<PAGE>
File Nos. 333-12507,811-7827
As filed with the Securities and Exchange Commission on March 7, 1997
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
--------
Registration Statement Under the Securities Act of 1933 [X] [_]
Pre-Effective Amendment No. 1 [X] [_]
-----
Post-Effective Amendment No. _____ [_]
and/or
Registration Statement Under the Investment Company Act of 1940 [X] [_]
Amendment No. 1 [X] [_]
-----
(Check appropriate box or boxes.)
RETIREMAP VARIABLE ACCOUNT
(Exact Name of Registrant)
UNITED INVESTORS LIFE INSURANCE COMPANY
(Name of Depositor)
2001 Third Avenue South
Birmingham, Alabama 35233
(Address of Depositor's Principal Executive Office)
Depositor's Telephone Number: (205) 325-4300
Name and Address of Agent for Service:
James L. Sedgwick, Esquire
United Investors Life Insurance Company
2001 Third Avenue South Copy to:
Birmingham, Alabama 35233 Frederick R. Bellamy, Esquire
Sutherland, Asbill & Brennan, L.L.P.
1275 Pennsylvania Avenue, N.W.
Washington, D.C. 20004-2404
Approximate Date of Proposed Public Offering:
As soon as practicable after effectiveness of the Registration Statement
____________________________________________
Pursuant to Rule 24f-2 under the Investment Company Act of 1940, an indefinite
amount of securities has been registered under the Securities Act of 1933. The
$500 filing fee was paid with the initial filing.
___________________________________________
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
SHALL DETERMINE.
<PAGE>
CROSS REFERENCE SHEET
PURSUANT TO RULE 481(A) UNDER THE SECURITIES ACT OF 1933
Showing Location of Information Required by Form N-4
in Part A (Prospectus) and Part B (Statement of
Additional Information) of the Registration Statement
___________________________________________________________________________
Part A
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<TABLE>
<CAPTION>
Item of Form N-4 Prospectus Caption
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<S> <C>
1. Cover Page............................. Cover page
2. Definition............................. Definitions
3. Synopsis............................... Summary
4. Condensed Financial Information........ N/A
5. General
(a) Depositor......................... United Investors Life Insurance
Company
(b) Registrant........................ RetireMap Variable Account
(c) Portfolio Company................. Charges and Deductions
(d) Fund Prospectus................... The Funds
(e) Voting Rights..................... Voting Rights
(f) Administrators.................... Summary
6. Deductions and Expense................. Charges and Deductions
(a) General........................... Charges and Deductions
(b) Sales Load Percentage............. Charges and Deductions
(c) Special Purchase Plan............. Charges and Deductions
(d) Commissions....................... Distributor of the Policies
(e) Expenses - Registrant............. Federal Taxes
(f) Fund Expenses..................... The Funds
(g) Organizational Expenses........... N/A
7. Contracts
(a) Persons with Rights............... The Policy; Annuity Payments;
Voting Rights
(b) (i) Allocation of Premium
Payments.................... Allocation of Purchase Payments
(ii) Transfers................... Transfers
(iii) Exchanges................... N/A
(c) Changes............................ Additions, Deletions or
Substitutions of Investments
(d) Inquiries.......................... Summary
8. Annuity Period......................... Annuity Payments
9. Death Benefit.......................... Death Benefits
10. Purchases and Contract Value
(a) Purchases.......................... Purchase Payments and Allocation
of Purchase Payments
(b) Valuation.......................... Policy Value
(c) Daily Calculation.................. Policy Value
(d) Underwriter........................ Distributor of the Policies
11. Redemptions
(a) - By Owners........................ Surrender and Partial Withdrawals
- By Annuitant N/A................
(b) Texas ORP.......................... Surrender and Partial Withdrawals
(c) Check Delay........................ Surrender and Partial Withdrawals
(d) Lapse.............................. N/A
(e) Free Look.......................... Free Look Period
12. Taxes.................................. Federal Tax Matters
13. Legal Proceedings...................... Legal Proceedings
</TABLE>
<PAGE>
<TABLE>
<S> <C>
14. Table of Contents of the Statement
of Additional Information......... Statement of Additional
Information
</TABLE>
Part B
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<TABLE>
<CAPTION>
Statement of Additional
Item of Form N-4 Information Caption
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<S> <C>
15. Cover Page.............................. Cover Page
16. Table of Contents....................... Table of Contents
17. General Information and History......... N/A
18. Services
(a) Fees and Expenses of Registrant.. N/A
(b) Management Contracts............. N/A
(c) Custodian........................ N/A
Independent Public Accountant..... Experts
(d) Assets of Registrant............. Safekeeping of Variable
Account Assets
(e) Affiliated Persons............... N/A
(f) Principal Underwriter............ Distribution of the Policy
19. Purchase of Securities Being
Offered................................. Distribution of the Policy
20. Underwriters............................ Distribution of the Policy
21. Calculation of Performance Data......... Performance Data Calculations
22. Annuity Payments........................ The Policy; Determination of
Annuity Payments
23. Financial Statements.................... Financial Statements
</TABLE>
<PAGE>
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U N I T E D I N V E S T O R S
RETIREMAP (SM) ___________ ___, 1997
VARIABLE ANNUITY
PROSPECTUS
This Prospectus describes the RetireMAP Deferred Variable Annuity Policy
("Policy") issued by United Investors Life Insurance Company ("United
Investors"). The Policy can be purchased with a single minimum Purchase Payment
of $2,000 (for tax qualified policies, the minimum Purchase Payment is lower).
Additional Purchase Payments may be made in amounts of $100 or more. No Policy
will be issued if either the Annuitant or the Owner is over age 85 last
birthday.
Over the life of the Policy, the Owner may choose to allocate Purchase Payments
or transfer values to no more than 17 of the Investment Divisions ("Investment
Divisions") of the RetireMAP Variable Account (the "Variable Account"), to the
Fixed Account which provides guaranteed interest accumulation, or to a
combination of both. (See "Transfers" for additional restrictions on
transfers.) Assets of each Investment Division are invested in a corresponding
mutual fund portfolio. The following 21 Portfolios of the Funds are currently
offered to Policyowners through the Investment Divisions of the Variable
Account:
<TABLE>
<S> <C>
TMK/UNITED FUNDS, INC. DREYFUS VARIABLE INVESTMENT FUND
MONEY MARKET PORTFOLIO CAPITAL APPRECIATION PORTFOLIO
BOND PORTFOLIO SMALL CAP PORTFOLIO
HIGH INCOME PORTFOLIO GROWTH AND INCOME PORTFOLIO
GROWTH PORTFOLIO QUALITY BOND PORTFOLIO
INCOME PORTFOLIO MFS VARIABLE INSURANCE TRUST
SMALL CAP PORTFOLIO EMERGING GROWTH SERIES
SCIENCE AND TECHNOLOGY PORTFOLIO RESEARCH SERIES
FEDERATED INSURANCE SERIES UTILITIES SERIES
EQUITY INCOME FUND II WARBURG PINCUS TRUST
FUND FOR U.S. GOVERNMENT SECURITIES II INTERNATIONAL EQUITY PORTFOLIO
SCUDDER VARIABLE LIFE INVESTMENT FUND WARBURG PINCUS TRUST II
INTERNATIONAL PORTFOLIO FIXED INCOME PORTFOLIO
GLOBAL DISCOVERY PORTFOLIO GLOBAL FIXED INCOME PORTFOLIO
</TABLE>
The Policy Value will vary in accordance with the investment performance of the
Investment Divisions selected by the Owner. Therefore, the Owner bears the
entire investment risk under the Policy for all Purchase Payments allocated to
the Variable Account. United Investors guarantees that Purchase Payments
allocated to the Fixed Account will earn interest at a rate of not less than the
Guaranteed Minimum Interest Rate of 4% per year.
The Owner can surrender the Policy for cash or make a partial cash withdrawal
(collectively, "Withdrawals"), although Withdrawals may be taxable and subject
to a withdrawal charge and tax penalty.
