL. THE GLWB RIDER IS DESIGNED FOR YOU TO TAKE NON-EXCESS WITHDRAWALS EACH CONTRACT YEAR. YOU SHOULD NOT PURCHASE THE GLWB RIDER IF YOU INTEND TO TAKE EXCESS WITHDRAWALS. - EXCESS WITHDRAWALS COULD REDUCE YOUR GUARANTEED WITHDRAWAL BALANCE AND LIFETIME INCOME BASE BY SUBSTANTIALLY MORE THAN THE ACTUAL AMOUNT OF THE WITHDRAWAL. THIS MEANS THAT THE AMOUNT OF TOTAL GROSS WITHDRAWALS YOU MAKE AND/OR MONTHLY SETTLEMENT PAYMENTS YOU RECEIVE UNDER THE RIDER COULD BE LESS THAN THE TOTAL OF YOUR PURCHASE PAYMENTS (LESS ANY PREMIUM TAXES AND NOT INCLUDING CORRESPONDING PPBS). - EXCESS WITHDRAWALS MAY REDUCE OR EVEN ELIMINATE YOUR FUTURE GUARANTEED WITHDRAWAL AMOUNT AND FUTURE LIFETIME INCOME AMOUNT. - WE WILL SURRENDER YOUR CONTRACT, AND YOU WILL LOSE THE GUARANTEES PROVIDED BY THE GLWB RIDER, IF YOUR CONTRACT VALUE IS REDUCED TO ZERO DUE TO EXCESS WITHDRAWALS. YOU WILL NOT RECEIVE ANY FURTHER BENEFITS UNDER THE GLWB RIDER. MAKING ADDITIONAL PURCHASE PAYMENTS You may make additional Purchase Payments at any time prior to the earlier of the Benefit Phase Start Date or the Covered Person's 76th birthday (or the older Covered Person's 76th birthday in the case of GLWB Plus For Two), subject to the limitations discussed below. PURCHASE PAYMENTS PRIOR TO THE LIFETIME INCOME DATE. If we receive a Purchase Payment prior to the Lifetime Income Date, we will increase the Guaranteed Withdrawal Balance and the Lifetime Income Base by the amount of the Purchase Payment (less any premium taxes and not including the corresponding PPB) (subject to a maximum limit of $5 million). We also will recalculate the Guaranteed Withdrawal Amount to equal the greater of: - the Guaranteed Withdrawal Amount immediately before the Purchase Payment; or - 5% of the Guaranteed Withdrawal Balance immediately after the Purchase Payment. PURCHASE PAYMENTS ON OR AFTER THE LIFETIME INCOME DATE. If we receive a Purchase Payment on or after the Lifetime Income Date, we will increase the Guaranteed Withdrawal Balance and the Lifetime Income Base by the amount of the Purchase Payment (less any premium taxes and not including the corresponding PPB) (subject to a maximum limit of $5 million). On and after the Lifetime Income Date, we will increase the Lifetime Income Amount every time we increase the Lifetime Income Base due to our receipt of a Purchase Payment. The new Lifetime Income Amount will equal 5% of the new Lifetime Income Base following the Purchase Payment. 49 PURCHASE PAYMENT LIMITATIONS. Please note the following limits on Purchase Payments: - We reserve the right to refuse to accept additional Purchase Payments at any time to the extent permitted in the state we issue your Contract. - You must obtain our prior approval if your Contract Value immediately following an additional Purchase Payment would exceed $1,000,000. We will aggregate multiple Contracts you own for purposes of the $1,000,000 limitation. - We will not accept an additional Purchase Payment on or after the first Contract Anniversary without our prior approval if the total of your Purchase Payments on and after the first Contract Anniversary would exceed $100,000. If you own a Qualified Contract, we will waive our requirement for prior approval of any Purchase Payments made in connection with a systematic investment program approved by us. We will aggregate multiple Contracts you own for purposes of the $100,000 limitation. All other limitations on Purchase Payments, as set forth in "Purchase Payments," also apply. We reserve the right to impose additional limitations on Purchase Payments at any time. We do not include PPBs credited to your Contract Value when calculating any of these limits. BONUS A Bonus is available for a limited time (the "Bonus Period"). The Bonus is an incentive for you to defer taking withdrawals until after the Bonus Period. The Bonus Period begins on the first Contract Anniversary and ends on the earlier of: - the 10th Contract Anniversary; or - the Contract Anniversary immediately following the Contract Year in which the Covered Person (or the older original Covered Person in the case of GLWB Plus For Two) reaches age 80. If you have never taken a withdrawal, we will increase the Lifetime Income Base by a Bonus on each Contract Anniversary during the Bonus Period (subject to the maximum Lifetime Income Base limit of $5 million). Each time you qualify for a Bonus, we will increase the Lifetime Income Base by an amount equal to 5% multiplied by total Purchase Payments (less any premium taxes and not including corresponding PPBs). On and after the Lifetime Income Date, we will increase the Lifetime Income Amount every time we increase the Lifetime Income Base due to a Bonus. The new Lifetime Income Amount will equal 5% of the new Lifetime Income Base after the Bonus. We will apply any Bonus before we determine if a Step-Up applies on any Contract Anniversary. Once you take a withdrawal, we will not apply any future Bonuses to the Lifetime Income Base. NOTE: A Bonus increases the Lifetime Income Base, but it is not available in cash and has no effect on your Contract Value. STEP-UP If your Contract Value on any "Step-Up Date" during the "Step-Up Period" is greater than the Lifetime Income Base on that date, we will automatically increase your Lifetime Income Base to equal the Contract Value (subject to the maximum Lifetime Income Base limit of $5 million). 50 On and after the Lifetime Income Date, we will increase the Lifetime Income Amount every time we increase the Lifetime Income Base due to a Step-Up. The new Lifetime Income Amount will equal 5% of the new Lifetime Income Base following the Step-Up. We will apply any Bonus before we determine if a Step-Up applies on any Contract Anniversary. STEP-UP PERIOD. The Step-Up Period begins on the Date of Issue and ends on the Contract Anniversary immediately following the Contract Year in which the Covered Person (or the older original Covered Person in the case of GLWB Plus For Two) reaches age 90. NO STEP-UPS WILL OCCUR AFTER THE END OF THE STEP-UP PERIOD. STEP-UP DATES. During the Step-Up Period, we schedule the Step-Up Dates for the 3rd, 6th, and 9th Contract Anniversary after the Date of Issue and every Contract Anniversary thereafter (e.g., the 10th, 11th, 12th, etc.) while the GLWB Rider is in effect, and on the Lifetime Income Date. INCREASE IN GLWB RIDER CHARGE: If we Step-Up the Lifetime Income Base, we reserve the right to increase the monthly GLWB Rider charge up to a maximum of 1.00% for GLWB Plus For One or 1.50% for GLWB Plus For Two, on an annual basis, of the Lifetime Income Base on each Monthiversary (see "GLWB Rider charge" above). If we decide to increase the GLWB Rider charge at the time of a Step-Up, you will receive advance notice and be given the opportunity of no less than 30 days to decline the automatic Step-Up by notifying us at our Service Center in writing. If you decline an automatic Step-Up, you will have the option to elect to Step-Up the Lifetime Income Base within 30 days of subsequent Step-Up Dates by submitting a written request to our Service Center. If you decide to Step-Up the Lifetime Income Base, we will thereafter resume automatic Step-Ups. BENEFIT PHASE The Contract enters the Benefit Phase IF: - the Contract Value is reduced to zero due to: - a Non-Excess Withdrawal; OR - poor market performance; OR - the assessment of Contract fees and charges, including the GLWB Rider charge - AND either the Guaranteed Withdrawal Balance or the Lifetime Income Amount immediately after any of the above occurs is greater than zero. The date the Contract enters the Benefit Phase is called the Benefit Phase Start Date. Note that the Contract will only be eligible to enter the Benefit Phase if: - In the case of GLWB Plus For One: 1. the Covered Person was the sole Owner on the Date of Issue and the Covered Person lives until the Benefit Phase Start Date; OR 2. both Owners live until the Benefit Phase Start Date (in the case of a Non-Qualified Contract with joint Owners); or 3. a Non-Qualified Contract with joint Owners is continued if the Owner who is not a Covered Person dies, and the Covered Person then lives until the Benefit Phase Start Date. - In the case of GLWB Plus For Two: 1. both Covered Persons live until the Benefit Phase Start Date; OR 51 2. a Covered Person who is not an Owner dies and the surviving Covered Person lives until the Benefit Phase Start Date; OR 3. the Contract is continued after the death of an Owner and the surviving Covered Person then lives until the Benefit Phase Start Date. On the Benefit Phase Start Date we will terminate the GLWB Rider and all other rights and benefits under the Contract, including death benefits and any additional riders. We will not accept additional Purchase Payments and we will not deduct the GLWB Rider charge after the Benefit Phase Start Date. During the Benefit Phase, we will pay you monthly Settlement Payments. Total monthly Settlement Payments received in the Benefit Phase (by you or your Beneficiary) will not be less than the Guaranteed Withdrawal Balance on the Benefit Phase Start Date, unless your Beneficiary chooses to commute any remaining monthly Settlement Payments on the death of the Covered Person (or the death of the last surviving Covered Person in the case of GLWB Plus For Two). NOTE: If the Benefit Phase Start Date occurs before the Lifetime Income Date, monthly Settlement Payments will continue until the Guaranteed Withdrawal Balance is reduced to zero. You may receive as few as one monthly Settlement Payment if the Guaranteed Withdrawal Balance is reduced to zero after the first monthly Settlement Payment. If the Benefit Phase Start Date occurs on or after the Lifetime Income Date, monthly Settlement Payments will continue while a Covered Person is living or until the Guaranteed Withdrawal Balance is reduced to zero, if later. You may receive as few as one monthly Settlement Payment if the Guaranteed Withdrawal Balance is equal to zero on the Benefit Phase Start Date (or is reduced to zero after the first monthly Settlement Payment) and the Covered Person dies (or last surviving Covered Person dies in the case of GLWB Plus for Two) before the next monthly Settlement Payment. Changes to Owners and Beneficiaries on and after the Benefit Period Start Date are subject to the same restrictions that would apply if the Contract entered the Annuity Period. (See "Owners, Annuitants, and Beneficiaries.") IF THE BENEFIT PHASE START DATE OCCURS BEFORE THE LIFETIME INCOME DATE: If the Guaranteed Withdrawal Balance on the Benefit Phase Start Date is less than or equal to $2,000: - The first and only Settlement Payment that we will pay you on the Benefit Phase Start Date will be equal to the Guaranteed Withdrawal Balance. If the Guaranteed Withdrawal Balance on the Benefit Phase Start Date is greater than $2,000: - The first monthly Settlement Payment that we will pay you on the Benefit Phase Start Date will be equal to the lesser of: - the Guaranteed Withdrawal Amount minus total Gross Withdrawals taken during the current Contract Year (but in no event less than zero) plus the Guaranteed Withdrawal Amount divided by twelve; or - the Guaranteed Withdrawal Balance. - We will decrease the Guaranteed Withdrawal Balance by the amount of the first monthly Settlement Payment. If the Guaranteed Withdrawal Balance following the first monthly Settlement Payment is greater than zero, we will pay you recurring monthly Settlement Payments (beginning one month after the Benefit Phase Start Date) equal to the Guaranteed Withdrawal Amount divided by twelve, and we will reduce the Guaranteed Withdrawal Balance by the amount of each payment until the Guaranteed Withdrawal Balance is equal to zero. If the Covered Person 52 dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) and the Guaranteed Withdrawal Balance has not been reduced to zero, monthly Settlement Payments will continue to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. The last monthly Settlement Payment may be less than the remaining Guaranteed Withdrawal Amount divided by twelve. EXAMPLE: If: The Guaranteed Withdrawal Balance on the Benefit Phase Start Date = $20,100 The Guaranteed Withdrawal Amount = $6,000 Total Gross Withdrawals taken during the current Contract Year = $3,000 The first monthly Settlement Payment will be equal to $3,500 (= Minimum ($20,100, $6,000 - $3,000 + ($6,000 / 12))). The Guaranteed Withdrawal Balance after the first monthly Settlement Payment will be equal to $16,600 (= $20,100 - $3,500). Thereafter, we will pay you monthly Settlement Payments of $500 (= $6,000 / 12), and we will reduce the Guaranteed Withdrawal Balance by $500 for each monthly Settlement Payment, until the Guaranteed Withdrawal Balance is reduced to zero. If the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) and the Guaranteed Withdrawal Balance has not been reduced to zero, the monthly Settlement Payments of $500 will continue to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. In this example, the Guaranteed Withdrawal Balance will be reduced to $100 (= $20,100 - 1 x $3,500 - 33 x $500) after the 34th payment. Therefore, the last monthly Settlement Payment (the 35th payment) will be equal to $100. - If you die, the Beneficiary may commute any remaining monthly Settlement Payments at an interest rate of 5%. IF THE BENEFIT PHASE START DATE OCCURS ON OR AFTER THE LIFETIME INCOME DATE: - The first monthly Settlement Payment that we will pay you on the Benefit Phase Start Date will be equal to the Lifetime Income Amount minus total Gross Withdrawals taken during the current Contract Year (but in no event less than zero) plus the Lifetime Income Amount divided by twelve. - You will then receive recurring monthly Settlement Payments (beginning one month after the Benefit Phase Start Date) for the rest of the Covered Person's life (or the last surviving Covered Person's life in the case of GLWB Plus For Two) equal to the Lifetime Income Amount divided by twelve. We will reduce the Guaranteed Withdrawal Balance by the amount of each monthly Settlement Payment we make to you. If the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) and the Guaranteed Withdrawal Balance has not been reduced to zero, monthly Settlement Payments will continue to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. The last monthly Settlement Payment may be less than the Lifetime Income Amount divided by twelve. EXAMPLE: If: The Guaranteed Withdrawal Balance on the Benefit Phase Start Date = $20,100 The Lifetime Income Amount = $6,000 Total Gross Withdrawals taken during the current Contract Year = $3,000 The first monthly Settlement Payment will be equal to $3,500 (= Minimum ($20,100, $6,000 - $3,000 + ($6,000 / 12)). The Guaranteed Withdrawal Balance after the first monthly Settlement Payment will be equal to $16,600 (= $20,100 - $3,500). Thereafter, we will pay you monthly Settlement Payments of $500 (= $6,000 / 12) for the rest of the Covered Person's life (or for the rest of the last surviving Covered Person's life in the case of GLWB Plus For Two). We will reduce the Guaranteed Withdrawal Balance by $500 for 53 each of these payments as we make them. If the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) and the Guaranteed Withdrawal Balance has not been reduced to zero, the monthly Settlement Payments of $500 will continue to your Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. In this example, the Guaranteed Withdrawal Balance will be reduced to $100 (= $20,100 - 1 x $3,500 - 33 x $500) after the 34th payment. If the Covered Person has died (or if the last surviving Covered Person has died in the case of GLWB Plus For Two) before the 35th payment, the last monthly Settlement Payment (the 35th payment) will be equal to $100, otherwise we will continue to make monthly Settlement Payments of $500 until the Covered Person's death (or the last surviving Covered Person's death in the case of GLWB Plus For Two). NOTE: Under Qualified Contracts, we may make higher monthly Settlement Payments before the Guaranteed Withdrawal Balance is reduced to zero, if we determine that we must do so based on our calculations of your minimum required distribution. In this case, after the Guaranteed Withdrawal Balance is reduced to zero, we will make monthly Settlement Payments equal to the Lifetime Income Amount divided by twelve, provided that a Covered Person is still living at that time. - If you die, the Beneficiary may commute any remaining monthly Settlement Payments at an interest rate of 5%. NOTE: If there is one living Covered Person on the Benefit Phase Start Date and the Benefit Phase Start Date occurs on or after the Lifetime Income Date, the duration of monthly Settlement Payments on and after the Benefit Phase Start Date will be based on that Covered Person's life only, regardless of who is named as an Annuitant. If there are two living Covered Persons on the Benefit Phase Start Date and the Benefit Phase Start Date occurs on or after the Lifetime Income Date, the duration of monthly Settlement Payments on and after the Benefit Phase Start Date will be based on both Covered Person's lives, regardless of who is named as an Annuitant. NOTE: In the event of divorce, there are cases where we will terminate the GLWB Rider on the Valuation Date that we receive due proof of divorce or the Valuation Date that we receive due proof of death of the first Owner to die. In some cases, the Contract will not be eligible to enter the Benefit Phase after the date of divorce. See "Divorce" below. GLWB RIDER DEATH BENEFIT GLWB RIDER DEATH BENEFIT BEFORE THE BENEFIT PHASE START DATE If the GLWB Rider Death Benefit is payable in the situations outlined below, the GLWB Rider Death Benefit will be equal to the greater of (A) or (B), less any premium taxes, where: (A) - The Contract Value on the Valuation Date we receive due proof of death (B) - The Guaranteed Withdrawal Balance on the Valuation Date we receive due proof of death We will calculate any GLWB Rider Death Benefit on the Valuation Date we receive due proof of death. 1) GLWB PLUS FOR ONE If an Owner's death occurs before the Benefit Phase Start Date and the Beneficiary elects to take the Contract death benefit as a lump sum under our current administrative procedures, the following will apply: IF: THEN: -------------------------------------------------------------------------------- 54 The Covered Person is the deceased - We will pay the GLWB Rider Death Owner: Benefit instead of the standard death benefit or any optional death benefit you elected if the GLWB Rider Death Benefit is greater. - We will terminate the GLWB Rider on the Valuation Date we receive due proof of death. The Covered Person is NOT the - We will NOT pay the GLWB Rider deceased Owner: Death Benefit. NOTE: THIS SITUATION CAN ONLY ARISE - We will terminate the GLWB Rider on IF JOINT OWNERS ARE NAMED ON THE DATE the Valuation Date we receive due OF ISSUE. proof of death. If an Owner's death occurs before the Benefit Phase Start Date and the Beneficiary elects NOT to take the Contract death benefit as a lump sum, the following will apply: IF: THEN: -------------------------------------------------------------------------------- The Covered Person is the deceased - We will pay the GLWB Rider Death Owner, the Beneficiary is the Benefit instead of the standard deceased Owner's surviving spouse, death benefit or any optional death and the Beneficiary chooses NOT to benefit you elected if the GLWB continue the Contract: Rider Death Benefit is greater. - We will terminate the GLWB Rider on the Valuation Date we receive due proof of death. The Covered Person is the deceased - We will apply the GLWB Rider Death Owner, the Beneficiary is the Benefit instead of the standard deceased Owner's surviving spouse, death benefit or any optional death and the Beneficiary chooses to benefit you elected if the GLWB continue the Contract: Rider Death Benefit is greater. - We will terminate the GLWB Rider on the Valuation Date we receive due proof of death. The Covered Person is the deceased - We will pay the GLWB Rider Death Owner and the Beneficiary is NOT the Benefit instead of the standard deceased Owner's surviving spouse: death benefit or any optional death benefit you elected if the GLWB Rider Death Benefit is greater. - We will terminate the GLWB Rider on the Valuation Date we receive due proof of death. The Covered Person is NOT the - We will NOT apply the GLWB Rider deceased Owner, the sole Beneficiary Death Benefit. is the deceased Owner's surviving spouse, and the Beneficiary chooses - We will NOT terminate the GLWB to continue the Contract: Rider - the Rider will continue unchanged. NOTE: THIS SITUATION CAN ONLY ARISE IF JOINT OWNERS ARE NAMED ON THE DATE - The surviving Owner may add or OF ISSUE. change any Beneficiary (spouse or non-spouse). The Covered Person is NOT the - We will NOT pay the GLWB Rider deceased Owner, the sole Beneficiary Death Benefit. is the deceased Owner's surviving spouse, and the Beneficiary chooses - We will terminate the GLWB Rider on NOT to continue the Contract: the Valuation Date we receive due proof of death. NOTE: THIS SITUATION CAN ONLY ARISE IF JOINT OWNERS ARE NAMED ON THE DATE OF ISSUE. 55 2) GLWB PLUS FOR TWO If an Owner's death occurs before the Benefit Phase Start Date and the Beneficiary elects to take the Contract death benefit as a lump sum under our current administrative procedures, the following will apply: - If the Covered Person is the deceased Owner and the Beneficiary is not the other Covered Person: 1. We will pay the GLWB Rider Death Benefit instead of the standard death benefit or any optional death benefit you elected if the GLWB Rider Death Benefit is greater. 2. We will terminate the GLWB Rider on the Valuation Date we receive due proof of death. NOTE: THIS SITUATION CAN ARISE ONLY IF BOTH OF THE COVERED PERSONS HAVE DIED. - Otherwise, we will not pay the GLWB Rider Death Benefit and we will terminate the GLWB Rider on the Valuation Date we receive due proof of death. If an Owner's death occurs before the Benefit Phase Start Date and the Beneficiary elects NOT to take the Contract death benefit as a lump sum, the following will apply: IF: THEN: -------------------------------------------------------------------------------- The Covered Person is the deceased - We will pay the GLWB Rider Death Owner and the Beneficiary is not the Benefit instead of the standard other Covered Person: death benefit or any optional death benefit you elected if the NOTE: THIS SITUATION CAN ARISE ONLY GLWB Rider Death Benefit is IF BOTH OF THE COVERED PERSONS HAVE greater. DIED. - We will terminate the GLWB Rider on the Valuation Date we receive due proof of death. A Covered Person is the deceased - We will NOT apply the GLWB Rider Owner, the Beneficiary is the Death Benefit. deceased Owner's surviving spouse (and the other Covered Person), and - We will NOT terminate the GLWB the Beneficiary chooses to continue Rider - the Rider will continue the Contract: unchanged. NOTE: THIS SITUATION CAN ARISE IF - If the Beneficiary (who is the ONLY ONE OF THE COVERED PERSONS HAS surviving spouse) was not an Owner DIED. of the Contract, the Beneficiary will become the new Owner and new Annuitant. The new or surviving Owner may add or change any Beneficiary (spouse or non-spouse). A Covered Person is the deceased - We will NOT pay the GLWB Rider Owner, the Beneficiary is the Death Benefit. deceased Owner's surviving spouse (and the other Covered Person), and - We will terminate the GLWB Rider on the Beneficiary chooses NOT to the Valuation Date we receive due continue the Contract: proof of death. NOTE: THIS SITUATION CAN ARISE IF ONLY ONE OF THE COVERED PERSONS HAS DIED. In the case of GLWB Plus For Two, the Rider will continue unchanged and we will not pay the GLWB Rider Death Benefit upon the death of a Covered Person who is not an Owner. In this case, the surviving Owner may add or change any Beneficiary (spouse or non-spouse). 56 We will pay or apply any GLWB Rider Death Benefit due upon the death of an Owner before the Benefit Phase Start Date in the same manner that we pay or apply the Contract death benefit when an Owner's death occurs before the Annuity Date and, in all circumstances, in accordance with Sections 72(s) or 401(a)(9) of the Code, as applicable. Please note that Contract continuation will not satisfy required minimum distribution rules for Qualified Contracts other than IRAs. Consult a tax adviser for more information. GLWB RIDER DEATH BENEFIT ON OR AFTER THE BENEFIT PHASE START DATE If a Covered Person (or the last surviving Covered Person, in the case of GLWB Plus For Two) dies on or after the Benefit Phase Start Date, we will continue to make the same recurring monthly Settlement Payments that were being made prior to the Covered Person's death to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. If the Benefit Phase Start Date occurs before the Lifetime Income Date, then the last monthly Settlement Payment may be less than the Guaranteed Withdrawal Amount divided by twelve. If the Benefit Phase Start Date occurs on or after the Lifetime Income Date, then the last monthly Settlement Payment may be less than the Lifetime Income Amount divided by twelve. We will pay or apply any GLWB Rider Death Benefit due upon the death of an Owner on or after the Benefit Phase Start Date in the same manner that we pay or apply the Contract death benefit when an Owner's death occurs on or after the Annuity Date and, in all circumstances, in accordance with Sections 72(s) or 401(a)(9) of the Code, as applicable. In some cases, the amount of each monthly Settlement Payment we make to the Beneficiary may be greater than the minimum distribution that might otherwise be required. NOTE: In the event of divorce, there are cases where we will terminate the GLWB Rider on the Valuation Date that we receive due proof of divorce or the Valuation Date that we receive due proof of death of the first Owner to die. In some cases, the GLWB Rider Death Benefit will not be payable on the death of an Owner, as outlined above, after the date of divorce. See "Divorce" below. ANNUITIZATION On the Annuity Date, you must elect one of the following Options: Option 1: Elect to surrender the Contract, and we will terminate the GLWB Rider and pay you the Withdrawal Value (see "Withdrawals and Surrenders During the Accumulation Period"); Option 2: Elect to receive annuity payments under your Contract, and we will terminate the GLWB Rider and apply your Withdrawal Value as of the Annuity Date to an Annuity Option (see "Annuity Period"); OR Option 3: If the Maximum Annuity Date has been reached, elect to apply your Withdrawal Value to the GLWB Rider annuitization option. Under the GLWB Rider annuitization option, we will pay you monthly Settlement Payments equal to the Lifetime Income Amount divided by twelve for the rest of the Covered Person's life (or the last surviving Covered Person's life in the case of GLWB Plus For Two), beginning on the Maximum Annuity Date. We will reduce the Guaranteed Withdrawal Balance by the amount of each monthly Settlement Payment we make to you. If the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus For Two) and the Guaranteed Withdrawal Balance has not been reduced to zero, monthly Settlement Payments will continue to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. The last monthly Settlement Payment may be less than the Lifetime Income Amount divided by twelve. NOTE: Total monthly Settlement Payments received on and after the Maximum Annuity Date (by you or your Beneficiary) will not be less than the Guaranteed Withdrawal Balance on the Maximum Annuity Date, unless your Beneficiary 57 chooses to commute any remaining monthly Settlement Payments on the death of the Covered Person (or the death of the last surviving Covered Person in the case of GLWB Plus For Two). NOTE: You may receive as few as one monthly Settlement Payment if the Guaranteed Withdrawal Balance is equal to zero on the Maximum Annuity Date (or is reduced to zero after the first monthly Settlement Payment) and the Covered Person dies (or last surviving Covered Person dies in the case of GLWB Plus for Two) before the next monthly Settlement Payment. NOTE: Under Qualified Contracts, we may make higher monthly Settlement Payments before the Guaranteed Withdrawal Balance is reduced to zero, if we determine that we must do so based on our calculations of your minimum required distribution. In this case, after the Guaranteed Withdrawal Balance is reduced to zero, we will make monthly Settlement Payments equal to the Lifetime Income Amount divided by twelve, provided that a Covered Person is still living at that time. If you die, the Beneficiary may commute any remaining monthly Settlement Payments at an interest rate of 5%. EXAMPLE: If: The Contract has reached the Maximum Annuity Date The Withdrawal Value on the Maximum Annuity Date = $2,000 The Guaranteed Withdrawal Balance on the Maximum Annuity Date = $17,100 The Lifetime Income Amount = $6,000 You elect Option 3 above We will pay you monthly Settlement Payments of $500 (= $6,000 / 12) for the rest of the Covered Person's life (or the last surviving Covered Person's life in the case of GLWB Plus For Two). We will reduce the Guaranteed Withdrawal Balance by $500 for each of these payments as we make them. If the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus for Two) and the Guaranteed Withdrawal Balance has not been reduced to zero, the monthly Settlement Payments of $500 will continue to your Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. In this example, the Guaranteed Withdrawal Balance will be reduced to $100 (= $17,100 - 34 x $500) after the 34th payment. If the Covered Person has died (or the last surviving Covered Person has died in the case of GLWB Plus For Two) before the 35th payment, the last monthly Settlement Payment (the 35th payment) will be equal to $100, otherwise we will continue to make monthly Settlement Payments of $500 until the Covered Person's death (or the last surviving Covered Person's death in the case of GLWB Plus For Two). Please consult your financial adviser as to which option is most appropriate for you. Note that you will only be eligible to elect Option 3 on the Maximum Annuity Date if: - In the case of GLWB Plus For One: 1. the Covered Person was the sole Owner on the Date of Issue and the Covered Person lives until the Maximum Annuity Date; OR 2. both Owners live until the Maximum Annuity Date (in the case of a Non-Qualified Contract with joint Owners); or 3. a Non-Qualified Contract with joint Owners is continued if the Owner who is not a Covered Person dies, and the Covered Person then lives until the Maximum Annuity Date. - In the case of GLWB Plus For Two: 58 1. both Covered Persons live until the Maximum Annuity Date; OR 2. a Covered Person who is not an Owner dies and the surviving Covered Person lives until the Maximum Annuity Date; OR 3. the Contract is continued after the death of an Owner and the surviving Covered Person then lives until the Maximum Annuity Date. If the Contract reaches the Maximum Annuity Date, and you elect Option 3 above, and there is one living Covered Person at that time, the duration of monthly Settlement Payments on and after the Maximum Annuity Date will be based on that Covered Person's life only, regardless of who is named as an Annuitant. If the Contract reaches the Maximum Annuity Date, and you elect Option 3 above, and there are two living Covered Persons at that time, the duration of monthly Settlement Payments on and after the Maximum Annuity Date will be based on both Covered Person's lives, regardless of who is named as an Annuitant. We must receive written notification of your election of one of the above Options at least 15 days before the Annuity Date. If the Maximum Annuity Date has been reached and we have not received an election, you will be deemed to elect the Option (Option 2 or Option 3) that would result in the higher initial monthly payment on the Maximum Annuity Date. We will not deduct the GLWB Rider charge after the Annuity Date. LOANS The Loan privilege described in the Contract is not available if you elect the GLWB Rider. DIVORCE In the event of divorce, the former spouses must provide due proof of divorce to us at our Service Center. WE MAKE A LIMITED NUMBER OF EXCEPTIONS (IDENTIFIED BELOW) WITH RESPECT TO CHANGING AN OWNER AND/OR BENEFICIARY IN CONNECTION WITH DIVORCE. THE COVERED PERSON (OR BOTH COVERED PERSONS IN THE CASE OF GLWB PLUS FOR TWO) MAY LOSE GLWB RIDER BENEFITS IN THE EVENT OF DIVORCE. 1) If the date of divorce occurs prior to the Benefit Phase Start Date and the Annuity Date: - If due proof of divorce indicates that one of the following changes is to be made to an Owner and/or Beneficiary (effective as of the date of divorce), we will permit the change and the GLWB Rider will continue: 1. If the Contract has joint Owners and both Owners are Covered Persons, we will permit one of the Owners to be removed from the Contract. 2. If the Contract has joint Owners and only one of the Owners is a Covered Person, we will permit the Owner who is not a Covered Person to be removed from the Contract. 3. If the Contract has a sole Owner, we will permit the Owner to be removed from the Contract if the sole Beneficiary who is also a Covered Person becomes the sole Owner of the Contract. 4. If the Contract has a sole Beneficiary who is a Covered Person, we will permit the sole Beneficiary to be removed from the Contract. 5. If the Contract has a sole Owner, and the Owner is the only Covered Person, we will permit the Owner to change or add any Beneficiary (spouse or non-spouse). After the change or removal of an Owner and/or Beneficiary, the remaining Owner (who will be the only Covered Person) may change or add any Beneficiary (spouse or non-spouse). Any amounts withdrawn from the Contract in connection with or following the divorce will 59 be treated as Non-Excess Withdrawals or Excess Withdrawals as the case may be, pursuant to the above "Taking Withdrawals" provisions. NOTE: In the case of GLWB Plus for Two, we will treat the removal of a Covered Person in the same manner as if Covered Person had been removed due to death. - If due proof of divorce indicates that there are to be no changes to an Owner and/or Beneficiary (effective as of the date of divorce): - If the date of death of the first former spouse to die occurs prior to the Benefit Phase Start Date, then either: - The GLWB Rider will continue if the deceased former spouse was not an Owner of the Contract. No GLWB Rider Death Benefit will be payable in connection with this death. The surviving Owner may then change or add any Beneficiary (spouse or non-spouse). OR: - We will terminate the GLWB Rider on the Valuation Date we receive due proof of death of the first former spouse to die, if the former spouse was an Owner of the Contract. If the first former spouse to die was the only Covered Person on the date of death, we will pay the GLWB Rider Death Benefit instead of the standard death benefit or any optional death benefit elected if the GLWB Rider Death Benefit is greater. Otherwise, no GLWB Rider Death Benefit will be payable in connection with this death. - If both former spouses are still living on the Benefit Phase Start Date, we will split the monthly Settlement Payments according to the instructions we receive as part of the due proof of divorce. Prior to our receipt of due proof of divorce, we will make monthly Settlement Payments in the manner prescribed by the Owner pursuant to the terms of the Rider. - If the Maximum Annuity Date has been reached, and both former spouses are still living on that date, and you elect the GLWB Rider annuitization option on that date, we will split the monthly Settlement Payments according to the instructions we receive as part of the due proof of divorce. Prior to our receipt of due proof of divorce, we will make monthly Settlement Payments in the manner prescribed by the Owner pursuant to the terms of the Rider. - If due proof of divorce indicates that an Owner and/or Annuitant and/or Beneficiary is to be changed, added, or removed (effective as of the date of divorce), and it is not specifically permitted above, the Rider will terminate on the earlier of the Valuation Date we receive due proof of divorce or the Valuation Date we receive due proof of death of the first Owner to die. The Contract will not be eligible to enter the Benefit Phase after the date of divorce and no GLWB Rider Death Benefit will be payable on the death of an Owner after the date of divorce. In this case, we will refund any GLWB Rider charges between the date of divorce and the date that the GLWB Rider is terminated. 2) If the date of divorce occurs on or after the Benefit Phase Start Date: - We will split the monthly Settlement Payments according to the instructions we receive as part of the due proof of divorce. Prior to our receipt of due proof of divorce, we will make monthly Settlement Payments in the manner prescribed by the Owner pursuant to the terms of the Rider. 60 3) If the date of divorce occurs on or after the Maximum Annuity Date and you elected the GLWB Rider annuitization option on the Maximum Annuity Date: - We will split the monthly Settlement Payments according to the instructions we receive as part of the due proof of divorce. Prior to our receipt of due proof of divorce, we will make monthly Settlement Payments in the manner prescribed by the Owner pursuant to the terms of the Rider. OTHER PROVISIONS If you elect the GLWB Rider, all other provisions of your Contract and this Prospectus that do not conflict with the provisions of the GLWB Rider apply, such as "Transfers During the Accumulation Period" and "Withdrawals and Surrenders During the Accumulation Period." TERMINATING THE GLWB RIDER You may not terminate the GLWB Rider once it is in effect. However, we will terminate the GLWB Rider automatically upon the earliest of: - the Valuation Date that the Contract Value, the Guaranteed Withdrawal Balance, and the Lifetime Income Amount all equal zero (we will treat this as a surrender); - the Annuity Date; - the Benefit Phase Start Date; - the Valuation Date we receive due proof of an Owner's death, in certain circumstances (see "GLWB Rider Death Benefit" above); - the Valuation Date we receive due proof of divorce or the Valuation Date we receive due proof of the death of the first Owner to die after divorce, in certain circumstances (see "Divorce" above); or - termination or surrender of the Contract. Once the GLWB Rider terminates, it cannot be reelected or reinstated. All charges for the GLWB Rider will cease upon termination. MISSTATEMENT OF AGE If any Owner or Covered Person's age has been misstated, we may change the Covered Person in the case of GLWB Plus for One. We will terminate the GLWB Rider if the Contract would not have been eligible to elect the GLWB Rider on the Date of Issue had the correct age been provided. We may also adjust the Lifetime Income Date, Guaranteed Withdrawal Balance, Guaranteed Withdrawal Amount, Lifetime Income Base, Lifetime Income Amount, Contract Value, the amount of previous charges for the GLWB Rider, GLWB Rider Death Benefits, and/or the amount of any Settlement Payments, as applicable, to the correct amount had the correct age been provided. If there is any underpayment of monthly Settlement Payments, we will pay the amount of the underpayment in one sum. We will deduct any overpayment of monthly Settlement Payments from the current or succeeding monthly Settlement Payment(s) due under the GLWB Rider. Interest not to exceed 3% compounded annually will be credited to any underpayment or charged to any overpayment of monthly Settlement Payments. EXAMPLES Please refer to Appendices B , Appendix C and Appendix D for hypothetical examples that illustrate the benefits under the GLWB Rider. 61 FEDERAL TAX ISSUES As with any distribution from the Contract, tax consequences may apply to GLWB Rider distributions. The application of certain tax rules, particularly those rules relating to distributions resulting from a GLWB Rider, are not entirely clear. In this regard, we intend to treat monthly Settlement Payments received by you under the GLWB Rider after the Contract enters into the Benefit Phase as annuity payments for tax purposes. (However, we intend to treat any portion of the first monthly Settlement Payment that is in excess of the Guaranteed Withdrawal Amount divided by twelve (if the Benefit Phase Start Date occurs before the Lifetime Income Date) or the Lifetime Income Amount divided by twelve (if the Benefit Phase Start Date occurs on or after the Lifetime Income Date), as fully taxable to you. In addition, if the Benefit Phase Start Date occurs before the Lifetime Income Date and the Guaranteed Withdrawal Balance on the Benefit Phase Start Date is less than or equal to $2,000, we intend to treat this Settlement Payment as a surrender payment for tax purposes.) We intend to treat the payments made to you prior to the Benefit Phase as withdrawals for tax purposes. (See "Federal Tax Matters - Taxation of Annuities in General.") The GLWB Rider provides benefits that differ from those traditionally offered under variable annuity contracts. If this Rider is in effect, the Covered Person(s) or his or her Beneficiary may be entitled to monthly Settlement Payments even if the Contract Value is zero. Such monthly Settlement Payments may be fully includible in income, if the investment in the Contract has been fully recovered. LIFE EXPECTANCY DISTRIBUTIONS You may request us in writing, in a form acceptable to us, to pay you withdrawals that we determine to be part of a series of substantially equal periodic payments over your "life expectancy" (or the joint life expectancies of both Covered Persons, if you elected GLWB Plus For Two). For purposes of the GLWB Rider, withdrawals under our Life Expectancy Distribution program are distributions within a calendar year that are intended to be paid to you as required or contemplated by Code Section 401(a)(9), Section 403(b)(10), Section 408(b)(3), or Section 408A(c), as the case may be (we sometimes refer to these as "Required Minimum Distributions"). You may take any Required Minimum Distributions related to this Contract from this Contract or from any other Contract you may own. Under our Life Expectancy Distribution program, we do not consider withdrawals under other Contracts you may own when calculating "life expectancy" distributions. In some cases there may be other acceptable methods of calculating the required distribution amount. You must accept our calculation of the minimum distribution amount in order to participate in our Life Expectancy Distribution program and to avoid potential Excess Withdrawal treatment. In some cases there may be other acceptable methods of calculating the required distribution amount. We reserve the right to make any changes we deem necessary to comply with the Code and Treasury Regulations. We base our "life expectancy" calculations on our understanding and interpretation of the requirements under tax law applicable to required minimum distributions. You should discuss these matters with your tax adviser prior to electing GLWB Rider. We will treat withdrawals under our Life Expectancy Distribution program as Non-Excess Withdrawals, if no other Gross Withdrawals are taken while the program is in effect. Any Gross Withdrawals that are taken that are not part of the program and any future Life Expectancy program withdrawals that are taken during that Contract Year may be considered Excess Withdrawals. (See "Taking Withdrawals" above). 9. LOANS. The Owner of a Contract issued as a tax sheltered annuity under Section 403(b) of the Code or with a qualified plan under Code Section 401, may request a loan (if permitted by the qualified plan) any time during the Accumulation Period. Only one loan may be outstanding on a Contract at a given time. The outstanding loan must be repaid in full before the next loan may be granted. The requirements and limitations governing the availability of loans, including the maximum amount that a participant may take 62 as a loan, are subject to the rules in the Code, IRS regulations, and our procedures in effect at the time a loan is made. In the case of loans made under Contracts which are subject to the Employee Retirement Income Security Act of 1974 ("ERISA"), additional requirements and limitations will apply such as those under the terms of the plan, Department of Labor regulations and ERISA. Because the rules governing loans under Code Section 403(b) contracts and ERISA qualified plans are complicated, you should consult your tax adviser before exercising the loan privilege. Failure to meet the requirements for loans may result in adverse income tax consequences to you. The loan agreement you sign will describe the restrictions and limitations applicable to the loan at the time you apply. For loans subject to ERISA, you also may wish to consult your plan administrator. The maximum loan available is the Fixed Account Contract Value, less any premium taxes and withdrawal charge that would apply to the total withdrawal of the Fixed Account Contract Value at the time that you make the loan, and less interest for one calendar year on the loan at the time that you make the loan. Federal tax law further restricts the total amount of your plan loans to the lesser of (i) 50,000, reduced by the excess of the highest outstanding balance of your loans during the one-year period preceding the date of a loan, over the outstanding balance of your loans, or (ii) the greater of 50% of your plan account value or $10,000. We may defer granting a loan for six months from the date we receive the written loan request at our Service Center. Federal tax law requires loans to be repaid in a certain manner and over a certain period of time. For example, loans generally are required to be repaid within five years (except in cases where the loan was used to acquire the principal residence of the plan participant), with repayments made at least quarterly and in substantially level amortized payments over the term of the loan. Failure to make a loan repayment when due will result in adverse tax income tax consequences to you. Interest will be charged on your loan amount. If your Contract is not subject to ERISA, the interest rate charged is 5.5%. If your Contract is subject to ERISA, the interest rate charged is based on Moody's Corporate Bond Yield Average--Monthly Average Corporates (rounded to the nearest 0.25%). We are not responsible for determining whether this rate is a "reasonable interest rate" as required by ERISA and we make no representations to that effect. While a loan is outstanding, we will credit the value securing the loan with interest at the daily equivalent of the annual loan interest rate charged reduced by 2.5%, instead of the current interest rate credited to the Fixed Account. This rate will never be lower than the minimum guaranteed Fixed Account interest rate. If there is an outstanding loan balance when the Contract is surrendered or annuitized, or when a death benefit is paid, the amount payable will be reduced by the amount of the loan outstanding plus accrued interest. In addition, loans, whether or not repaid, will have a permanent effect on the Contract Value because the investment results of the Investment Options will apply only to the unborrowed portion of the Contract Value. The longer a loan is unpaid, the greater the effect is likely to be. The effect could be favorable or unfavorable. If investment results are greater than the rate being credited on amounts held in your loan account while your loan is unpaid, your Contract Value will not increase as rapidly as it would have if no loan were unpaid. If investment results are below that rate, your Contract Value will be greater than it would have been had no loan been outstanding. We will apply any repayment of Debt first to reduce that part of the Debt that can be attributed to interest, and then to that part of the Debt that can be attributed to principal. You may repay the Debt in full or in part at any time prior to the Annuity Date. If the Debt equals or exceeds the Fixed Account Contract Value, less any premium taxes and withdrawal charge that would apply to the total withdrawal of the Fixed Account Contract Value, your interest in the Fixed Account will terminate. The termination occurs thirty-one days after we mail notice of termination to your last known address and that of any assignee of record. 63 If we receive a loan request at our Service Center before the close of business on the Valuation Date, we will process the request based on Accumulation Unit values determined at the end of that Valuation Date. If we receive a loan request at our Service Center on or after the close of business on the Valuation Date, we will process the request based on Accumulation Unit values determined at the end of the next Valuation Date. Please note that if you elect the GLWB Rider, the loan privilege is not available to you. (See "Guaranteed Lifetime Withdrawal Benefit.") 10. TELEPHONE AND FACSIMILE TRANSACTIONS. We currently permit requests for transfers to be submitted by telephone by calling 1-800-[_]. Before telephone transfer instructions will be honored, you must complete a telephone transfer authorization. We also currently permit requests for certain financial transactions to be submitted by facsimile at [_]. We reserve the right to discontinue telephone and/or facsimile requests at any time. We will employ reasonable procedures to determine that these transactions are genuine. There are risks associated with telephone and facsimile transactions that do not occur if an original handwritten request is submitted. Anyone authorizing or making telephone or facsimile requests bears those risks. We will not be liable for any liability or losses resulting from unauthorized or allegedly unauthorized telephone or facsimile requests that we believe are genuine. We may record telephone requests. Also, telephone and facsimile transactions may not always be available, and telephone and facsimile systems, whether yours, your service provider's or your agent's, can experience outages or slowdowns for a variety of reasons (such as natural disasters, man-made disasters, or simply because of a high number of calls or facsimiles (which is likely to occur during periods of high market turbulence)). These outages or slowdowns may prevent or delay our receipt and/or processing of your request. If you are experiencing problems, you should make your request in writing to our Service Center. CONTRACT CHARGES AND EXPENSES We deduct the following charges and expenses: |_| mortality and expense risk charge, |_| contract fee, |_| withdrawal charge, |_| commutation charge, |_| premium tax, |_| administration charge, |_| Step-Up Death Benefit Charge, and |_| GLWB Rider charge. We may receive compensation from the investment advisers of the Funds for services related to the Funds. (See "The Funds.") Subject to certain expense limitations, investment management fees and other Fund expenses are indirectly borne by you. 64 The fees and charges we deduct under the Contract may result in a profit to us. A. ASSET-BASED CHARGES 1. MORTALITY AND EXPENSE RISK CHARGE. We deduct a daily charge from your Separate Account Contract Value equal to 1.35%, on an annual basis, of Separate Account Contract Value. The mortality and expense risk charge reimburses us for mortality and expense risks. We deduct this charge during both the Accumulation Period and the Annuity Period. Variable Annuity payments reflect the investment experience of each Subaccount but are not affected by changes in actual mortality experience or by actual expenses we incur. Our mortality risk arises from two obligations. The first obligation we assume is to pay a standard death benefit that may be greater than the Withdrawal Value. The second obligation we assume is to continue making annuity payments to the Owner for the entire life of the Annuitant under Annuity Options involving life contingencies. We assume the risk that Annuitants will live beyond actuarial life expectancies. We also assume the risk that all administrative expenses including Contract maintenance costs, administrative costs, data processing costs, and costs of other services may exceed the mortality and expense risk charge. We expect to profit from the mortality and expense risk charge. We may use any profits for any lawful purpose including covering distribution costs. We use a portion of the mortality and expense risk charge to pay for the PPB. 2. ADMINISTRATION CHARGE. We deduct a daily charge from your Separate Account Contract Value equal to 0.15%, on an annual basis, of Separate Account Contract Value. The administration charge reimburses us for expenses incurred for administering the Contracts. These expenses include your inquiries, changes in allocations, reports to you, Contract maintenance costs, and data processing costs. The administration charge covers the average anticipated administrative expenses incurred while the Contracts are in force. There is not necessarily a direct relationship between the amount of the charge and the administrative costs of the particular Contract. 3. STEP-UP DEATH BENEFIT CHARGE. If you elect the Step-Up Death Benefit, we will deduct a daily charge from your Contract Value equal to 0.20%, on an annual basis, of Separate Account Contract Value. This charge covers the cost and risk of providing the benefits guaranteed by the Step-Up Death Benefit. We do not assess a charge for the Step-Up Death Benefit on amounts allocated to the Fixed Account. 4. GLWB RIDER CHARGE We assess an additional monthly charge for the GLWB Rider that compensates us for the costs and risks we assume in providing the benefits under the Rider. - In the case of GLWB Plus For One, the monthly GLWB Rider charge, which we will deduct from your Contract Value on each Monthiversary, is equal to 0.50%, on an annual basis, of the Lifetime Income Base on that Monthiversary. - In the case of GLWB Plus For Two, the monthly GLWB Rider charge, which we will deduct from your Contract Value on each Monthiversary, is equal to 0.75%, on an annual basis, of the Lifetime Income Base on that Monthiversary. 65 We reserve the right to increase the GLWB Rider charge on the effective date of each Step-Up. We guarantee, however, that the monthly GLWB Rider charge will never exceed 1.00% (for GLWB Plus For One) and 1.50% (for GLWB Plus For Two), on an annual basis, of the Lifetime Income Base on each Monthiversary. We also assess a pro rata portion of the charge upon surrender or annuitization. B. CONTRACT FEE During the Accumulation Period, we deduct a quarterly contract fee from your Contract Value that is equal to $30, on an annual basis. We will waive this fee for Contracts with Contract Value of $50,000 or more as of the end of each calendar quarter we would otherwise deduct the fee. The contract fee reimburses us for expenses incurred in establishing and maintaining Contract records. We assess the contract fee at the end of each calendar quarter and upon surrender or annuitization. When we deduct the contract fee, we will reduce Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in the chronological order in which we received such Purchase Payments. C. WITHDRAWAL CHARGE. We impose a withdrawal charge to reimburse us for Contract sales expense, including commissions and other distribution, promotion, and acquisition expenses. We use a portion of the withdrawal charge to pay for the PPB. For purposes of calculating the withdrawal charge on partial withdrawals and surrenders, we assume that amounts are withdrawn from Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in the chronological order in which they were received. We apply the withdrawal charge on each Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and PPB) withdrawn or surrendered during the first 8 Contribution Years following our receipt of the Purchase Payment. A Contribution Year is each Contract Year in which a Purchase Payment is made and each later year measured from the start of the Contract Year when the Purchase Payment was made. We do not impose the withdrawal charge on any Purchase Payment (or the PPB or earnings attributable to that Purchase Payment and PPB) withdrawn or surrendered more than eight Contribution Years following our receipt of that Purchase Payment. We calculate the withdrawal charge separately for each Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and PPB). Total withdrawal charges assessed under a Contract will never exceed 9% of the total Purchase Payments (not including PPBs) made under the Contract. Each Contract Year we guarantee that you can withdraw up to the Free Withdrawal Amount without incurring a withdrawal charge. We also apply the Free Withdrawal Amount upon full surrender of the Contract. The Free Withdrawal Amount, which will never be less than zero, is equal to (a + b) multiplied by 10% - c, where: a) is Contract Value less Debt prior to the withdrawal or surrender; b) is previous partial withdrawals made during the Contract Year (whether or not subject to withdrawal charges); and c) is previous partial withdrawals made during the Contract Year that were not subject to withdrawal charges. If you elect the GLWB Rider, Non-Excess Withdrawals and Excess Withdrawals will reduce the remaining Free Withdrawal Amount in any Contract Year. (See Guaranteed Lifetime Withdrawal Benefit.") If you withdraw an amount in excess of the Free Withdrawal Amount, we may impose a withdrawal charge on the excess. At the time of the withdrawal or surrender, we will determine whether the amount withdrawn includes Purchase Payments (and PPBs and earnings attributable to those Purchase Payments 66 and PPBs) that were made within the previous eight Contribution Years. We will determine the withdrawal charge percentage for each Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and PPB) withdrawn as follows: CONTRIBUTION YEAR WITHDRAWAL CHARGE ----------------- ----------------- First 8% Second 8% Third 7% Fourth 6% Fifth 5% Sixth 4% Seventh 3% Eighth 2% Ninth+ 0% WITHDRAWAL CHARGE EXAMPLE THIS EXAMPLE ILLUSTRATES THE CALCULATION OF THE FREE WITHDRAWAL AMOUNT AND THE WITHDRAWAL CHARGE - The values shown below assume that a Contract is issued to an Owner who is 50 years old on the Date of Issue - A initial Purchase Payment of $10,000 is received on the Date of Issue. No additional Purchase Payments are received and no premium taxes apply - All values shown below are beginning of year (and prior to any partial withdrawal requested) except for Line (5) which is middle of year
COLUMN (1) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) PURCHASE HYPOTHETICAL PAYMENT CONTRACT WITHDRAWAL WITHDRAWAL CONTRACT (NOT VALUE WITHDRAWAL FREE WITHOUT SUBJECT TO WITHDRAWAL VALUE CONTRACT INCLUDING PARTIAL BEFORE CONTRIBUTION CHARGE WITHDRAWAL WITHDRAWAL WITHDRAWAL CHARGE AFTER LINE YEAR PPB) WITHDRAWAL WITHDRAWAL YEAR (%) AMOUNT CHARGE CHARGE ($) WITHDRAWAL ------ -------- --------- ---------- ------------ ------------ ---------- ---------- ---------- ---------- ---------- ---------- (1) 1 $10,000 $10,400 1 8.00% $1,040 $10,400 (2) 2 10,700 2 8.00% 1,070 10,700 (3) 3 $1,000 11,100 3 7.00% 1,110 $1,000 $ 0 $ 0 10,100 (4) 4 500 10,200 4 6.00% 1,020 500 0 0 9,700 (5) 4 3,600 10,000 4 6.00% 550 550 3,050 183 6,400 (6) 5 6,700 5 5.00% 670 6,700 (7) 6 6,900 6 4.00% 690 6,900 (8) 7 7,400 7 3.00% 740 7,400 (9) 8 7,900 8 2.00% 790 7,900 (10) 9 8,400 9 0.00% 840 8,400 (11) 10 5,000 8,900 10 0.00% 890 890 4,110 0 3,900
COLUMN NOTES: Col (5) Includes the impact of Purchase Payments, PPB's, partial withdrawals, contract fees and charges, and investment performance Col (6) A Contribution Year is each Contract Year in which a Purchase Payment is made and each later year measured from the start of the Contract Year in which the Purchase Payment was made. In a Contract with a single Purchase Payment, Contribution Years are equal to Contract Years. Col (7) The withdrawal charge percentage applicable to the withdrawal of a Purchase Payment (and PPB and earnings attributable to that Purchase Payment and PPB) is based on the Contribution Year of the Purchase Payment (and PPB and earnings attributable to the Purchase Payment and PPB) being withdrawn. And for purposes of calculating the withdrawal charge on partial withdrawals and surrenders, we assume that amounts are withdrawn from Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in the chronological order in which they were received. Col (8) The Free Withdrawal Amount is equal to the greater of $0 and ([(a) plus (b)] x 10% minus (c)) where: (a) = Contract Value less Debt prior to the withdrawal or surrender (b) = previous partial withdrawals made during the Contract Year (whether or not subject to withdrawal charges) (c) = previous partial withdrawals made during the Contract Year that were not subject to withdrawal charges Col (9) is equal to the lesser of the partial withdrawal or surrender requested and the Free Withdrawal Amount (lesser of Column (4) and Column (8)) Col (10) is equal to the excess of the partial withdrawal or surrender requested over the withdrawal without surrender charge (greater of $0 and (Column (4) less Column (8)). Note that we do not impose the withdrawal charge on any Purchase Payment (or the PPB or earnings attributable to that Purchase Payment and PPB) withdrawn or surrendered more than eight Contribution Years following our receipt of that Purchase Payment. Col (11) is equal to the withdrawal subject to a withdrawal charge multiplied by the applicable withdrawal charge % (Column (10) x Column (7)). Col (12) is equal to the hypothetical contract value before withdrawal less the amount of the partial withdrawal or surrender requested (Column (5) less Column (4)) THIS EXAMPLE ILLUSTRATES THE CALCULATION OF THE FREE WITHDRAWAL AMOUNT AND THE WITHDRAWAL CHARGE PARTIAL WITHDRAWAL #1 - EXPLANATION: Line (3) A partial withdrawal of $1,000 is requested at the beginning of the 3rd Contract Year. The Free Withdrawal Amount is equal to $1,110 (= the greater of $0 and ( [ $11,100 + $0 ] x 10% - $0 ) ) using the formula for Column (8) above. The partial withdrawal requested is less than the Free Withdrawal Amount ($1,110), so the entire partial withdrawal is free of withdrawal charges. The Contract Value is reduced for the amount of the partial withdrawal ($11,100 - $1,000 = $10,100) PARTIAL WITHDRAWAL #2 AND PARTIAL WITHDRAWAL #3 - EXPLANATION: Line (4) A partial withdrawal of $500 is requested at the beginning of the 4th Contract Year. The Free Withdrawal Amount is equal to $1,020 (= the greater of $0 and ( [ $10,200 + $0 ] x 10% - $0 ) ) using the formula for Column (8) above. The partial withdrawal requested is less than the Free Withdrawal Amount ($1,020) so the entire partial withdrawal is free of withdrawal charges. The Contract Value is reduced for the amount of the partial withdrawal ($10,200 - $500 = $9,700) Line (5) - A partial withdrawal of $3,600 is requested in the middle of the 4th Contract Year. The Free Withdrawal Amount is equal to $550 (= the greater of $0 and ( [$10,000 + $500] x 10% - $500) ) using the formula for Column (8) above. In this case, the Free Withdrawal Amount is adjusted for the partial withdrawal that occurred earlier in the same Contract Year. Since the partial withdrawal requested exceeds the Free Withdrawal Amount, $3,050 of the partial withdrawal request is subject to a withdrawal charge ($3,050 = $3,600 - $550). For the purpose of calculating the withdrawal charge, the Purchase Payment (and PPB and earnings attributable to the Purchase Payment and PPB) from which the partial withdrawal is being withdrawn, is in it's 4th Contribution Year. Therefore, the applicable withdrawal charge percentage is 6% and the withdrawal charge is equal to $183 (= 6% x $3,050). The Contract Value is reduced for the amount of the partial withdrawal ($10,000 - $3,600 = $6,400). - IF AN ADDITIONAL PURCHASE PAYMENT HAD BEEN MADE TO THE CONTRACT: The partial withdrawal requested is less than the initial Purchase Payment (and PPB and earnings attributable to that Purchase Payment and PPB) so the entire partial withdrawal would have been assumed to be withdrawn from the initial Purchase Payment (and PPB earnings attributable to that Purchase Payment and PPB) for purposes of calculating the withdrawal charge. PARTIAL WITHDRAWAL #4 - EXPLANATION: Line (9) A partial withdrawal of $5,000 is requested at the beginning of the 10th Contract Year. The Free Withdrawal Amount is equal to $890 (= the greater of $0 and [ $8,900 + $0 ] x 10% - $0 ) ) using the formula for Column (8) above. The partial withdrawal exceeds the Free Withdrawal Amount. As a result, $4,110 of the partial withdrawal request is subject to a withdrawal charge. However, because the amount being withdrawn is taken from a Purchase Payment (and PPB and earnings attributable to a Purchase Payment and PPB) that was made more than eight Contribution Years prior to the partial withdrawal, no withdrawal charge is assessed. The Contract Value is reduced for the amount of the partial withdrawal ($8,900 - $5,000 = $3,900). For purposes of calculating the withdrawal charge on partial withdrawals and surrenders, we assume that amounts are withdrawn from Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in the chronological order in which they were received. Unless you request otherwise, we deduct any applicable withdrawal charge from the amount of the partial withdrawal. This means that when a withdrawal is requested and a withdrawal charge applies, you will receive a check for less than the amount requested. If you request otherwise and a withdrawal charge applies, we will reduce your Contract Value by the withdrawal charge in addition to the dollar amount sent to you. If you elect the GLWB Rider, please note that although we currently do not assess a withdrawal charge on Non-Excess Withdrawals, we reserve the right to do so. We will assess a withdrawal charge on Excess Withdrawals if such withdrawals would otherwise be subject to a withdrawal charge. If we assess a withdrawal charge on a Non-Excess Withdrawal or an Excess Withdrawal, we will calculate and impose the charge in the same manner that we would for any partial withdrawal. (See "Guaranteed Lifetime Withdrawal Benefit.") Because Contribution Years are based upon the date each Purchase Payment is made, you may be subject to a withdrawal charge even though the Contract may have been issued many years earlier. (For additional details, see "Withdrawals and Surrenders During the Accumulation Period.") For example: |_| You make a $15,000 Purchase Payment in the first Contract Year. |_| You make a $10,000 Purchase Payment in the fourth Contract year. |_| In the fifth Contract Year, the $15,000 Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and PPB) is in its fifth Contribution year and the $10,000 Purchase Payment (and the PPB and earnings attributable to that Purchase Payment and PPB) is in its second Contribution Year. The Free Withdrawal Amount and withdrawal charge also generally apply at annuitization to amounts attributable to Purchase Payments (and PPBs and earnings attributable to those Purchase Payments and PPBs) in their eighth Contribution Year or earlier. However, we do not assess a withdrawal charge upon annuitization if you select Annuity Option 2, 3, 4, or 5, or if payments under Annuity Option 1 are scheduled to continue for at least ten years. See "The Annuity Period--Annuity Options" for a discussion of the Annuity Options available. 67 Currently, we anticipate withdrawal charges will not fully cover distribution expenses. Unrecovered distribution expenses may be recovered from our general assets. Those assets may include proceeds from the mortality and expense risk charge. Currently, we do not assess withdrawal charges on required minimum distributions but reserve the right to do so. If we do assess a withdrawal charge, we will calculate and impose the charge in the same manner that we would for any partial withdrawal. We may reduce or eliminate the withdrawal charge if we anticipate that we will incur lower sales expenses or perform fewer services because of economies due to the size of a group, the average contribution per participant, or the use of mass enrollment procedures. Subject to certain exceptions and state approvals, withdrawal charges also are not assessed on withdrawals: |_| after you have been confined in a skilled health care facility or hospital for at least 90 consecutive days and you remain confined at the time of the request; |_| within 45 days following your discharge from a skilled health care facility after a confinement of at least 90 days; or |_| if you become disabled. The confinement must begin prior to your 75th birthday and at least two years after the later of the Date of Issue or the date the waiver endorsement was added to your Contract. The disability must begin prior to your 66th birthday and at least two years after the later of the Date of Issue or the date the waiver endorsement was added to your Contract. We must receive satisfactory proof of your disability. The proof may be a statement from your attending physician or any other proof satisfactory to us. "Disability" is defined as the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death, or which has lasted or can be expected to last for a continuous period of not less than 12 months. Such disability or confinement must not be due to: - substance abuse, or - mental or personality disorder without a demonstrable organic disease (a degenerative brain disease such as Alzheimer's Disease is considered an organic disease). Skilled Health Care Facility means a place which: - is licensed by the state, or certified if your state certifies such facilities, or operated pursuant to law if your state neither licenses nor certifies such facilities; - provides skilled nursing care under the supervision of a physician; - has twenty-four hour a day nursing services by or under the supervision of a licensed practical nurse (LPN) or a registered nurse (RN); and - keeps a medical record in accordance with accepted professional standards and practices for each patient. Hospital means a place that is licensed by the state as a hospital and is operating within the scope of its license. If your state does not license hospitals, then hospital means a place that is operated as a hospital pursuant to law. Restrictions and provisions related to the above withdrawal charge waiver are described in the Contract endorsements. 68 D. COMMUTATION CHARGE. We deduct a commutation charge if you request a lump sum payment with respect to: 1) any remaining periodic payments in the certain period under Annuity Options 1, 3 and 5 upon the death of an Annuitant during the Annuity Period; or 2) any remaining payments under Annuity Option 1. We deduct this charge to compensate us for any losses we might incur as a result of selling assets we hold to make a lump sum payment to you and for administrative costs in processing commuted values. The charge is equal to the following: For a fixed Annuity Option: 1) the present value of any remaining guaranteed Fixed Annuity payments (as of the date of calculation), using a discount rate that is equal to the interest rate used in calculating the initial income payment; LESS 2) the present value of any remaining guaranteed Fixed Annuity payments (as of the date of calculation), using a discount rate that is equal to the interest rate used in calculating the initial income payment plus 1%. For a variable Annuity Option: 1) the present value of any remaining guaranteed Variable Annuity payments (as of the date of calculation), using a discount rate that is equal to the assumed investment rate used in calculating the initial income payment; LESS 2) the present value of any remaining guaranteed Variable Annuity payments (as of the date of calculation), using a discount rate that is equal to the assumed investment rate used in calculating the initial income payment plus 1%. We will determine the present value of any remaining guaranteed Variable Annuity payments by applying the Annuity Unit value next determined after we receive the election to commute the remaining payments at our Service Center. E. INVESTMENT MANAGEMENT FEES AND OTHER EXPENSES. Each Fund's net asset value reflects the deductions of investment management fees, Rule 12b-1 fees (if applicable), and certain general operating expenses. Subject to limitations, you indirectly bear these fees and expenses. Further detail is provided in the prospectuses for the Funds' statements of additional information. F. STATE PREMIUM TAXES. Certain state and local governments impose a premium tax ranging from 0% to 3.50% of Purchase Payments (not including corresponding PPBs). If we pay state premium taxes, we will deduct the amount paid from: |_| Purchase Payments when we receive them, and/or |_| Partial withdrawals or full surrender, and/or |_| Death benefits, and/or |_| Contract Value applied to an Annuity Option at the time annuity payments start, and/or |_| Annuity payments when we pay them, and/or 69 |_| If you have elected the GLWB Rider, monthly Settlement Payments when we pay them (see "Guaranteed Lifetime Withdrawal Benefit"). If we deduct premium taxes from each annuity payment or each monthly Settlement Payment when we pay them, we will reduce each payment by the premium tax percentage multiplied by the amount of each payment until we have recovered an amount equal to the premium tax that we paid. In no case will we deduct a total of more than the premium tax that we paid. See "Appendix A--State Premium Tax Chart" in the Statement of Additional Information. G. REDUCTION OR ELIMINATION OF CERTAIN CHARGES. Contracts may be available for purchase in certain group or sponsored arrangements that qualify for reductions or eliminations of certain charges, the time periods in which such charges apply, or both. Group arrangements include those in which a trustee, an employer or an association purchases Contracts covering a group of individuals. Sponsored arrangements include those in which an employer or association allows us to offer Contracts to its employees or members on an individual basis. The contract fee may be reduced or eliminated if we anticipate lower administrative expenses. In certain other circumstances, sales expenses for Contracts purchased in certain group or sponsored arrangements may be reduced or eliminated and the applicable withdrawal charges may be reduced or eliminated. In determining whether a group or sponsored arrangement qualifies for reduced or eliminated charges, we will consider among other factors: |_| the size and type of group to which sales are to be made and administrative services provided, and the persistency expected from the group; |_| the total amount of Purchase Payments to be received and the method in which they will be remitted; |_| any prior or existing relationship with us; |_| the level of commission paid to selling broker-dealers; |_| the purpose for which the Contract is being purchased, and whether that purchase makes it likely that sales costs and administrative expenses will be reduced; and |_| the frequency of projected surrenders or distributions. We make any reductions or eliminations according to objective guidelines in effect when an application for a Contract is approved. We may change these guidelines from time to time. Any variation in the charges will reflect differences in costs or services and will be offered uniformly to all members of the group or sponsored arrangement. In no event will a charge reduction or elimination be permitted if it is unfairly discriminatory to any person or prohibited by law. THE ANNUITY PERIOD Contracts may be fully annuitized under one of several Annuity Options, which are available either on a fixed or variable basis. However, states may require variations to the Contract. If a state variation applies, it will appear in the Contract, an endorsement to the Contract, or a supplement to this Prospectus. You may annuitize any time after the Valuation Date on or next following one year from the Date of Issue. Annuity payments will begin on the Annuity Date under the Annuity Option you select. You may write to us prior to the payment of the death benefit or the first annuity payment date to request a change of the Annuity Date. Subject to state variation, the Annuity Date may not be after the Valuation Date on or next 70 following the later of the original older Owner's or Annuitant's 90th birthday. (See "Federal Tax Matters, 1. Tax Deferral During Accumulation Period, DELAYED ANNUITY DATES".) We do not permit partial annuitization. If you elect the GLWB Rider and the Maximum Annuity Date has been reached, you may choose the GLWB Rider annuitization option rather than one of the Annuity Options below. (See "Guaranteed Lifetime Withdrawal Benefit.") 1. ANNUITY PAYMENTS. The amount of the first annuity payment depends on: |_| the selected Annuity Option, and |_| the Annuity Option rates derived from the mortality tables specified in the Contract (for Annuity options 2, 3, 4, and 5), and |_| the age and gender of the Annuitant, and |_| the Withdrawal Value on the Annuity Date, and |_| the assumed investment rate (if variable annuitization is elected), and |_| the guaranteed minimum interest rate for annuitizations specified in the Contract (if fixed annuitization is elected). The age of the Annuitant influences the amount of periodic annuity payments because an older Annuitant is expected to have a shorter life span, resulting in larger payments. The sex of the Annuitant influences the amount of periodic payments, where males are expected to have a shorter life span than females, also resulting in larger payments. Under variable annuitization, you will receive the value of a fixed number of Annuity Units each month. An Annuity Unit's value reflects the investment performance of the Subaccount(s) selected. As a result, annuity payments will vary accordingly. If the Annuity Unit Values of the Subaccount(s) in which you invest increase, the amount of your annuity payments will increase. If the Annuity Unit Values of the Subaccount(s) in which you invest decrease, the amount of your annuity payments will decrease. 2. ANNUITY OPTIONS. You may elect one of the Annuity Options. We must receive an election of an Annuity Option in writing at our Service Center at least 15 calendar days before the Annuity Date. If no Annuity Option is elected, monthly annuity payments will be made in accordance with Option 3 below if there is one Annuitant on the Annuity Date or under Option 5 if there are joint Annuitants on the Annuity Date. You may change an Annuity Option before the Annuity Date. You cannot change an Annuity Option after the first annuity payment is made. We reserve the right to add additional Annuity Options in the future. An election before the Annuity Date will be revoked by: 1) a subsequent change of Beneficiary, or 2) an assignment of the Contract unless the assignment provides otherwise. The Annuity Option selected must result in an initial payment that is at least equal to our minimum payment, according to our rules, at the time the Annuity Option is chosen. If the selected Annuity Option does not produce an initial payment which meets this minimum, we reserve the right to decrease the payment frequency to quarterly, semi-annually, or annually to meet this minimum, or to make a single lump sum payment. 71 If you die before the Annuity Date, available Annuity Options are limited. The Annuity Options available are: |_| Option 2 over the lifetime of the Beneficiary, or |_| Option 1 or 3 with a specified period or certain period no longer than the life expectancy of the Beneficiary. The life expectancy of the Beneficiary must be at least ten years as of the date that he or she elects Option 1 or Option 3. The death benefit distribution must begin no later than one year from your death, unless a later date is permitted by federal regulation. If the Beneficiary is not an individual, the entire interest must be distributed within five years of your death. OPTION 1--INCOME FOR SPECIFIED PERIOD. Option 1 provides an annuity payable monthly for ten years. If you must take required minimum distributions from a Qualified Contract, consult a tax advisor before selecting this Option, as it may not satisfy those requirements in all situations. OPTION 2--LIFE INCOME. Option 2 provides for an annuity payable monthly over the lifetime of the Annuitant. If Option 2 is elected, annuity payments terminate automatically and immediately on the Annuitant's death without regard to the number or total amount of payments made. Thus, it is possible for you to receive only one payment if death occurred prior to the date the second payment was due. OPTION 3--LIFE INCOME WITH INSTALLMENTS GUARANTEED. Option 3 provides an annuity payable monthly for a certain period of 10 years and thereafter during the Annuitant's lifetime. If you must take required minimum distributions from a Qualified Contract, consult a tax advisor before selecting this Option, as it may not satisfy those requirements in all situations. OPTION 4--JOINT AND SURVIVOR ANNUITY. Option 4 provides an annuity payable monthly while both Annuitants are living. Upon either Annuitant's death, the monthly income payable continues over the life of the surviving Annuitant at a percentage of the original payment. The percentage payable must be selected at the time the Annuity Option is chosen. The percentages available are 50%, 66 2/3%, 75% and 100%. Annuity payments terminate automatically and immediately upon the surviving Annuitant's death without regard to the number or total amount of payments received. OPTION 5--JOINT AND SURVIVOR ANNUITY WITH INSTALLMENTS GUARANTEED. Option 5 provides an annuity payable monthly for a certain period of 10 years and thereafter while either Annuitant is alive. If you must take required minimum distributions from a Qualified Contract, consult a tax advisor before selecting this Option, as it may not satisfy those requirements in all situations. When you are choosing an Annuity Option, you should consider that: |_| for younger Annuitants, selecting Option 2 - Life Income, might result in smaller monthly payments than selecting Option 1 - Income for Specified Period; for older Annuitants, selecting Option 2 - Life Income, might result in larger monthly payments than selecting Option 1 - Income for Specified Period. 72 |_| selecting Option 3 - Life Income with Installments Guaranteed, will result in smaller monthly payments than selecting Option 2 - Life Income; however, the Owner or Beneficiary may receive more payments under Option 3 if the Annuitant dies before the end of the certain period |_| selecting Option 4 - Joint and Survivor Annuity, will result in smaller monthly payments than selecting Option 2 - Life Income. In lieu of monthly payments, you may request quarterly, semi-annual, or annual payments, with our prior approval. 3. ALLOCATION OF ANNUITY. Subject to state variation, when you elect an Annuity Option, you may request that we reallocate your Contract Value on the Annuity Date among the Investment Options you choose to arrange for payments on a fixed or variable basis, or a combination of both. A reallocation on the Annuity Date will not be subject to the transfer restrictions that we would normally impose. If we do not receive an election, any Fixed Account Withdrawal Value will be annuitized on a fixed basis and any Separate Account Withdrawal Value will be annuitized on a variable basis. Transfers among the Subaccounts during the Annuity Period are permitted subject to certain limitations. We reserve the right to restrict the number of Subaccounts available during the Annuity Period. You may not transfer to or from the Fixed Account during the Annuity Period. 4. FIXED ANNUITY PAYMENTS We calculate the portion of the Withdrawal Value that you elected to have paid to you as Fixed Annuity payments. We apply an annuity factor for the Annuity Option that you selected to this value to determine the first Fixed Annuity payment. Each Fixed Annuity payment will be equal to the first regardless of investment, mortality or expense experience, unless the Annuity Option selected specifies that there is to be a reduction in payments after the death of an Annuitant. 5. VARIABLE ANNUITY PAYMENTS We calculate the portion of the Withdrawal Value that you elected to have paid to you as Variable Annuity payments from each Subaccount. We apply an annuity factor for the Annuity Option that you selected to this value for each Subaccount to determine the first Variable Annuity payment for that Subaccount. The first Variable Annuity payment for each Subaccount is divided by the Annuity Unit value for that Subaccount to establish the number of Annuity Units per payment for that Subaccount. The number of units will not change after the initial determination unless a transfer occurs or the Annuity Option selected specifies that there is to be a reduction in payments upon the death of an Annuitant. Future Variable Annuity payments are determined by multiplying the number of Annuity Units per payment for each Subaccount by the Annuity Unit value for that Subaccount at the end of the Valuation Date that each annuity payment is due and summing the result. 6. BASIS OF ANNUITY OPTIONS Your Contract will contain tables for each Annuity Option that show the guaranteed monthly payment for each $1,000 applied to an Annuity Option. The guaranteed monthly payments are based on an interest rate (or assumed investment rate if variable annuitization is elected) of 2.50% per year and, where mortality is involved, the "Annuity 2000 Table" developed by the Society of Actuaries projected using Scale G to the year 2015. We may offer annuity rates for Fixed Annuity payments that are more favorable than those contained in the Contract. Any such rates will be applied uniformly to all Owners of the same class. We may also offer Variable Annuity payment options based on assumed investment rates other than 2.50%, but not greater than 5.00%. 73 The tables that we prepare for each annuity option are calculated with an assumed investment rate of 2.50% per annum. If the actual annualized net investment rate in a Subaccount exceeds 2.50% per annum, Variable Annuity payments for that Subaccount will increase. Conversely, if the actual annualized net investment rate for a Subaccount is less than 2.50% per annum, Variable Annuity payments for that Subaccount will decrease. ANNUITY UNIT VALUE. Annuity Unit values are determined independently for each Subaccount. The Annuity Unit value at the end of any Valuation Period is equal to a. multiplied by b. multiplied by c. where: a. is the Annuity Unit value at the end of the preceding Valuation Period b. is the net investment experience factor for the current Valuation Period c. is an interest factor of 0.99993235 for each calendar day in the current Valuation Period. The interest factor offsets the assumed investment rate of 2.5% per annum used in the Contract's annuity tables. A different interest factor will be used if we offer other assumed investment rates. The net investment experience factor for a Subaccount for the current Valuation Period is equal to x. divided by y. where: x. Is the Subaccount's Accumulation Unit value at the end of the current Valuation Period y. Is the Subaccount's Accumulation Unit value at the end of the preceding Valuation Period 7. TRANSFERS DURING THE ANNUITY PERIOD. During the Annuity Period, you may, by written request to our Service Center, transfer Contract Value from one Subaccount to another Subaccount, subject to the following limitations: |_| Transfers among Subaccounts are prohibited during the first year of the Annuity Period; subsequent transfers are limited to one per year. |_| Your interest in a Subaccount must be transferred in increments of 25%. |_| Your annuity payments for the Subaccount you are transferring to must be at least $100 after the transfer. Your annuity payments for the Subaccount you are transferring from must be at least $100 after the transfer, unless the transfer will eliminate your interest in the Subaccount. |_| You may not transfer to or from the Fixed Account. We calculate the number of Annuity Units per payment for the Subaccount you are transferring to, as A multiplied by B divided by C, where: A = The number of Annuity Units per payment for the Subaccount you are transferring from; B = The Annuity Unit value of the Subaccount you are transferring from; and C = The Annuity Unit value of the Subaccount you are transferring to. TRANSFER PROCEDURES - We will make transfers pursuant to proper written or telephone instructions to our Service Center that specify in detail the requested changes. Transfers involving a Subaccount will be based upon the Annuity Unit values determined following our receipt of complete transfer instructions. If we receive a transfer request at our Service Center before the close of business on the Valuation Date, we will process the request based on Annuity Unit values determined at the end of that Valuation Date. If we 74 receive a transfer request at our Service Center on or after the close of business on the Valuation Date, we will process the request based on Annuity Unit values determined at the end of the next Valuation Date. If you or your authorized representative call us to request a telephone transfer but have not given instructions to us prior to the close of business on the Valuation Date, even if due to our delay in answering your call, we will consider your telephone transfer request to be received after the close of business on the Valuation Date. We may suspend, change or terminate the transfer privilege at any time. 8. DEATH PROCEEDS. If the Annuitant dies, we will automatically continue any unpaid installments for the remainder of the certain period under Annuity Options 1, 3 or 5. If the Owner elects, we will pay a lump sum payment of the present value of the remaining payments in the certain period. The election to receive the lump sum payment must be made within 60 days of our receipt of due proof of death of the Annuitant or joint Annuitants. We deduct a commutation charge if you request a lump sum payment with respect to: 1) any remaining periodic payments in the certain period under Annuity Options 1, 3 and 5 upon the death of an Annuitant during the Annuity Period; or 2) any remaining payments under Annuity Option 1. The charge is equal to the following: For a fixed Annuity Option: 1) the present value of any remaining guaranteed Fixed Annuity payments (as of the date of calculation), using a discount rate that is equal to the interest rate used in calculating the initial income payment; LESS 2) the present value of any remaining guaranteed Fixed Annuity payments (as of the date of calculation), using a discount rate that is equal to the interest rate used in calculating the initial income payment plus 1%. For a variable Annuity Option: 1) the present value of any remaining guaranteed Variable Annuity payments (as of the date of calculation), using a discount rate that is equal to the assumed investment rate used in calculating the initial income payment; LESS 2) the present value of any remaining guaranteed Variable Annuity payments (as of the date of calculation), using a discount rate that is equal to the assumed investment rate used in calculating the initial income payment plus 1%. We will determine the present value of any remaining guaranteed Variable Annuity payments by applying the Annuity Unit value next determined after we receive the election to commute the remaining payments at our Service Center. If Annuity Option 2 is elected, annuity payments terminate automatically and immediately upon the Annuitant's death without regard to the number or total amount of payments made. Thus, it is possible that only one payment will be received if death occurred prior to the date the second payment was due. Under Annuity Option 4, Annuity payments terminate automatically and immediately upon the surviving Annuitant's death without regard to the number or total amount of payments received. If an Owner, who is not also an Annuitant, dies after the Annuity Date, the following provisions apply: |_| If the Owner was the sole Owner, the remaining annuity payments will be payable to the Beneficiary in accordance with the provisions described above. The Beneficiary will become the Owner of the Contract. 75 |_| If the Contract has joint Owners, the annuity payments will be payable to the surviving joint Owner in accordance with the provisions described above. Upon the death of the surviving joint Owner, the Beneficiary becomes the Owner. 9. PROTECTION OF BENEFITS. Unless otherwise provided in the supplementary agreement, the Owner may not commute, anticipate, assign, alienate or otherwise hinder the receipt of any annuity payment. Further, the proceeds of the Contract and any payment under an Annuity Option will be exempt from the claim of creditors and from legal process to the extent permitted by law. 10. AGE, GENDER AND SURVIVAL. We may require satisfactory evidence of the age, gender and the continued survival of any person on whose life the income is based. If the Annuitant's age or gender has been misstated, the amount payable under the Contract will be calculated as if those Purchase Payments sent to us had been made at the correct age or gender. Interest not to exceed the lesser of 3% or the maximum allowed by state law compounded each year will be charged to any overpayment or credited to any underpayment against future payments we may make under the Contract. In 1983, the United States Supreme Court held in ARIZONA GOVERNING COMMITTEE V. NORRIS that optional annuity benefits provided under an employee's deferred compensation plan could not, under Title VII of the Civil Rights Act of 1964, vary between men and women on the basis of sex. In addition, legislative, regulatory, or decisional authority of some states may prohibit use of sex-distinct mortality tables under certain circumstances. The Contracts offered by this Prospectus are based upon actuarial tables that distinguish between men and women and, thus, the Contract provides different benefits to men and women of the same age. Accordingly, employers and employee organizations should consider, in consultation with legal counsel, the impact of these authorities on any employment-related benefits program before purchasing the Contract. PAYMENTS TO CONTRACT OWNERS Generally, we will make any death benefit, loan, withdrawal, surrender, or annuity payment to you or effect any transfer within seven days after the Valuation Date we receive your proper request at our Service Center. However, we may suspend or postpone payments of any amount where permitted under applicable federal or state laws, rules, or regulations. We may suspend or defer payments or transfers involving any Subaccount: |_| during any period when the New York Stock Exchange is closed, |_| when trading is restricted or the SEC determines an emergency exists, or |_| as the SEC by order may permit. We also may defer any payment or transfer from the Fixed Account for the period permitted by law. During the deferral period, we will continue to credit interest at the current applicable interest rates. This can never be more than six months after you send us the request. Applicable laws designed to counter terrorism and prevent money laundering might, in certain circumstances, require us to block your ability to make certain transactions and thereby refuse to accept any Purchase Payment or requests for transfers, withdrawals, surrenders, loans, annuitization, or death benefits, 76 until instructions are received from the appropriate regulator. We may also be required to provide additional information about you and your Contract to government regulators. If you have submitted a recent check or draft that has not cleared through the banking system, we have the right to defer payment of a transfer, death benefit, loan, withdrawal, surrender, or annuity payment until such check or draft has been honored. FEDERAL TAX MATTERS A. INTRODUCTION This discussion is not exhaustive and is not intended as tax advice. A qualified tax adviser should always be consulted with regard to the application of the law to individual circumstances. This discussion is based on the Code, Treasury Department regulations, and interpretations existing on the date of this Prospectus. These authorities, however, are subject to change by Congress, the Treasury Department, and the courts. This discussion does not address state or local tax consequences, nor federal estate or gift tax consequences, associated with buying a Contract. IN ADDITION, WE MAKE NO GUARANTEE REGARDING ANY TAX TREATMENT--FEDERAL, STATE, OR LOCAL--OF ANY CONTRACT OR OF ANY TRANSACTION INVOLVING A CONTRACT. In this discussion, PPBs are treated as earnings for tax purposes. B. OUR TAX STATUS We are taxed as a life insurance company and the operations of the Separate Account are treated as a part of our total operations. The Separate Account is not separately taxed as a "regulated investment company." Investment income and capital gains of the Separate Account are not taxed to the extent they are applied under a contract. We do not anticipate that we will incur federal income tax liability attributable to the income and gains of the Separate Account, and therefore we do not intend to provide for these taxes. If we are taxed on investment income or capital gains of the Separate Account, then we may charge the Separate Account to pay these taxes. C. TAXATION OF ANNUITIES IN GENERAL 1. TAX DEFERRAL DURING ACCUMULATION PERIOD Under the Code, except as described below, increases in the Contract Value of a Non-Qualified Contract are generally not taxable to the Owner or Annuitant until received as annuity payments or otherwise distributed. However, certain requirements must be satisfied for this general rule to apply, including: |_| the Contract must be owned by an individual, |_| Separate Account investments must be "adequately diversified", |_| we, rather than you, must be considered the Owner of Separate Account assets for federal tax purposes, and |_| annuity payments must appropriately amortize Purchase Payments and Contract earnings. NON-NATURAL OWNER. As a general rule, deferred annuity contracts held by "non-natural persons", such as corporations, trusts or similar entities, are not annuity contracts for federal income tax purposes. The investment income on these contracts is taxed each year as ordinary income received or accrued by the non-natural Owner. There are exceptions to this general rule for non-natural Owners. Contracts are 77 generally treated as held by a natural person if the nominal Owner is a trust or other entity holding the contract as an agent for a natural person. However, this special exception does not apply to an employer who is the nominal Owner of a contract under a non-qualified deferred compensation plan for its employees. Additional exceptions to this rule include: |_| certain Contracts acquired by a decedent's estate due to the death of the decedent, |_| certain Qualified Contracts, |_| certain Contracts used with structured settlement agreements, and |_| certain Contracts purchased with a single premium when the Annuity Date is no later than one year from Contract purchase and substantially equal periodic payments are made at least annually. DIVERSIFICATION REQUIREMENTS. For a Contract to be treated as an annuity for federal income tax purposes, separate account investments must be "adequately diversified". The Treasury Secretary issued regulations prescribing standards for adequately diversifying separate account investments. If the Separate Account failed to comply with these diversification standards, the contract would not be treated as an annuity contract for federal income tax purposes and the Owner would generally be taxed on the difference between the contract value and the Purchase Payments. Although we do not control Fund investments, we expect that each Fund will comply with these regulations so that each Subaccount of the Separate Account will be considered "adequately diversified." OWNERSHIP TREATMENT. In certain circumstances, a variable annuity contract Owner may be considered the Owner of the assets of the separate account supporting the contract. Then, income and gains from separate account assets are includible in the Owner's gross income. The Internal Revenue Service ("IRS"), in published rulings, stated that a variable contract Owner will be considered the Owner of separate account assets if the Owner possesses the ability to exercise investment control over the assets. As of the date of the Prospectus, no comprehensive guidance has been issued by the IRS clarifying the circumstances when such investment control by a variable contract Owner would exist. As a result, your right to allocate the Contract Value among the Subaccounts may cause you to be considered the Owner of the assets of the Separate Account. We do not know what limits may be set forth in any guidance that the IRS may issue, or whether any such limits will apply to existing Contracts. We therefore reserve the right to modify the Contract as necessary to attempt to prevent you from being considered the Owner of the Separate Account assets. However, there is no assurance that such efforts would be successful. PUBLICLY-AVAILABLE FUNDS. Several of the Funds offered through the Separate Account are also available to the general public The IRS has ruled that investing in mutual funds shares that are "publicly-available," i.e., shares of mutual finds that can be purchased directly without purchasing a variable annuity or life insurance contract, is incompatible with the investment control restrictions described in the previous paragraph. ACCORDINGLY, IF A NON-QUALIFIED CONTRACT INVESTS IN PUBLICLY-AVAILABLE FUNDS, IT WILL NOT BE TREATED AS AN ANNUITY CONTRACT FOR FEDERAL INCOME TAX PURPOSES. For this purpose, a Contract purchased in connection with a non-government sponsored 457 plan is treated as a Non-Qualified Contract. Publicly-Available Funds under the Separate Account are intended only for Qualified Contracts. The IRS has ruled that most types of qualified contracts are not subject to the restrictions against investing in publicly-available mutual funds. We therefore believe that Qualified Contracts (other than those issued in connection with non-government 457 plans) may invest in publicly-available funds and remain exempt from current taxation until amounts are distributed or deemed to be distributed from the Contract. 78 REQUIRED DISTRIBUTIONS. In order to be treated as an annuity contract for federal income tax purposes, Section 72(s) of the Code requires any Non-Qualified Contract to contain certain provisions specifying how your interest in the Contract will be distributed in the event of the death of an Owner. Specifically, Section 72(s) requires that (a) if any Owner dies on or after the Annuity Date, but prior to the time the entire interest in the Contract has been distributed, the entire interest in the Contract will be distributed at least as rapidly as under the method of distribution being used as of the date of such Owner's death; and (b) if any Owner dies prior to the Annuity Date, the entire interest in the Contract will be distributed within five years after the date of such Owner's death. These requirements will be considered satisfied as to any portion of a Owner's interest which is payable to or for the benefit of a designated Beneficiary and which is distributed over the life of such designated Beneficiary or over a period not extending beyond the life expectancy of that Beneficiary, provided that such distributions begin within one year of the Owner's death. The designated Beneficiary refers to a natural person designated by the Owner as a Beneficiary and to whom ownership of the Contract passes by reason of death. However, if the designated Beneficiary is the surviving spouse of the deceased Owner, the Contract may be continued with the surviving spouse as the new Owner. The Non-Qualified Contracts contain provisions that are intended to comply with these Code requirements, although no regulations interpreting these requirements have yet been issued. We intend to review such provisions and modify them if necessary to assure that they comply with the applicable requirements when such requirements are clarified by regulation or otherwise. Other rules may apply to Qualified Contracts. DELAYED ANNUITY DATES. If the Annuity Date occurs (or is scheduled to occur) when the Annuitant has reached an advanced age, e.g., past age 85, the Contract might not be treated as an annuity for federal income tax purposes. In that event, the income and gains under the Contract would be currently includible in your income. The following discussion assumes that the Contract is treated as an annuity contract for tax purposes and that we are treated as the Owner of Separate Account assets. 