This Prospectus sets forth the basic information that a prospective investor
should know before investing. A "Statement of Additional Information"
containing more detailed information about the Policy and the Variable Account
is available free by writing United Investors at United Investors Life Insurance
Company, Administrative Office, P.O. Box 219065, Dallas, TX 75221-9065, or by
calling (800) 453-1271. The Statement of Additional Information, which has the
same date as this Prospectus, has been filed with the U.S. Securities and
Exchange Commission and is incorporated herein by reference. The table of
contents for the Statement of Additional Information is included at the end of
this Prospectus.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE U.S. SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE U.S.
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
THE POLICIES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ENDORSED OR GUARANTEED BY,
ANY BANK, NOR ARE THEY FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER AGENCY. AN INVESTMENT IN THE POLICIES INVOLVES CERTAIN
RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
PLEASE READ THIS PROSPECTUS CAREFULLY AND RETAIN IT FOR FUTURE REFERENCE.
Issued By: United Investors Life Insurance Company
2001 Third Avenue South
Birmingham, Alabama 35233
===============================================================================
<PAGE>
=================================================
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
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<S> <C>
DEFINITIONS................................................................... i
SUMMARY....................................................................... 1
PUBLISHED RATINGS............................................................. 8
UNITED INVESTORS LIFE INSURANCE COMPANY AND
RETIREMAP VARIABLE ACCOUNT.................................................... 8
United Investors Life Insurance Company..................................... 8
RetireMAP Variable Account.................................................. 8
The Funds................................................................... 9
Fund Management and Fees....................................................11
FIXED ACCOUNT.................................................................13
THE POLICY....................................................................14
Issuance of a Policy........................................................14
Purchase Payments...........................................................14
Allocation of Purchase Payments.............................................15
Policy Value................................................................15
Surrender and Partial Withdrawals...........................................16
Transfers ..................................................................17
Dollar Cost Averaging.......................................................18
Death Benefit...............................................................18
Free Look Period............................................................20
CHARGES AND DEDUCTIONS........................................................20
Withdrawal Charge...........................................................20
Waiver of Withdrawal Charges Rider..........................................21
Annual Contract Maintenance Charge..........................................21
Administration Fee..........................................................22
Reduction In Charges For Certain Groups.....................................22
Mortality and Expense Risk Charge...........................................22
Optional Death Benefit Rider Charge.........................................22
Transaction Charge..........................................................23
Premium Taxes...............................................................23
Federal Taxes...............................................................23
Fund Expenses...............................................................23
ANNUITY PAYMENTS..............................................................23
Election of Payment Option..................................................23
Retirement Date.............................................................23
Available Options...........................................................24
DISTRIBUTOR OF THE POLICIES...................................................25
FEDERAL TAX MATTERS...........................................................25
Introduction................................................................25
Taxation of Annuities in General............................................26
VOTING RIGHTS.................................................................29
LEGAL PROCEEDINGS.............................................................29
FINANCIAL STATEMENTS..........................................................30
STATEMENT OF ADDITIONAL INFORMATION...........................................31
</TABLE>
<PAGE>
The Policy is not available in all States.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT BE LAWFULLY MADE. NO DEALER, SALESMAN, OR OTHER PERSON IS
AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS IN CONNECTION
WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN
OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON.
<PAGE>
================================================================================
DEFINITIONS
- --------------------------------------------------------------------------------
Annuitant................. means the person on whose life Annuity Payments
depend. If the Policyowner names more than one
person as an "Annuitant," the second person is
referred to as "Co-Annuitant." All provisions based
on the date of death of the "Annuitant" prior to the
Retirement Date are based on the date of death of
the last to survive of the "Annuitant" or "Co-
Annuitant." The "Annuitant" and "Co-Annuitant" are
referred to collectively as the "Annuitant."
Annuity Payment........... means an amount paid monthly, starting on the
Retirement Date, by United Investors to the
Annuitant or any other payee.
Annuity Payment Option.... means any one of the payment options available under
the Policy.
Beneficiary............... means the person, persons or entity entitled to
Death Benefit proceeds under this Policy upon death
of the Owner (or Annuitant if the Owner is not a
natural person) before the Retirement Date. If the
Policy has Joint Owners and one Owner dies, the
surviving Joint Owner will be deemed the
Beneficiary.
Death Benefit............. means the benefit payable upon death of the Owner
(or Annuitant if the Owner is not a natural person)
before the Retirement Date.
Fixed Account............. is a part of the General Account of United Investors
Life Insurance Company. The General Account consists
of all assets of United Investors Life Insurance
Company other than those in any separate account.
Fixed Account Value....... means the value of the Fixed Account under the
Policy.
Fixed Annuity............. means an annuity with payments which remain fixed in
amount throughout the payment period and, unlike a
Variable Annuity, do not vary with the investment
experience of the variable Investment Divisions.
Funds..................... means the mutual funds of which certain portfolios
are available for investment by the Variable Account
on the Policy Date or as later changed by us.
Guaranteed Minimum
Interest Rate............ means the minimum effective annual rate at which
interest will be credited to amounts allocated to
the Fixed Account under the Policy. The Guaranteed
Minimum Interest Rate is 4% per year.
Joint Owner............... means the persons named as the Joint Owner in the
application, unless he or she has assigned ownership
to someone else.
-i-
<PAGE>
Net Purchase Payment...... means a Purchase Payment less any deduction for
premium taxes incurred at the time the Purchase
Payment was accepted.
Nonqualified Policies..... means Policies not used in connection with certain
plans that qualify for special Federal income tax
treatment.
Policy Anniversary........ means the same day and month as the Policy Date each
year that the Policy remains in force.
Policy Date............... means the date the Policy becomes effective, and the
date from which Policy Anniversaries and Policy
Years are determined.
Policy Value.............. means the Variable Account Value plus the Fixed
Account Value prior to the Retirement Date.
Policy Year............... means a year that starts on the Policy Date or on a
Policy Anniversary.
Policyowner or Owner...... means the person named as the owner in the
application, unless he or she has assigned ownership
to someone else.
Purchase Payment.......... means any payment made by the Policyowner under the
Policy.
Qualified Policies........ means Policies used in connection with certain plans
that qualify for special Federal income tax
treatment.
Retirement Date........... is the date on which the Annuity Payments start.
Surrender Value........... means the Policy Value less any Withdrawal Charge,
the Annual Contract Maintenance Charge, an Optional
Death Benefit Rider Charge (if applicable), and
applicable deductions for premium taxes.
Valuation Date............ means a normal business day, Monday through Friday.
However, we will not value the Policy on any
customary U.S. business holiday when the New York
Stock Exchange is not open for trading. Those
holidays currently are New Year's Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, and Christmas Day.
Valuation Period.......... means the interval of time commencing at the close
of business of the New York Stock Exchange on each
Valuation Date and ending at the close of business
of the New York Stock Exchange on the next Valuation
Date.
Variable Account Value.... means the sum of all values of the Investment
Divisions of the Variable Account under the Policy.
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<PAGE>
Variable Annuity.......... means an annuity with payments which vary in amount
with the investment experience of one or more of the
variable Investment Divisions.
We........................ means United Investors Life Insurance Company. "Us"
and "our" also refer to United Investors.
Written Request or Written
Notice.................... means a request or notice in writing signed
by the Policyowner.
You....................... means the owner of the Policy. "Your" and "yours"
also refer to the Policyowner.
-iii-
<PAGE>
SUMMARY
The following summary of Prospectus information should be read in
conjunction with the detailed information appearing elsewhere in this
Prospectus.
THE POLICY. The Policy is designed to aid individuals in long-term
financial planning and provides for the accumulation of capital on a tax-
deferred basis for retirement or other long-term purposes. The Policy also
provides Annuity Payments after the Retirement Date. The Owner may select from
a number of Annuity Payment Options, including a life annuity, joint life
annuity, and life annuity for a guaranteed period. Annuity Payments may be on a
variable basis, a fixed basis, or a combination thereof. (See "Annuity
Payments.")