2. TAXATION OF PARTIAL AND FULL WITHDRAWALS Partial withdrawals from a Non-Qualified Contract are includible in income to the extent the Contract Value exceeds the "investment in the contract". This amount is referred to as the "income on the contract". Full withdrawals are also includible in income to the extent they exceed the "investment in the contract." Investment in the contract equals the total of Purchase Payments (not including any corresponding PPBs) minus any amounts previously received from the Contract that were not includible in your income. All amounts includible in income with respect to the Contract are taxed as ordinary income. Credits we make to your Contract in connection with the PPB are not part of your investment in your Contract (and thus, for tax purposes, are treated in the same way as investment gains). All amounts includible in income with respect to the Contract are taxed as ordinary income. Any assignment or pledge (or agreement to assign or pledge) of Contract Value is treated as a withdrawal. Investment in the contract is increased by the amount includible in income with respect to such assignment or pledge. If you transfer a contract interest, without adequate consideration, to someone other than your spouse (or to a former spouse incident to divorce), you will be taxed on the income on the contract. In this case, the transferee's investment in the contract is increased to reflect the increase in your income. The Contract's optional death benefits, if elected, may exceed Purchase Payments or Contract Value. As described in the Prospectus, we impose certain charges with respect to these death benefits. It is possible that those charges (or some portion) could be treated as a partial withdrawal. 79 If your Contract contains a GLWB Rider, the application of certain tax rules, particularly those rules relating to distributions from your Contract, are not entirely clear. In view of this uncertainty, you should consult a tax advisor before purchasing the GLWB Rider. There may be special income tax issues present in situations where the Owner and the Annuitant are not the same person and are not married to one another. A tax adviser should be consulted in those situations. 3. TAXATION OF ANNUITY PAYMENTS Normally, the portion of each annuity payment taxable as ordinary income equals the payment minus the exclusion amount. The exclusion amount for Variable Annuity payments is the "investment in the contract" allocated to the variable Annuity Option and adjusted for any period certain or refund feature, divided by the number of payments expected to be made. The exclusion amount for Fixed Annuity payments is the payment times the ratio of the investment in the contract allocated to the fixed Annuity Option and adjusted for any period certain or refund feature, to the expected value of the Fixed Annuity payments. For income tax purposes, the PPB you receive is not considered "investment in the contract." This means the PPB will be taxed. Once the total amount of the investment in the contract is excluded using these ratios, annuity payments will be fully taxable. If annuity payments stop because the Annuitant dies before the total amount of the investment in the contract is recovered, the unrecovered amount generally is allowed as a deduction to the Annuitant in the last taxable year. 4. TAXATION OF DEATH BENEFITS Amounts may be distributed upon your or the Annuitant's death. Death benefits are includible in income and: |_| if distributed in a lump sum are taxed like a full withdrawal, or |_| if distributed under an Annuity Option are taxed like annuity payments. 5. PENALTY TAX ON PREMATURE DISTRIBUTIONS A 10% penalty tax applies to a taxable payment from a Non-Qualified Contract unless: |_| received on or after you reach age 59 1/2, |_| received due to your disability, |_| made to a Beneficiary after your death or, for non-natural Owners, after the primary Annuitant's death, |_| made as a series of substantially equal periodic payments (at least annually) for your life (or life expectancy) or for the joint lives (or joint life expectancies) of you and a designated Beneficiary (within the meaning of the tax law), |_| made under a Contract purchased with a single premium when the Annuity Date is no later than one year from Contract purchase and substantially equal periodic payments are made at least annually, or |_| made with annuities used with certain structured settlement agreements. Other exceptions may apply. 80 6. AGGREGATION OF CONTRACTS The taxable amount of an annuity payment or withdrawal from a Non-Qualified Contract may be determined by combining some or all of the Non-Qualified Contracts you own. For example, if you purchase a Contract and also purchase an immediate annuity at approximately the same time, the IRS may treat the two contracts as one contract. Similarly, if a person transfers part of his interest in one annuity contract to purchase another annuity contract, the IRS might treat the two contracts as one contract. In addition, if you purchase two or more Non-Qualified deferred annuity contracts from the same company (or its affiliates) during any calendar year, these contracts are treated as one contract. The effects of this aggregation are not always clear. However, it could affect the taxable amount of an annuity payment or withdrawal and the amount which might be subject to the 10% penalty tax. 7. EXCHANGE OF ANNUITY CONTRACTS We may issue the Contract in exchange for all or part of another annuity contract that you own. Such an exchange will be tax free if certain requirements are satisfied. If the exchange is tax free, your investment in the contract immediately after the exchange will generally be the same as that of the annuity contract exchanged, increased by any additional Purchase Payment (but not including any corresponding PPBs) made as part of the exchange. Your Contract Value immediately after the exchange may exceed your investment in the contract. That excess may be includible in income should amounts subsequently be withdrawn or distributed from the Contract (e.g. as a partial surrender, full surrender, annuity income payment, or death benefit). If you exchange part of an existing annuity contract for the Contract, the IRS might treat the two contracts as one annuity contract in certain circumstances. (See "Aggregation of Contracts.") You should consult your tax adviser in connection with an exchange of all or part of an annuity contract for the Contract. 8. LOSS OF INTEREST DEDUCTION WHERE CONTRACTS ARE HELD BY OR FOR THE BENEFIT OF CERTAIN NON-NATURAL PERSONS For Contracts issued to a non-natural Owner, all or some portion of otherwise deductible interest may not be deductible by the Owner. However, this interest deduction disallowance does not affect Contracts where the Owner is taxable each year on the investment income under the Contract. Entities considering purchasing the Contract, or entities that will be Beneficiaries under a Contract, should consult a tax adviser. D. QUALIFIED PLANS Currently, the Contracts are also available for use in connection with retirement plans which receive favorable treatment under Sections 401, 403, 408, 408A or 457 of the Code. Contracts offered for use in connection with retirement plans that receive favorable treatment under Sections 401, 403, 408, 408A or 457 of the Code ("Qualified Plans") are referred to as "Qualified Contracts." Numerous special tax rules apply to the participants in Qualified Plans and to Qualified Contracts. We make no attempt in this Prospectus to provide more than general information about use of the Contract with the various types of Qualified Plans. PERSONS INTENDING TO USE THE CONTRACT IN CONNECTION WITH QUALIFIED PLANS SHOULD CONSULT A TAX ADVISER. Under the Code, qualified plans generally enjoy tax-deferred accumulation amounts invested in the plan. Therefore, in considering whether or not to purchase a Contract in a qualified plan, you should consider the Contract's features other than tax deferral, including the availability of lifetime annuity payments and death benefit protection. The tax rules applicable to Qualified Plans vary according to the type of plan and the terms and conditions of the plan. For example, for both withdrawals and annuity payments under certain Qualified Contracts, there may be no "investment in the contract" and the total amount received may be taxable. Also, loans from Qualified Contracts, where allowed, are subject to a variety of limitations, including restrictions as to the amount that may be borrowed, the duration of the loan, the number of allowable loans 81 and the manner in which the loan must be repaid. (You should always consult your tax adviser and retirement plan fiduciary prior to exercising loan privileges.) Both the amount of the contribution that may be made, and the tax deduction or exclusion that you may claim for such contribution, are limited under Qualified Plans. If the Contract is used with a Qualified Plan, you and the Annuitant must be the same individual. If a joint Annuitant is named, all distributions made while the Annuitant is alive must be made to the Annuitant. Also, if a joint Annuitant is named who is not the Annuitant's spouse, the Annuity Options which are available may be limited, depending on the difference in their ages. Furthermore, the length of any guarantee period may be limited in some circumstances to satisfy certain minimum distribution requirements under the Code. Qualified Contracts are subject to special rules specifying the time at which distributions must begin and the amount that must be distributed each year. In the case of Individual Retirement Annuities, distributions of minimum amounts must generally begin by April 1 of the calendar year following the calendar year in which the Owner attains age 70 1/2. The required beginning date for 401, 403 and 457 plans is the April 1 of the calendar year following the later of the year in which the Owner attains age 70 1/2 or retires. There are no required minimum distributions during the Owner's lifetime under Roth IRAs. An excise tax is imposed for the failure to comply with the minimum distribution requirements. This excise tax generally equals 50% of the amount by which a minimum required distribution exceeds the actual distribution. The death benefit or other optional benefits under your Contract may affect the amount of the minimum required distribution that must be taken from your Contract. A 10% penalty tax may apply to the taxable amount of payments from Qualified Contracts. For Individual Retirement Annuities, the penalty tax does not apply, for example, to a payment: |_| received after you reach age 59 1/2, |_| received after your death or because of your disability, or |_| made as a series of substantially equal periodic payments (at least annually) for your life (or life expectancy) or for the joint lives (or joint life expectancies) of you and your designated Beneficiary. In addition, the penalty tax does not apply to certain distributions used for qualified first time home purchases or for higher education expenses. Special conditions must be met to qualify for these exceptions. If you wish to take a distribution for these purposes you should consult your tax adviser. Other exceptions may also be available. Qualified Contracts are amended to conform to tax qualification requirements. However, you are cautioned that the rights of any person to any benefits under Qualified Plans may be subject to the terms and conditions of the plans themselves, regardless of the terms and conditions of the Contract. In addition, we are not bound by terms and conditions of Qualified Plans if they are inconsistent with the Contract. 1. QUALIFIED PLAN TYPES INDIVIDUAL RETIREMENT ANNUITIES. The Code permits eligible individuals to contribute to an individual retirement annuity known as an "IRA." IRAs limit the amounts contributed, the persons eligible and the time when distributions start. Also, subject to direct rollover and mandatory withholding requirements, distributions from other types of qualified plans generally may be "rolled over" on a tax-deferred basis into an IRA. The Contract may not fund a "Coverdell Education Savings Account" (formerly known as an "Education IRA"). SIMPLIFIED EMPLOYEE PENSIONS (SEP IRAS). The Code allows employers to establish simplified employee pension plans, using the employees' IRAs. Under these plans the employer may make limited deductible contributions on behalf of the employees to IRAs. Employers and employees intending to use the Contract in connection with these plans should consult a tax adviser. 82 SIMPLE IRAS. The Code permits certain small employers to establish "SIMPLE retirement accounts," including SIMPLE IRAs, for their employees. Under SIMPLE IRAs, certain deductible contributions are made by both employees and employers. SIMPLE IRAs are subject to various requirements, including limits on the amounts that may be contributed, the persons who may be eligible, and the time when distributions may commence. Employers and employees intending to use the Contract in connection with these plans should consult a tax adviser. ROTH IRAS. The Code permits contributions to an IRA known as a "Roth IRA." Roth IRAs differ from other IRAs in certain respects, including: |_| Roth IRA contributions are never deductible, |_| "qualified distributions" from a Roth IRA are excludable from income, |_| mandatory distribution rules do not apply before death, |_| a rollover to a Roth IRA must be a "qualified rollover contribution," under the Code, |_| special eligibility requirements apply, and |_| contributions to a Roth IRA can be made after the Owner has reached age 70 1/2. All or part of an IRA may be converted into a Roth IRA without taking an actual distribution. You may convert by notifying the IRA issuer or trustee. You must be eligible for a qualified rollover contribution to convert an IRA to a Roth IRA. A conversion typically results in the inclusion of some or all of the IRA value in gross income, except that the 10% penalty tax does not apply on the conversion. Persons with adjusted gross incomes in excess of $100,000 or who are married and file a separate return are not eligible to make a qualified rollover contribution or a transfer in a taxable year from a non-Roth IRA to a Roth IRA. Any "qualified distribution", as defined in Code Section 408A, from a Roth IRA is excludible from gross income. A qualified distribution includes a distribution made after you reach age 59 1/2, after your death, because of your disability, or made to a first-time homebuyer. A qualified distribution can only be made after the first five tax years after the year for which you (or your spouse) made a contribution to any Roth IRA established for your benefit. CORPORATE AND SELF-EMPLOYED ("H.R. 10" AND "KEOGH") PENSION AND PROFIT-SHARING PLANS. The Code permits corporate employers to establish types of tax-favored retirement plans for employees. The Self-Employed Individuals Tax Retirement Act of 1962, as amended, commonly referred to as "H.R. 10" or "Keogh" permits self-employed individuals also to establish such tax-favored retirement plans for themselves and their employees. Such retirement plans may permit the purchase of the Contracts in order to provide benefits under the plans. The Contract provides a death benefit that in certain circumstances may exceed the greater of the Purchase Payments and the Contract Value. It is possible that such a death benefit could be characterized as an incidental death benefit. There are limitations on the amount of incidental benefits that may be provided under pension and profit sharing plans. In addition, the provision of such benefits may result in current taxable income to participants. Employers intending to use the Contract in connection with such plans should seek competent advice. TAX-SHELTERED ANNUITIES. Code Section 403(b) permits public school employees and employees of certain types of charitable, educational and scientific organizations to have their employers purchase annuity contracts for them and, subject to certain limitations, to exclude the amount of Purchase Payments from taxable gross income. These annuity contracts are commonly referred to as "tax-sheltered annuities". If you purchase a Contract for such purposes, you should seek competent advice as to eligibility, limitations on permissible amounts of Purchase Payments and other tax consequences associated with the Contracts. In particular, you should consider that the Contract provides optional death benefits that in certain 83 circumstances may exceed the greater of the Purchase Payments and the Contract Value (see "Death Benefits"). It is possible that such death benefits could be characterized as incidental death benefits. If the death benefit were so characterized, this could result in currently taxable income to you. In addition, there are limitations on the amount of incidental benefits that may be provided under a tax-sheltered annuity. Tax-sheltered annuity contracts must contain restrictions on withdrawals of: |_| contributions made pursuant to a salary reduction agreement in years beginning after December 31, 1988, |_| earnings on those contributions, and |_| earnings after December 31, 1988 on amounts attributable to salary reduction contributions held as of December 31, 1988. These amounts can be paid only if you have reached age 59 1/2, severed employment, died, or becomes disabled (within the meaning of the tax law), or in the case of hardship (within the meaning of the tax law). Amounts permitted to be distributed in the event of hardship are limited to actual contributions; earnings thereon cannot be distributed on account of hardship. Amounts subject to the withdrawal restrictions applicable to Section 403(b)(7) custodial accounts may be subject to more stringent restrictions. (These limitations on withdrawals generally do not apply to the extent you direct us to transfer some or all of the Contract Value to the issuer of another tax-sheltered annuity or into a Section 403(b)(7) custodial account.) If you are a participant in the Texas Optional Retirement Program, you may not take withdrawals before death, disability, retirement, or termination from employment in the Texas public institutions of higher education, as provided in the Texas Optional Retirement Program. (You are, however, permitted to make transfers of Contract Value among the Investment Options.) DEFERRED COMPENSATION PLANS OF STATE AND LOCAL GOVERNMENTS AND TAX-EXEMPT ORGANIZATIONS. The Code permits employees of state and local governments and tax-exempt organizations to defer a portion of their compensation without paying current taxes. The employees must be participants in an eligible deferred compensation plan. Generally, a Contract purchased by a state or local government or a tax-exempt organization will not be treated as an annuity contract for federal income tax purposes. Those who intend to use the Contracts in connection with such plans should seek competent advice. 2. DIRECT ROLLOVERS If the Contract is used with a retirement plan that is qualified under Sections 401(a), 403(a), or 403(b) of the Code or with an eligible government deferred compensation plan that is qualified under Section 457(b), any "eligible rollover distribution" from the Contract will be subject to "direct rollover" and mandatory withholding requirements. An eligible rollover distribution generally is any distribution from such a qualified retirement plan, excluding certain amounts such as: - minimum distributions required under Section 401(a)(9) of the Code, - certain distributions for life, life expectancy, or for 10 years or more which are part of a "series of substantially equal periodic payments, " and - hardship distributions. Under these requirements, federal income tax equal to 20% of the taxable portion of the eligible rollover distribution will be withheld from the amount of the distribution. Unlike withholding on certain other amounts distributed from the Contract, discussed below, you cannot elect out of withholding with respect to an eligible rollover distribution. However, this 20% withholding will not apply if, instead of 84 receiving the eligible rollover distribution, you elect to have it directly transferred to certain types of qualified retirement plans. Prior to receiving an eligible rollover distribution, a notice will be provided explaining generally the direct rollover and mandatory withholding requirements and how to avoid the 20% withholding by electing a direct rollover. E. FEDERAL INCOME TAX WITHHOLDING We withhold and send to the U.S. Government a part of the taxable portion of each distribution unless you notify us before distribution of an available election not to have any amounts withheld. In certain circumstances, we may be required to withhold tax. The withholding rates for the taxable portion of periodic annuity payments are the same as the withholding rates for wage payments. In addition, the withholding rate for the taxable portion of non-periodic payments (including withdrawals prior to the maturity date and conversions of, or rollovers from, non-Roth IRAs to Roth IRAs) is 10%. The withholding rate for eligible rollover distributions is 20%. F. OTHER TAX ISSUES 1. FEDERAL ESTATE TAXES While no attempt is being made to discuss the federal estate tax implications of the Contract, a purchaser should keep in mind that the value of an annuity contract owned by a decedent and payable to a beneficiary by virtue of surviving the decedent is included in the decedent's gross estate. Depending on the terms of the annuity contract, the value of the annuity included in the gross estate may be the value of the lump sum payment payable to the designated beneficiary or the actuarial value of the payments to be received by the beneficiary. Consult an estate planning advisor for more information. 2. GENERATION-SKIPPING TRANSFER TAX. Under certain circumstances, the Code may impose a "generation skipping transfer tax" when all or part of an annuity contract is transferred to, or a death benefit is paid to, an individual two or more generations younger than the Owner. Regulations issued under the Code may require us to deduct the tax from your Contract, or from any applicable payment, and pay it directly to the IRS. 3. ANNUITY PURCHASES BY RESIDENTS OF PUERTO RICO The Internal Revenue Service recently announced that income received by residents of Puerto Rico under life insurance or annuity contracts issued by a Puerto Rico branch of a United States life insurance company is U.S.-source income that is generally subject to United States federal income tax. 4. ANNUITY PURCHASES BY NONRESIDENT ALIENS AND FOREIGN CORPORATIONS The discussion above provides general information regarding U.S. federal income tax consequences to annuity purchasers that are U.S. citizens or residents. Purchasers that are not U.S. citizens or residents will generally be subject to U.S. federal withholding tax on taxable distributions from annuity contracts at a 30% rate, unless a lower treaty rate applies. In addition, purchasers may be subject to state and/or municipal taxes and taxes that may be imposed by the purchaser's country of citizenship or residence. Prospective purchasers are advised to consult with a qualified tax adviser regarding U.S. state, and foreign taxation with respect to an annuity contract purchase. 5. FOREIGN TAX CREDITS We may benefit from any foreign tax credits attributable to taxes paid by certain Funds to foreign jurisdictions to the extent permitted under federal tax law. 6. POSSIBLE TAX LAW CHANGES Although the likelihood of legislative changes is uncertain, there is always the possibility that the 85 tax treatment of the Contract could change by legislation or otherwise. Consult a tax adviser with respect to legislative developments and their effect on the Contract. We have the right to modify the contract in response to legislative changes that could otherwise diminish the favorable tax treatment that annuity contract Owners currently receive. We make no guarantee regarding the tax status of any contact and do not intend the above discussion as tax advice. G. SPECIAL TAX CONSIDERATIONS FOR OPTIONAL BENEFITS At present, the IRS has not provided guidance as to the tax treatment of charges for optional benefits to an annuity contract. The IRS might take the position that each charge associated with these optional benefits is deemed a withdrawal from the Contract subject to current income tax to the extent of any gains and, if applicable, the 10% penalty tax for premature withdrawals. We do not currently report charges for optional benefits as partial withdrawals, but we may do so in the future if we believe that the IRS would require us to report them as such. You should consult a tax adviser before electing any optional benefit riders. Amounts received in a partial withdrawal are taxable to the extent that the Contract Value exceeds the investment in the Contract. There is some uncertainty regarding the effect that certain optional benefits, e.g., the GLWB Rider, might have on the amount that is treated as the Contract Value for this purpose. As a result, the taxable portion of amounts received in a partial withdrawal could be greater or less depending on how such optional benefits are treated for this purpose. The death benefit under a Qualified Contract, or any optional death benefit or other optional benefit rider, may increase the amount of any required minimum distributions. Failure to comply with minimum distribution requirements will result in the imposition of an excise tax, generally 50% of the amount by which the amount required to be distributed exceeds the actual distribution. If you are considering purchasing the GLWB Rider in connection with a Qualified Contract, in certain circumstances your ability to access the withdrawal benefit may be limited by the terms of your plan and/or by applicable law. Always consult your tax adviser before purchasing this Rider in connection with a Qualified Contract. DISTRIBUTION OF CONTRACTS The Contracts are distributed through the principal underwriter for the Separate Account: [_] ("Distributor") [ONE NEW YORK PLAZA, NEW YORK, NY 10004 MAILING ADDRESS: 30 HUDSON ST., 27TH FLOOR, JERSEY CITY, NJ 07032] [132 TURNPIKE ROAD, SUITE 210, SOUTHBOROUGH, MA 01772] The Distributor is a wholly-owned subsidiary of The Goldman Sachs Group, Inc. We pay compensation to Distributor for sales of the Contracts by selling firms. We also pay amounts to Distributor that may be used for its operating and other expenses, including the following sales expenses: compensation and bonuses for the Distributor's management team, advertising expenses, and other expenses of distributing the Contracts. Distributor's management team also may be eligible for non-cash compensation items that we may provide jointly with Distributor. Non-cash items include conferences, seminars and trips (including travel, lodging and meals in connection therewith), entertainment, merchandise and other similar items. SELLING FIRMS. We and Distributor have entered into selling agreements with selling firms for the sale of the Contracts. All selling firms receive commissions and some form of non-cash compensation. Selected selling firms may receive additional compensation, including marketing allowances, persistency payments, preferred status fees and industry conference fees. These commissions and other incentives or payments, if any, are not charged directly to Contract Owners or the Separate Account. We intend to 86 recoup commissions and other sales expenses through fees and charges deducted under the Contract or from our General Account. A portion of the payments made to selling firms may be passed on to their sales representatives in accordance with their internal compensation programs. Those programs may also include other types of cash and non-cash compensation and other benefits. COMPENSATION PAID TO ALL SELLING FIRMS. We and Distributor pay compensation to all selling firms in the form of commissions and certain types of non-cash compensation. The maximum commission payable for contract sales by selling firms is 6.0% of Purchase Payments. Some selling firms may elect to receive a lower commission when a Purchase Payment is made, along with annual trail commissions up to 0.80% of Account Value (less Purchase Payments received within the previous 12 months) for so long as the Contract remains in effect or as agreed in the selling agreement. Distributor may also provide non-cash compensation items that we may provide jointly with Distributor. Non-cash items include expenses for conference or seminar trips and certain gifts. ADDITIONAL COMPENSATION FOR SELECTED SELLING FIRMS. We and Distributor may pay additional compensation to selected selling firms, including marketing allowances, persistency payments, preferred status fees and industry conference fees. Marketing allowances are periodic payments to certain selling firms based on cumulative sales of our variable insurance contracts (including the Contracts). Persistency payments are periodic payments based on account values of our variable insurance contracts (including Account Values of the Contracts) or other persistency standards. Preferred status fees are paid to obtain preferred treatment of the Contracts in selling firms' marketing programs, which may include marketing services and increased access to their sales representatives. Industry conference fees are amounts paid to cover in part the costs associated with sales conferences and educational seminars for selling firms' sales representatives. The additional types of compensation discussed above are not offered to all selling firms. The terms of any particular agreement governing compensation may vary among selling firms and the amounts may be significant. The prospect of receiving, or the receipt of, additional compensation as described above may provide selling firms and/or their sales representatives with an incentive to favor sales of the Contracts over other variable annuity contracts (or other investments) with respect to which a selling firm does not receive additional compensation, or lower levels of additional compensation. You may wish to take such payment arrangements into account when considering and evaluating any recommendation relating to the contracts. For more information about any such arrangements, ask your sales representative for further information about what your sales representative and the selling firm for which he or she works may receive in connection with your purchase of a contract. VOTING RIGHTS Proxy materials in connection with any Fund shareholder meeting are delivered or made available to each Owner with Subaccount interests invested in the Fund as of the record date. Proxy materials include a voting instruction form. It is important that each Owner provide voting instructions to us because we vote all Fund shares proportionately in accordance with instructions received from Owners. This means that we will vote shares for which no timely instructions are received in the same proportion as those shares for which we do receive voting instructions. As a result, a small number of Owners may control the outcome of a vote. We will also vote any Fund shares attributed to amounts we have accumulated in the Subaccounts in the same proportion that Owners vote. A Fund is not required to hold annual shareholders' meetings. Funds hold special meetings as required or deemed desirable for such purposes as electing trustees, changing fundamental policies or approving an investment advisory agreement. Owners have voting rights in a Fund based upon the Owner's proportionate interest in the corresponding Subaccount as measured by units. Owners have voting rights before surrender, or the death of an Owner. Thereafter, the payee entitled to receive Variable Annuity payments has voting rights. During the Annuity Period, voting rights decrease as Annuity Units decrease. 87 REPORTS TO CONTRACT OWNERS AND INQUIRIES Each calendar quarter we send you a statement showing amounts credited to each Subaccount and to the Fixed Account. It also shows the interest rate(s) that we are crediting upon amounts held in the Fixed Account. In addition, if you transfer amounts among the Investment Options or make additional Purchase Payments, you receive written confirmation of these transactions. We will also send a current statement upon your request. We also send you annual and semi-annual reports for the Funds that underlie the Subaccounts in which you invest and a list of the securities held by that Fund. Read all reports carefully. If you find any errors, please contact us promptly to correct them. You will have access to Contract information through the Interactive Voice Response System (IVR) at [phone number]. You will also be able to access your account information from our website at www.cwannuity.com. You may direct inquiries to the selling agent or may call or write to us at our Service Center. DOLLAR COST AVERAGING Under our Dollar Cost Averaging ("DCA") program, a predesignated portion of any Subaccount is automatically transferred on a monthly, quarterly, semi-annual or annual basis for a specified duration to other Subaccounts or from the Fixed Account to a Subaccount or Subaccounts. If you elect this program, you cannot elect Automatic Asset Rebalancing. There is no charge associated with our DCA program. The theory of a DCA program is that by investing at regular and level increments over time, you will be able to purchase more Accumulation Units when the Accumulation Unit value is relatively low and less Accumulation units when the Accumulation Unit value is relatively high. DCA generally helps reduce the risk of purchasing Accumulation Units when market prices are high and selling when market prices are low. However, participation in the DCA program does not assure you of greater profit from your purchases under the program, nor will it prevent or necessarily reduce losses in a declining market. Moreover, while we refer to this program of periodic transfers generally as Dollar Cost Averaging, periodic transfers from a Subaccount (other than a Subaccount which maintains a stable net asset value), are less likely to produce the desired effect of the DCA program and may have the effect of reducing the average price of the Subaccount shares being redeemed. If you choose to participate in this program you should have the financial ability to continue making transfers through periods of fluctuating markets. The Owner may select any day of the month except for the 29th, 30th or 31st for the DCA transfers to occur. The Dollar Cost Averaging program is available only during the Accumulation Period. You may enroll any time by completing our Dollar Cost Averaging form. We must receive the enrollment form at least five business days before the transfer date. The minimum transfer amount is $100 per Subaccount. At the time Dollar Cost Averaging is elected, the total Contract Value in the Subaccount from which transfers will be made must be at least equal to the amount designated to be transferred on each transfer date times the duration selected. Dollar Cost Averaging ends if: |_| the number of designated monthly transfers has been completed, |_| Contract Value in the transferring account is insufficient to complete the next transfer; the remaining amount is transferred, |_| we receive your written termination at our Service Center at least five business days before the next transfer date, or |_| the Contract is surrendered or annuitized. If the Fixed Account balance is at least $10,000, you may elect automatic monthly or calendar quarter transfers of interest accrued in the Fixed Account to one or more of the Subaccounts. Transfers are 88 made within five business days of the end of the month or calendar quarter, as applicable. We must receive the enrollment form at least ten days before the end of the month or calendar quarter, as applicable. AUTOMATIC ASSET REBALANCING We currently offer Automatic Asset Rebalancing on a monthly, quarterly, semi-annual, or annual basis. If you elect this program, you cannot elect Dollar Cost Averaging. There is currently no charge for this service. Under Automatic Asset Rebalancing, we will allocate your Purchase Payments (and corresponding PPBs) and rebalance your Separate Account Contract Value monthly, quarterly, semi-annually, or annually to maintain the particular percentage allocation among the Subaccounts that you select based on your investment goals and risk tolerance. Rebalancing of your Separate Account Contract Value will occur on the initial rebalancing date you select and then each rebalancing date thereafter. The initial date you select cannot be earlier than 30 days from the Date of Issue. If based on your selected date, rebalancing would occur on a date that is not a Valuation Date, the rebalancing will occur on the Valuation Date following your selected date. You may change the frequency of Automatic Asset Rebalancing at any time. We perform this periodic rebalancing to take account of: - increases and decreases in Separate Account Contract Value in each Subaccount due to Subaccount performance, and - increases and decreases in Separate Account Contract Value in each Subaccount due to withdrawals, transfers, and Purchase Payments (and corresponding PPBs). You may elect Automatic Asset Rebalancing at any time on or after the Date of Issue by submitting a written request to our Service Center. If you elect Automatic Asset Rebalancing, you must include all Separate Account Contract Value in the program. We allocate all Purchase Payments (and corresponding PPBs) paid under an automatic investment feature and, unless you instruct us otherwise, all other Purchase Payments (and corresponding PPBs) in accordance with the particular percentage allocation among the Subaccounts that you have selected. The percentages that you select under Automatic Asset Rebalancing will override any prior percentage allocations that you have chosen and we will allocate all future Purchase Payments (and corresponding PPBs) accordingly. You may change your allocations at any time. Once elected, you may instruct us, in a form satisfactory to us, at any time to terminate the program. We reserve the right to make changes to this program at any time. SYSTEMATIC WITHDRAWAL PLAN We offer a Systematic Withdrawal Plan ("SWP") allowing you to preauthorize periodic withdrawals during the Accumulation Period. You instruct us to withdraw selected amounts from the Fixed Account or from any of the Subaccounts on a monthly, quarterly, semi-annual or annual basis. The SWP is available when you request a minimum $100 periodic payment. If the amounts distributed under the SWP exceed the Free Withdrawal Amount, we may assess the withdrawal charge on those amounts. WITHDRAWALS TAKEN UNDER THE SWP MAY BE SUBJECT TO THE 10% TAX PENALTY ON EARLY WITHDRAWALS AND TO INCOME TAXES AND WITHHOLDING. If you are interested in SWP, you may obtain an application and information concerning this program and its restrictions from us or your agent. We give thirty days' notice if we amend the SWP. The SWP may be terminated at any time by you or us. There is no charge associated with the SWP. SPECIAL CONSIDERATIONS We reserve the right to amend the Contract to meet the requirements of federal or state laws or regulations. We will notify you in writing of these amendments. Your rights under a Contract may be assigned as provided by law. An assignment will not be binding upon us until we receive a written copy of the assignment at our Service Center. Any claim is subject to 89 proof of interest of the assignee. You are solely responsible for the validity or effect of any assignment. You, therefore, should consult a qualified tax adviser regarding the tax consequences, as an assignment may be a taxable event. Only our President, Vice President, Secretary, or Assistant Secretaries may change the Contract. No one else has authority to modify or waive any provision of the Contract. Any change must be in writing. At any time, we may make such changes to the Contract, without your consent, as required to make it conform with any law, regulation, or ruling issued by a government agency. We will notify you of such changes and when required will obtain approval from the appropriate regulatory authority and you. LEGAL PROCEEDINGS There are no legal proceedings pending to which the Variable Account is a party, or to which the assets of the Variable Account are subject. The Company and the Distributor are not involved in any litigation that is of material importance in relation to their total assets or that relates to the Variable Account. On July 24, 2002, an action captioned American National Bank and Trust Company of Chicago, as Trustee f/b/o Emerald Investments Limited Partnership, and Emerald Investments Limited Partnership v. Allmerica Financial Life Insurance and Annuity Company, was commenced in the United States District Court for the Northern District of Illinois, Eastern Division. In 1999, plaintiffs purchased two variable annuity contracts with initial premiums aggregating $5 million. Plaintiffs, who the Company subsequently identified as engaging in frequent transfers of significant sums between sub-accounts that in the Company's opinion constituted "market timing", were subject to restrictions upon such trading that the Company imposed in December 2001. Plaintiffs allege that such restrictions constituted a breach of the terms of the annuity contracts. In December 2003, the court granted partial summary judgment to the plaintiffs, holding that at least certain restrictions imposed on their trading activities violated the terms of the annuity contracts. (On September 1, 2006, Allmerica Financial Life Insurance and Annuity Company was renamed Commonwealth Annuity and Life Insurance Company.) On May 19, 2004, plaintiffs filed a Brief Statement of Damages in which, without quantifying their damage claim, they outlined a claim for (i) amounts totaling $150,000 for surrender charges imposed on the partial surrender by plaintiffs of the annuity contracts, (ii) loss of trading profits they expected over the remaining term of each annuity contract, and (iii) lost trading profits resulting from the Company's alleged refusal to process five specific transfers in 2002 because of trading restrictions imposed on market timers. With respect to the lost profits, plaintiffs claim that pursuant to their trading strategy of transferring money from money market accounts to international equity accounts and back again to money market accounts, they have been able to consistently obtain relatively risk free returns of between 35% to 40% annually. Plaintiffs claim that they would have been able to continue to maintain such returns on the account values of their annuity contracts over the remaining terms of the annuity contracts (which are based in part on the lives of the named annuitants). The aggregate account value of plaintiffs' annuities was approximately $12.8 million in December 2001. On February 1, 2006, the Court issued a ruling, which, as confirmed by the Court at a status conference on April 12, 2006, precludes plaintiffs from claiming any damages accruing beyond July 31, 2004. THG, on behalf of the Company, continues to vigorously defend this matter, and regards plaintiffs' claims for lost trading profits as being speculative and, in any case, subject to an obligation to mitigate damages. Further, in the Company's view, these purported lost profits would not have been earned because of various actions taken, the investment management industry and regulators, to deter or eliminate market timing, including the implementation of "fair value" pricing. The outcome of this matter is not expected to be material to the Company's annual results of operations or financial position. In addition, THG has agreed to indemnify the Company and Goldman Sachs with respect to this litigation. A trial was held in December 2006, resulting in an award to plaintiffs of $1,281,757. Plaintiffs have appealed. 90 The Company is involved from time to time in judicial, regulatory and arbitration proceedings concerning matters arising in connection with the conduct of its business. THG has agreed to indemnify the Company and Goldman Sachs with respect to certain of these matters as provided in the Stock Purchase Agreement. Management believes, based on currently available information, that the results of such proceedings, in the aggregate, will not have a material adverse effect on the Company's financial condition, but may be material to the Company's operating results for any particular period, depending, in part, upon the operating results for such period. Given the inherent difficulty of predicting the outcome of the Company's litigation and regulatory matters, particularly in cases or proceeding in which substantial or indeterminate damages or fines are sought, the Company cannot estimate losses or ranges of losses for cases or proceedings where there is only a reasonable possibility that a loss may be incurred. In addition, the Company is involved in investigations and proceedings by governmental and self-regulatory agencies, which currently include inquiries relating to tax reporting calculations to policyholders and others in connection with distributions under a subset of variable annuity contracts in this business. The Company believes that the result of these inquiries will not have a material effect on its financial position or results of operations. TABLE OF CONTENTS--STATEMENT OF ADDITIONAL INFORMATION The Statement of Additional Information, Table of Contents is: Services to the Separate Account; State Regulation; Experts; Financial Statements; Financial Statements of Commonwealth Annuity and Life Insurance Company; Appendix A State Premium Tax Chart. Please read the Statement of Additional Information in conjunction with this Prospectus. FINANCIAL STATEMENTS The consolidated financial statements of the Company at December 31, 2006 and 2005, and for each of the three years in the period ended December 31, 2006, or for portions of such periods as disclosed in the financial statements, are included in the Statement of Additional Information. Because the Separate Account was not in existence as of December 31, 2006, we have not provided financial statements for the Separate Account. 91 APPENDIX A COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY DEFERRED FIXED AND VARIABLE ANNUITY IRA, ROTH IRA AND SIMPLE IRA DISCLOSURE STATEMENT This Disclosure Statement describes the statutory and regulatory provisions applicable to the operation of traditional Individual Retirement Annuities (IRAs), Roth Individual Retirement Annuities (Roth IRAs) and Simple Individual Retirement Annuities (SIMPLE IRAs). Internal Revenue Service regulations require that this be given to each person desiring to establish an IRA, Roth IRA or a SIMPLE IRA. Except where otherwise indicated, IRA discussion includes Simplified Employee Pension IRAs (SEP IRA). Further information can be obtained from Commonwealth Annuity and Life Insurance Company and from any district office of the Internal Revenue Service. Also, see IRS Publication 590, INDIVIDUAL RETIREMENT ARRANGEMENTS (IRAS). This Disclosure Statement is for your general information and is not intended to be exhaustive or conclusive, to apply to any particular person or situation, or to be used as a substitute for qualified legal or tax advice. Please note that the information contained herein is based on current federal income tax law, income tax regulations, and other guidance provided by the IRS. Hence, this information is subject to change upon an amendment of the law or the issuance of further regulations or other guidance. Also, you should be aware that state tax laws may differ from federal tax laws governing such arrangements. You should consult your tax adviser about any state tax consequences of your IRA or Roth IRA, whichever is applicable. A. REVOCATION Within 7 days of the date you signed your enrollment application, you may revoke the Contract and receive back 100% of your money by submitting your request in writing to us at our Service Center. Notice of revocation will be deemed mailed on the date of the postmark (or if sent by certified or registered mail, the date of the certification or registration) if it is deposited in the mail in the United States in an envelope, or other appropriate wrapper, first class postage prepaid, properly addressed. B. STATUTORY REQUIREMENTS The Contract is intended to meet the requirements of Section 408(b) of the Code, Section 408A of the Code for use as a Roth IRA, or of Section 408(p) of the Code for use as a SIMPLE IRA, whichever is applicable. The Contract has not been approved as to form for use as an IRA, Roth IRA or a SIMPLE IRA by the Internal Revenue Service. Such approval by the Internal Revenue Service is a determination only as to form of the Contract, and does not represent a determination on the merits of the Contract. 1. The amount in your IRA, Roth IRA, and SIMPLE IRA, whichever is applicable, must be fully vested at all times and the entire interest of the Owner must be nonforfeitable. 2. The Contract must be nontransferable by the Owner. 3. The Contract must have flexible premiums. 4. For IRAs and SIMPLE IRAs, you must start receiving distributions on or before April 1 of the year following the year in which you reach age 70 1/2 (the required beginning date) (see "Required Distributions"). However, Section 401(a)(9)(A) of the Code (relating to minimum distributions required to commence at age 70 1/2), and the incidental death benefit requirements of Section 401(a) of the Code, do not apply to Roth IRAs. If you die on or after the date required minimum distributions under Section 401(a)(9) of the Code commence, unless otherwise permitted under applicable law, any remaining interest in the Contract must be 92 distributed at least as rapidly as under the method of distribution being used as of the date of death. If you die before required minimum distributions commence, unless otherwise permitted under applicable law, any remaining interest in the Contract must be distributed to your Beneficiary by December 31 of the calendar year containing the fifth anniversary of your death; except that: (1) if the interest is payable to an individual who is your designated Beneficiary (within the meaning of Section 401(a)(9) of the Code), the designated Beneficiary may receive the entire interest over his or her life, or over a period certain not extending beyond his or her life expectancy, commencing on or before December 31 of the calendar year immediately following the calendar year in which you die; and (2) if the sole designated Beneficiary is your spouse, the Contract may be treated as his or her own IRA, or, where applicable, Roth IRA. 5. Except in the case of a rollover contribution or a direct transfer (see "Rollovers and Direct Transfers"), or a contribution made in accordance with the terms of a Simplified Employee Pension (SEP), all contributions to an IRA, Roth and SIMPLE IRA must be cash contributions which do not exceed certain limits. 6. The Contract must be for the exclusive benefit of you and your Beneficiaries. C. ROLLOVERS AND DIRECT TRANSFERS FOR IRAS AND SIMPLE IRAS 1. A rollover is a tax-free transfer from one retirement program to another that you cannot deduct on your tax return. There are two kinds of tax-free rollover payments to an IRA. In one, you transfer amounts from another IRA. With the other, you transfer amounts from a qualified plan under Section 401(a) of the Code, a qualified annuity under Section 403(a) of the Code, a tax-sheltered annuity or custodial account under Section 403(b) of the Code, or a governmental plan under Section 457(b) of the Code (collectively referred to as "qualified employee benefit plans"). Tax-free rollovers can be made from a SIMPLE IRA to a SIMPLE Individual Retirement Account under Section 408(p) of the Code. An individual can make a tax-free rollover to an IRA from a SIMPLE IRA, or vice-versa, after a two-year period has expired since the individual first participated in a SIMPLE plan. 2. You must complete the rollover by the 60th day after the day you receive the distribution from your IRA or other qualified employee benefit plan or SIMPLE IRA. The failure to satisfy this 60-day requirement may be waived by the Internal Revenue Service in certain circumstances. 3. A rollover distribution may be made to you only once a year. The one-year period begins on the date you receive the rollover distribution, not on the date you roll it over (reinvest it). 4. A trustee-to-trustee transfer to an IRA of funds in an IRA from one trustee or insurance company to another is not a rollover. It is a transfer that is not affected by the one-year waiting period. 5. All or a part of the premium for the Contract used as an IRA may be paid from a rollover from an IRA or qualified employee benefit plan or from a trustee-to-trustee transfer from another IRA. All or part of the premium for the Contract used as a SIMPLE IRA may be paid from a rollover from a SIMPLE Individual Retirement Account or, to the extent permitted by law, from a direct transfer from a SIMPLE IRA. 6. A distribution that is eligible for rollover treatment from a qualified employee benefit plan will be subject to twenty percent (20%) withholding by the Internal Revenue Service even if you roll the distribution over within the 60-day rollover period. One way to avoid this withholding is to make the distribution as a direct transfer to the IRA trustee or insurance company. D. CONTRIBUTION LIMITS AND ALLOWANCE OF DEDUCTION FOR IRAS 1. In general, the amount you can contribute each year to an IRA is the lesser of (1) 100% of your compensation, or (2) the maximum annual contributions under Section 219(b) of the Code, including "catch-up" contributions for certain individuals age 50 and older. The maximum annual contribution limit for IRA contributions is equal to $4,000 for 2007, and $5,000 for 2008. After 2008, the limit may be 93 indexed annually in $500 increments as determined by the Secretary of Treasury to reflect cost of living increases. An individual who has attained age 50 may make additional "catch-up" IRA contributions. The maximum annual contribution limit for the individual is increased by $1,000 except as otherwise provided by law. If you have more than one IRA, the limit applies to the total contributions made to your own IRAs for the year. Generally, if you work the amount that you earn is compensation. Wages, salaries, tips, professional fees, bonuses and other amounts you receive for providing personal services are compensation. If you own and operate your own business as a sole proprietor, your net earnings reduced by your deductible contributions on your behalf to self-employed retirement plans are compensation. If you are an active partner in a partnership and provide services to the partnership, your share of partnership income reduced by deductible contributions made on your behalf to qualified retirement plans is compensation. All taxable alimony and separate maintenance payments received under a decree of divorce or separate maintenance is compensation. 2. In the case of a married couple filing a joint return, up to the maximum annual contribution can be contributed to each spouse's IRA, even if one spouse has little or no compensation. This means that the total combined contributions that can be made to both IRAs can be as much as $10,000 for 2007 ($4,000 annual contribution for each individual, plus $1,000 for each individual who has attained age 50). 3. In the case of a married couple with unequal compensation who file a joint return, the limit on the deductible contributions to the IRA of the spouse with less compensation is the smaller of: a. The maximum annual contribution, or b. The total compensation of both spouses, reduced by any deduction allowed for contributions to IRAs of the spouse with more compensation. The deduction for contributions to both spouses' IRAs may be further limited if either spouse is covered by an employer retirement plan. 4. If either you or your spouse is an active participants in an employer-sponsored plan and have a certain level of income, the amount of the contribution to your IRA that is deductible is phased out, and in some cases eliminated. If you are an active participant in an employer-sponsored plan, the deductibility of your IRA contribution will be phased out, depending on your adjusted gross income, or combined adjusted gross income in the case of a joint tax return, as follows: JOINT RETURNS: $83,000-$103,000 SINGLE TAXPAYERS: $52,000-$62,000 The phase-out range for married individuals filing separately is $0-$10,000. If you file a joint tax return and are not an active participant in an employer sponsored plan, but your spouse is, the amount of the deductible IRA contribution is phased out for adjusted gross income between $156,000 and $166,000. These amounts may be indexed for cost of living increases in future years. To designate a contribution as nondeductible, you must file IRS Form 8606, NONDEDUCTIBLE IRAS. You may have to pay a penalty if you make nondeductible contributions to an IRA and you do not file Form 8606 with your tax return, or if you overstate the amount of nondeductible contributions on your Form 8606. If you do not report nondeductible contributions, all of the contributions to your traditional IRA will be treated as deductible, and all distributions from your IRA will be taxed, unless you can show, with satisfactory evidence, that nondeductible contributions were made. 5. Contributions to your IRA for a year can be made at any time up to April 15 of the following year. If you make the contribution between January 1 and April 15, however, you may elect to treat the contribution as made either in that year or in the preceding year. You may file a tax return claiming a deduction for your IRA contribution before the contribution is actually made. You must, however, make the contribution by the due date of your return not including extensions. 94 6. You cannot make a contribution other than a rollover or transfer contribution to your IRA for the year in which you reach age 70 1/2 or thereafter. 7. A taxpayer may qualify for a tax credit for contributions to an IRA, or for a tax exempton for distributions donated to charity in 2007, depending on the taxpayer's adjusted gross income. E. SEP IRAS 1. SEP IRA rules concerning eligibility and contributions are governed by Code Section 408(k). The maximum deductible contribution for a SEP IRA is the lesser of $45,000 (may be indexed for cost-of-living increases in future years) or 100% of compensation. 2. A SEP must be established and maintained by an employer (corporation, partnership, sole proprietor). F. SIMPLE IRAS 1. A SIMPLE IRA must be established with your employer using a qualified salary reduction agreement. 2. You may elect to have your employer contribute to your SIMPLE IRA, under a qualified salary reduction agreement, an amount (expressed as a percentage of your compensation) not to exceed $10,500 for 2007. After 2007, the limit may be indexed annually, except as otherwise provided by law. In addition to these employee elective contributions, your employer is required to make each year either (1) a matching contribution equal to up to 3 percent, and not less than 1 percent, of your SIMPLE IRA contribution for the year, or (2) a non-elective contribution equal to 2 percent of your compensation for the year (up to $210,000 of compensation, as may be adjusted for inflation in future years). No other contributions may be made to a SIMPLE IRA. 3. Employee elective contributions and employer contributions (i.e., matching contributions and nonelective contributions) to your SIMPLE IRA are excluded from your gross income. 4. To the extent an individual with a SIMPLE IRA is no longer participating in a SIMPLE plan (e.g., the individual has terminated employment), and two years have passed since the individual first participated in the plan, the individual may treat the SIMPLE IRA as an IRA. G. TAX STATUS OF THE CONTRACT AND DISTRIBUTIONS FOR IRAS AND SIMPLE IRAS 1. Earnings of your IRA annuity contract are not taxed until they are distributed to you. 2. In general, taxable distributions are included in your gross income in the year you receive them. 3. Distributions under your IRA are non-taxable to the extent they represent a return of non-deductible contributions (if any). The non-taxable percentage of a distribution is determined generally by dividing your total undistributed, non-deductible IRA contributions by the value of all your IRAs (including SEPs and rollovers). 4. You cannot choose the special five-year or ten-year averaging that may apply to lump sum distributions from qualified employer plans. H. REQUIRED DISTRIBUTIONS FOR IRAS AND SIMPLE IRAS You must start receiving minimum distributions required under the Contract and Section 401(a)(9) of the Code from your IRA and SIMPLE IRA starting with the year you reach age 70 1/2 (your 70 1/2 year). Ordinarily, the required minimum distribution for a particular year must be received by December 31 of 95 that year. However, you may delay the required minimum distribution for the year you reach age 70 1/2 until April 1 of the following year (I.E., the required beginning date). Annuity payments which begin by April 1 of the year following your 70 1/2 year satisfy the minimum distribution requirement if they provide for non-increasing payments over your life or the lives of you and your designated Beneficiary (within the meaning of Section 401(a)(9) of the Code), provided that, if installments are guaranteed, the guaranty period does not exceed the applicable life or joint expectancy. The applicable life expectancy is your remaining life expectancy or the remaining joint life and last survivor expectancy of you and your designated Beneficiary, determined as set forth in applicable federal income tax regulations. If you have more than one IRA, you must determine the required minimum distribution separately for each IRA; however, you can take the actual distributions of these amounts from any one or more of your IRAs. In addition, the after-death minimum distribution requirements described generally in section B. STATUTORY REQUIREMENTS apply to IRAs and SIMPLE IRAs. If the actual distribution from your Contract is less than the minimum amount that should be distributed in accordance with the minimum distribution requirements mentioned above, the difference generally is an excess accumulation. There is a 50% excise tax on any excess accumulations. If the excess accumulation is due to reasonable error, and you have taken (or are taking) steps to remedy the insufficient distribution, you can request that this 50% excise tax be excused by filing with your tax return an IRS Form 5329, together with a letter of explanation and the excise tax payment. I. ROTH IRAS 1. If your Contract is a special type of individual retirement plan known as a Roth IRA, it will be administered in accordance with the requirements of section 408A of the Code. Roth IRAs are treated the same as other IRAs, except as described here. 2. If your Contract is a Roth IRA, we will send you a Roth IRA endorsement to be attached to, and to amend, your Contract. The Company reserves the right to amend the Contract as necessary or advisable from time to time to comply with future changes in the Code, regulations or other requirements imposed by the IRS to obtain or maintain its approval of the annuity as a Roth IRA. 3. Earnings in your Roth IRA are not taxed until they are distributed to you, and will not be taxed if they are paid as a "qualified distribution," as described to you in section L, below. 4. The minimum distribution requirements that apply to IRAs do not apply to Roth IRAs while the Owner is alive. However, after the death of a Roth IRA Owner, the after-death minimum distribution rules that apply to IRAs also apply to Roth IRAs as though the Roth IRA Owner died before his or her required beginning date. You may not use your Roth IRA to satisfy minimum distribution requirements for traditional IRAs. Nor may you use distributions from an IRA for required distributions from a Roth IRA. J. ELIGIBILITY AND CONTRIBUTIONS FOR ROTH IRAS 1. Generally, you are eligible to establish or make a contribution to your Roth IRA only if you meet certain income limits. No deduction is allowed for contributions to your Roth IRA. Contributions to your Roth IRA may be made even after you attain age 70 1/2. 2. The maximum aggregate amount of contributions for any taxable year to all IRAs, including all Roth IRAs, maintained for your benefit (the "contribution limit") generally is the lesser of (1) 100% of your compensation, or (2) the maximum annual contributions under Section 219(b) of the Code, including "catch-up" contributions for certain individuals age 50 and older (as discussed in section D, above). 96 The contribution limit for any taxable year is reduced (but not below zero) by the amount which bears the same ratio to such amount as: (a) the excess of (i) your adjusted gross income for the taxable year, over (ii) the "applicable dollar amount," bears to (b) $15,000 (or $10,000 if you are married). For this purpose, "adjusted gross income" is determined under the Code and (1) excludes any amount included in gross income as a result of any rollover from, transfer from, or conversion of an IRA to a Roth IRA, and (2) is reduced by any deductible IRA contribution. In addition, the "applicable dollar amount" is equal to $156,000 for a married individual filing a joint return, $0 for a married individual filing a separate return, and $99,000 for any other individual. These amounts may be indexed for cost of living increases in future years. A "qualified rollover contribution" (discussed in section K, below), and a non-taxable transfer from another Roth IRA, are not taken into account for purposes of determining the contribution limit. K. ROLLOVERS, TRANSFERS AND CONVERSIONS TO ROTH IRAS 1. ROLLOVERS AND TRANSFERS--A rollover may be made to a Roth IRA only if it is a "qualified rollover contribution." A "qualified rollover contribution" is a rollover to a Roth IRA from another Roth IRA or from an IRA, but only if such rollover contribution also meets the rollover requirements for IRAs under Section 408(d)(3). In addition, a transfer may be made to a Roth IRA directly from another Roth IRA or from an IRA. You may not make a qualified rollover contribution or transfer in a taxable year from an IRA to a Roth IRA if (a) your adjusted gross income for the taxable year exceeds $100,000 or (b) you are married and file a separate return. The rollover requirements of Section 408(d)(3) are complex and should be carefully considered before you make a rollover. One of the requirements is that the amount received be paid into another IRA (or Roth IRA) within 60 days after receipt of the distribution. The failure to satisfy this 60-day requirement may be waived by the Internal Revenue Service in certain circumstances. In addition, a rollover contribution from a Roth IRA may be made by you only once a year. The one-year period begins on the date you receive the Roth IRA distribution, not on the date you roll it over (reinvest it) into another Roth IRA. If you withdraw assets from a Roth IRA, you may roll over part of the withdrawal tax free into another Roth IRA and keep the rest of it. A portion of the amount you keep may be included in your gross income. 2. TAXATION OF ROLLOVERS AND TRANSFERS TO ROTH IRAS--A qualified rollover contribution or transfer from a Roth IRA maintained for your benefit to another Roth IRA maintained for your benefit which meets the rollover requirements for IRAs under Section 408(d)(3) is tax-free. In the case of a qualified rollover contribution or a transfer from an IRA maintained for your benefit to a Roth IRA maintained for your benefit, any portion of the amount rolled over or transferred which would be includible in your gross income were it not part of a qualified rollover contribution or a nontaxable transfer will be includible in your gross income. However, Code Section 72(t) (relating to the 10 percent penalty tax on premature distributions) will not apply. 3. TRANSFERS OF EXCESS IRA CONTRIBUTIONS TO ROTH IRAS--If, before the due date of your federal income tax return for any taxable year (not including extensions), you transfer, from an IRA, contributions for such taxable year (and earnings thereon) to a Roth IRA, such amounts will not be includible in gross income to the extent that no deduction was allowed with respect to such amount. 97 4. TAXATION OF CONVERSIONS OF IRAS TO ROTH IRAS--All or part of amounts in an IRA maintained for your benefit may be converted into a Roth IRA maintained for your benefit. The conversion of an IRA to a Roth IRA is treated as special type of qualified rollover contribution. Hence, you must be eligible to make a qualified rollover contribution in order to convert an IRA to a Roth IRA. A conversion typically will result in the inclusion of some or all of your IRA's value in gross income, as described above. A conversion of an IRA to a Roth IRA can be made without taking an actual distribution from your IRA. For example, an individual may make a conversion by notifying the IRA issuer or trustee, whichever is applicable. UNDER SOME CIRCUMSTANCES, IT MIGHT NOT BE ADVISABLE TO ROLLOVER, TRANSFER, OR CONVERT ALL OR PART OF AN IRA TO A ROTH IRA. WHETHER YOU SHOULD DO SO WILL DEPEND ON YOUR PARTICULAR FACTS AND CIRCUMSTANCES, INCLUDING, BUT NOT LIMITED TO, SUCH FACTORS AS WHETHER YOU QUALIFY TO MAKE SUCH A ROLLOVER, TRANSFER, OR CONVERSION, YOUR FINANCIAL SITUATION, AGE, CURRENT AND FUTURE INCOME NEEDS, YEARS TO RETIREMENT, CURRENT AND FUTURE TAX RATES, YOUR ABILITY AND DESIRE TO PAY CURRENT INCOME TAXES WITH RESPECT TO AMOUNTS ROLLED OVER, TRANSFERRED, OR CONVERTED, AND WHETHER SUCH TAXES MIGHT NEED TO BE PAID WITH WITHDRAWALS FROM YOUR ROTH IRA (SEE DISCUSSION BELOW OF "NON-QUALIFIED DISTRIBUTIONS"). YOU SHOULD CONSULT A QUALIFIED TAX ADVISER BEFORE ROLLING OVER, TRANSFERRING, OR CONVERTING ALL OR PART OF AN IRA TO A ROTH IRA. 5. SEPARATE ROTH IRAS--Due to the complexity of, and proposed changes to, the tax law, it may be advantageous to maintain amounts rolled over, transferred, or converted from an IRA in separate Roth IRAs from those containing regular Roth IRA contributions. For the same reason, you should consider maintaining a separate Roth IRA for each amount rolled over, transferred, or converted from an IRA. These considerations should be balanced against the additional costs you may incur from maintaining multiple Roth IRAs. You should consult your tax adviser if you intend to contribute rollover, transfer, or conversion amounts to your Contract, or if you intend to roll over or transfer amounts from your Contract to another Roth IRA maintained for your benefit. L. INCOME TAX CONSEQUENCES OF ROTH IRAS 1. QUALIFIED DISTRIBUTIONS--Any "qualified distribution" from a Roth IRA is excludible from gross income. A "qualified distribution" is a payment or distribution which satisfies two requirements. First, the payment or distribution must be (a) made after you attain 59 1/2, (b) made after your death, (c) attributable to your being disabled, or (d) a "qualified special purpose distribution" (i.e., a qualified first-time homebuyer distribution under the Code). Second, the payment or distribution must be made in a taxable year that is at least five years after (1) the first taxable year for which a contribution was made to any Roth IRA established for you, or (2) in the case of a rollover from, or a conversion of, an IRA to a Roth IRA, the taxable year in which the rollover or conversion was made if the payment or distribution is allocable (as determined in the manner set forth in guidance issued by the IRS) to the rollover contribution or conversion (or to income allocable thereto). 2. NONQUALIFIED DISTRIBUTIONS--A distribution from a Roth IRA which is not a qualified distribution is taxed under Code Section 72 (relating to annuities), except that such distribution is treated as made first from contributions to the Roth IRA to the extent that such distribution, when added to all previous distributions from the Roth IRA, does not exceed the aggregate amount of contributions to the Roth IRA. For purposes of determining the amount taxed, (a) all Roth IRAs established for you will be treated as one contract, (b) all distributions during any taxable year from Roth IRAs established for you will be treated as one distribution, and (c) the value of the contract, income on the contract, and investment in the contract, if applicable, will be computed as of the close of the calendar year in which the taxable year begins. An additional tax of 10% is imposed on nonqualified distributions (including amounts deemed distributed as the result of a prohibited loan or use of your Roth IRA as security for a loan) made before the benefited individual has attained age 59 1/2, unless one of the exceptions discussed in Section N applies. 98 M. TAX ON EXCESS CONTRIBUTIONS 1. You must pay a 6% excise tax each year on excess contributions that remain in your Contract. Generally, an excess contribution is the amount contributed to your Contract that is more than you can contribute. The excess is taxed for the year of the excess contribution and for each year after that until you correct it. If contributions to your IRA for a year are more than the contribution limit, you can apply the excess contribution in one year to a later year if the contributions for that later year are less than the maximum allowed for that year. 2. You will not have to pay the 6% excise tax if you withdraw the excess amount by the date your tax return is due including extensions for the year of the contribution. You do not have to include in your gross income an excess contribution that you withdraw from your Contract before your tax return is due if the income earned on the excess was also withdrawn and no deduction was allowed for the excess contribution. You must include in your gross income the income earned on the excess contribution. N. TAX ON PREMATURE DISTRIBUTIONS There is an additional tax on premature distributions from your IRA, Roth IRA, or SIMPLE IRA, equal to 10% of the taxable amount. For premature distributions from a SIMPLE IRA made within the first 2 years you participate in a SIMPLE plan, the additional tax is equal to 25% of the amount of the premature distribution that must be included in gross income. Premature distributions are generally amounts you withdraw before you are age 59 1/2. However, the tax on premature distributions does not apply generally: 1. To amounts that are rolled over or transferred tax free; 2. To a distribution which is made on or after your death, or on account of you being disabled within the meaning of Code Section 72(m)(7); 3. To a distribution which is part of a series of substantially equal periodic payments (made at least annually) over your life or your life expectancy or the joint life or joint life expectancy of you and your Beneficiary; 4. To a distribution which is used for qualified first-time homebuyer expenses, qualified higher education expenses, certain medical expenses, or by an unemployed individual to pay health insurance premiums; or 5. To a distribution mode during a specified time period to a reservist who is called or ordered to active duty for a period in excess of 170 days or for an indefinite period. O. EXCISE TAX REPORTING Use Form 5329, Additional Taxes Attributable to Qualified Retirement Plans (Including IRAs), Annuities, and Modified Endowment Contracts, to report the excise taxes on excess contributions, premature distributions, and excess accumulations. If you do not owe any IRA, SIMPLE IRA or Roth IRA excise taxes, you do not need Form 5329. Further information can be obtained from any district office of the Internal Revenue Service. P. BORROWING If you borrow money against your Contract or use it as security for a loan, the Contract will lose its classification as an IRA, Roth IRA, or SIMPLE IRA, whichever is applicable, and you must include in gross income the fair market value of the Contract as of the first day of your tax year. In addition, you may be subject to the tax on premature distributions described above. (Note: The Contract does not allow borrowings against it, nor may it be assigned or pledged as collateral for a loan.) 99 Q. REPORTING We will provide you with any reports required by the Internal Revenue Service. R. ESTATE TAX Generally, the value of your IRA, including your Roth IRA, is included in your gross estate for federal estate tax purposes. S. FINANCIAL DISCLOSURE 1. If on the enrollment application you indicated an allocation to a Subaccount, this Contract will be assessed a daily charge of an amount which will equal an aggregate of 1.50% per annum. 2. An annual Contract Fee of $30.00 will be assessed against the Separate Account Value each Contract Year. 3. Withdrawal charges will be assessed based on the Contract Years elapsed since the Contract was issued as described in the prospectus under the heading "Withdrawal Charge." 4. The method used to compute and allocate the annual earnings is contained in the prospectus under the heading "Accumulation Unit Value" for Separate Account Contract Value. 5. The growth in value of your Contract is neither guaranteed nor projected but is based on the investment experience of the Subaccounts or rates of interest as declared by Commonwealth Annuity. GUARANTEED LUMP SUM TERMINATION OF DEFERRED FIXED AND VARIABLE ANNUITY COMPLETELY ALLOCATED TO THE FIXED ACCOUNT WITH 2% GUARANTEED EACH YEAR FOR THE FIRST TEN YEARS AND 3% THEREAFTER. (TERMINATION VALUES ARE BASED ON $1,000 ANNUAL CONTRIBUTIONS AT THE BEGINNING OF EACH YEAR.)
END OF TERMINATION END OF TERMINATION END OF TERMINATION END OF TERMINATION YEAR VALUES* YEAR VALUES* YEAR VALUES* YEAR VALUES* ------ ----------- ------ ----------- ------ ----------- ------ ----------- 1 948 9 9,564 17 21,344 25 36,427 2 1,924 10 10,794 18 23,040 26 38,575 3 2,925 11 12,169 19 24,787 27 40,788 4 3,956 12 13,585 20 26,587 28 43,068 5 5,015 13 15,045 21 28,440 29 45,416 6 6,105 14 16,550 22 30,349 30 47,834 7 7,226 15 18,100 23 32,315 8 8,378 16 19,698 24 34,341
* Includes applicable withdrawal charges GUARANTEED LUMP SUM TERMINATION OF DEFERRED FIXED AND VARIABLE ANNUITY COMPLETELY ALLOCATED TO THE FIXED ACCOUNT WITH 2% GUARANTEED EACH YEAR FOR THE FIRST TEN YEARS AND 3% THEREAFTER. (TERMINATION VALUES ARE BASED ON $5,000 SINGLE PREMIUM.)
END OF TERMINATION END OF TERMINATION END OF TERMINATION END OF TERMINATION YEAR VALUES* YEAR VALUES* YEAR VALUES* YEAR VALUES* ------ ----------- ------ ----------- ------ ----------- ------ ----------- 1 4,886 9 5,910 17 7,144 25 8,781 2 4,955 10 5,998 18 7,328 26 9,014 3 5,075 11 6,147 19 7,518 27 9,254 4 5,198 12 6,302 20 7,713 28 9,501 5 5,324 13 6,460 21 7,914 29 9,756 6 5,452 14 6,624 22 8,121 30 10,018 7 5,584 15 6,792 23 8,334 8 5,719 16 6,966 24 8,554
100
END OF TERMINATION END OF TERMINATION END OF TERMINATION END OF TERMINATION YEAR VALUES* YEAR VALUES* YEAR VALUES* YEAR VALUES* ------ ----------- ------ ----------- ------ ----------- ------ ----------- 6 5,452 14 6,624 22 8,121 30 10,018 7 5,584 15 6,792 23 8,334 8 5,719 16 6,966 24 8,554
* Includes applicable withdrawal charges 101 Appendix B GLWB RIDER - EXAMPLE #1 THIS EXAMPLE ILLUSTRATES THE SETTING OF INITIAL AMOUNTS, THE IMPACT OF BONUSES AND STEP-UPS, THE IMPACT OF ADDITIONAL PURCHASE PAYMENTS, THE IMPACT OF NON-EXCESS AND EXCESS WITHDRAWALS, AND THE CALCULATION OF THE GLWB RIDER DEATH BENEFIT The values shown below assume that: - a Contract is issued with an initial Purchase Payment of $100,000 and no premium taxes apply - the Covered Person (or oldest Covered Person in the case of GLWB Plus For Two) is exact age 55 on the Date of Issue - the Covered Person (or both surviving Covered Persons in the case of GLWB Plus For Two) lives until the beginning of the 17th Contract Year - we do not exercise our right to increase the GLWB Rider charge on the effective date of any Step-Up of the Lifetime Income Base The values in the shaded lines below are middle of year values (after the impact of the each assumed transaction). All other values are beginning of the year.
PURCHASE HYPOTHETICAL HYPOTHETICAL PAYMENT CONTRACT CONTRACT AGE OF (NOT VALUE VALUE CONTRACT COVERED INCLUDING GROSS BEFORE AFTER LINE YEAR PERSON PPB) WITHDRAWAL TRANSACTION TRANSACTION ---- -------- ----------- --------- ---------- ------------ ------------ (1) 1 55 $100,000 $ 0 $104,000 (2) 2 56 95,000 95,000 (3) 3 57 110,000 110,000 (4) 4 58 117,500 117,500 (5) 4 Transaction #1 25,000 110,000 136,000 (6) 5 59 130,000 130,000 (7) 6 60 115,000 115,000 (8) 7 61 110,000 110,000 (9) 7 Transaction #2 6,250 118,750 112,500 (10) 8 62 115,000 115,000 (11) 9 63 117,500 117,500 (12) 9 Transaction #3 10,000 125,000 115,000 (13) 10 64 125,000 125,000 (14) 11 65 135,000 135,000 (15) 12 66 150,000 150,000 (16) 13 67 135,000 135,000 (17) 13 Transaction #4 7,500 122,500 115,000 (18) 14 68 105,000 105,000 (19) 15 69 110,000 110,000 (20) 16 70 90,000 90,000 (21) 16 Transaction #5 10,000 75,000 65,000 (22) 17 71 80,000 80,000 LIFETIME CONTRACT GUARANTEED INCOME VALUE ON LIFETIME GUARANTEED LIFETIME WITHDRAWAL BASE STEP-UP INCOME WITHDRAWAL INCOME LINE BALANCE BONUS DATE BASE AMOUNT AMOUNT ---- ---------- -------- -------- -------- ---------- -------- (1) $100,000 na na $100,000 $5,000 na (2) 100,000 5,000 na 105,000 5,000 na (3) 100,000 5,000 na 110,000 5,000 na (4) 100,000 5,000 117,500 117,500 5,000 na (5) 125,000 na na 142,500 6,250 na (6) 125,000 6,250 na 148,750 6,250 na (7) 125,000 6,250 na 155,000 6,250 na (8) 125,000 6,250 110,000 161,250 6,250 na (9) 118,750 na na 155,000 6,250 na (10) 118,750 na na 155,000 6,250 na (11) 118,750 na na 155,000 6,250 na (12) 108,750 na na 142,600 5,750 na (13) 108,750 na 125,000 142,600 5,750 na (14) 108,750 na 135,000 142,600 na 7,130 (15) 108,750 na 150,000 150,000 na 7,500 (16) 108,750 na 135,000 150,000 na 7,500 (17) 101,250 na na 150,000 na 7,500 (18) 101,250 na 105,000 150,000 na 7,500 (19) 101,250 na 110,000 150,000 na 7,500 (20) 101,250 na 90,000 150,000 na 7,500 (21) 87,750 na na 130,000 na 6,500 (22) 87,750 na 80,000 130,000 na 6,500
SETTING OF INITIAL AMOUNTS Line (1) - On the Date of Issue, the Contract Value is equal to the initial Purchase Payment plus the PPB ($104,000 = $100,000 + $4,000). The initial Guaranteed Withdrawal Balance and Lifetime Income Base are set equal to the initial Purchase Payment (not including the corresponding PPB) (= $100,000). The Guaranteed Withdrawal Amount is set equal to the 5% of the Guaranteed Withdrawal Balance (5% x $100,000 = $5,000). The Lifetime Income Amount is not calculated prior to the Lifetime Income Date DETERMINATION OF LIFETIME INCOME DATE - The Lifetime Income Date is the Contract Anniversary on or after the Covered Person (or oldest Covered Person in the case of GLWB Plus for Two) reaches age 65, or the Date of Issue if the Covered Person (or oldest Covered Person in the case of GLWB Plus for Two) is age 65 or older on the Date of Issue. Line (14) In this example the Lifetime Income Date is the first day of the 11th Contract Year. BONUSES & STEP-UPS - The Bonus Period lasts until the earlier of the 10th Contract Anniversary or the Contract Anniversary immediately following the Contract Year in which the Covered Person (or older original Covered Person in the case of GLWB Plus for Two) reaches age 80. No Bonuses will be applied after a withdrawal is taken. - The Step-Up Period begins on the Date of Issue and ends on the Contract Anniversary immediately following the Contract Year in which the Covered Person (or older original Covered Person in the case of GLWB Plus For Two) reaches age 90. During the Step-Up Period, Step-Up dates are scheduled for the 3rd, 6th, and 9th Contract Anniversary and every Contract Anniversary thereafter and the Lifetime Income Date. Line (2) Since no withdrawals have been taken and the Covered Person is within the Bonus Period, the Lifetime Income Base is increased for a Bonus. The Bonus is equal to 5% of total Purchase Payments (not including corresponding PPB's) (= 5% x $100,000 = $5,000). The new Lifetime Income Base after the Bonus is equal to $105,000 (= $100,000 + $5,000). The Guaranteed Withdrawal Amount does not change after a Bonus is applied Line (4) The 3rd Contract Anniversary is a Step-Up Date and the Contract Value ($117,500) exceeds the Lifetime Income Base after the Bonus is applied ($115,000), so the Lifetime Income Base is Stepped-Up to the Contract Value. Note that the Bonus is applied before we determine if a Step-Up applies. Line (8) The Contract Value ($110,000) is lower than the Lifetime Income Base after the Bonus is applied ($155,000 + $6,250 = $161,250) so the Lifetime Income Base is not Stepped-Up. Line (15) The Contract Value ($150,000) is higher than the Lifetime Income Base ($142,600) so the Lifetime Income Base is Stepped-Up to equal the Contract Value. The Lifetime Income Amount is increased to equal 5% of the new Lifetime Income Base (= 5% x $150,000 = $7,500). TRANSACTION #1 - IMPACT OF AN ADDITIONAL PURCHASE PAYMENT Line (5) - We increase the Guaranteed Withdrawal Balance and Lifetime Income Base by the amount of an additional Purchase Payment (not including the corresponding PPB) when we receive it. The Guaranteed Withdrawal Balance after the additional Purchase Payment is equal to $125,000 (= $100,000 + $25,000). The Lifetime Income Base after the additional Purchase Payment equals $125,000 (= $100,000 = $25,000) - The Guaranteed Withdrawal Amount is recalculated to equal the greater of (a) the Guaranteed Withdrawal Amount immediately before the Purchase Payment; or (b) 5% of the Guaranteed Withdrawal Balance immediately after the Purchase Payment. This is equal to $6,250 which is the greater of (a) = $5,000 or (b) = 5% x $125,000 = $6,250 TRANSACTION #2 - IMPACT OF A NON-EXCESS WITHDRAWAL TAKEN PRIOR TO THE LIFETIME INCOME DATE - Prior to the Lifetime Income Date, the Guaranteed Withdrawal Amount is used for the purpose of determining whether a Gross Withdrawal is a Non-Excess Withdrawal or Excess Withdrawal Line (9) A Gross Withdrawal of $6,250 is taken in the middle of the 7th Contract Year. Since the Gross Withdrawal does not cause total Gross Withdrawals taken during the Contract Year to exceed the Guaranteed Withdrawal Amount ($6,250), the Gross Withdrawal is classified as a Non-Excess Withdrawal. According to the terms of the GLWB Rider, amounts are adjusted for a Non-Excess Withdrawal taken prior to the Lifetime Income Date, as follows: - The new Guaranteed Withdrawal Balance equals the Guaranteed Withdrawal Balance prior to the withdrawal minus the amount of the withdrawal ($118,750 = $125,000 - $6,250). - The new Lifetime Income Base is equal to the greater of (a) the Lifetime Income Base immediately prior to the withdrawal minus the amount of the withdrawal or (b) the Lifetime Income Base immediately prior to the withdrawal multiplied by the Proportional Reduction Factor*. This is equal to $155,000 which is the greater of (a) = $161,250 - $6,250 = $155,000 or (b) = $161,250 x ($112,500 / $118,750) = $152,763. - There is no change to the Guaranteed Withdrawal Amount * The Proportional Reduction Factor is equal to the Contract Value after the withdrawal divided by the Contract Value immediately prior to the withdrawal (= $112,500 / $118,750) Line (9) No future Bonuses will be applied to the Lifetime Income Base after this withdrawal TRANSACTION #3 - IMPACT OF AN EXCESS WITHDRAWAL TAKEN PRIOR TO THE LIFETIME INCOME DATE Line (12) A Gross Withdrawal of $10,000 is taken in the middle of the 9th Contract Year. Since the Gross Withdrawal exceeds the Guaranteed Withdrawal Amount ($6,250), the Gross Withdrawal is classified as an Excess Withdrawal. According to the terms of the GLWB Rider, amounts are adjusted for an Excess Withdrawal taken prior to the Lifetime Income Date, as follows: - The new Guaranteed Withdrawal Balance is equal to the lesser of (a) the Guaranteed Withdrawal Balance immediately prior to the withdrawal minus the amount of the withdrawal or (b) the Guaranteed Withdrawal Balance immediately prior to the withdrawal multiplied by the Proportional Reduction Factor*. This is equal to $108,750 which is the lesser of (a) = $118,750 - $10,000 = $108,750 or (b) = $118,750 x ($115,000 / $125,000) = $109,250. - The new Lifetime Income Base is equal to the Lifetime Income Base immediately prior to the withdrawal multiplied by the Proportional Reduction Factor ($155,000 x ($115,000 / $125,000) = $142,600). Note that the Lifetime Income Base decreases by more than the amount of the withdrawal. - The new Guaranteed Withdrawal Amount is equal to the Guaranteed Withdrawal Amount immediately prior to the withdrawal multiplied by the Proportional Reduction Factor ($6,250 x ($115,000 / $125,000) = $5,750) * The Proportional Reduction Factor is equal to the Contract Value after the withdrawal divided by the Contract Value immediately prior to the withdrawal (= $115,000 / $125,000) TRANSACTION #4 - IMPACT OF A NON-EXCESS WITHDRAWAL TAKEN ON OR AFTER THE LIFETIME INCOME DATE - On and after the Lifetime Income Date, the Lifetime Income Amount is used for the purpose of determining whether a Gross Withdrawal is a Non-Excess Withdrawal or Excess Withdrawal Line (9) A Gross Withdrawal of $7,500 is taken in the middle of the 13th Contract Year. Since the Gross Withdrawal does not cause total Gross Withdrawals taken during the Contract Year to exceed the Lifetime Income Amount ($7,500), the Gross Withdrawal is classified as a Non-Excess Withdrawal. According to the terms of the GLWB Rider, amounts are adjusted for a Non-Excess Withdrawal taken on or after the Lifetime Income Date, as follows: - The new Guaranteed Withdrawal Balance equals the Guaranteed Withdrawal Balance prior to the withdrawal minus the amount of the withdrawal ($101,250 = $108,750 - $7,500). - There is no change to the Lifetime Income Base - There is no change to the Lifetime Income Amount TRANSACTION #5 - IMPACT OF AN EXCESS WITHDRAWAL TAKEN ON OR AFTER THE LIFETIME INCOME DATE Line (12) A Gross Withdrawal of $10,000 is taken in the middle of the 16th Contract Year. Since the Gross Withdrawal exceeds the Lifetime Income Amount ($7,500), the Gross Withdrawal is classified as an Excess Withdrawal. According to the terms of the GLWB Rider, amounts are adjusted for an Excess Withdrawal taken on or after the Lifetime Income Date, as follows: - The new Guaranteed Withdrawal Balance is equal to the lesser of (a) the Guaranteed Withdrawal Balance immediately prior to the withdrawal minus the amount of the withdrawal or (b) the Guaranteed Withdrawal Balance immediately prior to the withdrawal multiplied by the Proportional Reduction Factor*. This is equal to to $87,750 which is the lesser of (a) = $101,250 - $10,000 = $91,250 or (b) = $101,250 x ($65,000 / $75,000) = $87,750. Note that the Guaranteed Withdrawal Balance decreases by more than the amount of the withdrawal - The new Lifetime Income Base is equal to the Lifetime Income Base immediately prior to the withdrawal multiplied by the Proportional Reduction Factor ($150,000 x ($65,000 / $75,000) = $130,000). Note that Lifetime Income Base decreases by more than the amount of the withdrawal - The new Lifetime Income Amount is equal to 5% of the new Lifetime Income Base (5% x $130,000 = $6,500) * The Proportional Reduction Factor is equal to the Contract Value after the withdrawal divided by the Contract Value immediately prior to the withdrawal (= $65,000 / $75,000) GLWB RIDER DEATH BENEFIT - The GLWB Rider Death Benefit may be payable on an Owner's death in certain situations identified in the GLWB Rider. If the GLWB Rider Death Benefit is payable, we will pay (or apply) the GLWB Rider Death Benefit instead of the standard death benefit or any optional death benefit elected, if the GLWB Rider Death Benefit is greater. - The GLWB Rider Death Benefit is equal to the greater of (a) or (b), less any premium taxes, where: (a) = the Contract Value on the Valuation Date we receive due proof of death; and (b) = the Guaranteed Withdrawal Balance on the Valuation Date we receive due proof of death Line (14) If we were to receive due proof of death of an Owner's death on the 11th Contract Anniversary AND the GLWB Rider Death Benefit is payable on such Owner's death in a situation identified in the GLWB Rider: - The GLWB Rider Death Benefit would be equal to $135,000 which is the greater of (a) the Contract Value ($135,000) or (b) the Guaranteed Withdrawal Balance ($108,750) Line (20) If we were to receive due proof of death of an Owner's death on the 16th Contract Anniversary AND the GLWB Rider Death Benefit is payable on such Owner's death in a situation identified in the GLWB Rider: - The GLWB Rider Death Benefit would be equal to $101,250 which is the greater of (a) the Contract Value ($90,000) or (b) the Guaranteed Withdrawal Balance ($101,250) 102 Appendix C GLWB RIDER - EXAMPLE #2 THIS EXAMPLE ILLUSTRATES A SITUATION WHERE THE BENEFIT PHASE START DATE OCCURS PRIOR TO THE LIFETIME INCOME DATE The values shown below assume that: - a Contract is issued with an initial Purchase Payment of $150,000 and no premium taxes apply - the Covered Person (or oldest Covered Person in the case of GLWB Plus For Two) is exact age 55 on the Date of Issue - the Covered Person (or both surviving Covered Persons in the case of GLWB Plus For Two) lives until the Benefit Period Start Date - Non-Excess Withdrawals equal to the Guaranteed Withdrawal Amount are taken in the middle of each Contract Year
BEGINNING OF YEAR VALUES ----------------------------------------------------------------------------- PURCHASE PAYMENT LIFETIME CONTRACT AGE OF (NOT HYPOTHETICAL GUARANTEED INCOME VALUE ON LIFETIME GUARANTEED CONTRACT COVERED INCLUDING CONTRACT WITHDRAWAL BASE STEP-UP INCOME WITHDRAWAL LINE YEAR PERSON PPB) VALUE BALANCE BONUS DATE BASE AMOUNT ---- -------- ------- --------- ------------ ---------- -------- -------- -------- ---------- (1) 1 55 $150,000 $156,000 $150,000 na na $150,000 $7,500 (2) 2 56 127,000 142,500 na na 142,500 7,500 (3) 3 57 111,000 135,000 na na 135,000 7,500 (4) 4 58 95,000 127,500 na 95,000 127,500 7,500 (6) 5 59 67,000 120,000 na na 120,000 7,500 (7) 6 60 30,000 112,500 na na 112,500 7,500 (8) 7 61 18,000 105,000 na 18,000 105,000 7,500 (10) 8 62 11,000 97,500 na na 97,500 7,500 (11) 9 3,000 90,000 na na na na (12) Benefit Period Start Date (13) Benefit Period Start Date + 1 Month (14) Benefit Period Start Date + 2 Months (15) etc MIDDLE OF YEAR VALUES BENEFIT PHASE ------------------------ ---------------------- HYPOTHETICAL CONTRACT VALUE MONTHLY GUARANTEED BEFORE GROSS SETTLEMENT WITHDRAWAL LINE WITHDRAWAL WITHDRAWAL PAYMENT BALANCE ---- ------------ ---------- ---------- ---------- (1) $141,500 7,500 na (2) 119,000 7,500 na (3) 103,000 7,500 na (4) 81,000 7,500 na (6) 48,500 7,500 na (7) 24,000 7,500 na (8) 14,500 7,500 na (10) 10,000 7,500 na (11) 2,300 2,300 na $87,700 (12) 5,825 81,875 (13) 625 81,250 (14) 625 80,625 (15)
SETTING OF INITIAL AMOUNTS Line (1) - On the Date of Issue, the Contract Value is equal to the initial Purchase Payment plus the PPB ($156,000 = $150,000 + $6,000). The initial Guaranteed Withdrawal Balance and Lifetime Income Base are set equal to the initial Purchase Payment (not including the correspoding PPB) (= $150,000). The Guaranteed Withdrawal Amount is set equal to the 5% of the Guaranteed Withdrawal Balance (5% x $150,000 = $7,500). The Lifetime Income Amount is not calculated prior to the Lifetime Income Date so it is not shown above. - In this example, the Lifetime Income Date would be the first day of the 11th Contract Year (the Contract Anniversary on or after the Covered Person (or oldest Covered Person in the case of GLWB Plus for Two) reaches age 65) BONUSES & STEP-UPS Line (2) No Bonuses are applied to the Lifetime Income Base in this example because a withdrawal is taken in the 1st Contract Year (no future Bonuses are applied to the Lifetime Income Base after a withdrawal). Line (4) The Contract Value on the 3rd Contract Anniversary (a scheduled Step-Up Date that is within the Step-Up Period) is less than the Lifetime Income Base so the Lifetime Income Base is not Stepped-Up. BENEFIT PHASE START DATE Line (11) - A Gross Withdrawal of $2,300 is taken in the middle of the 9th Contract Year reducing the Contract Value to zero. This withdrawal is a Non-Excess Withdrawal because it does not cause total Gross Withdrawals taken during the Contract Year to exceed the Guaranteed Withdrawal Amount ($7,500). The Guaranteed Withdrawal Balance is reduced by the amount of the Gross Withdrawal ($90,000 - $2,300 = $87,700). - The Contract enters the Benefit Phase because the Contract Value has been reduced to zero due to a Non-Excess Withdrawal and the remaining Guaranteed Withdrawal Balance is greater than zero. The date that the Contract enters the Benefit Phase is called the Benefit Phase Start Date. The GLWB Rider is terminated on the Benefit Phase Start Date; the remaining Guaranteed Withdrawal Balance and Guaranteed Withdrawal Amount are stored for use in the Benefit Phase. All other GLWB Rider amounts cease to exist on the Benefit Phase Start Date because the GLWB Rider is terminated. Line (12) - The remaining Guaranteed Withdrawal Balance immediately following the final Gross Withdrawal is greater than $2,000. Therefore, the first monthly Settlement Payment is equal $5,825 which is the lesser of (a) the Guaranteed Withdrawal Amount minus total Gross Withdrawals taken during the current Contract Year plus the Guaranteed Withdrawal Amount divided by twelve, ($7,500 - $2,300 + $7,500 / 12 = $5,825) or (b) the remaining Guaranteed Withdrawal Balance ($87,700). The remaining Guaranteed Withdrawal Balance after the first monthly Settlement Payment is equal to remaining Guaranteed Withdrawal Balance after the final Gross Withdrawal minus the amount of the first monthly Settlement Payment ($81,875 = $87,700 - $5,825) - Note that the total amount received on the Benefit Phase Start Date ($8,125) is equal to the amount of the final Gross Withdrawal ($2,300) plus the first monthly Settlement Payment ($5,825) Line (15) Monthly Settlement Payments will continue until the Guaranteed Withdrawal Balance is reduced to zero. If the Covered Person dies before the Guaranteed Withdrawal Balance is reduced to zero, monthly Settlement Payments will continue to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero 103 Appendix D GLWB RIDER - EXAMPLE #3 THIS EXAMPLE ILLUSTRATES A SITUATION WHERE THE BENEFIT PHASE START DATE OCCURS AFTER THE LIFETIME INCOME DATE The values shown below assume that: - a Contract is issued with an initial Purchase Payment of $120,000 and no premium taxes apply - the Covered Person (or oldest Covered Person in the case of GLWB Plus For Two) is exact age 68 on the Date of Issue - the Covered Person (or both surviving Covered Persons in the case of GLWB Plus For Two) lives until the Benefit Period Start Date - Non-Excess Withdrawals equal to the Lifetime Income Amount are taken in the middle of each Contract Year
BEGINNING OF YEAR VALUES --------------------------------------------------------------------------- PURCHASE PAYMENT LIFETIME CONTRACT AGE OF (NOT HYPOTHETICAL GUARANTEED INCOME VALUE ON LIFETIME LIFETIME CONTRACT COVERED INCLUDING CONTRACT WITHDRAWAL BASE STEP-UP INCOME INCOME LINE YEAR PERSON PPB) VALUE BALANCE BONUS DATE BASE AMOUNT ---- -------- ------- --------- ------------ ---------- -------- -------- -------- -------- (1) 1 68 $120,000 $124,800 $120,000 na $124,800 $124,800 $6,240 (2) 2 69 122,000 113,760 na na 124,800 6,240 (3) 3 70 111,000 107,520 na na 124,800 6,240 (4) 4 71 95,000 101,280 na 95,000 124,800 6,240 (6) 5 72 67,000 95,040 na na 124,800 6,240 (7) 6 73 30,000 88,800 na na 124,800 6,240 (8) 7 74 18,000 82,560 na 18,000 124,800 6,240 (10) 8 75 11,000 76,320 na na 124,800 6,240 (11) 9 4,000 70,080 na na na na (12) Benefit Period Start Date (13) Benefit Period Start Date + 1 Month (14) Benefit Period Start Date + 2 Months (15) etc MIDDLE OF YEAR VALUES BENEFIT PHASE ------------------------ ---------------------- HYPOTHETICAL CONTRACT VALUE MONTHLY GUARANTEED BEFORE GROSS SETTLEMENT WITHDRAWAL LINE WITHDRAWAL WITHDRAWAL PAYMENT BALANCE ---- ------------ ---------- ---------- ---------- (1) $123,400 $6,240 na (2) 116,500 6,240 na (3) 103,000 6,240 na (4) 81,000 6,240 na (6) 48,500 6,240 na (7) 24,000 6,240 na (8) 14,500 6,240 na (10) 10,000 6,240 na (11) 3,800 3,800 na 66,280 (12) 2,960 63,320 (13) 520 62,800 (14) 520 62,280 (15)
SETTING OF INITIAL AMOUNTS Line (1) - On the Date of Issue, the Contract Value is equal to the initial Purchase Payment plus the PPB ($124,800 = $120,000 + $4,800). The initial Guaranteed Withdrawal Balance and Lifetime Income Base are set equal to the initial Purchase Payment (not including the corresponding PPB) of $120,000. In this example, the Lifetime Income Date is equal to the Date of Issue as the Covered Person (or oldest Covered Person in the case of GLWB Plus for Two) is older than age 65 on the Date of Issue. Because the Lifetime Income Date is a Step-Up Date and the Covered Person is within the Step-Up Period, the Contract Value is compared to the Lifetime Income Base to see if a Step-Up applies. The Contract Value ($124,800) is larger than the initial Lifetime Income Base ($120,000), so the Lifetime Income Base is Stepped-Up to the Contract Value ($124,800). The Lifetime Income Amount is set equal to the 5% of the Lifetime Income Base (5% x $124,800 = $6,240). The Guaranteed Withdrawal Amount is not calculated on or after the Lifetime Income Date so it is not shown above. BONUSES & STEP-UPS Line (2) No Bonuses are applied to the Lifetime Income Base in this example because a withdrawal is taken in the 1st Contract Year (no future Bonuses are applied to the Lifetime Income Base after a withdrawal). Line (4) The Contract Value on the 3rd Contract Anniversary (a scheduled Step-Up Date that is within the Step-Up Period) is less than the Lifetime Income Base so the Lifetime Income Base is not Stepped-Up. BENEFIT PHASE START DATE Line (11) - A Gross Withdrawal of $3,800 is taken in the middle of the 9th Contract Year reducing the Contract Value to zero. This withdrawal is a Non-Excess Withdrawal because it does not cause total Gross Withdrawals taken during the Contract Year to exceed the Lifetime Income Amount ($6,240). The Guaranteed Withdrawal Balance is reduced by the amount of the Gross Withdrawal ($70,080 - $3,800 = $66,280). - The Contract enters the Benefit Phase because the Contract Value has been reduced to zero due to a Non-Excess Withdrawal and the Lifetime Income Amount is greater than zero. The date that the Contract enters the Benefit Phase is called the Benefit Phase Start Date. The GLWB Rider is terminated on the Benefit Phase Start Date; the remaining Guaranteed Withdrawal Balance and Lifetime Income Amount are stored for use in the Benefit Phase. All other GLWB Rider amounts cease to exist on the Benefit Phase Start Date because the GLWB Rider is terminated. Line (12) - The first monthly Settlement Payment is equal to the Lifetime Income Amount minus total Gross Withdrawals taken during the current Contract Year plus the Lifetime Income Amount divided by twelve. This is equal to $2,960 (= $6,240 - $3,800 + $6,240 / 12). The remaining Guaranteed Withdrawal Balance after the first monthly Settlement Payment is equal to remaining Guaranteed Withdrawal Balance after the final Gross Withdrawal minus the amount of the first monthly Settlement Payment ($63,320 = $66,280 - $2,960) - Note that the total amount received on the Benefit Phase Start Date ($6,760) is equal to the amount of the final Gross Withdrawal ($3,800) plus the first monthly Settlement Payment ($2,960) Line (15) Monthly Settlement Payments will continue until the Covered Person dies (or the last surviving Covered Person dies in the case of GLWB Plus for Two). If the Covered Person dies before the Guaranteed Withdrawal Balance is reduced to zero, monthly Settlement Payments will continue to the Beneficiary until the Guaranteed Withdrawal Balance is reduced to zero. 104 STATEMENT OF ADDITIONAL INFORMATION [JULY 9], 2007 ---------- FLEXIBLE PREMIUM FIXED AND VARIABLE DEFERRED ANNUITY CONTRACTS ---------- ISSUED BY COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY IN CONNECTION WITH COMMONWEALTH ANNUITY SEPARATE ACCOUNT A HOME OFFICE: SERVICE CENTER MAILING ADDRESS: 132 Turnpike Road, Suite 210 P.O. Box 758550 Southborough, MA 01772 Topeka, Kansas 66675-8550 [phone number] [phone number] This Statement of Additional Information is not a prospectus. This Statement of Additional Information should be read in conjunction with the Prospectus of the Separate Account dated [July 9], 2007. The Prospectus may be obtained from Commonwealth Annuity and Life Insurance Company by writing or calling the Service Center address or telephone number listed above.