The Policy is issued in consideration of the application and payment of the
initial Purchase Payment. The minimum initial Purchase Payment for non-qualified
policies is $2,000. For qualified plans, the initial Purchase Payment must be
at least $1,200, unless Purchase Payments will be made by means of a bank draft
authorization or a group payment method approved in advance by us. (See
"Purchase Payments.") The Policy can be purchased for a single Purchase
Payment. However, additional Purchase Payments may be paid at the Policyowner's
option (within certain limits). (See "Purchase Payments.") The Policy can be
purchased on a non-qualified tax basis or it can be purchased and used in
connection with plans qualifying for favorable Federal income tax treatment.
THE VARIABLE ACCOUNT. The Variable Account currently has 21 Investment
Divisions. Each Investment Division invests solely in shares of a corresponding
mutual fund portfolio of one of several Funds. Currently the following 21
separate investment portfolios are available:
<TABLE>
<S> <C>
TMK/UNITED FUNDS, INC. DREYFUS VARIABLE INVESTMENT FUND
MONEY MARKET PORTFOLIO CAPITAL APPRECIATION PORTFOLIO
BOND PORTFOLIO SMALL CAP PORTFOLIO
GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO
HIGH INCOME PORTFOLIO QUALITY BOND PORTFOLIO
INCOME PORTFOLIO MFS VARIABLE INSURANCE TRUST
SMALL CAP PORTFOLIO EMERGING GROWTH SERIES
SCIENCE AND TECHNOLOGY PORTFOLIO RESEARCH SERIES
FEDERATED INSURANCE SERIES UTILITIES SERIES
EQUITY INCOME FUND II WARBURG PINCUS TRUST
FUND FOR U.S. GOVERNMENT SECURITIES II INTERNATIONAL EQUITY PORTFOLIO
SCUDDER VARIABLE LIFE INVESTMENT FUND WARBURG PINCUS TRUST II
INTERNATIONAL PORTFOLIO FIXED INCOME PORTFOLIO
GLOBAL DISCOVERY PORTFOLIO GLOBAL FIXED INCOME PORTFOLIO
</TABLE>
Each of these Portfolios has a different investment objective. (See "The
Funds.")
-1-
<PAGE>
The Policyowner determines the allocation of Purchase Payments and Policy
Value among the Investment Divisions of the Variable Account. Because the
Policy Value depends on the investment experience of the selected Investment
Divisions, the Owner bears the entire investment risk under the Policy for all
Purchase Payments allocated to, and amounts transferred to, the Variable
Account. (See "Allocation of Purchase Payments.") Prior to the Retirement
Date, the Policyowner may transfer the Policy Value from one Investment Division
to one or more other Investment Divisions up to twelve times per Policy Year at
no cost. After the Retirement Date, the Annuitant may reallocate the value of
the Annuitant's interest in the Investment Divisions once each Policy Year at no
cost. (See "Transfers.")
THE FIXED ACCOUNT. The Fixed Account is a part of the General Account of
United Investors Life Insurance Company. The General Account consists of all
assets of United Investors Life Insurance Company other than those in any
separate account. We guarantee that we will credit interest at a rate of not
less than the Guaranteed Minimum Interest Rate of 4% per year to amounts
allocated to the Fixed Account. We may credit interest at a rate in excess of
the Guaranteed Minimum Interest Rate. ANY EXCESS INTEREST CREDITED WILL BE
DETERMINED IN OUR SOLE DISCRETION. THE OWNER ASSUMES THE RISK THAT INTEREST
CREDITED TO FIXED ACCOUNT ALLOCATIONS MAY NOT EXCEED THE GUARANTEED MINIMUM
INTEREST RATE. The Fixed Account may not be available in all states. (See
"Fixed Account.")
The Policyowner determines the allocation of Purchase Payments and Policy
Value to the Fixed Account. Prior to the Retirement Date, the Policyowner may
transfer all or part of the values held in the Fixed Account to one or more of
the Investment Divisions of the Variable Account, subject to certain
restrictions. (See "Transfers.") After the Retirement Date, transfers from the
Fixed Account to the Investment Divisions of the Variable Account are not
allowed. After the Retirement Date values held in the Investment Divisions of
the Variable Account may be transferred to the Fixed Account only once per
policy year. (See "Transfers.")
POLICY VALUE. On the Policy Date, the Policy Value equals the initial
Purchase Payment less any applicable premium taxes plus any accrued interest
from the date of receipt of the initial Purchase Payment to the Policy Date.
Thereafter, the Policy Value will increase or decrease from day to day depending
on the investment experience of the selected Investment Divisions.
The Policy Value is equal to the Variable Account Value plus the Fixed
Account Value prior to the Retirement Date. (See "Fixed Account.") Variable
Account Value is not guaranteed. The Policy Value will reflect the investment
performance of the selected Investment Divisions, the charges imposed in
connection with the Policy, and indirectly the expenses of the Portfolios. (See
"Policy Value.") Accordingly, although the Policy offers the possibility that
the Policy Value will increase, there is no assurance that it will increase, and
it may decrease.
SURRENDER AND PARTIAL WITHDRAWALS. You may surrender the Policy at any
time prior to the Retirement Date for the Surrender Value, which is the Policy
Value less any applicable Withdrawal Charge, the Annual Contract Maintenance
Charge, the Optional Death Benefit Rider Charge (if applicable), and applicable
deductions for premium taxes. You may also make partial withdrawals of the
Policy Value at any time prior to the Retirement Date. However, amounts
withdrawn during the first six Policy Years following receipt of a Purchase
Payment may be subject to a Withdrawal Charge. (See "Surrender and Partial
Withdrawals.") In addition, withdrawals may be taxable and subject to a penalty
tax. For certain Qualified Policies, withdrawals may be severely restricted
and/or penalized. (See "Federal Tax Matters.")
DEATH BENEFIT. The Policy provides a Death Benefit if an Owner dies
before the Retirement Date. Upon the death of any Owner prior to the Retirement
Date, certain distribution requirements under Federal income tax laws will
apply. (See "Death Benefit.") The Death Benefit under the Policy will be paid
in a lump sum or under one of the Annuity Payment Options. (See
-2-
<PAGE>
"Death Benefit," and "Annuity Payments.") No Death Benefit will be paid if the
Annuitant or Owner dies after the Retirement Date unless provided for in the
Annuity Payment Option then in effect. (See "Death Benefit.")
If death of the Annuitant occurs prior to the Retirement Date and the
Annuitant is also an Owner or a Joint Owner of the Policy, the rules governing
distribution of death benefit proceeds in the event of the death of the Owner
shall apply. (See "Death Benefit.")
An Optional Death Benefit Rider is available for an extra charge of 0.17%
annually of the average death benefit amount. (See "Death Benefit.")
CHARGES AND DEDUCTIONS. United Investors does not impose any charge or
deduction against a Purchase Payment prior to its allocation to the Variable
Account or Fixed Account (except for a charge for any premium taxes incurred at
the time the Purchase Payment is accepted). Deductions are made from the values
in the Investment Divisions and the Fixed Account to pay for various expenses
and risks that we incur.
A sales charge in the form of a withdrawal charge ("Withdrawal Charge") is
assessed against each Purchase Payment withdrawn or applied under an Annuity
Payment Option within six years after the Purchase Payment is received. The
Withdrawal Charge is 7% of Purchase Payments less than two years old, and
decreases to 3% on Purchase Payments that are 5 years old. Purchase Payments 6
years old or older are not subject to Withdrawal Charges. (See "Withdrawal
Charge.")
A Transaction Charge of up to $20 will apply if more than twelve
withdrawals are made in a Policy Year. (See "Transaction Charge.") Withdrawals
may be taxable and subject to a penalty tax. (See "Federal Tax Matters.")
An Annual Contract Maintenance Charge of $35 is made on each Policy
Anniversary and at the time a Policy is surrendered to partially compensate
United Investors for the cost of administering the Policy. This charge is
waived on any Policy Anniversary on which cumulative Purchase Payments less
withdrawals equals or exceeds $30,000. (See "Annual Contract Maintenance
Charge.") This annual deduction will be made from the variable Investment
Divisions in the same proportion that their values bear to the total Variable
Account Value. There is also a daily charge at an annual rate of 0.15% of the
daily value of the Investment Divisions, for the costs of administering the
Variable Account and the Policies. (See "Administration Fee.")