TABLE OF CONTENTS PAGE ---- SERVICES TO THE SEPARATE ACCOUNT 2 STATE REGULATION 2 EXPERTS 2 FINANCIAL STATEMENTS 3 FINANCIAL STATEMENTS OF COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY APPENDIX A STATE PREMIUM TAX CHART 110
SERVICES TO THE SEPARATE ACCOUNT Commonwealth Annuity and Life Insurance Company ("Commonwealth Annuity") maintains the books and records of Commonwealth Annuity Separate Account A (the "Separate Account"). Commonwealth Annuity holds the assets of the Separate Account. The assets are kept segregated and held separate and apart from the general funds of Commonwealth Annuity. Commonwealth Annuity maintains records of all purchases and redemptions of shares of each Fund by each of the Subaccounts. All expenses incurred in the operations of the Separate Account, except the Contract fees and charges described in the Prospectus, are borne by Commonwealth Annuity. The independent registered public accounting firm for the Separate Account is [accounting firm, address]. Because [Distributor] and Commonwealth Annuity Separate Account A were not in existence as of December 31, 2006, [Distributor]. did not receive any compensation from Commonwealth Annuity Separate Account A in connection with the sale of the Contracts. STATE REGULATION Commonwealth Annuity is subject to the laws of Massachusetts governing insurance companies and to regulation by the Massachusetts Department of Insurance. An annual statement in a prescribed form is filed with the Massachusetts Department of Insurance each year. Commonwealth Annuity's books and accounts are subject to review by the Department of Insurance at all times, and a full examination of its operations is conducted periodically. Such regulation does not, however, involve any supervision of management or investment practices or policies. In addition, Commonwealth Annuity is subject to regulation under the insurance laws of other jurisdictions in which it may operate. EXPERTS The financial statements of Commonwealth Annuity at December 31, 2006 and 2005, and for each of the three years in the period ended December 31, 2006, included in this Statement of Additional Information have been audited by [name of auditor], independent registered public accounting firm, [insert auditor's address], as set forth in their reports thereon appearing elsewhere herein, and are included in reliance upon such reports given on the authority of such firm as experts in accounting and auditing. FINANCIAL STATEMENTS This Statement of Additional Information contains financial statements for Commonwealth Annuity. The financial statements of Commonwealth Annuity should be considered primarily as bearing on our ability to meet our obligations under the Contract. The Contracts are not entitled to participate in our earnings, dividends, or surplus. They should not be considered as bearing on the investment performance of the assets held in the Separate Account. Because the Separate Account was not in existence as of December 31, 2006, we have not included in this Statement of Additional Information financial statements for the Separate Account. APPENDIX A STATE PREMIUM TAX CHART
RATE OF TAX ------------------------- QUALIFIED NON-QUALIFIED STATE PLANS PLANS ------------- --------- ------------- California 0.50%* 2.35%* Maine -- 2.00% Nevada -- 3.50%* South Dakota -- 1.25%** West Virginia 1.00%* 1.00%* Wyoming -- 1.00%
---------- * Taxes will be assessed when annuity benefits commence. We reserve the right to deduct taxes earlier if such taxes are assessed by the state. ** The Tax Rate is 0.08% on annuity considerations in excess of $500,000 PART C. OTHER INFORMATION ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS (A) FINANCIAL STATEMENTS Financial Statements Included in Part A None [Commonwealth Annuity and Life Insurance Company's Consolidated Balance Sheets at December 31, 2006 and 2005] [Commonwealth Annuity and Life Insurance Company's Consolidated Statements of Operations for each of the three years in the period ended December 31, 2006] [Commonwealth Annuity and Life Insurance Company's Consolidated Statements of Shareholders Equity for each of the three years in the period ended December 31, 2006] [Commonwealth Annuity and Life Insurance Company's Consolidated Statements of Comprehensive Income (Loss) for each of the three years in the period ended December 31, 2006] [Commonwealth Annuity and Life Insurance Company's Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2006] [Commonwealth Annuity and Life Insurance Company's Notes to Consolidated Financial Statements for the year ended December 31, 2006] Financial Statements Included in Part C None (B) EXHIBITS EXHIBIT 1 Vote of Board of Directors Authorizing Establishment of Registrant dated February 9, 2007 was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. EXHIBIT 2 Not Applicable. Pursuant to Rule 26a-2, the Insurance Company may hold the assets of the Registrant not pursuant to a trust indenture or other such instrument. EXHIBIT 3 (a) Distribution Agreement and [Distributor] is filed herewith. Form of Distribution Agreement between the Company and the [broker/dealer] was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (b) Service Agreement with broker-dealers is filed herewith. Form of Sales Agreement with broker-dealers was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. EXHIBIT 4 (a) Policy (3039-07) is filed herewith. Form of Contract and Form of Specification Pages was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (b) Extended Care Waiver Rider (4009-07) (Nursing Home Rider Endorsement) is filed herewith. Form of Nursing Home Rider Endorsement - Extended Care Waiver on Application of Withdrawal Charges was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (c) Disability Waiver Rider (4008-07) is filed herewith. Form of Disability Rider was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (d) Texas Optional Retirement Program Rider (4010-07) is filed herewith. Form of Texas Optional Retirement Program Rider was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (e) Qualified Plan Rider (401a) (4011-07) is filed herewith. Form of Qualified Plan Rider (401a) was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (f) Tax Sheltered Annuity Rider (403b) (4012-07) is filed herewith. Form of Tax Sheltered Annuity Rider (403b) was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (g) GLWB Rider - Single Life (4006-07) is filed herewith. Form of GLWB Rider - Single Life - for Preferred Plus was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (h) GLWB Rider - Joint Life (4007-07) is filed herewith. Form of GLWB Rider - Joint Life - for referred Plus was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (i) Step-Up Death Benefit Rider (4005-07) for Preferred Plus is filed herewith. Form of Step-Up Rider for Preferred Plus was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. (j) 457 Rider (4013-07) is filed herewith. EXHIBIT 5 Form of Application (Preferred Plus-PP-401) is filed herewith. Form of Application (Advantage IV and Preferred Plus) was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. EXHIBIT 6 Articles of Organization and Bylaws, as amended of the Company, effective as of September 1, 2006 was previously filed on March 1, 2007 in the Initial Registration Statement (File Nos. 333-141019/811-22024), and is incorporated by reference herein. EXHIBIT 7 Not Applicable. EXHIBIT 8 (a) Directors' Powers of Attorney are filed herewith. (b) Third Party Agreement (TPA) between Security Benefit Life Insurance Co, Security Distributors, Inc and The Goldman Sachs Group, Inc. was previously filed on February 10, 2006 in Registrant's Post-Effective Amendment No. 26 (Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. EXHIBIT 9 Opinion of Counsel is filed herewith. EXHIBIT 10 Consent of Independent Registered Public Accounting Firm is filed herewith. EXHIBIT 11 None. EXHIBIT 12 None. EXHIBIT 13 Schedule for Computation of Performance Quotations is not applicable. EXHIBIT 14 Not Applicable. EXHIBIT 15(a) Form of Amendment dated August 1, 2007 to the AIM Participation Agreement is filed herewith. Amendment dated January 1, 2003 to the AIM Participation Agreement was previously filed on April 28, 2003 in Post-Effective Amendment No. 23 of Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. Form of Amendment #7 dated May 1, 2002 to the AIM Participation Agreement was previously filed in April 19, 2002 in Post-Effective Amendment No. 22 of Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. Form of Amendment #6 to the AIM Participation Agreement was previously filed on April 19, 2001 in Post-Effective Amendment No. 19 of Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. Form of Amendment to AIM Participation Agreement was previously filed in April 2000 in Post-Effective Amendment No. 19 of Registration Statement No. 33-44830/811-6293 and is incorporated by reference herein. Participation Agreement with AIM Variable Insurance Funds, Inc. was previously filed on August 27, 1998 in Post-Effective Amendment No. 3 in Registration Statement No. 333-11377/811-7799, and is incorporated by reference herein. EXHIBIT 15(b) Form of Amended and Restated Participation Agreement among Commonwealth Annuity and Life Insurance Company, Alliance Capital Management L.P., and Alliance Fund Distributors, Inc. is filed herewith. Exhibit 15(c) Form of Amendment dated August 1, 2007 and the Amended and Restated Participation Agreement dated September 25, 2006 with Franklin Templeton Variable Insurance Products Trust, Franklin/Templeton Distributors, Inc., and Commonwealth Annuity and Life Insurance are filed herewith. EXHIBIT 15(d) Form of Amendment dated August 1, 2007 to the Participation Agreement dated January 2, 2006 between Goldman Sachs Variable Insurance Trust, Goldman, Sachs & Co, and Allmerica Financial Life Insurance and Annuity Company is filed herewith. Participation Agreement dated January 2, 2006 between Goldman Sachs Variable Insurance Trust, Goldman, Sachs & Co, and Allmerica Financial Life Insurance and Annuity Company was previously filed on April 28, 2006 in Registrant's Post-Effective Amendment No. 27 (Registration Statement No. 33-39702/811-6293), and is incorporated by reference herein. EXHIBIT 15(e) Form of Participation Agreement dated August 1, 2007 with Goldman Sachs Trust is filed herewith. EXHIBIT 15(f) Form of Amendment dated August 1, 2007 to the Participation Agreement with Janus is filed herewith. Amendment dated February 25, 2000 to the Participation Agreement with Janus was previously filed in April 19, 2002 in Post-Effective Amendment No. 22 of Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. Participation Agreement with Janus was previously filed on April 21, 2000 in Post-Effective Amendment No. 1 of Registration Statement No. 333-87099/811-6293 and is incorporated by reference herein. EXHIBIT 15(g) Form of Amendment dated August 1, 2007 to the Participation Agreement with Oppenheimer Variable Account Funds is filed herewith. Amendment dated May 1, 2002 to the Participation Agreement with Oppenheimer Variable Account Funds was previously filed on April 28, 2003 in Post-Effective Amendment No. 23 of Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. Form of Amendment dated May 1, 2002 to the Participation Agreement with Oppenheimer Variable Account Funds was previously filed in April 19, 2002 in Post-Effective Amendment No. 22 of Registration Statement No. 33-39702/811-6293, and is incorporated by reference herein. Participation Agreement with Oppenheimer Variable Account Funds was previously filed on August 27, 1998 in Post-Effective Amendment No. 3, and is incorporated by reference herein. EXHIBIT 15(h) Form of Participation Agreement among Pioneer Variable Contracts Trust, Commonwealth Annuity and Lie Insurance Company, Pioneer Investment Management, Inc. and Pioneer Funds Distributor, Inc. dated August 1, 2007 is filed herewith. ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR The principal business address of most the following Directors and Officers* is: 85 Broad Street New York, NY 10004 The principal business address of the other following Directors and Officers is: 132 Turnpike Road, Suite 210 Southborough, MA 01772. DIRECTORS AND PRINCIPAL OFFICERS OF THE COMPANY NAME POSITION WITH COMPANY Allan S. Levine* Chairman of the Board John J. Fowler* Vice President Michael A. Pirrello Vice President and Chief Financial Officer Nicholas Helmuth von Moltke* Director, Vice President, and Chief Operating Officer J. William McMahon* Director Donald Mullen* Director Timothy J. O'Neill* Director Samuel Ramos* Vice President and Secretary Michael A. Reardon Director, President, and Chief Executive Officer Amol Sagun Naik* Vice President and Treasurer Jane Spanier Grosso Vice President and Controller Alan Akihiro Yamamura* Vice President and Chief Risk Officer Margot K. Wallin Vice President and Chief Compliance Officer ITEM 26. PERSONS UNDER COMMON CONTROL WITH REGISTRANT The following are significant subsidiaries of The Goldman Sachs Group, Inc. and the states or jurisdictions in which they are organized. Indentation indicates the principal parent of each subsidiary. Except as otherwise specified, in each case The Goldman Sachs Group, Inc. owns, directly or indirectly, at least 99% of the voting securities of each subsidiary. The names of particular subsidiaries have been omitted because, considered in the aggregate as a single subsidiary, they would not constitute, as of the end of the year covered by this report, a "significant subsidiary" as that term is defined in Rule 1-02(w) of Regulation S-X under the Securities Act of 1934. ---------------------------- | THE GOLDMAN SACHS GROUP, | | INC. | | (Delaware) | ---------------------------- | | ----------------------------------------------------------------------------------- --------------------- | |100% | | | | GOLDMAN, SACHS & |100%| | (a) | | | 100% | CO. | (a)| -------------------- | ---------------------- | ---------------------------- | (New York) |----| | MLQ, L.L.C. | | | COLUMBIA CAPITAL |100%| | COMMONWEALTH | --------------------- | | (Delaware) | | | LIFE REINSURANCE |----| | ANNUITY AND LIFE | | -------------------- | | COMPANY | | | INSURANCE COMPANY | | | | | (South Carolina) | | | (FORMERLY ALLMERICA | | | | ---------------------- | | FINANCIAL LIFE INSURANCE | | GP | | LP | | | AND ANNUITY COMPANY) | | 1% |--------------- 99% | 100% | | (Massachusetts) | | | | | ---------------------------- | | | | --------------------- | -------------------- ---------------------- | ---------------------------- | GOLDMAN SACHS |100%| | MTGLQ INVESTORS, | | CHARLESTON CAPITAL | | | ARROW REINSURANCE | | ASSET MANAGEMENT, | (a)| | L.P. | | REINSURANCE, L.L.C.| |100%| COMPANY, LIMITED | | L.P. |----| | (Delaware) | | (South Carolina) | |----| (Bermuda) | | (Delaware) | | -------------------- ---------------------- | ---------------------------- --------------------- | | | | | 21.8% | | | | ---------------------100%| -------------------- ---------------------- | ---------------------------- | GOLDMAN SACHS |(a) | | SPARTA INSURANCE | | GOLDMAN SACHS |100%|100%| ARROW REINSURANCE | | INTERNATIONAL |----| | HOLDINGS, INC. | | RISK ADVISORS, L.P.|----|----| COMPANY, LIMITED | | (United Kingdom) | | (Delaware) | | (Delaware) | | | (Bermuda) | --------------------- -------------------- ---------------------- | ---------------------------- | | | | 100% |100% | | | | -------------------- ---------------------- | ---------------------------- | AMERICAN | | ARROW CAPITAL RISK | |100%| PEARL STREET | | EMPLOYERS | | SERVICES LIMITED | |----| INSURANCE | | INSURANCE COMPANY| | (Bermuda) | | | COMPANY, INC. | | (Massachusetts) | ---------------------- | | (Vermont) | -------------------- | ---------------------------- | | | ---------------------- | ---------------------------- | GOLDMAN SACHS |100%|100%| GOLDMAN SACHS | | RISK BROKERS, INC. |---------| RISK SERVICES L.L.C. | | (Delaware) | | (Delaware) | ---------------------- ----------------------------
(a) GS Group holds 100% of the equity interest in these subsidiaries through one or more intermediary holding companies THE GOLDMAN SACHS GROUP, INC.
SUBSIDIARY SUB NAME PARENT PARENT NAME OWNER % DOMICILE -------------------------------------------------------------------------------------------------------------------- 0001 Goldman, Sachs & Co. 0006 The Goldman, Sachs & Co. L.L.C 0.20 New York 0001 Goldman, Sachs & Co. 0009 Goldman Sachs Group, Inc. 99.80 New York 0006 The Goldman, Sachs & Co. L.L.C 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0007 The J. Aron Corporation 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0008 J. Aron Holdings, L.P. 0007 The J. Aron Corporation 0.20 Delaware 0008 J. Aron Holdings, L.P. 0009 Goldman Sachs Group, Inc. 99.80 Delaware 0027 Epoch Securities, Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0032 SCADBURY UK LIMITED 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0033 AMAGANSETT UK LIMITED 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0034 SCADBURY ASSETS 0032 SCADBURY UK LIMITED 99.00 United Kingdom 0034 SCADBURY ASSETS 0036 SCADBURY FUNDING LIMITED 1.00 United Kingdom 0035 AMAGANSETT II ASSETS 0033 AMAGANSETT UK LIMITED 100.00 United Kingdom 0036 SCADBURY FUNDING LIMITED 0032 SCADBURY UK LIMITED 100.00 United Kingdom 0037 AMAGANSETT FUNDING LIMITED 0033 AMAGANSETT UK LIMITED 100.00 United Kingdom 0038 AMAGANSETT ASSETS 0033 AMAGANSETT UK LIMITED 99.00 United Kingdom 0038 AMAGANSETT ASSETS 0037 AMAGANSETT FUNDING LIMITED 1.00 United Kingdom 0039 SCADBURY II ASSET 0032 SCADBURY UK LIMITED 100.00 United Kingdom 0041 GSFS PRINCIPAL STRATEGIES 2200 GS Financial Serv L.P. (DEL) 100.00 United Kingdom 0042 GSFS INVESTMENTS II CORP 2298 GSFS INVESTMENTS I CORP 100.00 United States 0050 GSTP LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0080 Goldman Sachs Financial Market 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0091 GSJC 50 Hudson Urban Renewal 0009 Goldman Sachs Group, Inc. 100.00 New Jersey 0092 GSJC Land L.L.C. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0093 GSJC 30 Hudson Urban Renewal 0009 Goldman Sachs Group, Inc. 100.00 New Jersey SUBSIDIARY BUSINESS DESCRIPTION ----------------------------------------------------------------------------------------------------------------------------------- 0001 A registered U.S. broker-dealer and futures commission merchant engaged in investment banking, securities activities and investment management. Trades on a proprietary basis and also provides services to a substantial and diversified client base that inc 0001 A registered U.S. broker-dealer and futures commission merchant engaged in investment banking, securities activities and investment management. Trades on a proprietary basis and also provides services to a substantial and diversified client base that inc 0006 Owns 0.2% of GS & Co. 0007 Owns 0.2% of J. Aron & Company and J. Aron Holdings L.P. 0008 General partner of J. Aron & Company. 0008 General partner of J. Aron & Company. 0027 An investment bank that uses sophisticated technology to connect to individual investors in the United States. 0032 Established as part of an SSG Structured Investing Group transaction. 0033 Established as part of an SSG Structured Investing Group transaction. 0034 Established as part of an SSG Structured Investing Group transaction. 0034 Established as part of an SSG Structured Investing Group transaction. 0035 Established as part of an SSG Structured Investing Group transaction. 0036 Established as part of an SSG Structured Investing Group transaction. 0037 Established as part of an SSG Structured Investing Group transaction. 0038 Established as part of an SSG Structured Investing Group transaction. 0038 Established as part of an SSG Structured Investing Group transaction. 0039 Established as part of an SSG Structured Investing Group transaction. 0041 This entity was set up as part of an AMSSG Structured Investing Group transaction. 0042 Set up as part of the SBD Principal Investing Portfolio-to hold airplane leases. 0050 Holding entity for aircraft purchases. 0080 Owns 1% of Goldman Sachs Financial Markets, L.P. 0091 Lessee and construction agent for construction project in Jersey City. 0092 Land owner - Jersey City 0093 Owns building in Jersey City
0094 GSJC Master Lessee L.L.C. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0096 MLK DRIVE URBAN RENEWAL LLC 0009 Goldman Sachs Group, Inc. 100.00 New Jersey 0097 PH PIER MANAGEMENT LLC 0092 GSJC Land L.L.C. 100.00 Delaware 0098 REP ELD Gen-Par, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 0100 Archon Group, L.P. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0100 Archon Group, L.P. 0101 Archon Gen-Par, Inc. 1.00 Delaware 0101 Archon Gen-Par, Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0102 Archon Group Italia s.r.l. 0104 Archon International, Inc. 100.00 Italy 0104 Archon International, Inc. 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 0105 Archon Group Deutschland GmbH 0104 Archon International, Inc. 100.00 Germany 0106 GS COMM MORTGAGE CAPITAL, L.P. 0107 GS COMM MORTGAGE CAPITAL, LLC 1.00 Delaware 0106 GS COMM MORTGAGE CAPITAL, L.P. 1503 MLQ Investors, L.P. 99.00 Delaware 0107 GS COMM MORTGAGE CAPITAL, LLC 1503 MLQ Investors, L.P. 100.00 Delaware 0109 SPF ONE IL, L.L.C. 1513 MTGLQ Investors, LP 100.00 Delaware 0111 GS MD80 Leasing, LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 0113 SAVOY ASSOCIATES, LLC 1011 REP SVY HOLDINGS REALTY, LLC 100.00 United States 0118 Goldman Sachs (Asia) L.L.C. 0250 Goldman Sachs Global Holdings 1.00 Delaware 0118 Goldman Sachs (Asia) L.L.C. 1222 Goldman Sachs (Cayman) Holding 99.00 Delaware 0120 Goldman Sachs (Asia) Securitie 0009 Goldman Sachs Group, Inc. 99.00 Hong Kong 0120 Goldman Sachs (Asia) Securitie 0250 Goldman Sachs Global Holdings 1.00 Hong Kong 0123 Goldman Sachs (Asia Pacific) L 0250 Goldman Sachs Global Holdings 1.00 Delaware 0123 Goldman Sachs (Asia Pacific) L 1222 Goldman Sachs (Cayman) Holding 99.00 Delaware 0124 SENNA INVESTMENT (IRELAND) LTD 2200 GS Financial Serv L.P. (DEL) 100.00 Ireland 0135 Goldman Sachs (China) L.L.C. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0135 Goldman Sachs (China) L.L.C. 0250 Goldman Sachs Global Holdings 1.00 Delaware
0094 Master lessee for building in Jersey City 0096 Lessee and construction agent for construction project in Jersey City. 0097 Entity that owns the pier in Jersey City. 0098 Established to serve as General Partner of REP ELD Real Estate, L.P. 0100 Real estate property/asset manager owned by The Goldman Sachs Group, Inc. 0100 Real estate property/asset manager owned by The Goldman Sachs Group, Inc. 0101 1% general partner of Archon Group, L.P. 0102 Provides consulting services relating to assignment, acquisition, evaluation and management of immovable assets and/or assignment & management of credits. 0104 Holds investments in Archon Group Italia S.r.l and Archon Group International, Inc. 0105 Provides consultancy on economic and technical aspects of investment in real estate. Set up to support Archon's activities in Germany. 0106 Limited partnership designed to invest in commercial mortgages. 0106 Limited partnership designed to invest in commercial mortgages. 0107 Acts as a general partner of Archon Financial L.P. 0109 Serves as a strategic capital planning entity. 0111 Established as part of an SSG Structured Investing Group transaction. 0113 Entity is a condominium developer that is engaged in the business of selling its developed properties. 0118 Established to assume Goldman Sachs (Asia) Securities Limited's non-exchange business in Hong Kong. Also has a representative in Bangkok, Thailand. 0118 Established to assume Goldman Sachs (Asia) Securities Limited's non-exchange business in Hong Kong. Also has a representative in Bangkok, Thailand. 0120 Executes agency transactions for affiliates on the Hong Kong stock exchange. Non-exchange business was transferred to Goldman Sachs (Asia) LLC in the first quarter of fiscal 1995. 0120 Executes agency transactions for affiliates on the Hong Kong stock exchange. Non-exchange business was transferred to Goldman Sachs (Asia) LLC in the first quarter of fiscal 1995. 0123 Investment holding company for PT Goldman Sachs Indonesia. 0123 Investment holding company for PT Goldman Sachs Indonesia. 0124 Invests in KAMCO I loans purchased from Restamove Ireland Limited. 0135 Representative offices in Beijing and Shanghai. 0135 Representative offices in Beijing and Shanghai.
0137 DELMORA BANK GMBH 0104 Archon International, Inc. 100.00 Germany 0150 Goldman Sachs Canada Inc. 0009 Goldman Sachs Group, Inc. 100.00 Ontario 0154 CMLQ Investors Company 1506 MLQ L.L.C. 1.00 Nova Scotia 0154 CMLQ Investors Company 1513 MTGLQ Investors, LP 99.00 Nova Scotia 0156 Goldman Sachs Canada Finance 0009 Goldman Sachs Group, Inc. 100.00 Alberta 0157 Goldman Sachs Canada Finance 0009 Goldman Sachs Group, Inc. 99.00 Nova Scotia 0157 Goldman Sachs Canada Finance 0156 Goldman Sachs Canada Finance 1.00 Nova Scotia 0159 Goldman Sachs Canada Credit 0009 Goldman Sachs Group, Inc. 1.00 Nova Scotia 0159 Goldman Sachs Canada Credit 2220 Goldman Sachs Credit Part L.P. 99.00 Nova Scotia 0160 Goldman Sachs (Asia) Finance 0165 Goldman Sachs (Asia) Finance 99.00 Republic of Mauritius 0160 Goldman Sachs (Asia) Finance 0250 Goldman Sachs Global Holdings 1.00 Republic of Mauritius 0162 Express Investments III Privat 0160 Goldman Sachs (Asia) Finance 100.00 Malaysia 0163 NJLQ (Ireland) Ltd. 2200 GS Financial Serv L.P. (DEL) 100.00 Ireland 0164 Jade Dragon (Mauritius) Ltd 0192 Tiger Strategic Investments Lt 100.00 Republic of Mauritius 0165 Goldman Sachs (Asia) Finance 0001 Goldman, Sachs & Co. 99.00 Delaware 0165 Goldman Sachs (Asia) Finance 0250 Goldman Sachs Global Holdings 1.00 Delaware 0169 Muni Tic Toc Series Trust Cons 0001 Goldman, Sachs & Co. 100.00 United States 0170 Singel Cool One B.V. 2200 GS Financial Serv L.P. (DEL) 100.00 Netherlands 0171 Singel Cool Two B.V. 2200 GS Financial Serv L.P. (DEL) 100.00 Netherlands 0172 Archon Group (France) 0170 Singel Cool One B.V. 99.98 France 0172 Archon Group (France) 0171 Singel Cool Two B.V. 0.02 France 0173 TORIIZAKA KAIHATSU CO.,LTD. 1503 MLQ Investors, L.P. 100.00 Japan 0177 GS GLOBAL COMMODITIES(CANADA)C 0178 GS GLOB COMMODITIES(CAN)HOLDIN 100.00 Canada 0178 GS GLOB COMMODITIES(CAN)HOLDIN 0179 GS GLOB COMMODITIES(CAN)HOLDIN 1.00 United States 0178 GS GLOB COMMODITIES(CAN)HOLDIN 0250 Goldman Sachs Global Holdings 25.00 United States 0178 GS GLOB COMMODITIES(CAN)HOLDIN 2200 GS Financial Serv L.P. (DEL) 74.00 United States 0179 GS GLOB COMMODITIES(CAN)HOLDIN 2200 GS Financial Serv L.P. (DEL) 100.00 United States 0180 REP SAN REAL ESTATE, L.P. 0009 Goldman Sachs Group, Inc. 99.80 Delaware
0137 ESSG related bank in Germany that held non performing loans at the time of acquisition. 0150 Toronto/Calgary - based regulated broker/dealer of fixed income, equities, and futures products. 0154 Holds a portfolio of Canadian loans. 0154 Holds a portfolio of Canadian loans. 0156 Formerly a 1% general partner of Goldman Sachs Canada Finance, L.P. Now a 1% shareholder of Goldman Sachs Canada Finance Co. Entity is expected to be dissolved in near future. 0157 Issues commercial paper in Canada and lends the proceeds to GS affiliates in Canada. 0157 Issues commercial paper in Canada and lends the proceeds to GS affiliates in Canada. 0159 Engaged in trading of Canadian senior bank debt. 0159 Engaged in trading of Canadian senior bank debt. 0160 Based in Hong Kong and regulated by the Financial Services Commission. Primarily engaged in trading foreign currencies, securities and other financial products. 0160 Based in Hong Kong and regulated by the Financial Services Commission. Primarily engaged in trading foreign currencies, securities and other financial products. 0162 ASSG related entity investing in non-performing loans. 0163 Purchases non-performing loans. 0164 Established to primarily engage in trading of financial products in Asian countries. 0165 Holding company of Goldman Sachs (Asia) Finance. 0165 Holding company of Goldman Sachs (Asia) Finance. 0169 Aggregation of multiple trusts used in connection with the municipal tender option bond program (TIC TOC). 0170 Holding entity. Limited partner of Archon Group France 0171 Holding entity. Limited partner of Archon Group France 0172 Provides real estate loan and property asset management as well as underwriting services. 0172 Provides real estate loan and property asset management as well as underwriting services. 0173 TK operator of Toriizaka Kaihatsu TK. 0177 Oil and Gas commodity operating entity 0178 Holding company for GS Global Commodities (Canada) Corporation 0178 Holding company for GS Global Commodities (Canada) Corporation 0178 Holding company for GS Global Commodities (Canada) Corporation 0179 Holding entity within the structure of GS Global Commodities (Canada) Corporation 0180 REPIA entity.
0180 REP SAN REAL ESTATE, L.P. 0181 REP SAN GEN PAR, LLC 0.20 Delaware 0181 REP SAN GEN PAR, LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0182 REP CHW REALTY, LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0183 REP ELD REAL ESTATE LP 0009 Goldman Sachs Group, Inc. 99.80 Delaware 0183 REP ELD REAL ESTATE LP 0098 REP ELD Gen-Par, LLC 0.20 Delaware 0185 National Healthcare Staffing 0009 Goldman Sachs Group, Inc. 100.00 United States 0186 Elbe Funding Limited 1222 Goldman Sachs (Cayman) Holding 100.00 Cayman Islands 0187 Rhys Trust 2200 GS Financial Serv L.P. (DEL) 95.00 United States 0187 Rhys Trust 2284 GS GLOBAL MARKETS INC 5.00 United States 0188 Sapien Limited 0187 Rhys Trust 100.00 United States 0189 Sargasso Limited 0188 Sapien Limited 100.00 United States 0190 GS CAP PART 2000 EMPLOYEE FUND 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0191 GS Asian Venture (Delaware)LLC 0250 Goldman Sachs Global Holdings 25.00 China 0191 GS Asian Venture (Delaware)LLC 2200 GS Financial Serv L.P. (DEL) 75.00 China 0192 Tiger Strategic Investments Lt 0191 GS Asian Venture (Delaware)LLC 100.00 China 0193 Panda Investments Ltd. 0192 Tiger Strategic Investments Lt 100.00 China 0194 MLT Investments Ltd. 0192 Tiger Strategic Investments Lt 100.00 China 0196 EUSTON ENTERPRISES LTD 0194 MLT Investments Ltd. 100.00 Hong Kong 0197 FAIRWAY ENTERPRISES LTD 0194 MLT Investments Ltd. 100.00 Hong Kong 0198 Wealth Earner Limited 6153 GS STRATEGIC INVESTMENTS (ASIA 100.00 British Virgin Islands 0201 Goldman Sachs International 0220 Goldman Sachs Holding (U.K.) 99.00 United Kingdom 0201 Goldman Sachs International 0709 Goldman Sachs Group Holdings ( 1.00 United Kingdom 0211 GS Equity Markets, L.P. (Bermu 0531 GSEM DEL LLC 99.00 Bermuda 0211 GS Equity Markets, L.P. (Bermu 0542 GSEM BERMUDA HOLDINGS, L.P. 1.00 Bermuda 0220 Goldman Sachs Holding (U.K.) 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0226 SIGNUM LIMITED 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0227 Goldman Sachs (Monaco) S.A.M. 0709 Goldman Sachs Group Holdings ( 100.00 Monaco 0230 Goldman Sachjs Europe Limited 0201 Goldman Sachs International 100.00 Isle of Jersey 0240 Goldman Sachs Asset Management 0220 Goldman Sachs Holding (U.K.) 99.00 United Kingdom
0180 REPIA entity. 0181 REPIA entity. 0182 REPIA entity. 0183 REPIA entity. 0183 REPIA entity. 0185 Provides temporary nurse staffing to medical institutions. 0186 Established as part of an SSG Structured Investing Group transaction. 0187 Established as part of an SSG Structured Investing Group transaction. 0187 Established as part of an SSG Structured Investing Group transaction. 0188 Established as part of an SSG Structured Investing Group transaction. 0189 Established as part of an SSG Structured Investing Group transaction. 0190 Established for purposes of consolidating multiple employee-owned merchant banking funds. 0191 Holding company for ASSG entities 0191 Holding company for ASSG entities 0192 Holding company for ASSG entities 0193 Holding company for ASSG entities 0194 Holding company for ASSG entities 0196 To hold ASSG investments in Tung Fung Development Co. 0197 To hold ASSG investments in Tung Fung Development Co. 0198 Holding ASSG Investments 0201 A U.K. broker-dealer regulated by the Financial Services Authority. Provides a wide range of financial services to clients located worldwide and undertakes proprietary trading. 0201 A U.K. broker-dealer regulated by the Financial Services Authority. Provides a wide range of financial services to clients located worldwide and undertakes proprietary trading. 0211 Proprietary trading of Structured Equity Products. 0211 Proprietary trading of Structured Equity Products. 0220 Non-regulated holding company for U.K. entities. 0226 Established to report all consolidated Signum variable interest entities under FIN-46R. It is not a legal entity but set up for SPV consolidation process only. 0227 IMD/PWM business development in Monaco, Middle East and France. 0230 Employs consultants to Investment Banking Division; contracts with international advisers. 0240 London-based provider of asset management and investment advisory services, covering European and other international asset classes.
0240 Goldman Sachs Asset Management 0709 Goldman Sachs Group Holdings ( 1.00 United Kingdom 0241 GSPS Investments 0248 GSPS Strategies Corp 100.00 United Kingdom 0242 GS TRUST COMPANY OF DELAWARE 0244 Goldman Sachs Trust Company 100.00 Delaware 0244 Goldman Sachs Trust Company 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0245 Goldman Sachs Insurance Agency 0009 Goldman Sachs Group, Inc. 100.00 New York 0246 Pearl Street Insurance Company 0009 Goldman Sachs Group, Inc. 100.00 Vermont 0247 GOLDMAN SACHS BANK (USA) INC 1309 GS Bank USA Holdings LLC 100.00 Utah 0248 GSPS Strategies Corp 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 0249 (GS) GS CREDIT PARTNRS 0009 Goldman Sachs Group, Inc. 100.00 United States 0250 Goldman Sachs Global Holdings 0006 The Goldman, Sachs & Co. L.L.C 1.00 Delaware 0250 Goldman Sachs Global Holdings 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0270 Goldman Sachs Israel LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0290 Goldman Sachs Services Limited 0001 Goldman, Sachs & Co. 100.00 British Virgin Islands 0291 GS Global Funding (UK) Limited 0201 Goldman Sachs International 100.00 United Kingdom 0292 GS NEW MARKETS FUND, LLC 0009 Goldman Sachs Group, Inc. 98.00 Delaware 0292 GS NEW MARKETS FUND, LLC 0293 GS NEW MARKETS FUND PNR, INC 2.00 Delaware 0293 GS NEW MARKETS FUND PNR, INC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0302 GOLDMAN SACHS (JAPAN) LTD. 0009 Goldman Sachs Group, Inc. 100.00 British Virgin Islands 0303 GOLDMAN SACHS JAPAN CO., LTD. 0302 GOLDMAN SACHS (JAPAN) LTD. 100.00 British Virgin Islands 0307 Goldman Sachs Realty Japan Ltd 1503 MLQ Investors, L.P. 100.00 Japan 0310 A&G Investments Co, Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0313 Goldman Sachs Asset Management 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0313 Goldman Sachs Asset Management 0250 Goldman Sachs Global Holdings 1.00 Delaware 0314 Stone St PEP Tech Fund 2000 LP 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0316 GS Asset Management Co., Ltd 0009 Goldman Sachs Group, Inc. 1.00 Japan 0316 GS Asset Management Co., Ltd 0313 Goldman Sachs Asset Management 99.00 Japan 0318 Goldman Sachs Funds Management 0009 Goldman Sachs Group, Inc. 99.00 Ireland 0318 Goldman Sachs Funds Management 0250 Goldman Sachs Global Holdings 1.00 Ireland 0319 Goldman Sachs Investments Ltd. 0009 Goldman Sachs Group, Inc. 100.00 Bermuda 0320 GS Pension Management Company 0009 Goldman Sachs Group, Inc. 99.00 Cayman Islands
0240 London-based provider of asset management and investment advisory services, covering European and other international asset classes. 0241 Set up to trade principal investments 0242 Established as a limited purpose trust company. 0244 A national bank providing fiduciary services in the United States subject to regulation by the Office of the Comptrolle of Currency. 0245 Broker in the life insurance business. 0246 Insures specific hazards and operational risks of the firm. 0247 To engage in the business of credit and other financial related services, organized under the law of the state of Utah. 0248 Setup to trade private equity investments. 0249 Principal business of NEWCO is to act as subparticipant for loans originated by GSIB Milan Branch and the secondary trading of such loans. 0250 1% general partner of various Goldman Sachs entities. 0250 1% general partner of various Goldman Sachs entities. 0270 Engaged in investment research in Israel. 0290 Employs U.K. Group personnel. 0291 Holding company for a Far East structured finance deal. 0292 Parent for UIG - Portland fund of funds investment. 0292 Parent for UIG - Portland fund of funds investment. 0293 Parent for UIG - Portland fund of funds investment. 0302 Parent of GSJCL. 0303 A Tokyo-based broker-dealer regulated by the Financial Services Agency. Engaged in a wide range of customer activities as well as proprietary trading. 0307 Provides liaison services and other activities with respect to real estate loans, transactions in or outside of Japan, holds leases for Japan based entities, and Japanese real estate agent services. 0310 An ASSG related entity that holds non-performing loans. 0313 U.S.-based provider of asset management and investment advisory services across a wide range of domestic and global asset classes. 0313 U.S.-based provider of asset management and investment advisory services across a wide range of domestic and global asset classes. 0314 Consolidated employee fund. 0316 Provides asset management and investment advisory services in Japan. 0316 Provides asset management and investment advisory services in Japan. 0318 Investment fund manager and offshore fund administrator. 0318 Investment fund manager and offshore fund administrator. 0319 Holds investments on behalf of yet-to-be formed funds. 0320 GSAM-related vehicle which is dormant.
0320 GS Pension Management Company 1222 Goldman Sachs (Cayman) Holding 1.00 Cayman Islands 0321 Goldman Sachs Fund Management 0220 Goldman Sachs Holding (U.K.) 1.00 Luxembourg 0321 Goldman Sachs Fund Management 0700 Goldman Sachs (UK) L.L.C. 99.00 Luxembourg 0323 Goldman Sachs Japan Holdings, 0302 GOLDMAN SACHS (JAPAN) LTD. 100.00 Japan 0324 Palmwood Co., Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0327 GS CREDIT PARTNERS (JAPAN),LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0329 GS Strategic Invest Japan LLC 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 0330 Jupiter Investment Co. Ltd. 1503 MLQ Investors, L.P. 100.00 Japan 0331 CITRINE INVESTMENT CO.,LTD. 1503 MLQ Investors, L.P. 100.00 Japan 0332 LIME GREEN CO., LTD. 1503 MLQ Investors, L.P. 100.00 Japan 0333 CFGI CO., LTD. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0334 MERCER INVESTMENTS IV PRIVATE 0160 Goldman Sachs (Asia) Finance 100.00 Malaysia 0337 EXPRESS SECURITIZATION SPECIAL 2204 BEST INVESTMENT (DELAWARE) LLC 100.00 Korea 0340 R&G CO., LTD 0307 Goldman Sachs Realty Japan Ltd 98.33 Japan 0340 R&G CO., LTD 6001 JLQ LLC 1.67 Japan 0344 MERCER INVESTMENTS V PRIVATE L 0160 Goldman Sachs (Asia) Finance 100.00 Malaysia 0345 EXPRESS II SECURITIZATION SPEC 2204 BEST INVESTMENT (DELAWARE) LLC 100.00 Korea 0347 GAC PERSONAL CO. LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0348 PHOENIX OXNARD (DELAWARE) LLC 1503 MLQ Investors, L.P. 100.00 Delaware 0354 GSJBWere Financial Markets Pty 0009 Goldman Sachs Group, Inc. 100.00 Australia 0356 ARCHON HOSPITALITY CO. LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0357 LEAF GREEN CO. LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0358 LINDEN WOOD, LTD 1503 MLQ Investors, L.P. 100.00 Japan 0359 SOLAR WIND LTD 1503 MLQ Investors, L.P. 100.00 Japan 0360 Goldman Sachs Mitsui Marine De 0380 GSMMDPGP Inc. 1.00 Delaware 0360 Goldman Sachs Mitsui Marine De 0389 Goldman Sachs Holdings (Nether 49.00 Delaware 0361 Teibow Co.,Ltd. 0330 Jupiter Investment Co. Ltd. 100.00 Japan 0362 Nihon Hotel Investment Co., Lt 1503 MLQ Investors, L.P. 100.00 Japan 0363 Nephrite Equity Co.,Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0364 Amethyst Realty TK 0572 Amethyst Realty Co. Ltd. 100.00 Japan 0365 Omachi Onsen Kaihatsu Co. Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0366 TG Fund TK 0571 TG FUND CO.,LTD(TKO) 100.00 Japan 0367 GK SAKURAZAKA CAPITAL 0307 Goldman Sachs Realty Japan Ltd 1.00 Japan
0320 GSAM-related vehicle which is dormant. 0321 Management company for German Bond Fund. 0321 Management company for German Bond Fund. 0323 Established to provide management services to Japanese entities and hold the fixed assets in Japan. 0324 An ASSG related entity that holds Japanese loans/receivables. 0327 Non-regulated entity established to trade emerging market loans and senior bank loans. 0329 Invests in private and public entities in Japan, TK arrangements in Japan, and SPCs that hold investments (equity/loans/REO) in Japan. 0330 Holds Haseko and MyPrint shares and other equities. 0331 Holds a hotel in Osaka, Japan. 0332 Purchases and sells loans. 0333 ASSG related entity that owns hotels and shopping mall in Japan. 0334 ASSG related entity that has an investment in the Cho Hung Bank deal. 0337 Holds investment in Cho Hung bank deal. 0340 Invests in non-performing loans. 0340 Invests in non-performing loans. 0344 ASSG related entity that invests in non performing loans. 0345 Holds investment in Cho Hung bank deal. 0347 An ASSG related entity that purchased residential loans from Chiyoda Life. 0348 Holds certain mortgage properties for liquidation. 0354 Member of GSJBWere group of companies, focused on the Australian/NZ markets. 0356 Holding company in Asia for certain hotel entities. 0357 TK operator for Leaf Green TK 0358 TK operator of Linden Wood TK. 0359 TK operator of Solar Wind TK. 0360 AAA rated company established to provide credit rating enhancement to derivative product trading. All trades to third parties are back to back with affiliates. 0360 AAA rated company established to provide credit rating enhancement to derivative product trading. All trades to third parties are back to back with affiliates. 0361 Consolidation of Japan entity. To purchase equity. Manufacturer of pen-head. 0362 Consolidation of Japan entity. To hold hotels in Japan. 0363 To hold TK investment in Amethyst Realty (REO Equity). 0364 To hold real estate in Japan 0365 To hold Onsen hotels. 0366 To hold real estate in Japan. 0367 To invest in private/public equity of various operating companies of Japan.
0367 GK SAKURAZAKA CAPITAL 1503 MLQ Investors, L.P. 99.00 Japan 0368 YOSHINO HOSPITALITY CO.,LTD. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0369 REAL ESTATE CREATION FUND2 CO. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0370 Nagasaka Kaihatsu Co.,Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0371 YOSHINO KAIHATSU CO.,LTD. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0372 Star gate Realty Co.,Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0373 REC INVESTMENTS2 CO.,LTD. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0374 PIA Holdings Cayman Tokyo Br. 1503 MLQ Investors, L.P. 100.00 Japan 0375 GS PIA HOLDINGS GK 0374 PIA Holdings Cayman Tokyo Br. 1.00 Japan 0375 GS PIA HOLDINGS GK 1503 MLQ Investors, L.P. 99.00 Japan 0380 GSMMDPGP Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0382 GS GESTION S.G.I.I.C.,SA 0690 Goldman Sachs (Netherlands) B. 100.00 Spain 0385 GSPS ASIA LTD 0191 GS Asian Venture (Delaware)LLC 100.00 Mauritius 0389 Goldman Sachs Holdings (Nether 0009 Goldman Sachs Group, Inc. 100.00 Netherlands 0390 Goldman Sachs (India) L.L.C. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0390 Goldman Sachs (India) L.L.C. 0250 Goldman Sachs Global Holdings 1.00 Delaware 0391 GS INDIA HOLDINGS (DELAWARE) L 0009 Goldman Sachs Group, Inc. 100.00 United States 0392 GS India Holdings L.P. 0009 Goldman Sachs Group, Inc. 74.99 United States 0392 GS India Holdings L.P. 0250 Goldman Sachs Global Holdings 25.00 United States 0392 GS India Holdings L.P. 0391 GS INDIA HOLDINGS (DELAWARE) L 0.01 United States 0396 VANTAGE MARKETPLACE HOLDINGS, 0009 Goldman Sachs Group, Inc. 100.00 United States 0397 EMBARGO LLC 1513 MTGLQ Investors, LP 100.00 Delaware 0398 REC INVESTMENTS TK 1998 ReC Investments Co., Ltd 100.00 Japan 0399 REAL ESTATE CREATION FUND TK 1997 Real Estate Creation Fund Co. 100.00 Japan 0401 SHIRE II ASSETS 0404 SHIRE UK LIMITED 100.00 United Kingdom 0402 SHIRE FUNDING LIMITED 0404 SHIRE UK LIMITED 100.00 United Kingdom 0403 SHIRE ASSETS 0402 SHIRE FUNDING LIMITED 1.00 United Kingdom 0403 SHIRE ASSETS 0404 SHIRE UK LIMITED 99.00 United Kingdom 0404 SHIRE UK LIMITED 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0406 Bay Wind Realty Finance(Cayman 1503 MLQ Investors, L.P. 100.00 Japan 0408 Prime Equity Co., LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0409 MG Partners Co., LTD 2313 SOLAR WIND TK 100.00 Japan 0410 Minerva L.P. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0410 Minerva L.P. 0411 Minerva Inc. 1.00 Delaware
0367 To invest in private/public equity of various operating companies of Japan. 0368 To hold partial ownership of commercial building, Tokyo, Japan. 0369 To hold partial ownership of commercial building, Tokyo, Japan. 0370 To hold partial ownership of commercial building, Tokyo, Japan. 0371 To hold partial ownership of commercial building, Tokyo, Japan. 0372 To hold partial ownership of commercial building, Tokyo, Japan. 0373 To hold partial ownership of commercial building, Tokyo, Japan. 0374 To Invest in GS PIA Holdings GK 0375 To Invest in Equities of PIA Entities. 0375 To Invest in Equities of PIA Entities. 0380 1% corporate general partner of Goldman Sachs Mitsui Marine Derivative Products, L.P. 0382 Entity set-up to manage Spanish SICAVs and offer PWM services in Spain - entity run by PWM Iberian team. 0385 GBC2 Mauritius Entity estab. To hold GSPS Investments 0389 Entity established to own GS limited partnership in GSMMDP. 0390 Representative office in India. 0390 Representative office in India. 0391 Holding company for investments into India. 0392 Holding company for investments into India. 0392 Holding company for investments into India. 0392 Holding company for investments into India. 0396 Entity set up to house experts who will help clients who have contracted the expert's services on specific questions / topics. 0397 To purchase portfolios of credit cards receivables. 0398 An ASSG related entity that invests in loans. 0399 Purchases Resona loans. 0401 Established as part of an SSG Structured Investing Group transaction. 0402 Established as part of an SSG Structured Investing Group transaction. 0403 Established as part of an SSG Structured Investing Group transaction. 0403 Established as part of an SSG Structured Investing Group transaction. 0404 Established as part of an SSG Structured Investing Group transaction. 0406 ASSG related entity engaged in real estate development in Japan. 0408 Invests in real estate. 0409 Invests in real estate. 0410 Established as part of an SSG Structured Investing Group transaction. 0410 Established as part of an SSG Structured Investing Group transaction.
0411 Minerva Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0412 Amagansett Financing 0709 Goldman Sachs Group Holdings ( 100.00 Cayman Islands 0413 Laffitte Participation 10 2331 Chiltern Trust 100.00 France 0413 Laffitte Participation 10 2331 Chiltern Trust 100.00 France 0414 Laffitte Participation 12 0413 Laffitte Participation 10 100.00 France 0414 Laffitte Participation 12 0413 Laffitte Participation 10 100.00 France 0415 GS Longport Investment Corp 0414 Laffitte Participation 12 100.00 United States 0415 GS Longport Investment Corp 0414 Laffitte Participation 12 100.00 United States 0416 GS Oceanside Investment LLC 0415 GS Longport Investment Corp 100.00 United States 0416 GS Oceanside Investment LLC 0415 GS Longport Investment Corp 100.00 United States 0417 Normandy Funding Corporation 2200 GS Financial Serv L.P. (DEL) 100.00 United States 0417 Normandy Funding Corporation 2200 GS Financial Serv L.P. (DEL) 100.00 United States 0426 SARC Srl 0102 Archon Group Italia s.r.l. 2.00 Italy 0426 SARC Srl 1503 MLQ Investors, L.P. 98.00 Italy 0429 Hull Trading GMBH Frankfurt 0431 The Hull Group, L.L.C. 100.00 Germany 0430 GS Hull Holding, Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0431 The Hull Group, L.L.C. 0009 Goldman Sachs Group, Inc. 22.79 Illinois 0431 The Hull Group, L.L.C. 0430 GS Hull Holding, Inc. 77.21 Illinois 0432 SLK - Hull Derivatives LLC 0431 The Hull Group, L.L.C. 100.00 Delaware 0434 Hull Trading (UK) Limited 0431 The Hull Group, L.L.C. 100.00 United Kingdom 0435 Hull Trading Asia, Limited 0191 GS Asian Venture (Delaware)LLC 100.00 Hong Kong 0440 Frankfurter Mobilien Limited 2200 GS Financial Serv L.P. (DEL) 100.00 Isle of Jersey 0441 Akteas S.R.L. 0762 ELQ INVESTORS, LTD 100.00 Italy
0411 Established as part of an SSG Structured Investing Group transaction. 0412 Established as part of an SSG Structured Investing Group transaction. 0413 Established as part of an SSG Structured Investing Group transaction. 0413 Established as part of an SSG Structured Investing Group transaction. 0414 Established as part of an SSG Structured Investing Group transaction. 0414 Established as part of an SSG Structured Investing Group transaction. 0415 Established as part of an SSG Structured Investing Group transaction. 0415 Established as part of an SSG Structured Investing Group transaction. 0416 Established as part of an SSG Structured Investing Group transaction. 0416 Established as part of an SSG Structured Investing Group transaction. 0417 Established as part of an SSG Structured Investing Group transaction. 0417 Established as part of an SSG Structured Investing Group transaction. 0426 Purchases non-performing Italian mortgage and consumer loan portfolios and then securitizes them. 0426 Purchases non-performing Italian mortgage and consumer loan portfolios and then securitizes them. 0429 Proprietary trading firm; Entity was liquidated in Nov/Dec 2005 and is in the process of dissolution. 0430 Holding company within the Hull family of entities 0431 Managing member for SLK Hull Derivatives LLC, Hull Trading GmbH, Hull Trading UK & Hull Trading Asia. 0431 Managing member for SLK Hull Derivatives LLC, Hull Trading GmbH, Hull Trading UK & Hull Trading Asia. 0432 Registered broker-dealer that operates as a market-maker and trader on various securities and futures exchanges. 0434 A market-maker in equity derivatives and equity securities at the time of acquisition in 1999. Business has since been moved into other entities. 0435 A market-maker in equity derivatives and equity securities at the time of acquisition in 1999. Business has since been moved into other entities. 0440 An ESSG entity that holds leases in Germany. 0441 ESSG related entity established for potential acquisition of real estate.
0442 Northern Electric (Peaking)LTD 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 0443 South Wales Investments TPL LT 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 0444 Western Power Investments LTD 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 0445 Yellow Acquisition Ltd. 2400 GS EUROPEAN OPP FUND BV 100.00 Germany 0446 GS Capital Funding (Cayman) 0453 GS CAPITAL FUNDING UK II 100.00 Cayman Islands 0447 GS Capital Funding, Inc 2200 GS Financial Serv L.P. (DEL) 100.00 United States 0448 GS Capital Funding UK 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0449 GSFS (Cayman) 2002-A Limited 2200 GS Financial Serv L.P. (DEL) 100.00 Cayman Islands 0452 CONRAD P4 LTD. 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 0453 GS CAPITAL FUNDING UK II 0447 GS Capital Funding, Inc 100.00 United Kingdom 0454 SUNE SOLAR FUND I LLC 2329 GS Solar Power I, LLC 100.00 United States 0462 Ruby Realty Co.,Ltd. 1503 MLQ Investors, L.P. 100.00 Japan 0470 GK KAZAHANA 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0471 Archon Japan Branch 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0472 Funabiki Co.,Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0473 GK Gekko 0330 Jupiter Investment Co. Ltd. 100.00 Japan 0474 GK Sayama 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0475 GK ARISUGAWA FINANCE 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0476 ARISUGAWA FINANCE TK 0475 GK ARISUGAWA FINANCE 100.00 Japan 0477 GK ASUKA 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0478 SHINING PARTNERS TK2 0479 SHINING PARTNERS LTD(TKO) 100.00 Japan 0479 SHINING PARTNERS LTD(TKO) 1503 MLQ Investors, L.P. 100.00 Japan 0482 SLK Global Markets Ltd 0495 GS EXECUTION AND CLEARING, L.P 100.00 United Kingdom 0484 SLK Index Specialists, L.L.C. 0495 GS EXECUTION AND CLEARING, L.P 100.00 New York 0485 Spear, Leeds & Kellogg Special 0495 GS EXECUTION AND CLEARING, L.P 100.00 New York 0487 SLK LLC 0009 Goldman Sachs Group, Inc. 99.00 New York 0487 SLK LLC 0488 SLK Acquisition Holdings Inc. 1.00 New York 0488 SLK Acquisition Holdings Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0495 GS EXECUTION AND CLEARING, L.P 0487 SLK LLC 100.00 New York
0442 Established to hold an investment in a power company. 0443 ESSG related entity established to hold an investment in a power company. 0444 An ESSG related entity established to hold an investment in a power company. 0445 To hold a portfolio of non performing loans. 0446 The entity is setup as part of an upcoming Structured Investment Group (SSG) transaction. 0447 The entity is setup as part of an upcoming Structured Investment Group (SSG) transaction. 0448 The entity is setup as part of an upcoming Structured Investment Group (SSG) transaction. 0449 Set up as part of a Structured Investing Group transaction. The entity will be capitalised by GS Financial Services LP It's purpose will purely be to sell a third party a put option over the third parties' minority interest in a GS controlled Unit Trus 0452 Entity set-up to hold portfolio of non-performing German loans. 0453 Set-up as part of a Structured Investing Group Transaction. 0454 Company founded to support the installation of solar electric systems. 0462 Holds commercial buildings in Tokyo, Japan. 0470 To purchase a shopping center Joy park Kakogawa 0471 To set up Archon Japan (division of GSRJL) with ots own enity code. Initially set up as Shell Entity 8. 0472 To Hold Onsen Hotels 0473 To Hold Equity Investments 0474 To hold Shinjuku retail building 0475 To Invest in Loan and Preferred Shares of AP8, a SPC created by Advantage Partners, a well known MBO fund in Japan 0476 To Invest in Loan and Preferred Shares of AP8, a SPC created by Advantage Partners, a well known MBO fund in Japan 0477 To provide load to Hunet, a small real estate developer. 0478 Consolidation of Japan Entity (to hold SPL portfolio) 0479 TK operator for Shining Partners TK 0482 Introduces foreign customer trades to Spear, Leeds & Kellogg, LP on a fully-disclosed basis. 0484 Specialist and market-maker in various Exchange Traded Funds (ETFs) and options on ETFs which are traded on the AMEX. 0485 NYSE stock specialist firm. 0487 Holding company for Goldman Sachs Execution and Clearing, L.P. and other SLK entities. 0487 Holding company for Goldman Sachs Execution and Clearing, L.P. and other SLK entities. 0488 Holding company owning 1% membership interest in SLK LLC. 0495 A registered U.S. broker-dealer that provides execution, clearing and prime brokerage services to institutions and broker-dealers.
0499 Kansai Realty Co., LTD 0409 MG Partners Co., LTD 100.00 Japan 0501 Hyogo Wide Service Co., LTD 2309 GAC PERSONAL TK 100.00 Japan 0502 Midori Data Co., LTD 2309 GAC PERSONAL TK 100.00 Japan 0503 Wakaba Hoken Daiko Co., LTD 2309 GAC PERSONAL TK 100.00 Japan 0504 Minami Aoyama Kaihatsu Co.,LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0506 GS AYCO HOLDINGS LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0507 THE AYCO COMPANY, L.P. 0506 GS AYCO HOLDINGS LLC 99.00 Delaware 0507 THE AYCO COMPANY, L.P. 0509 SARATOGA SPRINGS LLC 1.00 Delaware 0508 HAMBRE, INC 0506 GS AYCO HOLDINGS LLC 100.00 Delaware 0509 SARATOGA SPRINGS LLC 0506 GS AYCO HOLDINGS LLC 100.00 Delaware 0511 AYCO SERVICES AGENCY, L.P. 0506 GS AYCO HOLDINGS LLC 1.00 Delaware 0511 AYCO SERVICES AGENCY, L.P. 0507 THE AYCO COMPANY, L.P. 99.00 Delaware 0512 MERCAY CORPORATION 0511 AYCO SERVICES AGENCY, L.P. 100.00 Delaware 0513 MERCER ALLIED COMPANY, L.P. 0506 GS AYCO HOLDINGS LLC 1.00 Delaware 0513 MERCER ALLIED COMPANY, L.P. 0507 THE AYCO COMPANY, L.P. 99.00 Delaware 0514 JUST OPTIONS LLC 0495 GS EXECUTION AND CLEARING, L.P 100.00 United States 0530 GSEM DEL INC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0531 GSEM DEL LLC 0542 GSEM BERMUDA HOLDINGS, L.P. 100.00 Delaware 0532 GS PRIME HOLDINGS LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0533 FEDERAL BOULEVARD, LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0534 GS POWER HOLDINGS LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0535 AMERICAN GAS ROYALTY TRUST 0001 Goldman, Sachs & Co. 100.00 Delaware 0536 Site 26 Holdings Inc. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0537 GS Headquarters LLC 0009 Goldman Sachs Group, Inc. 99.80 Delaware 0537 GS Headquarters LLC 0536 Site 26 Holdings Inc. 0.20 Delaware 0541 GSEM (DEL) HOLDINGS, L.P. 0250 Goldman Sachs Global Holdings 25.00 United States 0541 GSEM (DEL) HOLDINGS, L.P. 0530 GSEM DEL INC 75.00 United States 0542 GSEM BERMUDA HOLDINGS, L.P. 0250 Goldman Sachs Global Holdings 1.00 Other Americas
0499 ASSG entity engaged in real estate activities in Japan. 0501 Guarantees loans purchased from RCC. 0502 Guarantees loans purchased from RCC. 0503 An ASSG related entity that guarantees loan purchased from RCC. 0504 An ASSG related entity that is engaged in real estate investing. 0506 Parent company to The Ayco Company, LP, Saratoga Springs, LLC, also is a General Partner for the Ayco Services Agency LP. 0507 Provides financial counseling to individuals employed by corporations. 0507 Provides financial counseling to individuals employed by corporations. 0508 Entity whose employees support Ayco Company LP and Ayco Services Agency LP. 0509 General partners for the Ayco Company LP. 0511 Provides personal insurance needs and administration services (estate planning) for clients. 0511 Provides personal insurance needs and administration services (estate planning) for clients. 0512 Holding company for two entities that were established to provide insurance services in particular states. 0513 Broker/dealer established as part of the Ayco acquisition. 0513 Broker/dealer established as part of the Ayco acquisition. 0514 Just Options is a joint venture between Peak 6 and GSEC where we are currently taking a majority share in the company's net losses. Accounting Policy is mandating that we treat this as a consolidating VIE until the situation changes. 0530 General partner for GS Equity Market, L.P. (Bermuda). 0531 Holding company for GS Equity Market, L.P. (Bermuda). 0532 Acquired as part of the Linden Venture. 0533 Data center in New Jersey. 0534 Holding company for power generation assets obtained in the firm's acquisition of Cogentrix Energy, Inc. and National Energy & Gas Transmission, Inc. 0535 Part of the VPP Dominion Transaction. 0536 Partial owner of GS Headquarters LLC. 0537 Engaged in the construction of the new world headquarter in lower Manhattan. 0537 Engaged in the construction of the new world headquarter in lower Manhattan. 0541 As part of the GSEM L.P. restructuring, entity is being formed as part of the holding company structure for GSEM L.P. 0541 As part of the GSEM L.P. restructuring, entity is being formed as part of the holding company structure for GSEM L.P. 0542 As part of the GSEM L.P. restructuring, entity is being formed as part of the holding company structure for GSEM L.P.
0542 GSEM BERMUDA HOLDINGS, L.P. 0541 GSEM (DEL) HOLDINGS, L.P. 99.00 Other Americas 0543 MEP GS INVESTOR L.P. 0250 Goldman Sachs Global Holdings 1.00 United Kingdom 0543 MEP GS INVESTOR L.P. 1513 MTGLQ Investors, LP 99.00 United Kingdom 0545 GSFS INVESTMENTS III, LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 0546 GS DIRECT MEZZANINE 2006, L.P. 0009 Goldman Sachs Group, Inc. 100.00 United States 0547 Pinnacle Partners Group, LP 0009 Goldman Sachs Group, Inc. 100.00 United States 0552 SOUTH WIND REALTY FINANCE (CAY 1503 MLQ Investors, L.P. 100.00 Japan 0554 GS Capital Opportunities LLC 2200 GS Financial Serv L.P. (DEL) 100.00 United States 0555 GS Financing Opportunities LLC 0554 GS Capital Opportunities LLC 100.00 United States 0561 LDT, Inc. 0009 Goldman Sachs Group, Inc. 100.00 New York 0564 LDT Partners 0001 Goldman, Sachs & Co. 49.00 Delaware 0564 LDT Partners 0195 PBC Holdings Limited 50.00 Delaware 0564 LDT Partners 0561 LDT, Inc. 1.00 Delaware 0571 TG FUND CO.,LTD(TKO) 0572 Amethyst Realty Co. Ltd. 100.00 Japan 0572 Amethyst Realty Co. Ltd. 1503 MLQ Investors, L.P. 100.00 Japan 0573 Excellent Equity Co., Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0574 Blue Daisy Co., Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0575 Dandelion Investments Co., Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0576 Green Mountain One Co., Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0578 Fukuoka Toshi Kaihatsu Co. Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0579 GK Taiyo Kaihatsu 1503 MLQ Investors, L.P. 100.00 Japan 0620 Goldman Sachs DO Brasil Banco 0009 Goldman Sachs Group, Inc. 99.90 Brazil 0620 Goldman Sachs DO Brasil Banco 0250 Goldman Sachs Global Holdings 0.10 Brazil 0630 GS REPRESENTACOES LTDA. 0001 Goldman, Sachs & Co. 1.00 Brazil 0630 GS REPRESENTACOES LTDA. 0009 Goldman Sachs Group, Inc. 99.00 Brazil 0652 Goldman Sachs Group y Compania 0009 Goldman Sachs Group, Inc. 99.00 Mexico 0652 Goldman Sachs Group y Compania 0250 Goldman Sachs Global Holdings 1.00 Mexico 0653 Goldman Sachs Mexico Casa de B 0009 Goldman Sachs Group, Inc. 99.99 Mexico 0653 Goldman Sachs Mexico Casa de B 0250 Goldman Sachs Global Holdings 0.01 Mexico 0660 Goldman Sachs Argentina LLC 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0660 Goldman Sachs Argentina LLC 0250 Goldman Sachs Global Holdings 1.00 Delaware 0683 GS Hedge Fund Strategies LLC 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0683 GS Hedge Fund Strategies LLC 0313 Goldman Sachs Asset Management 1.00 Delaware 0686 GS LIQUID TRDNG OPPORTUNITIES 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0690 Goldman Sachs (Netherlands) B. 0009 Goldman Sachs Group, Inc. 100.00 Netherlands 0691 GS A320 LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 0692 GS RJX Leasing LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States
0542 As part of the GSEM L.P. restructuring, entity is being formed as part of the holding company structure for GSEM L.P. 0543 Limited Partner in an Investment Fund 0543 Limited Partner in an Investment Fund 0545 To hold five operating leases for the SBD Principal Investing Desk. 0546 To consolidate the GS Direct Mezzanine Fund 0547 To consolidate GS Pinnacle Partners, LP 0552 An ASSG related entity that holds golf courses and related assets in Japan. 0554 Established as part of an SSG Structured Investing Group transaction. 0555 Established as part of an SSG Structured Investing Group transaction. 0561 General partner of LDT Partners and 1% ownership in LDT Partners. 0564 General partner of LDT Partners & 1% ownership in LDT Partners. 0564 General partner of LDT Partners & 1% ownership in LDT Partners. 0564 General partner of LDT Partners & 1% ownership in LDT Partners. 0571 TK operator for TG Fund TK 0572 TK Operator of Amethsyt Realty TK 0573 TK Operator of Excellent Equity TK 0574 TK operator of Blue Daisy TK. 0575 TK Operator of Dandelion Investments TK 0576 TK Operator of Green mountain One TK 0578 TK Operator of Fukuoka Toshi Kaihatsu TK 0579 To hold Shibuya Lu82 building in Shibuya udagawacho, Japan. REO deal 0620 Brazilian bank. 0620 Brazilian bank. 0630 Representative office in Sao Paulo, Brazil. 0630 Representative office in Sao Paulo, Brazil. 0652 IBD Rep office in Mexico. 0652 IBD Rep office in Mexico. 0653 Broker/dealer that is in the process of liquidation. 0653 Broker/dealer that is in the process of liquidation. 0660 Representative office in Buenos Aires. 0660 Representative office in Buenos Aires. 0683 Registered as a commodity pool operator and a commodity trading advisor with the Commodity Futures Trading Commission. 0683 Registered as a commodity pool operator and a commodity trading advisor with the Commodity Futures Trading Commission. 0686 Facilitates the consolidation of the GSAM fund seed investments. 0690 Owns the GS limited partnership interest in GSMMDP. 0691 Established as part of a Private Finance Group Leasing Transaction. 0692 Established as part of a Private Finance Group Leasing Transaction.
0700 Goldman Sachs (UK) L.L.C. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0705 Fleet Trade & Transport Limit 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0706 Fleet Trade & Transport (U.S. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0709 Goldman Sachs Group Holdings ( 0700 Goldman Sachs (UK) L.L.C. 100.00 United Kingdom 0714 Goldman Sachs Trust Company (T 0009 Goldman Sachs Group, Inc. 100.00 New York 0715 Goldman Sachs (Cayman) Trust, 0250 Goldman Sachs Global Holdings 1.00 Cayman Islands 0715 Goldman Sachs (Cayman) Trust, 1222 Goldman Sachs (Cayman) Holding 99.00 Cayman Islands 0730 Goldman Sachs International Ba 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 0740 Goldman Sachs Property Managem 0009 Goldman Sachs Group, Inc. 100.00 United Kingdom 0746 GS Municipal Products L.L.C. 0001 Goldman, Sachs & Co. 1.00 Delaware 0746 GS Municipal Products L.L.C. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0752 CER HOLDINGS LP 0541 GSEM (DEL) HOLDINGS, L.P. 99.00 United Kingdom 0752 CER HOLDINGS LP 0755 CER Holdings GP 1.00 United Kingdom 0753 CER INVESTMENT 1 0752 CER HOLDINGS LP 100.00 United Kingdom 0754 GSPS (Del) LP 0248 GSPS Strategies Corp 75.00 United States 0754 GSPS (Del) LP 0250 Goldman Sachs Global Holdings 25.00 United States 0755 CER Holdings GP 0250 Goldman Sachs Global Holdings 100.00 United Kingdom 0760 Goldman Sachs Overseas Finance 0009 Goldman Sachs Group, Inc. 99.00 Delaware 0760 Goldman Sachs Overseas Finance 0115 Goldman Sachs (France) Finance 1.00 Delaware 0761 EXCELLENT EQUITY TK 0573 Excellent Equity Co., Ltd. 100.00 Japan 0762 ELQ INVESTORS, LTD 1513 MTGLQ Investors, LP 100.00 United Kingdom 0763 RESIMARNE SAS 0762 ELQ INVESTORS, LTD 100.00 France 0766 PERCIER FINANCE SAS 0762 ELQ INVESTORS, LTD 100.00 France 0767 Fleet Properties 0762 ELQ INVESTORS, LTD 99.00 Portugal 0767 Fleet Properties 1513 MTGLQ Investors, LP 1.00 Portugal 0768 Mont Blanc Acquisition LTD 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 0769 Matterhorn Acquisitions Ltd 2400 GS EUROPEAN OPP FUND BV 100.00 United Kingdom 0773 MB Acquisitions BV 0762 ELQ INVESTORS, LTD 100.00 Netherlands 0774 Portfolio Acquisitions 1 Ltd. 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 0775 Goldman Sachs Power L.L.C. 0008 J. Aron Holdings, L.P. 99.00 Delaware
0700 Non-regulated holding company for Goldman Sachs Group Holdings (U.K.) 0705 Undertakes commodities trading in oil and shipping operations, principally vessel chartering. 0706 Non-regulated petroleum shipping entity. 0709 Holding company which owns 100% of Fleet Trade; 100% of Goldman Sachs International Bank; and minority interest in a number of UK entities. 0714 A limited purpose trust company which provides clearing, trust, investment management and other fiduciary services. 0715 Trust company; acts as offshore fund administrator. 0715 Trust company; acts as offshore fund administrator. 0730 London based bank involved in loan origination, secondary dealing in bank loans and related activities. 0740 UK-based entity with building-related assets and expenses pertaining to GS' London operations. 0746 Holds sponsor certificates issued in tender option programs. 0746 Holds sponsor certificates issued in tender option programs. 0752 Set up to own various SPVs that will hold carbon emmission certificates 0752 Set up to own various SPVs that will hold carbon emmission certificates 0753 SPV set up to hold carbon emmission certificates 0754 Set up to hold an entity holding illiquid investments. 0754 Set up to hold an entity holding illiquid investments. 0755 Will own various SPVs set up to hold carbon emmission certificates 0760 Non-regulated Delaware limited partnership formed to issue debt notes in back to back relationships with affiliates. 0760 Non-regulated Delaware limited partnership formed to issue debt notes in back to back relationships with affiliates. 0761 Kamata kosan (Residential); Excellent to purchase 2 retail store buildings, 1 hotel plus parking area (land), 1 residential and 5 lands 0762 Holding company for non-performing debt investments. 0763 An ESSG related entity established to acquire buildings on the Euro Disney campus. 0766 An ESSG related entity that functions as an investment company. 0767 Vehicle for potential acquisitions of real estate from PMF-1 Ltd. 0767 Vehicle for potential acquisitions of real estate from PMF-1 Ltd. 0768 An ESSG related entity that invests in non performing loans. 0769 An ESSG related entity that invests in non performing loans. 0773 An ESSG related entity that invests in non performing loans. 0774 To purchase and originate real estate debt 0775 Established to serve as the exclusive advisor to Constellation Power Source Inc. (CPSI - a subsidiary of Baltimore Gas and Electric) for power trading and risk management and will license to CPSI software related to power trading and risk management.