A daily charge, at an annual rate of 1.25% of the daily value of the
Investment Divisions, will be deducted from the Investment Divisions for United
Investors' assumption of certain mortality and expense risks incurred in
connection with the Policy. (See "Mortality and Expense Risk Charge.") There is
no Mortality and Expense Risk Charge for amounts in the Fixed Account.
SUMMARY OF FEES AND CHARGES. The following information summarizes the fees
and charges payable by the Owner of a Policy:
<TABLE>
<CAPTION>
CONTRACT OWNER TRANSACTION EXPENSES:
<S> <C>
Maximum Withdrawal Charge............................................ 7%
Maximum Transaction Charge (for each Withdrawal in excess
of 12 per Policy Year)............................................ $20
Transfer fee (maximum of 12 transfers in a Policy Year).............. $ 0
MAXIMUM ANNUAL CONTRACT MAINTENANCE CHARGE............................. $35
</TABLE>
VARIABLE ACCOUNT ANNUAL EXPENSES (expressed as a percentage of the average daily
net assets of each Investment Division of the Variable Account):
-3-
<PAGE>
<TABLE>
<S> <C>
Mortality and Expense Risk Charge................. 1.25%
Administration Fee................................ 0.15%
----
Total Variable Account Annual Expenses:............. 1.40%
</TABLE>
Optional Death Benefit Rider Charge: 0.17% (annually) of the average death
benefit amount
-4-
<PAGE>
PORTFOLIO ANNUAL EXPENSES (1)
(expressed as a percentage of net assets of each Portfolio) (2)
<TABLE>
<CAPTION>
TOTAL
PORTFOLIO
MANAGEMENT OTHER ANNUAL
FEE (3) EXPENSES (3) EXPENSES (3)
(after any (after any (after waiver or
PORTFOLIO waiver) reimbursement) reimbursement)
--------- ----------- -------------- ----------------
<S> <C> <C> <C>
TMK/United Funds, Inc.
Money Market Portfolio.................... 0.50% 0.11% 0.61%
Bond Portfolio............................ 0.53% 0.06% 0.59%
High Income Portfolio..................... 0.65% 0.06% 0.71%
Growth Portfolio.......................... 0.70% 0.03% 0.73%
Income Portfolio.......................... 0.70% 0.03% 0.73%
Small Cap Portfolio....................... 0.85% 0.06% 0.91%
Science and Technology Portfolio.......... 0.70% 0.03% 0.73%
Federated Insurance Series
Equity Income Fund II..................... 0.00% 0.85% 0.85%
Fund for U.S. Government Securities II.... 0.00% 0.80% 0.80%
Scudder Variable Life Investment Fund
International Portfolio................... 0.86% 0.19% 1.05%
Global Discovery Portfolio................ 0.16% 1.34% 1.50%
Dreyfus Variable Investment Fund
Capital Appreciation Portfolio............ 0.75% 0.05% 0.80%
Small Cap Portfolio....................... 0.75% 0.03% 0.78%
Growth and Income Portfolio............... 0.75% 0.03% 0.78%
Quality Bond Portfolio.................... 0.65% 0.08% 0.73%
MFS Variable Insurance Trust
Emerging Growth Series.................... 0.75% 0.25% 1.00%
Research Series........................... 0.75% 0.25% 1.00%
Utilities Series.......................... 0.75% 0.25% 1.00%
Warburg Pincus Trust
International Equity Portfolio............ .__% .__% .__%
Warburg Pincus Trust II
Fixed Income Portfolio.................... .__% .__% .__%
Global Fixed Income Portfolio............. .__% .__% .__%
</TABLE>
_________________________
(1) The Portfolio Annual Expenses shown above are assessed at the underlying
mutual fund level and are not direct charges against Variable Account assets
or reductions from Policy Value. These underlying Portfolio Annual Expenses
are taken into consideration in computing each underlying Portfolio's net
asset value which is the share price used to calculate the unit values of
the Investment Divisions of the Variable Account. The Management Fees and
Other Expenses, some of which are subject to fee waivers or expense
reimbursements, are more fully described in the prospectus for each
individual underlying mutual fund. The information relating to the
underlying Portfolio Annual Expenses was provided by the underlying mutual
fund and was not independently verified by United Investors.
-5-
<PAGE>
(2) The percentages are based on expenses incurred for the year ended December
31, 1996, except for the following new Portfolios, where the figures are
estimates for the year ending December 31, 1997: TMK/United Science and
Technology Portfolio; Federated Equity Income II Portfolio; Scudder Global
Discovery Portfolio; Warburg Pincus Fixed Income Portfolio; and Warburg
Pincus Global Fixed Income Portfolio.
(3) With respect to certain Portfolios, the Portfolio's investment adviser is
waiving part or all of its Management Fee and reimbursing part or all of the
Other Expenses. Absent the waiver or reimbursement, the expenses (1996
actual or 1997 estimated, as the case may be) of these Portfolios would have
been as indicated below:
<TABLE>
<CAPTION>
TOTAL
PORTFOLIO
MANAGEMENT OTHER ANNUAL
FEE EXPENSES EXPENSES
(before any (before any (before waiver or
PORTFOLIO waiver) reimbursement) reimbursement)
--------- ------------ -------------- ------------------
<S> <C> <C> <C>
Federated Equity Income Fund II..................... 0.75 % 1.07 % 1.82 %
Federated Fund for U.S. Government Securities II.... 0.60 % 1.21 % 1.81 %
Scudder International Portfolio..................... 0.875% .__ % .__ %
Scudder Global Discovery Portfolio.................. 0.975% .__ % .__ %
MFS Emerging Growth Series.......................... 0.75 % 0.41 % 1.16 %
MFS Research Series................................. 0.75 % 0.73 % 1.48 %
MFS Utilities Series................................ 0.75 % 2.00 % 2.75 %
Warburg Pincus International Equity Portfolio....... 1.00 % .__ % .__ %
Warburg Pincus Fixed Income Portfolio............... 0.50 % .__ % .__ %
Warburg Pincus Global Fixed Income Portfolio........ 1.00 % .__ % .__ %
</TABLE>
EXPENSE EXAMPLES. The purpose of the following Example Tables is to assist
the Owner in understanding the various costs and expenses that an Owner will
bear directly and indirectly. The Tables reflect charges and expenses of the
Variable Account and charges and expenses of the Portfolios for the year ended
December 31, 1996, where available, or estimates for new Portfolios (after any
fee waiver or expense reimbursement); the Portfolios' charges and expenses for
future years may be higher or lower. For more information on the charges
-6-
<PAGE>
summarized in these Tables, see "Charges and Deductions," and the Prospectuses
for the Portfolios.