0775 Goldman Sachs Power L.L.C. 0801 J. Aron & Company 1.00 Delaware 0777 Alkas Realty Private Limited 6152 Baekdu Investments Limited 100.00 Singapore 0778 Exchange Realty SRL 6152 Baekdu Investments Limited 100.00 Barbados 0779 Case RM, LLC 1513 MTGLQ Investors, LP 100.00 United States 0785 GS Leasing Engines II, LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 0786 Goldman Sachs Futures (Asia) L 0250 Goldman Sachs Global Holdings 1.00 Hong Kong 0786 Goldman Sachs Futures (Asia) L 0801 J. Aron & Company 99.00 Hong Kong 0789 TRIUMPH INVESTMENTS (IRELAND) 6150 Best II Investments (Delaware) 100.00 Ireland 0791 Nihon Endeavor Fund Co., LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0792 GS 767 Leasing LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 0793 Blossom Holding III BV 2400 GS EUROPEAN OPP FUND BV 100.00 Germany 0794 GS Leasing (N506MC), LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 0795 REP FSB Real Estate, L.L.C 0009 Goldman Sachs Group, Inc. 100.00 United States 0796 GS LPII Phase I Realty LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 0797 Mars Equity Co., Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 0798 OOO Goldman Sachs 0847 GS RBD Holdings LP 100.00 Russia 0799 GCN CE Holdings Corp 2200 GS Financial Serv L.P. (DEL) 100.00 United States 0801 J. Aron & Company 0007 The J. Aron Corporation 0.20 New York 0801 J. Aron & Company 0008 J. Aron Holdings, L.P. 99.80 New York 0802 J. Aron & Company (Singapore) 0805 Goldman Sachs Foreign Exchange 100.00 Singapore 0804 Goldman Sachs (Singapore) PTE 0805 Goldman Sachs Foreign Exchange 100.00 Singapore
0775 Established to serve as the exclusive advisor to Constellation Power Source Inc. (CPSI - a subsidiary of Baltimore Gas and Electric) for power trading and risk management and will license to CPSI software related to power trading and risk management. 0777 The entity is a SPC which will purchase DBS tower as a rental property in Singapore. 0778 Holding the Exchange Tower in Beijing 0779 The entity will own and service several consumer auto loan portfolios (Remark Capital Group LLC is management company of this entity.) 0785 To hold 6 operating leases to Mesaba Aviations guaranteed by 6 engines. 0786 Conducts Hong Kong Futures Exchange (HKFE) business for affiliates through an outside broker. HKFE member and commodities dealer; registered with the Hong Kong Securities and Futures Commission. 0786 Conducts Hong Kong Futures Exchange (HKFE) business for affiliates through an outside broker. HKFE member and commodities dealer; registered with the Hong Kong Securities and Futures Commission. 0789 Established primarily to hold ASSG positions in Korean assets. 0791 Established to purchase loans (SMBC Rivival Fund). 0792 Established as part of an SSG Structured Investing Group transaction. 0793 GS European Opportunities Fund BV subsidiary for Ihr Platz Investment. 0794 Established to hold an aircraft. 0795 REPIA entity. 0796 REPIA entity. 0797 This entity was set up to invest in equity shares of Japanese corporation Sanyo Electric Credit. 0798 This entity was set up as part of an AMSSG Structured Investing Group transaction 0799 The entity will own several micro-ticket machine leases throughout the US and Canada. 0801 International commodities dealer trading in various commodities including electricity, natural gas, precious metals, base metals, currencies, crude oil, and petroleum products. 0801 International commodities dealer trading in various commodities including electricity, natural gas, precious metals, base metals, currencies, crude oil, and petroleum products. 0802 Singapore-based entity that deals in commodities in the spot, forward and future markets. 0804 Singapore based broker, fund manager and investment banking advisor.
0805 Goldman Sachs Foreign Exchange 0001 Goldman, Sachs & Co. 24.85 Singapore 0805 Goldman Sachs Foreign Exchange 0009 Goldman Sachs Group, Inc. 15.76 Singapore 0805 Goldman Sachs Foreign Exchange 0801 J. Aron & Company 59.39 Singapore 0807 Goldman Sachs Futures PTE Ltd 0805 Goldman Sachs Foreign Exchange 100.00 Singapore 0808 River North Technologies, INC. 0009 Goldman Sachs Group, Inc. 100.00 United States 0809 RAINBOW CAPITAL SRL 6152 Baekdu Investments Limited 100.00 China 0810 J. Aron & Company (U.K.) 0220 Goldman Sachs Holding (U.K.) 99.00 United Kingdom 0810 J. Aron & Company (U.K.) 0709 Goldman Sachs Group Holdings ( 1.00 United Kingdom 0812 GS INVSTMT STRATEGIES(SINGAPOR 0805 Goldman Sachs Foreign Exchange 100.00 Asia 0822 Goldman Sachs (Mauritius) L.LC 0392 GS India Holdings L.P. 100.00 Republic of Mauritius 0823 Goldman Sachs Investments (Mau 2200 GS Financial Serv L.P. (DEL) 100.00 Republic of Mauritius 0825 J. Aron & Company (Bullion) 0220 Goldman Sachs Holding (U.K.) 50.00 United Kingdom 0825 J. Aron & Company (Bullion) 0709 Goldman Sachs Group Holdings ( 50.00 United Kingdom 0828 Euro-splitter B.V. 0801 J. Aron & Company 100.00 Netherlands Antilles 0831 GSCS Holdings I, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 0832 GSCS HOLDINGS II, LLC 0831 GSCS Holdings I, LLC 100.00 United States 0833 GSPS BERMUDA CORPORATION 0754 GSPS (Del) LP 100.00 Bermuda 0839 GS SERVICES PRIVATE LTD. 0160 Goldman Sachs (Asia) Finance 1.00 India 0839 GS SERVICES PRIVATE LTD. 0822 Goldman Sachs (Mauritius) L.LC 99.00 India 0840 Goldman Sachs International Fi 0220 Goldman Sachs Holding (U.K.) 100.00 United Kingdom 0842 GS TRADING & CLEARING SERVICES 0008 J. Aron Holdings, L.P. 0.25 Netherlands 0842 GS TRADING & CLEARING SERVICES 0801 J. Aron & Company 99.75 Netherlands 0843 European Power Source Company 0009 Goldman Sachs Group, Inc. 100.00 Netherlands 0844 European Powere Source (U.K.) 0843 European Power Source Company 100.00 United Kingdom 0845 Patterson Capital Markets, Ltd 0009 Goldman Sachs Group, Inc. 100.00 United States 0846 GS (INDIA) SECURITIES PVT.LTD. 0822 Goldman Sachs (Mauritius) L.LC 100.00 India 0847 GS RBD Holdings LP 0848 GS RBD HOLDINGS I CORP 99.00 United States
0805 Foreign exchange dealer in the forward, option, futures and spot markets. 0805 Foreign exchange dealer in the forward, option, futures and spot markets. 0805 Foreign exchange dealer in the forward, option, futures and spot markets. 0807 Executes, clears and carries financial and fuel oil futures for affiliated entities on the Singapore Exchange Derivatives Clearing Limited ("SGX-DC"); transacts only on behalf of affiliates. 0808 IT services firm that supports electronic trading. 0809 Holds a residential building in Shanghai, China. 0810 U.K. dealer in commodities; registered with The Financial Services Authority. 0810 U.K. dealer in commodities; registered with The Financial Services Authority. 0812 To act as a sub-adviser / manager to another US entity, who in turn will advice/manage a hedge fund. 0822 Invests in Kotak Mahindra Capital Co., Kotak Securities JVs and GS entities in India. 0823 Special purpose unregulated vehicle formed to deal in Indian shares. 0825 Bullion market-making; precious metals trader (ceased to trade in 2001). 0825 Bullion market-making; precious metals trader (ceased to trade in 2001). 0828 Established to invest in a condensate splitter (oil refinery) in Rotterdam. Being considered for liquidation. 0831 Holding Company of GSCS Holdings II, LLC which in turn holds GS Capital Strategies LLC 0832 Holding Company of GS Capital Strategies LLC 0833 Set up to hold an illiquid investment in bermuda for tax reasons. Investment is in a shipping company. 0839 Provides IT & IT enabled services to other GS entities. 0839 Provides IT & IT enabled services to other GS entities. 0840 London based foreign exchange dealer in the spot and forward market (ceased to trade in 2002) registered with the Bank of England. 0842 Employs traders in Rotterdam. 0842 Employs traders in Rotterdam. 0843 Holding company for power trading subsidiaries. 0844 Trades power in the UK / NETA Environment. 0845 Futures introducing broker. 0846 Carry out securities, banking and asset management business in India. 0847 To be a Holding Company of 000 Goldman Sachs, the firm's new broker/ dealer in Russia.
0847 GS RBD Holdings LP 0849 GS RBD Holdings II Corp 1.00 United States 0848 GS RBD HOLDINGS I CORP 0009 Goldman Sachs Group, Inc. 100.00 United States 0849 GS RBD Holdings II Corp 0009 Goldman Sachs Group, Inc. 100.00 United States 0851 Goldman Sachs Paris Inc. Et Ci 0001 Goldman, Sachs & Co. 99.00 France 0851 Goldman Sachs Paris Inc. Et Ci 0250 Goldman Sachs Global Holdings 1.00 France 0854 GS SITE 25 HOTEL HOLDING, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 0855 GS SITE 25 RETAIL LLC 0856 GS SITE 25 RETAIL HOLDING LLC 100.00 United States 0856 GS SITE 25 RETAIL HOLDING LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 0857 GS SITE 25 HOTEL, LLC 0854 GS SITE 25 HOTEL HOLDING, LLC 100.00 United States 0860 Goldman Sachs (UK) L.L.C. III 0700 Goldman Sachs (UK) L.L.C. 99.00 Delaware 0860 Goldman Sachs (UK) L.L.C. III 0709 Goldman Sachs Group Holdings ( 1.00 Delaware 0862 Goldman Sachs Asset Management 0860 Goldman Sachs (UK) L.L.C. III 100.00 United Kingdom 0863 CIN Management 0862 Goldman Sachs Asset Management 100.00 United Kingdom 0865 PT Goldman Sachs Indonesia 0118 Goldman Sachs (Asia) L.L.C. 10.00 Indonesia 0865 PT Goldman Sachs Indonesia 0123 Goldman Sachs (Asia Pacific) L 90.00 Indonesia 0920 Goldman Sachs Services (B.V.I. 1001 Goldman Sachs Global ServiceII 100.00 British Virgin Islands 0936 Distressed Opportunities Inter 0009 Goldman Sachs Group, Inc. 100.00 Delaware 0940 Restamove Ireland Limited 2200 GS Financial Serv L.P. (DEL) 100.00 Ireland 0948 GS LINDEN POWER HOLDINGS LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 1000 Goldman Sachs Global Services1 0009 Goldman Sachs Group, Inc. 100.00 Cayman Islands 1001 Goldman Sachs Global ServiceII 0250 Goldman Sachs Global Holdings 1.00 Cayman Islands 1001 Goldman Sachs Global ServiceII 1222 Goldman Sachs (Cayman) Holding 99.00 Cayman Islands 1002 WALL STREET ON DEMAND, INC. 0009 Goldman Sachs Group, Inc. 100.00 United States 1010 Goldman Sachs Housing and Heal 0009 Goldman Sachs Group, Inc. 99.00 New York
0847 To be a Holding Company of 000 Goldman Sachs, the firm's new broker/ dealer in Russia. 0848 To be a partner in GS RBD HOLDINGS, L.P. 0849 To be a partner in GS RBD HOLDINGS, L.P. 0851 Established to facilitate activities in IBD, Equities, GSAM and derivatives with Mexican counterparts. 0851 Established to facilitate activities in IBD, Equities, GSAM and derivatives with Mexican counterparts. 0854 Entity to house the holding company for Embassy Suite Hotel Acquisition 0855 Entity to house Embassy Suite Retail Acquisition 0856 Entity to house holding company for the Embassy Suite Retail Acquisition 0857 Entity to house the entity for the Embassy Suite Hotel Acquisition 0860 Holding company which owns Goldman Sachs Asset Management Holdings. 0860 Holding company which owns Goldman Sachs Asset Management Holdings. 0862 Holding company formed in connection with CIN Management. 0863 U.K. based asset management company for British Coal pension funds. Company has ceased to trade and is awaiting liquidation. 0865 Carries out investment banking and broker-dealer business in Indonesia. 0865 Carries out investment banking and broker-dealer business in Indonesia. 0920 Expatriate and TCN dual contract employment vehicle. 0936 Joint venture with Caisse Depot to purchase assets. 0940 Established primarily to hold proprietary positions in Korean bonds and equities; all activity is limited to affiliates and Korean broker/dealers. 0948 Entity related to the Linden Power Plant operations. 1000 Entity which employs U.S. citizens or green card holders in various foreign offices. 1001 Entity that employs U.S. citizens or green card holders in various foreign offices. 1001 Entity that employs U.S. citizens or green card holders in various foreign offices. 1002 WSOD offers a managed software service whereby clients in the financial services industry can outsource the design, development and maintenance of their on-line information portals to WSOD. WSOD is a Boulder, CO based private company which 1010 Government National Mortgage Association (GNMA) issuer/servicer and a non-supervised mortgagee under FHA regulations to originate, process and service FHA insured mortgages.
1010 Goldman Sachs Housing and Heal 1020 Goldman Sachs Housing Capital 1.00 New York 1011 REP SVY HOLDINGS REALTY, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 1012 GSUIG, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 1020 Goldman Sachs Housing Capital 0009 Goldman Sachs Group, Inc. 100.00 New York 1021 GS CALIC 0009 Goldman Sachs Group, Inc. 100.00 United States 1022 Comm. Ann. and Life Ins. Co 0009 Goldman Sachs Group, Inc. 100.00 United States 1023 Arrow Capital Reinsurance Comp 0009 Goldman Sachs Group, Inc. 100.00 Bermuda 1024 Eastport Capital Corporation 0009 Goldman Sachs Group, Inc. 100.00 United States 1025 EPF Financial, LLC. 1024 Eastport Capital Corporation 100.00 United States 1026 GS RE HOLDINGS INC. 0009 Goldman Sachs Group, Inc. 100.00 Delaware 1027 LIFE SETTLEMENTS SOLUTIONS INC 1030 LONGMORE CAPITAL, LLC 100.00 United States 1028 LIFE PREMIUM SOLUTIONS, LLC 1029 LIFE SOLUTIONS INTERNATIONAL, 100.00 United States 1029 LIFE SOLUTIONS INTERNATIONAL, 1030 LONGMORE CAPITAL, LLC 100.00 United States 1030 LONGMORE CAPITAL, LLC 1026 GS RE HOLDINGS INC. 100.00 United States 1031 Longmore Credit Services, LLC 1026 GS RE HOLDINGS INC. 100.00 United States 1032 GS INVESTMENT STRATEGIES, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 1050 goldman sachs risk advisors,lp 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1050 goldman sachs risk advisors,lp 1051 GS Risk Advisors, Inc. 1.00 Delaware 1051 GS Risk Advisors, Inc. 0009 Goldman Sachs Group, Inc. 100.00 United States 1052 Arrow Capital Risk Services Li 1050 goldman sachs risk advisors,lp 100.00 Bermuda 1053 Goldman Sachs Risk Advisors (E 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom
1010 Government National Mortgage Association (GNMA) issuer/servicer and a non-supervised mortgagee under FHA regulations to originate, process and service FHA insured mortgages. 1011 Entity is the holding company that owns Savoy (0113). 1012 Entity created for Urban Investment Group's corporate investments. 1020 Originates and services Federal Housing Administration (FHA) insured mortgages; general partner in Goldman Sachs Housin and Health Care Funding Company. 1021 This is an insurance company organized under the laws of Massachusetts. The Company manages blocks of variable annuity variable universal life and minor blocks of group retirement products. 1022 This is an insurance company organized under the laws of Massachusetts. The Company manages blocks of variable annuity variable universal life and minor blocks of group retirement products. 1023 Bermuda insurance company that will assume and cede property catastrophe risks. 1024 Management company for the Life Settlements business. This will be the employing entity for the business and is the parent of Eastport Financial, L.L.C. 1025 The company is a SPV that will purchase and hold life insurance contracts. It is a wholly owned subsidiary of Eastport Capital Corporation, which is owned by GS. 1026 SPE set up as a Holding entity for Life Settlement Solutions, Inc. 1027 Operating entity that will act in an agency capacity to source and service life settlement contracts for capital providers 1028 Licensed insurance entity that facilitates the life settlements agency business,including the premium finance business. 1029 Administration entity for agency based life settlements in San Diego 1030 Holding company for agency based life settlements business in San Diego. Entity holds intellectual property acquired in acquisition. 1031 Operating entity that will be used to originate premium finance loans 1032 Asset Management Company 1050 Licensed re-insurance intermediary in NY that can act as re-insurance broker. 1050 Licensed re-insurance intermediary in NY that can act as re-insurance broker. 1051 General Partner of GS Risk Advisors, L.P. 1052 Maintains Insurance Broker's license in Bermuda; reinsurance intermediary that can act as reinsurance broker. 1053 Involved in the insurance and reinsurance products business (entity is currently dormant).
1207 GS Bank Zurich 0009 Goldman Sachs Group, Inc. 100.00 Switzerland 1209 GSCO BETEILIGUNGS GMBH 1220 Goldman, Sachs & Co. oHG 100.00 Germany 1210 Goldman, Sachs & Co Finanz Gmb 0009 Goldman Sachs Group, Inc. 100.00 Germany 1220 Goldman, Sachs & Co. oHG 1210 Goldman, Sachs & Co Finanz Gmb 1.00 Germany 1220 Goldman, Sachs & Co. oHG 1222 Goldman Sachs (Cayman) Holding 99.00 Germany 1222 Goldman Sachs (Cayman) Holding 0009 Goldman Sachs Group, Inc. 97.00 Cayman Islands 1222 Goldman Sachs (Cayman) Holding 0250 Goldman Sachs Global Holdings 3.00 Cayman Islands 1223 GOLDMAN SACHS MANAGEMENT GP 1220 Goldman, Sachs & Co. oHG 100.00 Germany 1225 GS Verwaltungs GmbH 1220 Goldman, Sachs & Co. oHG 100.00 Germany 1240 Goldman Sachs (AO) L.L.C. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1240 Goldman Sachs (AO) L.L.C. 0250 Goldman Sachs Global Holdings 1.00 Delaware 1244 Killingholme Power Group Ltd 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 1245 Killingholme Generation Ltd 1247 Killingholme Holdings Limited 0.00 United Kingdom 1245 Killingholme Generation Ltd 1318 Amagansett Funding Limited 13.37 United Kingdom 1245 Killingholme Generation Ltd 1323 Scadbury II Assets 50.32 United Kingdom 1245 Killingholme Generation Ltd 1326 Shire Funding Limited 36.31 United Kingdom 1246 Killingholme Power Limited 1245 Killingholme Generation Ltd 100.00 United Kingdom 1247 Killingholme Holdings Limited 1244 Killingholme Power Group Ltd 100.00 United Kingdom 1248 GS KILLINGHOLME CAYMAN INVESME 1246 Killingholme Power Limited 100.00 United Kingdom 1253 Goldman Sachs S.G.R. S.P.A. 0220 Goldman Sachs Holding (U.K.) 1.00 Italy 1253 Goldman Sachs S.G.R. S.P.A. 0700 Goldman Sachs (UK) L.L.C. 99.00 Italy 1254 VEICOLO ACQUISIZIONE PORTAFOGL 1506 MLQ L.L.C. 50.00 Italy 1254 VEICOLO ACQUISIZIONE PORTAFOGL 1513 MTGLQ Investors, LP 50.00 Italy
1207 Provides auxiliary services which include Swiss franc clearing and derivatives sales and trading, including trading on the electronic Swiss exchanges and SOFFEX. 1209 Established to buy preferred shares in NetJets, a Swiss based company. 1210 Managing general partner of Goldman, Sachs & Co. oHG. 1220 Provides investment banking services, fixed income trading services, equity agency services, capital markets and futures services. 1220 Provides investment banking services, fixed income trading services, equity agency services, capital markets and futures services. 1222 Holding company for Goldman, Sachs & Co. oHG, Goldman, Sachs & Co. Bank, Goldman Sachs (Cayman) Trust Limited, GS Asia LLC, Goldman Sachs Global Services II Limited, and GS Asia Pacific LLC. 1222 Holding company for Goldman, Sachs & Co. oHG, Goldman, Sachs & Co. Bank, Goldman Sachs (Cayman) Trust Limited, GS Asia LLC, Goldman Sachs Global Services II Limited, and GS Asia Pacific LLC. 1223 General Partner of GS Capital Partners 2000 GmbH & Co. Beteiligungs KG. 1225 Trustee function for Rhein-Donau and Capital Partners. 1240 Investment banking entity based in Russia. 1240 Investment banking entity based in Russia. 1244 Established as part of an SSG Structured Investing Group transaction. 1245 Established as part of an SSG Structured Investing Group transaction. 1245 Established as part of an SSG Structured Investing Group transaction. 1245 Established as part of an SSG Structured Investing Group transaction. 1245 Established as part of an SSG Structured Investing Group transaction. 1246 Established as part of an SSG Structured Investing Group transaction. 1247 Established as part of an SSG Structured Investing Group transaction. 1248 Is a part of the structured investing trade and will enter into Swaps. 1253 Assets management company. 1253 Assets management company. 1254 Special purpose vehicle for securitization deal. 1254 Special purpose vehicle for securitization deal.
1260 Goldman, Sachs & Co. Wertpapie 0009 Goldman Sachs Group, Inc. 100.00 Germany 1280 Goldman Sachs (Espana), S.A. 0690 Goldman Sachs (Netherlands) B. 100.00 Italy 1305 CPV Germany 0009 Goldman Sachs Group, Inc. 99.00 United States 1305 CPV Germany 1223 GOLDMAN SACHS MANAGEMENT GP 1.00 United States 1306 GSSM Holding II LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 1307 GSSM Holding II Corp 1306 GSSM Holding II LLC 100.00 United States 1308 GS LS Leasing LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 1309 GS Bank USA Holdings LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 1311 REP KBY Realty,LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 1312 BEESTON INVESTMENTS LIMITED 0123 Goldman Sachs (Asia Pacific) L 100.00 Hong Kong 1313 CORNWALL INVESTMENTS LIMITED 0165 Goldman Sachs (Asia) Finance 100.00 Hong Kong 1317 Amagansett Assets 1318 Amagansett Funding Limited 1.00 United Kingdom 1317 Amagansett Assets 1320 Amagansett UK Limited 99.00 United Kingdom 1318 Amagansett Funding Limited 1320 Amagansett UK Limited 100.00 United Kingdom 1319 Amagansett II Assets 1320 Amagansett UK Limited 100.00 United Kingdom 1320 Amagansett UK Limited 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 1321 Scadbury Assets 1322 Scadbury Funding Limited 1.00 United Kingdom 1321 Scadbury Assets 1324 Scadbury UK Limited 99.00 United Kingdom 1322 Scadbury Funding Limited 1324 Scadbury UK Limited 100.00 United Kingdom 1323 Scadbury II Assets 1324 Scadbury UK Limited 100.00 United Kingdom 1324 Scadbury UK Limited 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 1325 Shire Assets 1326 Shire Funding Limited 1.00 United Kingdom 1325 Shire Assets 1328 Shire UK Limited 99.00 United Kingdom 1326 Shire Funding Limited 1328 Shire UK Limited 100.00 United Kingdom 1327 Shire II Assets 1328 Shire UK Limited 100.00 United Kingdom 1328 Shire UK Limited 0709 Goldman Sachs Group Holdings ( 100.00 United Kingdom 1329 FAIRWAY RESOURCES L.P. 1513 MTGLQ Investors, LP 100.00 United States
1260 Non-regulated Frankfurt based entity that issues warrants through GS oHG and purchases offsetting OTC options in the fixed income, equity, commodity and currency markets. 1280 Engaged in financial advisory/investment banking entity in Spain. 1305 This entity was set up to invest in principal investments. 1305 This entity was set up to invest in principal investments. 1306 To act as a holding company for GSSM Holding II Corp 1307 To hold the Sumitomo preferred shares 1308 For PFG leasing business 1309 Holding Company (Single Member LL) to hold GS Group Investment in GS Bank USA 1311 Real Estate investment 1312 Trading Company for Korean Futures 1313 Changed from non-consolidating to consolidating 1317 This entity was set up as part of an AMSSG Structured Investing Group transaction 1317 This entity was set up as part of an AMSSG Structured Investing Group transaction 1318 This entity was set up as part of an AMSSG Structured Investing Group transaction 1319 This entity was set up as part of an AMSSG Structured Investing Group transaction 1320 This entity was set up as part of an AMSSG Structured Investing Group transaction 1321 This entity was set up as part of an AMSSG Structured Investing Group transaction 1321 This entity was set up as part of an AMSSG Structured Investing Group transaction 1322 This entity was set up as part of an AMSSG Structured Investing Group transaction 1323 This entity was set up as part of an AMSSG Structured Investing Group transaction 1324 This entity was set up as part of an AMSSG Structured Investing Group transaction 1325 This entity was set up as part of a Structured Investing Group transaction 1325 This entity was set up as part of a Structured Investing Group transaction 1326 This entity was set up as part of a Structured Investing Group transaction 1327 This entity was set up as part of a Structured Investing Group transaction 1328 This entity was set up as part of a Structured Investing Group transaction 1329 Partnership focused on oil and gas production and ownership of lease acreage.
1330 PRNP, LLC 1513 MTGLQ Investors, LP 100.00 Puerto Rico 1331 KRETA ACQUISTIONS LTD. 2406 GS European Opportunities F II 100.00 United Kingdom 1332 GS MEZZANINE PARTNERS 2006 0009 Goldman Sachs Group, Inc. 100.00 United States 1333 Asama Onsen Kaihatsu Co.,Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 1334 KAKEGAWA HOLDINGS CO.,LTD. 0358 LINDEN WOOD, LTD 100.00 Japan 1335 GS Hony Holdings I Ltd 0191 GS Asian Venture (Delaware)LLC 100.00 Cayman Islands 1336 GS Hony Holdings II Ltd 0191 GS Asian Venture (Delaware)LLC 100.00 Cayman Islands 1337 GS Capital Partners Auto Glass 0009 Goldman Sachs Group, Inc. 100.00 Mauritius 1338 GS Capital Partners Aurum Hold 0009 Goldman Sachs Group, Inc. 100.00 Mauritius 1341 GS UNIT TRUST ADMNSTR LIMITED 0709 Goldman Sachs Group Holdings ( 100.00 Cayman Islands 1342 GS Unit Trust Investments Limi 0709 Goldman Sachs Group Holdings ( 100.00 Cayman Islands 1343 GS Leasing Investments 0201 Goldman Sachs International 98.95 Cayman Islands 1343 GS Leasing Investments 1342 GS Unit Trust Investments Limi 1.05 Cayman Islands 1344 GS Leasing Limited Partneship 1345 GS Leasing No. 1 Limited 5.00 United Kingdom 1344 GS Leasing Limited Partneship 1346 GS Leasing No. 2 Limited 95.00 United Kingdom 1345 GS Leasing No. 1 Limited 1317 Amagansett Assets 100.00 Cayman Islands 1346 GS Leasing No. 2 Limited 1317 Amagansett Assets 100.00 Cayman Islands 1347 GS Leasing Holdings Limited 0709 Goldman Sachs Group Holdings ( 100.00 Cayman Islands 1348 BIRCHFIELD ESTATES LTD. 0009 Goldman Sachs Group, Inc. 100.00 United Kingdom 1350 Asset Funding Company IV 2200 GS Financial Serv L.P. (DEL) 100.00 United States 1351 Amagansett FX 2200 GS Financial Serv L.P. (DEL) 100.00 United Kingdom
1330 The entity is holding non-performing loans or "distressed" loans that were originated in Puerto Rico. 1331 To purchase and originate publicly and privately issued fixed income securities Non performing loan portfolio investments. 1332 Consolidation of PIA's Mezz 2006 Fund 1333 Owns two hot-spring hotels in Japan. 1334 Owns a hotel in Kakegawa, Japan. 1335 Investment vehicle for the firm's interest in Hony Capital fund III LP 1336 Investment vehicle for the firm's interest in Hony Capital fund III LP 1337 Investement in Auto Glass company in China, economics will be swapped to GS Capital partners VI Funds 1338 Investement in white electronic goods company in China, economics will be swapped to GS Capital partners VI Funds 1341 Entity purely acts as an administrator for GS Leasing Investments. The entity will purely have a tiny amount of capital and cash. 1342 Entity will invest as a minority unit holder in GS Leasing Investments. It will be capitalized by an existing GS entity. 1343 Unauthorized unit trust that will act as a limited partner in GS Leasing Limited Partnership. It will invest in the partnership in return for its share of the leasing the leasing income. 1343 Unauthorized unit trust that will act as a limited partner in GS Leasing Limited Partnership. It will invest in the partnership in return for its share of the leasing the leasing income. 1344 Entity is a partnerships set up to enter into a finance lease with Tesco Plc. It will acquire assets from Tesco and the lease them back in the form of the finance lease. As such the fixed assets do not go on the GS balance sheet. Instead there is a lease 1344 Entity is a partnerships set up to enter into a finance lease with Tesco Plc. It will acquire assets from Tesco and the lease them back in the form of the finance lease. As such the fixed assets do not go on the GS balance sheet. Instead there is a lease 1345 Entity set up to be the general partner (controlling interest) in GS Leasing Limited Partnership. It will invest in the partnership in return for its share of the leasing income. 1346 Entity is set up to purchase the limited partnership interest from GS Leasing Investments once the structure and subsequent sale of the lease rentals to a third party is complete. 1347 Entity set up to act as trustee for GS Leasing Investments. The entity will purely have a tiny amount of capital and cash. 1348 SPV for building a new London Offsite Data Centre 1350 Part of structured investing trade which will enter into swaps and repos 1351 Part of structured investing trade which will enter into contracts and options
1491 Ares (Real Estate) B.V. 2200 GS Financial Serv L.P. (DEL) 100.00 Netherlands 1493 Ares Finance S.R.L. 0009 Goldman Sachs Group, Inc. 100.00 Italy 1494 PNW, LLC 6117 SSIG SPF One LQ, LLC 100.00 United States 1501 Goldman Sachs Real Estate Fund 0009 Goldman Sachs Group, Inc. 100.00 New York 1502 Goldman Sachs Mortgage Company 0009 Goldman Sachs Group, Inc. 99.00 New York 1502 Goldman Sachs Mortgage Company 1501 Goldman Sachs Real Estate Fund 1.00 New York 1503 MLQ Investors, L.P. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1503 MLQ Investors, L.P. 1506 MLQ L.L.C. 1.00 Delaware 1505 CL Investments Limited 0009 Goldman Sachs Group, Inc. 100.00 Cayman Islands 1506 MLQ L.L.C. 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1506 MLQ L.L.C. 0250 Goldman Sachs Global Holdings 1.00 Delaware 1510 Main Street Mortgage Co, LP 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1512 GS Mortgage Securities Corp II 0009 Goldman Sachs Group, Inc. 100.00 Delaware 1513 MTGLQ Investors, LP 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1513 MTGLQ Investors, LP 1506 MLQ L.L.C. 1.00 Delaware 1515 Strategic Mortgage Holdings LP 0009 Goldman Sachs Group, Inc. 99.00 Delaware 1515 Strategic Mortgage Holdings LP 1516 Strategic Mortgage Holding INC 1.00 Delaware 1516 Strategic Mortgage Holding INC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 1517 SOPAC LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 1518 Southern Pacific Funding Co 0009 Goldman Sachs Group, Inc. 100.00 California 1520 GSSLQ LLC 1513 MTGLQ Investors, LP 100.00 Delaware 1521 GRMT, LTD 1502 Goldman Sachs Mortgage Company 100.00 United States 1522 SCLQ, S. de R.L de C.V. 1513 MTGLQ Investors, LP 100.00 Mexico 1523 CDV-1 Holding Co Gen-Par LLC 1513 MTGLQ Investors, LP 100.00 Delaware 1524 CDV-1 Ltd 1525 CDV-1 Holding Company LP 100.00 United Kingdom 1525 CDV-1 Holding Company LP 1513 MTGLQ Investors, LP 99.78 Delaware 1525 CDV-1 Holding Company LP 1523 CDV-1 Holding Co Gen-Par LLC 0.22 Delaware 1526 SHM II LLC 1515 Strategic Mortgage Holdings LP 100.00 United States
1491 ESSG related entity established to hold real estate assets from loan workouts in Ares Finance S.r.l. 1493 A securitization vehicle formed in Italy that holds sub-performing assets. 1494 A utilities supplier of energy and energy-related products. 1501 1% corporate general partner of Goldman Sachs Mortgage Company. 1502 Purchases and sells residential and commercial mortgage loans or participation interests in such loans, primarily in connection with securitizations. Provides warehouse financing to mortgage originators. 1502 Purchases and sells residential and commercial mortgage loans or participation interests in such loans, primarily in connection with securitizations. Provides warehouse financing to mortgage originators. 1503 Holds certain mortgage properties for liquidation. 1503 Holds certain mortgage properties for liquidation. 1505 AMSSG related entity established to invest in an entity that holds a consumer loan portfolio. 1506 1% general partner of MLQ Investors, L.P. and MTGLQ Investors, L.P. 1506 1% general partner of MLQ Investors, L.P. and MTGLQ Investors, L.P. 1510 Established to service mortgage portfolios. 1512 Florida-based subsidiary acquired to service mortgage portfolios. 1513 Invests in and holds non-performing real estate assets and loans. 1513 Invests in and holds non-performing real estate assets and loans. 1515 Holds debt and equity interests in a Canadian broker business. 1515 Holds debt and equity interests in a Canadian broker business. 1516 General partner of Strategic Mortgage Holdings, LP. 1517 An AMSSG related entity that purchases securities from S. Pacific Liquidators. 1518 Purchase of S. Pacific Funding Corp. and residuals. 1520 40% equity owner of SLQ S. de R.L. de C.V., which is purchasing servicing rights in a portfolio of non-performing Mexican loans from Banco Union. 1521 Established to purchase a performing sub-prime pool of residential mortgage loans. 1522 Established to purchase a portfolio of non-performing Mexican loans from Banco International, S.A. Institution de Banca multiple, Grupo Financiero (Bital). 1523 General partner for CDV-1 Holding Company, LP. 1524 An ESSG related entity that holds non-performing loans. 1525 Established as a partnership to own CDV-1, Ltd. 1525 Established as a partnership to own CDV-1, Ltd. 1526 Established to facilitate structured financing.
1527 DEERWOOD CORP 0009 Goldman Sachs Group, Inc. 100.00 United States 1528 CDV-2 Ltd 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 1529 PRALQ LLC 6117 SSIG SPF One LQ, LLC 100.00 Delaware 1531 ARLO LLC 6117 SSIG SPF One LQ, LLC 100.00 Delaware 1532 MIL Phase I Dallas Gen-Par, LL 1513 MTGLQ Investors, LP 100.00 Delaware 1533 MIL PHASE I DALLAS, L.P. 0100 Archon Group, L.P. 2.00 Delaware 1533 MIL PHASE I DALLAS, L.P. 1513 MTGLQ Investors, LP 97.80 Delaware 1533 MIL PHASE I DALLAS, L.P. 1532 MIL Phase I Dallas Gen-Par, LL 0.20 Delaware 1534 GS ASSET BACKED SECURITIES CO 0009 Goldman Sachs Group, Inc. 100.00 Delaware 1535 REP DER GEN-PAR, LLC 1513 MTGLQ Investors, LP 100.00 United States 1536 REP DER REAL ESTATE LP 1513 MTGLQ Investors, LP 99.90 United States 1536 REP DER REAL ESTATE LP 1535 REP DER GEN-PAR, LLC 0.10 United States 1537 REP MCR REALTY, LLC 1513 MTGLQ Investors, LP 100.00 United States 1539 DUNVEGAN INVESTMENTS, LTD 0220 Goldman Sachs Holding (U.K.) 100.00 Cayman Islands 1540 Rio Negro Assessoria LTDA 1513 MTGLQ Investors, LP 100.00 Brazil 1540 Rio Negro Assessoria LTDA 2200 GS Financial Serv L.P. (DEL) 0.00 Brazil 1541 RIO TOCURUI CLA SECURITIZADORA 1513 MTGLQ Investors, LP 100.00 Brazil 1542 ReMark Capital Group, LLC 1513 MTGLQ Investors, LP 100.00 United States 1543 MLQ-MLL, LLC 1513 MTGLQ Investors, LP 100.00 United States 1545 Rio Parana CLA Securitizadora 1513 MTGLQ Investors, LP 99.99 Brazil 1545 Rio Parana CLA Securitizadora 2200 GS Financial Serv L.P. (DEL) 0.01 Brazil 1546 AMC REO LLC 1513 MTGLQ Investors, LP 100.00 United States 1547 JUPITER-APX, LP 1513 MTGLQ Investors, LP 100.00 United States 1560 AMC of America LLC 1513 MTGLQ Investors, LP 100.00 United States 1561 AMC of America LP 1513 MTGLQ Investors, LP 99.00 United States 1561 AMC of America LP 1560 AMC of America LLC 1.00 United States 1565 DAC HOLDING I, L.L.C. 6117 SSIG SPF One LQ, LLC 100.00 Delaware 1902 Goldman Sachs London PL 0009 Goldman Sachs Group, Inc. 100.00 United Kingdom 1940 BEIJING GAO HUA SEC CL 1942 BEIJING GAO WANG VCCL 33.33 China 1940 BEIJING GAO HUA SEC CL 1943 BEIJING DE SHANG VCCL 33.33 China
1527 To hold and sell manufactured housing loans. 1528 An ESSG related entity that holds a portfolio of non performing loans in Czech Republic. 1529 AMSSG related entity that holds a portfolio of consumer receivables, primarily auto loans. 1531 AMSSG related entity that holds non-performing loans. 1532 Established to invest 0.2% interest in and serve as general partner of MIL Phase I Dallas, L.P. 1533 An AMSSG related entity engaged in real estate investing. 1533 An AMSSG related entity engaged in real estate investing. 1533 An AMSSG related entity engaged in real estate investing. 1534 Facilitates distribution of asset backed securitizations 1535 REPIA entity. 1536 Established to acquire and hold a non-performing real estate secured loan (Deerfield asset). 1536 Established to acquire and hold a non-performing real estate secured loan (Deerfield asset). 1537 REPIA entity. 1539 Investment company (dormant). 1540 Invests in distressed assets in Brazil. 1540 Invests in distressed assets in Brazil. 1541 Invests in non-performing loan portfolios in Brazil. 1542 An AMSSG related entity that manages and services portfolios of consumer auto loans. 1543 Established to originate and purchase Mezzanine loans on real estate investments. 1545 Invests in non-performing loan portfolios in Brazil. Entity owns 1% interest in Archon Financial L.P., SPV in order to hold Brazilian loan portfolios. 1545 Invests in non-performing loan portfolios in Brazil. Entity owns 1% interest in Archon Financial L.P., SPV in order to hold Brazilian loan portfolios. 1546 To hold real estate obligations. 1547 To hold the firm's equity investment in APX Holdings, LLC. 1560 Set up to own 1% interest in Asset Management Company of America L.P. 1561 Capital restructure. 1561 Capital restructure. 1565 Holding company for 6 other special purpose partnerships involved in leveraged lease transactions. 1902 Holds land that is intended to be developed for future use within the group. 1940 Chinese entity engaged in underwriting and proprietary trading of securities as well as providing financial advisory services. 1940 Chinese entity engaged in underwriting and proprietary trading of securities as well as providing financial advisory services.
1940 BEIJING GAO HUA SEC CL 1944 BEIJING HOU FENG VCCL 33.33 China 1941 GS GAO HUA SECURITIES CO. LTD 0118 Goldman Sachs (Asia) L.L.C. 33.00 China 1941 GS GAO HUA SECURITIES CO. LTD 1940 BEIJING GAO HUA SEC CL 67.00 China 1942 BEIJING GAO WANG VCCL 0165 Goldman Sachs (Asia) Finance 100.00 China 1943 BEIJING DE SHANG VCCL 0165 Goldman Sachs (Asia) Finance 100.00 China 1944 BEIJING HOU FENG VCCL 0165 Goldman Sachs (Asia) Finance 100.00 China 1990 Keyakizaka Finance Co., LTD 2200 GS Financial Serv L.P. (DEL) 100.00 Japan 1991 Goldman Sachs Japan Finance KK 2200 GS Financial Serv L.P. (DEL) 100.00 Japan 1993 CMA Co., Ltd 1994 Linden Wood II S TK 100.00 Japan 1994 Linden Wood II S TK 1995 Linden Wood IIS Ltd 100.00 Japan 1995 Linden Wood IIS Ltd 1503 MLQ Investors, L.P. 100.00 Japan 1996 Merchant Support Co,. Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 1997 Real Estate Creation Fund Co. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 1998 ReC Investments Co., Ltd 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2001 GS Wind Holdings, LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 2002 GS Macro Investments LLC 0009 Goldman Sachs Group, Inc. 11.11 United States 2002 GS Macro Investments LLC 1513 MTGLQ Investors, LP 88.89 United States 2003 Kawasaki Holdings Co, LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2005 White Ocean Co, LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2006 Merchant Capital Co. Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2007 GSGF Investments Inc. 2223 GS Global Funding, Inc. 100.00 United States 2008 GS Macro Investments 2006 LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 2009 GS Macro Investments II LLC 2002 GS Macro Investments LLC 100.00 United States 2010 GS Macro Investments I LLC 2002 GS Macro Investments LLC 100.00 United States 2011 Forres LLC 0220 Goldman Sachs Holding (U.K.) 100.00 United States 2012 Ellon LLC 2011 Forres LLC 100.00 United States 2013 AYCO Services Insurance Agency 0512 MERCAY CORPORATION 100.00 United States 2014 Sakurazaka Kaihatsu Co. LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2015 Blue Daisy TK 0574 Blue Daisy Co., Ltd. 100.00 Japan
1940 Chinese entity engaged in underwriting and proprietary trading of securities as well as providing financial advisory services. 1941 Chinese entity engaged in underwriting of shares and bonds, brokerage of foreign investment shares, brokerage and proprietary trading of bonds, other activities. 1941 Chinese entity engaged in underwriting of shares and bonds, brokerage of foreign investment shares, brokerage and proprietary trading of bonds, other activities. 1942 Invests in Beijing Gao Hua Securities Company Limited. 1943 Investor in Beijing Gao Hua Securities Company Limited. 1944 Invests in Beijing Gao Hua Securities Company Limited. 1990 ASSG entity that acts in a lending related capacity in Asia. 1991 Acts in lending related capacity in Japan. 1993 Established to facilitate mortgage loan financing. 1994 An ASSG related entity that invests in distressed loans. 1995 TK operator of Linden Wood IIS TK. 1996 Merchant joint venture. 1997 TK operator of Real Estate Creation Fund TK. 1998 TK operator of REC Investments TK. 2001 Holding company for acquisition of Zilkha Renewable Energy. 2002 Established as part of an SSG Structured Investing Group transaction. 2002 Established as part of an SSG Structured Investing Group transaction. 2003 TK operator of Kawasaki Holdings TK. 2005 Purchases loans from Resona (RCC/ Resona securitization deal). 2006 An ASSG related entity engaged in activities related to credit card factoring. 2007 Established as part of an SSG Structured Investing Group transaction. 2008 Formed to facilitate a SALG trading program 2009 Established as part of an SSG Structured Investing Group transaction. 2010 Established as part of an SSG Structured Investing Group transaction. 2011 Established as part of an SSG Structured Investing Group transaction. 2012 Established as part of an SSG Structured Investing Group transaction. 2013 Insurance related entity that is part of the AYCO suite of advisory services. 2014 An ASSG related entity established in connection with the TRS with Aozora. 2015 Blue Daisy is a vehicle to invest in recruit through its participation in the secondary shares acquired by Nochu.
2020 GS Macro Investments III LLC 2002 GS Macro Investments LLC 100.00 United States 2021 GS Macro Investments IV LLC 2002 GS Macro Investments LLC 100.00 United States 2022 Liberty Harbor, LLC. 0831 GSCS Holdings I, LLC 1.00 United States 2022 Liberty Harbor, LLC. 0832 GSCS HOLDINGS II, LLC 99.00 United States 2023 DANDELION INVESTMENTS TK 0575 Dandelion Investments Co., Ltd 100.00 Japan 2024 GREEN MOUNTAIN TK 0576 Green Mountain One Co., Ltd. 100.00 Japan 2026 Ashitaba Creation Co. Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2027 JAPAN HOTEL & RESORT K.K. 1503 MLQ Investors, L.P. 100.00 Japan 2028 Hanamizuki Kaihatsu Co.,Ltd. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2029 Shining Partners TK 0479 SHINING PARTNERS LTD(TKO) 100.00 Japan 2030 FUKUOKA TOSHI KAIHATSU TK 0578 Fukuoka Toshi Kaihatsu Co. Ltd 100.00 Japan 2031 KINMIRAI CREATE CO. LTD. 1503 MLQ Investors, L.P. 100.00 Japan 2032 GS MACRO INVESTMENTS V LLC 2002 GS Macro Investments LLC 100.00 United States 2200 GS Financial Serv L.P. (DEL) 0009 Goldman Sachs Group, Inc. 100.00 Delaware 2201 Mortgage Asset Management Corp 0009 Goldman Sachs Group, Inc. 100.00 Delaware 2202 GS Mortgage Securities Corp 0009 Goldman Sachs Group, Inc. 100.00 Delaware 2204 BEST INVESTMENT (DELAWARE) LLC 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2208 Goldman Sachs Invest Mgmt Gmbh 1220 Goldman, Sachs & Co. oHG 100.00 Germany 2209 Goldman Sachs Cap Market L.L.C 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2210 Goldman Sachs Cap Markets, L.P 2200 GS Financial Serv L.P. (DEL) 99.00 Delaware 2210 Goldman Sachs Cap Markets, L.P 2209 Goldman Sachs Cap Market L.L.C 1.00 Delaware 2212 VANTAGE MARKET PLACE LLC 0396 VANTAGE MARKETPLACE HOLDINGS, 100.00 United States 2220 Goldman Sachs Credit Part L.P. 2350 GSCP (Del) Inc 99.90 Bermuda 2220 Goldman Sachs Credit Part L.P. 2351 GSCP (Del) LLC 0.10 Bermuda 2221 Special Situations Invest Grou 0009 Goldman Sachs Group, Inc. 100.00 Delaware 2223 GS Global Funding, Inc. 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware
2020 Established as part of an SSG Structured Investing Group transaction. 2021 Established as part of an SSG Structured Investing Group transaction. 2022 Trading / Fund Entity 2022 Trading / Fund Entity 2023 Dandelion has made investments in Green mountain to acquire non-performing loans from Linden Wood an existing SPC of the ASSG business. 2024 It has been set up jointly with Dandelion Investmenst YK ("Dandelion") and Mizuho Security, a third party, to acquire nonperforming loans from LindenWood, an existing SPC of the ASSG business. 2026 To purchase distressed loans 2027 This entity was set up to provide asset management, financing, and reporting services to Japan Hotel & Resort Toushi Hojin. 2028 Investment in equity shares 2029 Consolidation of Japan Entity (to hold SPL portfolio) 2030 Consolidation of Japan Entity (REO acquisition). To hold Real Estate. 2031 Consolidation of Japan Entity (REO acquisition). To hold Real Estate. 2032 Established as part of an SSG Structured Investing Group transaction. 2200 Financing and holding company for various GS entities. 2201 Performs administrative services related to issuance of collateralized mortgage obligations. 2202 Issues bonds and/or forms trusts to issue bonds collateralized by pools of mortgage related securities. 2204 Holding company for Express Securitization Specialty L.L.C. and Express II Securitization Specialty L.L.C. 2208 GSAM operations in Germany. 2209 Restructured entity replacing GSCM; holds 1% interest in Goldman Sachs Capital Markets Partners, L.P. 2210 Primarily engaged in trading interest rate and FX derivatives. 2210 Primarily engaged in trading interest rate and FX derivatives. 2212 As part of Goldman Sachs' independent research platform, Vantage Marketplace LLC's subject matter experts will consult with clients who have contracted the expert's services on specific questions/topics. 2220 Engaged in the origination and trading of corporate loans. 2220 Engaged in the origination and trading of corporate loans. 2221 Established primarily to buy and sell bank debt; additionally, the entity does trade in some securities. 2223 Established as part of an SSG Structured Investing Group transaction.
2224 GS Global Funding (Cayman) Ltd 2223 GS Global Funding, Inc. 100.00 Cayman Islands 2225 Hechshire Limited (form Mudchu 1328 Shire UK Limited 100.00 United Kingdom 2226 Cheshire Holdings Europe Limit 0009 Goldman Sachs Group, Inc. 100.00 Jersey, Channel Islands 2228 Luge LLC 2234 Mehetia Holdings Inc. 100.00 Delaware 2229 Madison/Special Situations Val 2221 Special Situations Invest Grou 100.00 Delaware 2230 RTV Ventures LLC 2220 Goldman Sachs Credit Part L.P. 100.00 Texas 2231 GSGF Mortgage I, Co. 2200 GS Financial Serv L.P. (DEL) 19.00 Delaware 2231 GSGF Mortgage I, Co. 2223 GS Global Funding, Inc. 81.00 Delaware 2232 GSGF Mortgage II, Co. 2231 GSGF Mortgage I, Co. 100.00 Delaware 2233 GS Mortgage I, Partners 1502 Goldman Sachs Mortgage Company 95.00 Delaware 2233 GS Mortgage I, Partners 2279 GS MORTGAGE I HOLDINGS LLC 5.00 Delaware 2234 Mehetia Holdings Inc. 2235 GS Mehetia Corp 20.00 Delaware 2234 Mehetia Holdings Inc. 2236 GS Mehetia LLC 50.00 Delaware 2234 Mehetia Holdings Inc. 2237 GS Mehetia Partnership LP 30.00 Delaware 2235 GS Mehetia Corp 0009 Goldman Sachs Group, Inc. 100.00 Delaware 2236 GS Mehetia LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 2237 GS Mehetia Partnership LP 2235 GS Mehetia Corp 1.00 Delaware 2237 GS Mehetia Partnership LP 2236 GS Mehetia LLC 99.00 Delaware 2238 Mehetia Inc 2234 Mehetia Holdings Inc. 100.00 Delaware 2239 Carrera2 LLC 2234 Mehetia Holdings Inc. 100.00 Delaware 2240 GS Global Funding Services I L 0823 Goldman Sachs Investments (Mau 100.00 China 2241 GS Global Funding Serv II Limi 0823 Goldman Sachs Investments (Mau 100.00 China 2242 GS Global Funding Hong Kong I 0009 Goldman Sachs Group, Inc. 99.00 China 2242 GS Global Funding Hong Kong I 2200 GS Financial Serv L.P. (DEL) 1.00 China
2224 Established as part of an SSG Structured Investing Group transaction. 2225 Established as part of an SSG Structured Investing Group transaction. 2226 Established as part of an SSG Structured Investing Group transaction. 2228 Established as part of an SSG Structured Investing Group transaction. 2229 Joint venture specializing in bankruptcy trade claims. 2230 Established to service an existing loan portfolio. 2231 Established as part of an SSG Structured Investing Group transaction. 2231 Established as part of an SSG Structured Investing Group transaction. 2232 Established as part of an SSG Structured Investing Group transaction. 2233 Established as part of an SSG Structured Investing Group transaction. 2233 Established as part of an SSG Structured Investing Group transaction. 2234 Established as part of an SSG Structured Investing Group transaction. 2234 Established as part of an SSG Structured Investing Group transaction. 2234 Established as part of an SSG Structured Investing Group transaction. 2235 Established as part of an SSG Structured Investing Group transaction. 2236 Established as part of an SSG Structured Investing Group transaction. 2237 Established as part of an SSG Structured Investing Group transaction. 2237 Established as part of an SSG Structured Investing Group transaction. 2238 Established as part of an SSG Structured Investing Group transaction. 2239 Established as part of an SSG Structured Investing Group transaction. 2240 Established as part of an SSG Structured Investing Group transaction. 2241 Established as part of an SSG Structured Investing Group transaction. 2242 Established as part of an SSG Structured Investing Group transaction. 2242 Established as part of an SSG Structured Investing Group transaction.
2243 GS Global Funding Hong Kong II 0009 Goldman Sachs Group, Inc. 99.00 China 2243 GS Global Funding Hong Kong II 2200 GS Financial Serv L.P. (DEL) 1.00 China 2244 GS Glob Fund Hong Kong Trust I 0160 Goldman Sachs (Asia) Finance 100.00 China 2245 GS Glob Fund Hong KongTrust II 0160 Goldman Sachs (Asia) Finance 100.00 China 2246 GS Glob Funding Hong Kong Part 2245 GS Glob Fund Hong KongTrust II 100.00 China 2247 GS Global Funding II Co. 2223 GS Global Funding, Inc. 100.00 Delaware 2248 GS Global Funding III Co. 2247 GS Global Funding II Co. 100.00 Delaware 2249 GS Global Funding IV, LLC 2248 GS Global Funding III Co. 100.00 Delaware 2250 GS Global Investments Co. 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2251 GS Global Investments II, Ltd 2252 GS Global Investments III Trus 100.00 Cayman Islands 2252 GS Global Investments III Trus 2250 GS Global Investments Co. 100.00 Delaware 2253 COUNTY ASSETS LIMITED 2254 COUNTY FUNDING LIMITED 100.00 Cayman Islands 2254 COUNTY FUNDING LIMITED 2255 COUNTY UK LIMITED 100.00 United Kingdom 2255 COUNTY UK LIMITED 2256 GS GLOBAL INVESTMENTS UK, INC 100.00 Cayman Islands 2256 GS GLOBAL INVESTMENTS UK, INC 2250 GS Global Investments Co. 100.00 Delaware 2257 MADISON/SPECIAL SITUATIONS VAL 2221 Special Situations Invest Grou 100.00 Delaware 2258 GS GLOBAL PARTNERS LLC 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2270 GS Wind Power II LLC 2298 GSFS INVESTMENTS I CORP 100.00 Delaware 2271 GS RAFT RIVER I HOLDINGS, LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 2272 RAFT RIVER ENERGY I, LLC 2271 GS RAFT RIVER I HOLDINGS, LLC 100.00 United States 2273 BRIDGEWATER ODC, LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 2279 GS MORTGAGE I HOLDINGS LLC 1502 Goldman Sachs Mortgage Company 100.00 Delaware 2280 Synfuel Solutions Holdings LLC 0009 Goldman Sachs Group, Inc. 99.99 Delaware 2280 Synfuel Solutions Holdings LLC 2200 GS Financial Serv L.P. (DEL) 0.01 Delaware 2282 GS V-1 Holdings, L.P. 0009 Goldman Sachs Group, Inc. 1.00 Bermuda
2243 Established as part of an SSG Structured Investing Group transaction. 2243 Established as part of an SSG Structured Investing Group transaction. 2244 Established as part of an SSG Structured Investing Group transaction. 2245 Established as part of an SSG Structured Investing Group transaction. 2246 Established as part of an SSG Structured Investing Group transaction. 2247 Established as part of an SSG Structured Investing Group transaction. 2248 Established as part of an SSG Structured Investing Group transaction. 2249 Established as part of an SSG Structured Investing Group transaction. 2250 Established as part of an SSG Structured Investing Group transaction. 2251 Established as part of an SSG Structured Investing Group transaction. 2252 Established as part of an SSG Structured Investing Group transaction. 2253 Established as part of an SSG Structured Investing Group transaction. 2254 Established as part of an SSG Structured Investing Group transaction. 2255 Established as part of an SSG Structured Investing Group transaction. 2256 Established as part of an SSG Structured Investing Group transaction. 2257 Joint venture partner to purchase small bankruptcy trade clients. 2258 Established as part of an SSG Structured Investing Group transaction. 2270 Established as part of an SSG Structured Investing Group transaction. 2271 Established as part of an SSG Structured Investing Group transaction. 2272 Established as part of an SSG Structured Investing Group transaction. 2273 Entity to house a proposed new uS data centre property 2279 Established as part of an SSG Structured Investing Group transaction. 2280 Holding company for Synfuel Solutions LLC. 2280 Holding company for Synfuel Solutions LLC. 2282 Established as part of an SSG Structured Investing Group transaction.
2282 GS V-1 Holdings, L.P. 0250 Goldman Sachs Global Holdings 99.00 Bermuda 2283 GS WIND LLC 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2284 GS GLOBAL MARKETS INC 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2285 GS CAPITAL INVESTMENTS LIMITED 2200 GS Financial Serv L.P. (DEL) 100.00 United Kingdom 2286 GS CAPITAL INVESTMENTS II LTD 2285 GS CAPITAL INVESTMENTS LIMITED 100.00 United Kingdom 2287 CAP INVESTMENTS (US) III LLC 2286 GS CAPITAL INVESTMENTS II LTD 100.00 Delaware 2290 GSFS Investor Inc. 0009 Goldman Sachs Group, Inc. 100.00 Hong Kong 2291 Minerva Investment Partnership 0410 Minerva L.P. 1.00 United Kingdom 2291 Minerva Investment Partnership 0411 Minerva Inc. 99.00 United Kingdom 2298 GSFS INVESTMENTS I CORP 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2299 ENERGY CENTER HOLDINGS LLC 2298 GSFS INVESTMENTS I CORP 100.00 Delaware 2300 MINATO DEBT COLLECTION KK 1503 MLQ Investors, L.P. 100.00 Japan 2301 GS 737 CLASSICS LEASING LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 2302 GS FUNDING OPPORTUNITIES 2303 GS FUNDING OPPORTUNITIES II 100.00 Delaware 2303 GS FUNDING OPPORTUNITIES II 2200 GS Financial Serv L.P. (DEL) 100.00 Delaware 2304 FLURET TRUST 2200 GS Financial Serv L.P. (DEL) 95.00 Delaware 2304 FLURET TRUST 2303 GS FUNDING OPPORTUNITIES II 5.00 Delaware 2305 FLURET LIMITED 2304 FLURET TRUST 100.00 Delaware 2309 GAC PERSONAL TK 0347 GAC PERSONAL CO. LTD 100.00 Japan 2311 LINDEN WOOD TK 0358 LINDEN WOOD, LTD 100.00 Japan 2312 LEAF GREEN TK 0357 LEAF GREEN CO. LTD 100.00 Japan 2313 SOLAR WIND TK 0359 SOLAR WIND LTD 100.00 Japan 2314 NIHON ENDEAVOR FUND TK 0791 Nihon Endeavor Fund Co., LTD 100.00 Japan 2315 KYUSHU HOTEL MGT CO., LTD 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2320 GS Diversified Investments Ltd 2200 GS Financial Serv L.P. (DEL) 100.00 United States 2321 GS Diversified Holdings Ltd 2322 GS Diversified Funding LLC 100.00 Cayman Islands
2282 Established as part of an SSG Structured Investing Group transaction. 2283 Established as part of an SSG Structured Investing Group transaction. 2284 Established as part of an SSG Structured Investing Group transaction. 2285 Established as part of an SSG Structured Investing Group transaction. 2286 Established as part of an SSG Structured Investing Group transaction. 2287 Established as part of an SSG Structured Investing Group transaction. 2290 Established as part of an SSG Structured Investing Group transaction. 2291 Established as part of an SSG Structured Investing Group transaction. 2291 Established as part of an SSG Structured Investing Group transaction. 2298 Established as part of an SSG Structured Investing Group transaction. 2299 Established as part of an SSG Structured Investing Group transaction. 2300 An ASSG related entity that acts as core servicer for loan and real estate SPCs in Japan. 2301 Established as part of an SSG Structured Investing Group transaction. 2302 Established as part of an SSG Structured Investing Group transaction. 2303 Established as part of an SSG Structured Investing Group transaction. 2304 Established to facilitate structured financing. 2304 Established to facilitate structured financing. 2305 Established as part of an SSG Structured Investing Group transaction. 2309 An ASSG related entity that purchased residential loans from Chiyoda Life. 2311 An ASSG related entity that invests in distressed loans. 2312 An ASSG related entity that holds non-performing loans. 2313 An ASSG related entity that invests in distressed loans. 2314 An ASSG related entity that invests in distressed loans 2315 ASSG related entity engaged in hotel management. 2320 Established as part of an SSG Structured Investing Group transaction. 2321 Established as part of an SSG Structured Investing Group transaction.
2322 GS Diversified Funding LLC 0009 Goldman Sachs Group, Inc. 100.00 United States 2323 Wyndham Investments I Ltd 2200 GS Financial Serv L.P. (DEL) 86.67 Cayman Islands 2323 Wyndham Investments I Ltd 2322 GS Diversified Funding LLC 13.33 Cayman Islands 2324 Wyndham Investments II Ltd 2323 Wyndham Investments I Ltd 100.00 Cayman Islands 2325 Rothmill Investment Company 2320 GS Diversified Investments Ltd 100.00 Cayman Islands 2326 501-2 Investment Partnership 2325 Rothmill Investment Company 100.00 Australia 2327 201-2 Investment Partnership 2325 Rothmill Investment Company 100.00 Australia 2328 ACP Partnership Services 2324 Wyndham Investments II Ltd 100.00 Cayman Islands 2329 GS Solar Power I, LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 2330 Lorraine Funding Limited 1222 Goldman Sachs (Cayman) Holding 100.00 Cayman Islands 2331 Chiltern Trust 2200 GS Financial Serv L.P. (DEL) 95.00 Isle of Jersey 2331 Chiltern Trust 2284 GS GLOBAL MARKETS INC 5.00 Isle of Jersey 2343 GS Diversified Finance I LLC 2200 GS Financial Serv L.P. (DEL) 100.00 United States 2344 GS Diversified Finance II LLC 2200 GS Financial Serv L.P. (DEL) 100.00 United States 2345 GS Diversified Finance III LLC 2200 GS Financial Serv L.P. (DEL) 100.00 United States 2346 GS Diversified Finance IV LLC 2200 GS Financial Serv L.P. (DEL) 100.00 United States 2347 GS Diversified Finance V LLC 2200 GS Financial Serv L.P. (DEL) 100.00 United States 2349 GS Diversified Holdings II LLC 2200 GS Financial Serv L.P. (DEL) 99.99 Delaware 2349 GS Diversified Holdings II LLC 2345 GS Diversified Finance III LLC 0.01 Delaware 2350 GSCP (Del) Inc 0009 Goldman Sachs Group, Inc. 100.00 United States 2351 GSCP (Del) LLC 2350 GSCP (Del) Inc 100.00 United States 2353 FJT (HK) LIMITED 0165 Goldman Sachs (Asia) Finance 100.00 Hong Kong 2354 Linden Wood II, Ltd. 1503 MLQ Investors, L.P. 100.00 Japan 2355 Shiga (Delaware) LLC 0165 Goldman Sachs (Asia) Finance 100.00 United States 2356 Kiri (Delaware) LLC 0165 Goldman Sachs (Asia) Finance 100.00 United States 2357 BAY WIND II LTD 1503 MLQ Investors, L.P. 100.00 Japan
2322 Established as part of an SSG Structured Investing Group transaction. 2323 Established as part of an SSG Structured Investing Group transaction. 2323 Established as part of an SSG Structured Investing Group transaction. 2324 Established as part of an SSG Structured Investing Group transaction. 2325 Established as part of an SSG Structured Investing Group transaction. 2326 Established as part of an SSG Structured Investing Group transaction. 2327 Established as part of an SSG Structured Investing Group transaction. 2328 Established as part of an SSG Structured Investing Group transaction. 2329 Established as part of an SSG Structured Investing Group transaction. 2330 Established as part of an SSG Structured Investing Group transaction. 2331 Established in connection with a third party funding transaction. 2331 Established in connection with a third party funding transaction. 2343 Established as part of an SSG Structured Investing Group transaction. 2344 Established as part of an SSG Structured Investing Group transaction. 2345 Established as part of an SSG Structured Investing Group transaction. 2346 Established as part of an SSG Structured Investing Group transaction. 2347 Established as part of an SSG Structured Investing Group transaction. 2349 Established as part of an SSG Structured Investing Group transaction. 2349 Established as part of an SSG Structured Investing Group transaction. 2350 Established to act as general partner and regular partner in GSCP. 2351 Established to act as limited partners for GSCP. 2353 ASSG related entity holding a hotel property in China. 2354 TK operator of Linden Wood II TK. 2355 This entity, a TK investor, was set up to provide equity financing to SPCs which invests in non-performing loans and real estates. 2356 Pass-through entity used in connection with TK investing structures. 2357 This entity is a SPC which purchases golf course operators as a facility similar to Southwind structure.
2358 GS Leasing (KCSR 2005-1) LLC 2298 GSFS INVESTMENTS I CORP 100.00 United States 2359 MINATOMARU HOTEL HOLDINGS CO. 0307 Goldman Sachs Realty Japan Ltd 100.00 Japan 2398 PMF-1 (BES III) 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 2399 PMF-2 (BES III), LTD 2400 GS EUROPEAN OPP FUND BV 100.00 United Kingdom 2400 GS EUROPEAN OPP FUND BV 0762 ELQ INVESTORS, LTD 100.00 Netherlands 2400 GS EUROPEAN OPP FUND BV 1513 MTGLQ Investors, LP 0.00 Netherlands 2401 GS EUROPEAN OPPORTUNITY FUND, 1513 MTGLQ Investors, LP 100.00 Delaware 2402 DEMAC FINANCIAL SERVICES S.R.O 1513 MTGLQ Investors, LP 100.00 Czech Republic 2403 PMF - 1, LTD 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 2404 PMF-2 LTD 2400 GS EUROPEAN OPP FUND BV 100.00 United Kingdom 2405 GS European Investment Grp II 2406 GS European Opportunities F II 100.00 United Kingdom 2406 GS European Opportunities F II 0762 ELQ INVESTORS, LTD 100.00 United Kingdom 6001 JLQ LLC 2200 GS Financial Serv L.P. (DEL) 100.00 Cayman Islands 6007 NASU URBANE PROPERTIES CO., LT 6001 JLQ LLC 100.00 Japan 6021 Arrow Reinsurance Company Lim 0009 Goldman Sachs Group, Inc. 100.00 Bermuda 6051 Goldman Sachs Financial MarkLP 0009 Goldman Sachs Group, Inc. 99.00 Delaware 6051 Goldman Sachs Financial MarkLP 0080 Goldman Sachs Financial Market 1.00 Delaware 6100 Goldman Sachs Europe - BGA 0220 Goldman Sachs Holding (U.K.) 99.00 United Kingdom 6100 Goldman Sachs Europe - BGA 0709 Goldman Sachs Group Holdings ( 1.00 United Kingdom 6103 William Street Commitment 0009 Goldman Sachs Group, Inc. 100.00 Delaware 6104 William Street Equity 2210 Goldman Sachs Cap Markets, L.P 100.00 Delaware 6105 William Street Funding 6104 William Street Equity 100.00 Delaware 6107 GOLDMAN SACHS (JERSEY) LTD 0201 Goldman Sachs International 100.00 Isle of Jersey 6108 WILLIAM STREET CREDIT CORPORAT 0009 Goldman Sachs Group, Inc. 100.00 Delaware
2358 The entity is an equity holder in a leverage lease transaction where the assets are locomotives. 2359 Holds hotels in Narita, Naha and Chitose, Japan. 2398 It is not a true legal entity. PMF 1 (2403) has a non performing porfolio for which the desk needs separate reporting and entity 2398 has been set up to facilitate this. 2399 It is not a true legal entity. PMF 2 (2404) has a non performing porfolio for which the desk needs separate reporting and entity 2399 has been set up to facilitate this. 2400 Established to purchase through its subsidiaries fixed income securities and maintain a portfolio of investments. 2400 Established to purchase through its subsidiaries fixed income securities and maintain a portfolio of investments. 2401 Established to provide funding to GS European Strategic Investment Group BV. 2402 Incorporated to provide debt servicing and administrative services for CDV-1, Ltd.'s loan assets. 2403 Incorporated to provide debt servicing and administrative services for CDV-1, Ltd.'s loan assets. 2404 Established for the purpose of acquiring a 95% participation in a portfolio of non-performing Portuguese mortgages from PMF-1, Ltd. 2405 To purchase and originate publicly and privately issued fixed income securities 2406 Holding company 6001 An ASSG related entity that invests in loans. 6007 An ASSG related entity that holds property of Japanese style hotel, "Ouan". 6021 Established to support catastrophe reinsurance business. 6051 A registered U.S. broker-dealer whose business consists of dealer activities in eligible OTC derivative instruments, together with related cash management and portfolio management activities. 6051 A registered U.S. broker-dealer whose business consists of dealer activities in eligible OTC derivative instruments, together with related cash management and portfolio management activities. 6100 Engaged in agency stock lending business. 6100 Engaged in agency stock lending business. 6103 Extends unfunded loan commitments to investment-grade customers of Goldman Sachs Group, Inc. 6104 Invests in William Street Funding Corporation in exchange for equity and mezzanine securities. 6105 Provides liquidity for potential funding of loan commitments originated by William Street Commitment Corporation. 6107 Acts as an issuer of securitized derivatives in the UK market 6108 Issues commitments (both funded and unfunded) under the William Street program that will not for various reasons be issued by WS Commitment Corp.
6109 GSSM HOLDING UK 0009 Goldman Sachs Group, Inc. 100.00 United Kingdom 6110 GSSM HOLDING CORP 0009 Goldman Sachs Group, Inc. 100.00 Delaware 6111 GS EURO STRATEGIC INVST GRP BV 2400 GS EUROPEAN OPP FUND BV 100.00 Netherlands 6112 GS EUROPEAN INVESTMENT GRP BV 0762 ELQ INVESTORS, LTD 100.00 Netherlands 6113 GS EURO MEZZANINE INVST GRP BV 0762 ELQ INVESTORS, LTD 100.00 Netherlands 6114 GS EUROPEAN PERFORMANCE FUND 0009 Goldman Sachs Group, Inc. 100.00 Ireland 6115 GS Multi-Curr Euro Performance 0009 Goldman Sachs Group, Inc. 100.00 Ireland 6116 GS Specialty Lending Holdings 0009 Goldman Sachs Group, Inc. 100.00 Delaware 6117 SSIG SPF One LQ, LLC 1513 MTGLQ Investors, LP 100.00 Delaware 6118 GS Specialty Lending HoldingII 0009 Goldman Sachs Group, Inc. 100.00 United States 6119 Remark Funding Co, LLC. 1513 MTGLQ Investors, LP 100.00 United States 6120 GS Spec. Lending CLO-I LTD 6118 GS Specialty Lending HoldingII 100.00 United States 6121 Charleston Reinsurance LLC 6122 Columbia Capital Life Reins Co 100.00 South Carolina 6122 Columbia Capital Life Reins Co 0009 Goldman Sachs Group, Inc. 100.00 South Carolina 6136 Triumph Investments II (Irel) 0191 GS Asian Venture (Delaware)LLC 100.00 Ireland 6137 Triumph III Inv (Ireland) Ltd 6150 Best II Investments (Delaware) 100.00 Ireland 6138 GS Structured Products (Asia) 0160 Goldman Sachs (Asia) Finance 100.00 Cayman Islands 6150 Best II Investments (Delaware) 2200 GS Financial Serv L.P. (DEL) 100.00 Ireland 6151 Astoria Investment Ventures, I 0160 Goldman Sachs (Asia) Finance 100.00 Philippines 6152 Baekdu Investments Limited 2200 GS Financial Serv L.P. (DEL) 100.00 Cayman Islands 6153 GS STRATEGIC INVESTMENTS (ASIA 0194 MLT Investments Ltd. 100.00 Delaware 6155 GS India Venture Capital Limit 0164 Jade Dragon (Mauritius) Ltd 100.00 Hong Kong
6109 Established to hold firm's investments in SMFG convertible preferreds - As of 11-25-05, it no longer held the shares of GSSM Hldg Corp. 6110 Established to hold firm's investments in SMFG convertible preferreds - As of 11-25-05, the SMFG Pref's were held by GS Group, 6111 Primarily invests in non investment grade securities and loans of European companies. 6112 Established to purchase and originate publicly and privately issued fixed income securities. 6113 Established to purchase and originate publicly and privately issued fixed income securities. 6114 Primarily invests in investment grade debt instruments of European companies. 6115 Established to hold USD, GDP and Euro notes from the GS European Performance Fund Limited and issue single currency Euro notes to the Investor. 6116 Originates (or purchases) loans made to middle market borrowers that cannot sufficiently access the market through traditional senior bank debt lenders. 6117 Actively managed opportunity fund which invests in distressed credit. 6118 Originates (or purchases) loans made to middle market borrowers that cannot sufficiently access the market through traditional senior bank debt lenders. 6119 General purpose entity for the PFG consumer business to invest in portfolios of consumer loans. 6120 Established to be an actively managed performance fund engaged in par credit investing. 6121 To pursue various opportunities in the reinsurance business. 6122 Established to pursue various opportunities in the reinsurance business. 6136 Established primarily to hold ASSG positions in Korean assets. 6137 Established to hold an array of Dong Ah Construction Ltd. Claims with a portion guaranteed by Korea Express Co. ("KorEx") and certain direct claim of KorEx. 6138 Established for issuance of Hong Kong listed warrants. 6150 Owns Triumph Investments (Ireland) Limited and Triumph III Investments (Ireland) Limited. 6151 Owns approximately 18.6% of the ERP shares issued by a Philippine metro operating company. 6152 A holding company that owns 30% of Alkas Realty Pte. Ltd., which in turn, owns the DBS Building (a 862,810 sq ft. Grade A office complex comprising of 2 adjacent towers) in Singapore. 6153 To hold ASSG investments 6155 Will hold ASSG assets.
6156 GS STRATEGIC HOLDINGS LIMITED 0193 Panda Investments Ltd. 100.00 Mauritius 6157 COUGAR INVESTMENTS (MAURITIUS) 0193 Panda Investments Ltd. 100.00 Mauritius 6158 TUNG FUNG DEVELOPMENT CO. 0196 EUSTON ENTERPRISES LTD 50.00 Hong Kong 6158 TUNG FUNG DEVELOPMENT CO. 0197 FAIRWAY ENTERPRISES LTD 50.00 Hong Kong 6159 GOLDMAN SACHS LLC 0435 Hull Trading Asia, Limited 100.00 Hong Kong 6160 GS Strategic Investments (Dela 0196 EUSTON ENTERPRISES LTD 50.00 Delaware 6160 GS Strategic Investments (Dela 0197 FAIRWAY ENTERPRISES LTD 50.00 Delaware 6163 GRAND STEEL STRATEGIC INVESTMT 6153 GS STRATEGIC INVESTMENTS (ASIA 100.00 Cayman Islands 6164 GLOBAL TECHNOLOGIES INTERNATIO 0194 MLT Investments Ltd. 100.00 British Virgin Islands 6165 GS CHINA VENTURE I(MAURITIUS) 0164 Jade Dragon (Mauritius) Ltd 100.00 Mauritius 6166 GS CHINA VENTURE II (MAURITIUS 0164 Jade Dragon (Mauritius) Ltd 100.00 Mauritius 6167 Jade Dragon Venture Inv Limite 6165 GS CHINA VENTURE I(MAURITIUS) 60.00 China 6167 Jade Dragon Venture Inv Limite 6166 GS CHINA VENTURE II (MAURITIUS 40.00 China 6168 ELEVATECH LIMITED 0198 Wealth Earner Limited 100.00 Hong Kong 9868 REP PEB REALTY, LLC 6117 SSIG SPF One LQ, LLC 100.00 Delaware 9869 REP PRK Realty, LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware 9870 REP ALX Realty, LLC 0009 Goldman Sachs Group, Inc. 100.00 Delaware
6156 To hold ASSG positions in Mengxi Cement 6157 To hold ASSG positions in Indian private equities. 6158 6158 6159 To hold our investment in ICBC. 6160 Potentially holding ASSG positions 6160 Potentially holding ASSG positions 6163 To hold investments in Jianlong, a steel Manufacturer in China 6164 Holding 20% of APPH (a Philippines Co) and 20 % of APPCo. APPH and APPCo are engaged in real estate contruction and development business 6165 Holding Co of Jade Dragon Venture Investment Limited 6166 Holding Co of Jade Dragon Venture Investment Limited 6167 TO hold China Investments in future 6167 TO hold China Investments in future 6168 Holding ASSG investments 9868 REPIA entity. 9869 REPIA entity. 9870 REPIA entity.
These entities are directly or indirectly controlled by or under common control with the Company. ITEM 27. NUMBER OF CONTRACT OWNERS As of May 31, 2007, there were 0 Contract Owners of qualified Contracts and 0 Contract Owners of non-qualified Contracts. As of May 31, 2007, there were no Contract Form A3038-07 Owners since sales had not yet begun. ITEM 28. INDEMNIFICATION RULE 484 UNDERTAKING - Article VI of the Bylaws of Commonwealth Annuity and Life Insurance Company (the Depositor) states: The Corporation shall indemnify to the full extent permitted by applicable law any person made or threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person's testator or intestate is or was a director, officer or employee of the Corporation or serves or served at the request of the Corporation any other enterprise as a director, officer or employee. Expenses, including attorneys' fees, incurred by any such person in defending any such action, suit or proceeding shall be paid or reimbursed by the Corporation promptly upon receipt by it of an undertaking of such person to repay such expenses if such person if finally adjudicated not to have acted in good faith in the reasonable belief that his or her action was in the best interest of the Corporation or other enterprise. The Corporation shall accept such undertaking without reference to the financial ability of such person to make repayment. Notwithstanding the foregoing, no indemnification shall be provided for any person with respect to any matter as to which such person shall have been finally adjudicated not to have acted in good faith in the reasonable belief that the action was in best interests of the Corporation or other enterprise. No matter disposed of by settlement, compromise, the entry of a consent decree or the entry of any plea in a criminal proceeding, shall of itself be deemed an adjudication of not having acted in good faith in the reasonable belief that the action was in the best interest of the Corporation. The rights provided to any person by this by-law shall be enforceable against the Corporation by such person who shall be presumed to have relied upon it in serving or continuing to serve as director, officer or employee as provided above. No amendment of this by-law shall impair the rights of any person arising at any time with respect to events occurring prior to such amendment. ITEM 29. PRINCIPAL UNDERWRITERS (a) [Distributor] also acts as principal underwriter for the following: - Commonwealth Annuity Separate Account A (b) The Principal Business Address of each of the following Directors and Officers of [Distributor] is: 132 Turnpike Rd., Suite 210 Southborough, MA 01772 NAME POSITION OR OFFICE WITH UNDERWRITER ---- ----------------------------------- [ ] (c) As indicated in Part B (Statement of Additional Information) in response to Item 20(c), the [Distributor] did not received any commission in connection with the sale of the Contracts funded by the Registrant because the [Distributor] was not in existence as of December 31, 2006. No other commissions or other compensation was received by the principal underwriter, directly or indirectly, from the Registrant during the Registrant's last fiscal year. ITEM 30. LOCATION OF ACCOUNTS AND RECORDS Each account, book or other document required to be maintained by Section 31(a) of the Investment Company Act of 1940 and Rules 31a-1 to 31a-3 thereunder are maintained for the Company by Security Benefit Life Insurance Company at One Security Benefit Place, Topeka, Kansas. ITEM 31. MANAGEMENT SERVICES The Company provides daily unit value calculations and related services for the Company's separate accounts. ITEM 32. UNDERTAKINGS (a) The Registrant hereby undertakes to file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements in the registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted. (b) The Registrant hereby undertakes to include as part of the application to purchase a Contract a space that the applicant can check to request a Statement of Additional Information. (c) The Registrant hereby undertakes to deliver a Statement of Additional Information and any financial statements promptly upon written or oral request, according to the requirements of Form N-4. (d) Insofar as indemnification for liability arising under the 1933 Act may be permitted to Directors, Officers and Controlling Persons of Registrant under any registration statement, underwriting agreement or otherwise, Registrant has been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the 1933 Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by Registrant of expenses incurred or paid by a Director, Officer or Controlling Person of Registrant in the successful defense of any action, suit or proceeding) is asserted by such Director, Officer or Controlling Person in connection with the securities being registered, Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the 1933 Act and will be governed by the final adjudication of such issue. (e) Commonwealth Annuity and Life Insurance Company hereby represents that the aggregate fees and charges deducted under the Contracts are reasonable in relation to the services rendered, expenses expected to be incurred, and risks assumed by the Company. ITEM 33. REPRESENTATIONS CONCERNING WITHDRAWAL RESTRICTIONS ON SECTION 403(B) PLANS AND UNDER THE TEXAS OPTIONAL RETIREMENT PROGRAM Registrant, a separate account of Commonwealth Annuity and Life Insurance Company ("Company"), states that it is (a) relying on Rule 6c-7 under the 1940 Act with respect to withdrawal restrictions under the Texas Optional Retirement Program ("Program") and (b) relying on the "no-action" letter (Ref. No. IP-6-88) issued on November 28, 1988 to the American Council of Life Insurance, in applying the withdrawal restrictions of Internal Revenue Code Section 403(b)(11). Registrant has taken the following steps in reliance on the letter: 1. Appropriate disclosures regarding the redemption withdrawal restrictions imposed by the Program and by Section 403(b)(11) have been included in the prospectus of each registration statement used in connection with the offer of the Company's variable contracts. 2. Appropriate disclosures regarding the redemption withdrawal restrictions imposed by the Program and by Section 403(b)(11) have been included in sales literature used in connection with the offer of the Company's variable contracts. 3. Sales Representatives who solicit participants to purchase the variable contracts have been instructed to specifically bring the redemption withdrawal restrictions imposed by the Program and by Section 403(b)(11) to the attention of potential participants. 4. A signed statement acknowledging the participant's understanding of (i) the restrictions on redemption withdrawal imposed by the Program and by Section 403(b)(11) and (ii) the investment alternatives available under the employer's arrangement will be obtained from each participant who purchases a variable annuity contract prior to or at the time of purchase. Registrant hereby represents that it will not act to deny or limit a transfer request except to the extent that a Service-Ruling or written opinion of counsel, specifically addressing the fact pattern involved and taking into account the terms of the applicable employer plan, determines that denial or limitation is necessary for the variable annuity contracts to meet the requirements of the Program or of Section 403(b). Any transfer request not so denied or limited will be effected as expeditiously as possible. SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940 the Registrant has duly caused this Pre-Effective Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereto duly authorized, in the City of Southborough, and Commonwealth of Massachusetts, on the [15th] day of June, 2007. COMMONWEALTH ANNUITY SEPARATE ACCOUNT A OF COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY By: [/s/ Samuel Ramos] ------------------------------------- Samuel Ramos, Vice President and Secretary Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, this Pre-Effective Amendment No. 1 to the Registration Statement has been signed below by the following persons in the capacities and on the dates indicated. SIGNATURES TITLE DATE ---------------------------- ----------------------------- ------------- [/s/ Michael A. Pirrello] Vice President and [June , 2007] ---------------------------- Chief Financial Officer Michael A. Pirrello Allan S. Levine* Chairman of the Board ---------------------------- Nicholas Helmuth von Moltke* Director, Vice President, and ---------------------------- Chief Operating Officer John W. McMahon* Director ---------------------------- Donald Mullen* Director ---------------------------- J. William McMahon* Director ---------------------------- Timothy J. O'Neill* Director ---------------------------- Marc A. Spilker* Director ---------------------------- [/s/ Samuel Ramos] Vice President and Secretary ---------------------------- Samuel Ramos Michael A. Reardon* Director, President, and ---------------------------- Chief Executive Officer John J. Fowler* Vice President ---------------------------- Amol Sagon Naik* Vice President and Treasurer ---------------------------- Jane Spanier Grosso* Vice President and Controller ---------------------------- Alan Akihiro Yamamura* Vice President and ---------------------------- Chief Risk Officer Margot K. Wallin* Vice President and ---------------------------- Chief Compliance Officer * Jon-Luc Dupuy, by signing his name hereto, does hereby sign this document on behalf of each of the above-named Directors and Officers of the Registrant pursuant to the Powers of Attorney dated June 8, 2007 duly executed by such persons. [/s/ Jon-Luc Dupuy] ------------------------------------ Jon-Luc Dupuy, Attorney-in-Fact (Preferred Plus) EXHIBIT TABLE Exhibit (3)(a) Distribution Agreement between the Company and [Distributor] Exhibit (3)(b) Sales Agreement with broker-dealers Exhibit (4)(a) Policy (3039-07) Exhibit (4)(b) Extended Care Waiver Rider (4009-07) (Nursing Home Rider Endorsement) Exhibit (4)(c) Disability Waiver Rider (4008-07) Exhibit (4)(d) Texas Optional Retirement Program Rider (4010-07) Exhibit (4)(e) Qualified Plan Rider (401a) (4011-07) Exhibit (4)(f) Tax Sheltered Annuity Rider (403b) (4012-07) Exhibit (4)(g) GLWB Rider - Single Life - Advantage IV (4006-07) Exhibit (4)(h) GLWB Rider - Joint Life - Advantage IV (4007-07) Exhibit (4)(i) Step-Up Death Benefit Rider (4005-07) Exhibit (4)(j) 457 Rider (4013-07) Exhibit 5 Form of Application (Preferred Plus - PP-401) Exhibit 8(b) Directors' Powers of Attorney Exhibit 9 Opinion of Counsel Exhibit 10 Consent of Independent Registered Public Accounting Firm Exhibit 15(a) Form of Amendment dated August 1, 2007 to the AIM Participation Agreement Exhibit 15(b) Form of Amended and Restated Participation Agreement among Commonwealth Annuity and Life Insurance Company, Alliance Capital Management L.P., and Alliance Fund Distributors, Inc. Exhibit 15(c) Form of Amendment dated August 1, 2007 and the Amended and Restated Participation Agreement dated September 25, 2006 with Franklin Templeton Variable Insurance Products Trust, Franklin/Templeton Distributors, Inc., and Commonwealth Annuity and Life Insurance Exhibit 15(d) Form of Amendment dated August 1, 2007 to the Participation Agreement dated January 2, 2006 between Goldman Sachs Variable Insurance Trust, Goldman, Sachs & Co, and Allmerica Financial Life Insurance and Annuity Company Exhibit 15(e) Form of Participation Agreement dated August 1, 2007 with Goldman Sachs Trust
Exhibit 15(f) Form of Amendment dated August 1, 2007 to the Participation Agreement with Janus Exhibit 15(g) Form of Amendment dated August 1, 2007 to the Participation Agreement with Oppenheimer Variable Account Funds Exhibit 15(h) Form of Participation Agreement among Pioneer Variable Contracts Trust, Commonwealth Annuity and Lie Insurance Company, Pioneer Investment Management, Inc. and Pioneer Funds Distributor, Inc. dated August 1, 2007