EXAMPLE 1 (assuming basic death benefit)
If you surrender your contract at the end of the applicable time period, you
would pay the following expenses on a $1,000 investment, assuming 5% annual
return on assets:
<TABLE>
<CAPTION>
INVESTMENT DIVISION 1 YEAR 3 YEARS
------------------- ------- -------
<S> <C> <C>
TMK/United Money Market............................. $90.10 $124.75
TMK/United Bond..................................... $89.90 $124.15
TMK/United High Income.............................. $91.10 $127.77
TMK/United Growth................................... $91.30 $128.38
TMK/United Income................................... $91.30 $128.38
TMK/United Small Cap................................ $93.10 $133.79
TMK/United Science and Technology................... $91.30 $128.38
Federated Equity Income Fund II..................... $92.50 $131.99
Federated Fund for U.S. Government Securities II.... $92.00 $130.48
Scudder International............................... $94.50 $137.99
Scudder Global Discovery............................ $99.00 $151.40
Dreyfus Capital Appreciation........................ $92.00 $130.48
Dreyfus Small Cap................................... $91.80 $129.88
Dreyfus Growth and Income........................... $91.80 $129.88
Dreyfus Quality Bond................................ $91.30 $128.38
MFS Emerging Growth Series.......................... $94.00 $136.49
MFS Research Series................................. $94.00 $136.49
MFS Utilities Series................................ $94.00 $136.49
Warburg Pincus International Equity................. _____ _____
Warburg Pincus Fixed Income......................... _____ _____
Warburg Pincus Global Fixed Income.................. _____ _____
</TABLE>
-7-
<PAGE>
If you annuitize or do not surrender your contract, you would pay the
following expenses on a $1,000 investment, assuming 5% annual return on assets:
<TABLE>
<CAPTION>
INVESTMENT DIVISION 1 YEAR 3 YEARS
------------------- ------- -------
<S> <C> <C>
TMK/United Money Market............................ $20.10 $64.75
TMK/United Bond.................................... $19.90 $64.15
TMK/United High Income............................. $21.10 $67.77
TMK/United Growth.................................. $21.30 $68.38
TMK/United Income.................................. $21.30 $68.38
TMK/United Small Cap............................... $23.10 $73.79
TMK/United Science and Technology.................. $21.30 $68.38
Federated Equity Income Fund II.................... $22.50 $71.99
Federated Fund for U.S. Government Securities II... $22.00 $70.48
Scudder International.............................. $24.50 $77.99
Scudder Global Discovery........................... $29.00 $91.40
Dreyfus Capital Appreciation....................... $22.00 $70.48
Dreyfus Small Cap.................................. $21.80 $69.88
Dreyfus Growth and Income.......................... $21.80 $69.88
Dreyfus Quality Bond............................... $21.30 $68.38
MFS Emerging Growth Series......................... $24.00 $76.49
MFS Research Series................................ $24.00 $76.49
MFS Utilities Series............................... $24.00 $76.49
Warburg Pincus International Equity................ _____ _____
Warburg Pincus Fixed Income........................ _____ _____
Warburg Pincus Global Fixed Income................. _____ _____
</TABLE>
-8-
<PAGE>
EXAMPLE 2 (assuming optional death benefit)
If you surrender your contract at the end of the applicable time period, you
would pay the following expenses on a $1,000 investment, assuming 5% annual
return on assets:
<TABLE>
<CAPTION>
INVESTMENT DIVISION 1 YEAR 3 YEARS
------------------- ------- -------
<S> <C> <C>
TMK/United Money Market............................ $90.10 $128.22
TMK/United Bond.................................... $89.90 $127.61
TMK/United High Income............................. $91.10 $131.23
TMK/United Growth.................................. $91.30 $131.83
TMK/United Income.................................. $91.30 $131.83
TMK/United Small Cap............................... $93.10 $137.24
TMK/United Science and Technology.................. $91.30 $131.83
Federated Equity Income Fund II.................... $92.50 $135.44
Federated Fund for U.S. Government Securities II... $92.00 $133.94
Scudder International.............................. $94.50 $141.43
Scudder Global Discovery........................... $99.00 $154.82
Dreyfus Capital Appreciation....................... $92.00 $133.94
Dreyfus Small Cap.................................. $91.80 $133.33
Dreyfus Growth and Income.......................... $91.80 $133.33
Dreyfus Quality Bond............................... $91.30 $131.83
MFS Emerging Growth Series......................... $94.00 $139.93
MFS Research Series................................ $94.00 $139.93
MFS Utilities Series............................... $94.00 $139.93
Warburg Pincus International Equity................ _____ _____
Warburg Pincus Fixed Income........................ _____ _____
Warburg Pincus Global Fixed Income................. _____ _____
</TABLE>
If you annuitize or do not surrender your contract, you would pay the
following expenses on a $1,000 investment, assuming 5% annual return on assets:
<TABLE>
<CAPTION>
INVESTMENT DIVISION 1 YEAR 3 YEARS
------------------- ------- -------
<S> <C> <C>
TMK/United Money Market............................ $20.10 $68.22
TMK/United Bond.................................... $19.90 $67.61
TMK/United High Income............................. $21.10 $71.23
TMK/United Growth.................................. $21.30 $71.83
</TABLE>
-9-
<PAGE>
<TABLE>
<S> <C> <C>
TMK/United Income.................................. $21.30 $71.83
TMK/United Small Cap............................... $23.10 $77.24
TMK/United Science and Technology.................. $21.30 $71.83
Federated Equity Income Fund II.................... $22.50 $75.44
Federated Fund for U.S. Government Securities II... $22.00 $73.94
Scudder International.............................. $24.50 $81.43
Scudder Global Discovery........................... $29.00 $94.82
Dreyfus Capital Appreciation....................... $22.00 $73.94
Dreyfus Small Cap.................................. $21.80 $73.33
Dreyfus Growth and Income.......................... $21.80 $73.33
Dreyfus Quality Bond............................... $21.30 $71.83
MFS Emerging Growth Series......................... $24.00 $79.93
MFS Research Series................................ $24.00 $79.93
MFS Utilities Series............................... $24.00 $79.93
Warburg Pincus International Equity................ ----- -----
Warburg Pincus Fixed Income........................ ----- -----
Warburg Pincus Global Fixed Income................. ----- -----
</TABLE>
In addition, United Investors will deduct a charge for premium taxes when
they are incurred.
THESE EXAMPLES SHOULD NOT BE CONSIDERED REPRESENTATIONS OF PAST OR FUTURE
EXPENSES AND THE ACTUAL EXPENSES MAY BE HIGHER OR LOWER THAN THOSE SHOWN. The
$35 Annual Contract Maintenance Charge is reflected in these examples as a
charge of 0.13% of the net assets.
"FREE LOOK" PERIOD. You may cancel the Policy by returning it within 10
days after you receive it. When we receive the Policy we will cancel it and
generally refund the Policy Value plus any charges deducted prior to allocation
to the Investment Divisions or the Fixed Account. In some states, we will
instead refund all Purchase Payments that we have received. (See "Free Look
Period.") The Free Look Period may be extended where required by state
law.
OWNER INQUIRIES. All inquiries regarding the Policy should be addressed
or directed to the sales agent who sold the Policy or to United Investors'
Administrative Office at the following address:
United Investors Life Insurance Company
Administrative Office
P.O. Box 219065
Dallas, TX 75221-9065
Phone: (800) 453-1271
All inquiries should include the Policy number and the Annuitant's name and
Owner's name, if different.
* * *
-10-
<PAGE>
NOTE: The foregoing summary is qualified in its entirety by the detailed
information in the remainder of this Prospectus and in the
Prospectuses for the Portfolios, all of which should be referred to
for more detailed information. With respect to Qualified Policies, it
should be noted that the requirements of a particular retirement plan,
an endorsement to the Policy, or limitations or penalties imposed by
the Internal Revenue Code may impose limits or restrictions on
Purchase Payments, surrenders, distributions or benefits, or on other
provisions of the Policies, and this Prospectus does not describe any
such limitations or restrictions. (See "Federal Tax Matters.")
PUBLISHED RATINGS
We may publish in advertisements, sales literature, and reports to
Policyowners, the ratings and other information assigned to us by one or more
independent insurance industry analyst or rating organizations such as A.M. Best
Company, Standard & Poor's Corporation, and Weiss Research, Inc. These ratings
reflect the current opinion of an insurance company's financial strength and
operating performance in comparison to the norms for the insurance industry;
they do not reflect the strength, performance, or safety (or lack thereof) of
the Variable Account. The claims-paying ability rating as measured by Standard
& Poor's is an opinion of an operating insurance company's financial capacity to
meet the obligations of its insurance and annuity policies in accordance with
their terms.
-11-
<PAGE>
These ratings should not be considered as bearing on the investment performance
of the assets held in the Variable Account or the degree of risk associated with
an investment in the Variable Account.
UNITED INVESTORS LIFE INSURANCE COMPANY AND
RETIREMAP VARIABLE ACCOUNT
UNITED INVESTORS LIFE INSURANCE COMPANY
United Investors Life Insurance Company is a stock life insurance company
that was incorporated in the State of Missouri on August 17, 1981, as the
successor to a company of the same name established in Missouri on September 27,
1961. United Investors is a wholly-owned subsidiary of United Investors
Management Company (formerly TMK/United, Inc.), which in turn is indirectly
owned by Torchmark Corporation. United Investors is principally engaged in
offering life insurance and annuity contracts and is admitted to do business in
the District of Columbia and all states except New York.
RETIREMAP VARIABLE ACCOUNT
The RetireMAP Variable Account (the "Variable Account") is currently
divided into 21 Investment Divisions. Each Investment Division invests
exclusively in shares of a single mutual fund portfolio. Income and both
realized and unrealized gains or losses from the assets of each Investment
Division are credited to or charged against that Investment Division without
regard to income, gains or losses from any other Investment Division of the
Variable Account or arising out of any other business United Investors may
conduct.
Although the assets in the Variable Account are the property of United
Investors, the assets in the Variable Account attributable to the Policies are
not chargeable with liabilities arising out of any other business which United
Investors may conduct. The Variable Account was established by United Investors
as a segregated asset account on September 20, 1996. The Variable Account will
receive and invest the Purchase Payments allocated to it under the Policies.
The Variable Account has been registered as a unit investment trust under
the Investment Company Act of 1940 and meets the definition of a separate
account under the Federal securities law. Registration with the Securities and
Exchange Commission does not involve supervision of the management or investment
practices or policies of the Variable Account or United Investors by the
Commission.
THE FUNDS
Each Investment Division invests exclusively in a designated series of
shares, representing an interest in a particular Portfolio of one of several
Funds, which are summarized below. Within each Fund, the assets of each
Portfolio are held separate from the assets of the other Portfolios. Thus, each
Portfolio operates as a separate investment portfolio, and the income or losses
of one Portfolio have no effect on the investment performance of any other
Portfolio.
The investment objectives and policies of each Portfolio are summarized
below. There is no assurance that any of the Portfolios will achieve their
stated objectives. More detailed information, including a description of risks,
is in the Funds' prospectuses, which accompany this Prospectus and which should
be read carefully in conjunction with this Prospectus and retained.
The Funds are designed as investment vehicles for variable annuity or
variable life insurance contracts of various insurance companies. For more
information about the risks associated with the
-12-
<PAGE>
use of the same funding vehicle for both variable annuity and variable life
insurance contracts of various insurance companies, see the Funds' prospectuses.
The following 21 Portfolios of the Funds are currently offered to
Policyowners through the Investment Divisions of the Variable Account:
TMK/United Funds, Inc.
- ----------------------
TMK/United Money Market Portfolio seeks to maximize current income
consistent with stability of principal. It may invest in money market
securities such as bank obligations and instruments secured by bank obligations,
commercial paper and corporate debt obligations and obligations of the U.S. and
Canadian Governments or their respective agencies and instrumentalities.
Investments in the Money Market Portfolio are neither insured nor guaranteed by
the U.S. Government and there is no assurance that the portfolio will be able to
maintain a stable per share net asset value.
TMK/United Bond Portfolio seeks current income with an emphasis on
preservation of capital. It will invest primarily in debt securities of varying
yields, qualities, and maturities.
TMK/United High Income Portfolio primarily seeks high current income. As a
secondary goal it will seek capital growth when consistent with the primary
goal. It will invest primarily in high-yield, high risk fixed-income securities
(commonly known as "junk bonds"), but may have up to 20% of its assets in common
stocks. High-yield fixed-income securities may have an increased risk of
default and greater market price volatility than higher rated securities due to
various circumstances. See "Debt Securities" in the TMK/United Funds, Inc.
prospectus for a further description of the risk factors.
TMK/United Growth Portfolio primarily seeks capital growth. As a secondary
goal it will seek current income. It will invest primarily in common stocks or
securities convertible into common stocks.
TMK/United Income Portfolio seeks to maintain current income, subject to
market conditions. It will invest primarily in common stocks or securities
convertible into common stocks.
TMK/United Small Cap Portfolio seeks capital growth through a diversified
holding of securities, primarily in the common stocks of, or securities
convertible into the common stocks of, relatively new or unseasoned companies,
companies which are in their early stages of development or smaller companies
positioned in new and emerging industries where the opportunity for rapid growth
is above average.
TMK/United Science and Technology Portfolio seeks long-term capital growth
through investments primarily in science and technology securities.
Federated Insurance Series
- --------------------------
Federated Equity Income Fund II's investment objective is to provide above
average income and capital appreciation. It attempts to achieve its objectives
by investing at least 65% of its assets
-13-
<PAGE>
in income-producing equity securities.
Federated Fund for U.S. Government Securities II seeks current income by
investing in a professionally managed, diversified portfolio limited to U.S.
government securities (i.e., securities issued or guaranteed as to payment of
principal and interest by the U.S. government, its agencies or
instrumentalities).
Scudder Variable Life Investment Fund
- -------------------------------------
Scudder International Portfolio seeks long-term growth of capital
principally through diversified holdings or marketable foreign equity
investments. It invests in companies, wherever organized, which do business
primarily outside the limited states. It invests primarily in equity securities
of established companies, listed on foreign exchanges.
Scudder Global Discovery Portfolio seeks above-average capital appreciation
over the long term by investing primarily in the equity securities of small
companies located throughout the world. It generally invests in small, rapidly
growing companies that offer the potential for above-average returns relative to
larger companies, yet are frequently overloaded and thus undervalued by the
market.
Dreyfus Variable Investment Fund
- --------------------------------
Dreyfus Capital Appreciation Portfolio's primary investment objective is to
provide long-term capital growth consistent with the preservation of capital;
current income is a secondary investment objective. This series invests
primarily of common stocks of domestic and foreign issuers.
Dreyfus Small Cap Portfolio's investment objective is to maximize capital
appreciation. This series invests primarily in common stocks of domestic and
foreign issuers. This series will be particularly alert to emerging smaller-
sized companies which are believed to be characterized by new or innovative
products, services or processes which should enhance prospects for growth in
future earnings.
Dreyfus Growth and Income Portfolio's investment objective is to provide
long-term capital growth, current income and growth of income, consistent with
reasonable investment risk. This series invests primarily in equity securities,
debt securities and money market instruments of domestic and foreign
issuers.
Dreyfus Quality Bond Portfolio's investment objective is to provide the
maximum amount of current income to the extent consistent with the preservation
of capital and the maintenance of liquidity. This series principally in debt
obligations of corporations, the U.S. Government and its agencies and
instrumentalities, and U.S. major banking institutions.
MFS Variable Insurance Trust
- ----------------------------
MFS Emerging Growth Series seeks long-term growth of capital. Dividend and
interest income from portfolio securities, if any, is incidental to the series'
investment objective of long-term
-14-
<PAGE>
growth of capital. The series' policy is to invest primarily in common stocks of
companies that are early in their life cycles but which are believed to have the
potential to become major enterprises (emerging growth companies). The series
may also invest in more-established companies whose earnings growth are expected
to accelerate due to unique opportunities.
MFS Research Series seeks to provide long-term growth of capital and future
income. The series is an equity portfolio combining U.S. and foreign stocks of
all sizes and many industries. The series is managed by a committee of equity
research analysts, rather than by an individual manager. Each analyst presents
his or her "best idea." Industry and sector weightings are then reviewed by the
committee as a whole. This system of individual expertise balanced by consensus
can open doors to many equity opportunities.
MFS Utilities Series seeks capital growth and current income (income above
that available from a portfolio invested entirely in equity securities). This
series takes a balanced approach to investing. The series, under normal
circumstances, will have at least 65% of its assets (but up to 100% at the
discretion of the manager) allocated between stocks and bonds of both domestic
and foreign companies, primarily in the utilities industry. The manager has the
flexibility to invest up to 35% of the series' net assets in foreign
securities.
Warburg Pincus Trust
- --------------------
Warburg Pincus International Equity Portfolio's investment objective is to
seek long-term capital appreciation. It pursues its investment objective by
investing primarily in a broadly diversified portfolio of equity securities of
companies, wherever organized, that have their principal business activities and
interests outside the United States.
Warburg Pincus Trust II
- -----------------------
Warburg Pincus Fixed Income Portfolio seeks total return consistent with
prudent investment management. It pursues its investment objective by
investing, under normal market conditions, at least 65% of its total assets in
fixed income securities.
Warburg Pincus Global Fixed Income Portfolio seeks total return consistent
with prudent investment management, consisting of combination of interest
income, currency gains and capital appreciation. It pursues its objective by
investing, under normal market conditions, at least 65% of its total assets in
fixed income obligations of governmental and corporate issuers denominated in
various currencies.
FUND MANAGEMENT AND FEES
TMK/United Money Market, Bond, High Income, Growth, Income, Small Cap, and
Science and Technology Portfolios. Waddell & Reed Investment Management Company
("W&R") is the manager of TMK/United Funds, Inc. and provides investment
advisory services to that Fund. W&R is a wholly-owned subsidiary of Waddell &
Reed, Inc. which is a direct subsidiary of Waddell & Reed Financial Services,
Inc. and an indirect subsidiary of United Investors Management Company and
Torchmark Corporation. Each Portfolio pays W&R a fee for managing its
investments consisting of two elements: (i) a specific fee computed on each
Portfolio's net asset value at the close of business each day at the following
annual rates:
-15-
<PAGE>
<TABLE>
<CAPTION>
Specific Fee
Annual Rate
Portfolio (% of net assets)
--------- -----------------
<S> <C>
Money Market none
Bond 0.03%
High Income 0.15%
Growth 0.20%
Income 0.20%
Small Cap 0.35%
Science and Technology 0.20%
</TABLE>
and (ii) a pro rata participation based on the relative net asset size of each
Portfolio in a "Group" fee computed each day on the combined net asset values of
all of the Portfolios of TMK/United Funds, Inc. at the following annual rates:
<TABLE>
<CAPTION>
Group Fee
Group Net Asset
Annual Rate
Level ($ millions) (% of net assets)
------------------ -----------------
<S> <C>
$0 - $750 0.51%
$750 - $1,500 0.49%
$1,500 - $2,250 0.47%
over $2,250 0.45%
</TABLE>
Federated Equity Income Fund II and Fund for U.S. Government Securities II.
Federated Advisers is the investment adviser of Federated Insurance Series and
provides investment advisory services to the Fund. Federated Advisers is a
subsidiary of Federated Investors, whose voting shares are owned by a trust
whose trustees are the Chairman of Federated Investors, his wife, and his son.
Each Portfolio pays Federated Advisers a fee for managing its investments at the
following annual rates:
<TABLE>
<CAPTION>
Advisory Fee
Annual Rate
Portfolio (% of net assets)
--------- -----------------
<S> <C>
Equity Income Fund II 0.75%
Fund for U.S. Government Securities II 0.60%
</TABLE>
Scudder International and Global Discovery Portfolios. Scudder, Stevens &
Clark, Inc. ("Scudder"), is the investment adviser of Scudder Variable Life
Investment Fund and provides investment advisory services to that Fund. Each
Portfolio pays Scudder a fee for managing its investments at the following
annual rates:
<TABLE>
<CAPTION>
Advisory Fee
Annual Rate
Portfolio (% of net assets)
--------- -----------------
<S> <C>
International 0.875%
Global Discovery 0.975%
</TABLE>
-16-
<PAGE>
Dreyfus Capital Appreciation, Small Cap, Growth and Income, and Quality
Bond Portfolios. The Dreyfus Corporation ("Dreyfus") is the investment adviser
of Dreyfus Variable Investment Fund and provides investment advisory services to
that Fund. Dreyfus is a wholly-owned subsidiary of Mellon Bank, N.A., which is
a wholly-owned subsidiary of Mellon Bank Corporation. Fayez Sarofim & Co. is
the sub-investment adviser of the Capital Appreciation Portfolio, for which it
provides investment advisory assistance and day-to-day management. Each
Portfolio pays investment management fees at the following annual rates:
<TABLE>
<CAPTION>
Advisory Fee
Annual Rate
Portfolio (% of net assets)
--------- -----------------
<S> <C>
Capital Appreciation 0.75%
Small Cap 0.75%
Growth and Income 0.75%
Quality Bond 0.65%
</TABLE>
MFS Emerging Growth, Research, and Utilities Series. Massachusetts
Financial Services Company ("MFS") is the investment adviser of MFS Variable
Insurance Trust and provides investment advisory services to that Fund. MFS is
a subsidiary of Sun Life of Canada (U.S.), which in turn is a wholly-owned
subsidiary of Sun Life Assurance Company of Canada. Each Portfolio pays MFS a
fee for managing its investments at the following annual rates:
<TABLE>
<CAPTION>
Advisory Fee
Annual Rate
Portfolio (% of net assets)
--------- -----------------
<S> <C>
Emerging Growth Series 0.75%
Research Series 0.75%
Utilities Series 0.75%
</TABLE>
Warburg Pincus Fixed Income, Global Fixed Income, and International Equity
Portfolios. Warburg, Pincus Counsellors, Inc. ("Warburg"), is the investment
adviser of Warburg Pincus Trust and Warburg Pincus Trust II and provides
investment advisory services to those Funds. Warburg is a wholly-owned
subsidiary of Warburg, Pincus Counsellors G.P. and is controlled by E.M.
Warburg, Pincus & Co., Inc. Each Portfolio pays Warburg a fee for managing its
investments at the following annual rates:
<TABLE>
<CAPTION>
Advisory Fee
Annual Rate
Portfolio (% of net assets)
--------- -----------------
<S> <C>
International Equity Portfolio 1.00%
Fixed Income Portfolio 0.50%
Global Fixed Income Portfolio 1.00%
</TABLE>
FIXED ACCOUNT
THAT PORTION OF THE POLICY RELATING TO THE FIXED ACCOUNT IS NOT REGISTERED
UNDER THE SECURITIES ACT OF 1933 ("1933 ACT") AND THE FIXED ACCOUNT IS NOT
REGISTERED AS AN INVESTMENT COMPANY UNDER THE INVESTMENT COMPANY ACT OF 1940
("1940 ACT"). ACCORDINGLY, NEITHER THE FIXED ACCOUNT NOR ANY INTERESTS THEREIN
ARE SUBJECT TO THE PROVISIONS OR RESTRICTIONS OF THE 1933 ACT OR THE 1940 ACT,
AND THE DISCLOSURE REGARDING THE FIXED ACCOUNT HAS NOT BEEN REVIEWED BY THE
STAFF OF THE SECURITIES AND EXCHANGE COMMISSION.
-17-
<PAGE>
The Fixed Account is a part of the General Account of United Investors Life
Insurance Company. The General Account consists of all assets of United
Investors Life Insurance Company other than those in any separate account. We
guarantee that we will credit interest at a rate of not less than the Guaranteed
Minimum Interest Rate of 4% per year to amounts allocated to the Fixed Account.
We may credit interest at a rate in excess of the Guaranteed Minimum Interest
Rate. ANY EXCESS INTEREST CREDITED WILL BE DETERMINED IN OUR SOLE DISCRETION.
THE OWNER ASSUMES THE RISK THAT INTEREST CREDITED TO FIXED ACCOUNT ALLOCATIONS
MAY NOT EXCEED THE GUARANTEED MINIMUM INTEREST RATE. The Fixed Account may not
be available in all states. (See "Fixed Account" in the Statement of Additional
Information.)
The Policyowner determines the allocation of Purchase Payments and Policy
Value to the Fixed Account. Prior to the Retirement Date, the Policyowner may
transfer all or part of the values held in the Fixed Account to one or more of
the Investment Divisions of the Variable Account, subject to certain
restrictions. (See "Transfers.") After the Retirement Date, transfers from the
Fixed Account to the Investment Divisions of the Variable Account are not
allowed. After the Retirement Date values held in the Investment Divisions of
the Variable Account may be transferred to the Fixed Account not more often than
once per policy year. (See "Transfers.")
THE POLICY
The Policy is a Deferred Variable Annuity. The rights and benefits of the
Policy are described below and in the Policy. The obligations under the
Policies are obligations of United Investors. However, United Investors
reserves the right to make any modification to conform the Policy to, or to give
the Owner the benefit of, any Federal or state statute or rule or regulation.
The Policy may be purchased on a non-qualified tax basis ("Nonqualified
Policy"). The Policy may also be purchased and used in connection with plans
qualifying for favorable Federal income tax treatment ("Qualified Policy").
ISSUANCE OF A POLICY
Individuals wishing to purchase a Policy must complete an application and
send it to United Investors' Administrative Office. Acceptance is subject to
United Investors' rules, and United Investors reserves the right to reject any
application or Purchase Payment. If the application can be accepted in the form
received, the initial Purchase Payment will be applied within two Valuation
Dates after the latter of receipt of the application or receipt of the initial
Purchase Payment. If the initial Purchase Payment, plus any accrued interest,
cannot be applied because the application is incomplete or for any other reason,
the applicant will be contacted and given an explanation for the delay and the
initial Purchase Payment will be returned within five Valuation Dates after
receipt unless the applicant consents to United Investors' retaining the initial
Purchase Payment and applying it as soon as the necessary requirements are
fulfilled. No Policy will be issued if either the Annuitant or the Owner are
over age 85 last birthday on the date the application is signed. Coverage will
only become effective on the Policy Date.
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PURCHASE PAYMENTS
The minimum initial Purchase Payment for Nonqualified Policies is $2,000.
For Qualified Policies, the initial Purchase Payment must be at least $1,200 (as
an exception for Qualified Policies, if Purchase Payments will be made by means
of a bank draft authorization or a group payment method approved in advance by
us, we will accept installments of $100 per month totaling at least $1,200 in
the first year). Additional Purchase Payments may be made in amounts of $100 or
more.
ALLOCATION OF PURCHASE PAYMENTS
The Policyowner determines in the application how the initial Net Purchase
Payment will be allocated among the Investment Divisions of the Variable Account
and the Fixed Account. You may allocate any whole percentage of Net Purchase
Payments, from 0% to 100%. Between the date that the initial Purchase Payment
was received and the Policy Date, interest will be credited on the Purchase
Payment as if it had been invested in the Money Market Investment Division.
If we receive an additional purchase payment, the Net Purchase Payment will
be allocated to the Investment Divisions and the Fixed Account as of the
Valuation Date it is received by United Investors at its Home Office according
to the allocation percentage specified in your application, unless subsequently
changed.
The Policy Value will vary with the investment performance of the
Investment Divisions you select, and you bear the entire risk for amounts
allocated to the Variable Account. You should periodically review your
allocations of Policy Value in light of all relevant factors, including market
conditions and your overall financial planning requirements.
POLICY VALUE
The Policy Value prior to the Retirement Date is equal to the Variable
Account Value plus the Fixed Account Value. Variable Account Values are not
guaranteed. The Variable Account Value is equal to the sum of the values of the
Investment Divisions of the Variable Account under the Policy. The value of
each Investment Division is calculated first on the Policy Date and thereafter
on each Valuation Date (a normal business day).
Variable Account Value. On the Policy Date, the value of the Investment
Divisions is equal to the amount of the initial Net Purchase Payment allocated
to the Investment Divisions of the Variable Account plus any accrued interest
from the date of the receipt of the initial Purchase Payment to the Policy Date.
On any Valuation Date thereafter, the value of each Investment Division equals:
(1) the value of the Investment Division on the previous Valuation Date, as
increased or decreased by the investment experience and daily charges for
the Investment Division during the current Valuation Period; plus
(2) the amount of any Net Purchase Payments allocated to the Investment
Division during the current Valuation Period; plus
(3) the amount of any transfers from other Investment Divisions or from the
Fixed Account to the Investment Division during the current Valuation
Period; minus
(4) the amount of any withdrawals (including any Withdrawal Charge or
Transaction Charge) from the Investment Division during the current
Valuation Period; minus
(5) the amount of any transfers from the Investment Division to other
Investment Divisions or to the Fixed Account during the current Valuation
Period; minus
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(6) the portion of the Annual Contract Maintenance Charge (and Optional
Death Benefit Rider Charge, if applicable) allocated to the Investment
Division during the current Valuation Period; minus
(7) the portion of any deduction for premium taxes allocated to the Investment
Division during the current Valuation Period.
Fixed Account Value. At the end of any Valuation Period, the Fixed Account
Value is equal to:
(1) the Fixed Account Value at the end of the previous Valuation Period;
plus
(2) the sum of all Net Purchase Payments allocated to the Fixed Account during
the current Valuation Period; plus
(3) any amounts transferred from the Variable Account to the Fixed Account
during the current Valuation Period; plus
(4) total interest credited to the Fixed Account during the current Valuation
Period; minus
(5) any amounts transferred from the Fixed Account to the Variable Account
during the current Valuation Period; minus
(6) the portion of any withdrawals, Withdrawal Charges, and Transaction Charges
allocated to the Fixed Account during the current Valuation Period;
minus
(7) the portion of the Optional Death Benefit Rider Charge (if applicable)
allocated to the Fixed Account during the current Valuation Period;
minus
(8) the portion of any deduction for premium taxes which is allocated to the
Fixed Account during the current Valuation Period.
SURRENDER AND PARTIAL WITHDRAWALS
Withdrawals. You may make a partial withdrawal from the Policy Value,
prior to the Retirement Date, by sending a Written Request to United Investors
at its Home Office. A partial withdrawal must be for at least $100, and the
Policy Value must be at least $1,000 after a partial withdrawal. If the Policy
Value would be less than $1,000, we will treat the request for a partial
withdrawal as a request for total surrender. A withdrawal will ordinarily be
paid within seven days of receipt of the Written Request (unless the check for
your Purchase Payment has not yet cleared your bank). United Investors may
defer payment of any amounts from the Fixed Account for up to six months from
the date of the request to surrender. If United Investors defers payment for
more than 30 days, United Investors will pay interest on the amount deferred at
a rate not less than the Guaranteed Minimum Interest Rate.
If you do not specify that the partial withdrawal is to be made from
particular Investment Divisions or the Fixed Account, the partial withdrawal
will be made from the Fixed Account and the Variable Investment Divisions in the
same proportion that their values bear to the total Policy Value.
You may request up to 12 withdrawals per Policy Year without a Transaction
Charge. If more than 12 withdrawals are requested during a Policy Year, there
will be a $20 Transaction Charge (or 2% of the amount withdrawn, if less) for
each withdrawal in addition to the 12 withdrawals. Also, Withdrawal Charges of
up to 7% may apply, but each Policy Year you can withdraw up to 10% of the
Policy Value without charge. (See "Withdrawal Charge" and "Transaction
Charge.") Any Transaction Charge or Withdrawal Charge applicable to a
withdrawal will be deducted from the remaining Policy Value, or from the amount
paid if the remaining value is insufficient. No withdrawals may be made after
the Retirement Date.
Partial withdrawals may be subject to the 10% Federal tax penalty on early
withdrawals and to income tax. (See "Federal Tax Matters.")
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Automatic Partial Withdrawals. You may also establish automatic partial
withdrawals prior to the Retirement Date, by submitting a one-time Written
Request. Withdrawals may be in fixed dollar amount on a monthly, quarterly,
semi-annual or annual basis. The minimum amount of an automatic partial
withdrawal is $100. The maximum amount of automatic partial withdrawals in any
one policy year is 10% of the Policy Value.
Automatic partial withdrawals are subject to all the other contract
provisions and terms. If an additional withdrawal is made from a contract
participating in automatic partial withdrawals, the automatic partial
withdrawals will terminate automatically and may be resumed only on or after the
next policy anniversary.
Automatic partial withdrawals may be subject to the 10% Federal tax penalty
on early withdrawals and to income tax. (See "Federal Tax Matters.")
Surrender. You may surrender the Policy for its Surrender Value, which is
the Policy Value less any Withdrawal Charge, the Annual Contract Maintenance
Charge, the Optional Death Benefit Rider Charge (if applicable) and applicable
deductions for premium taxes by sending a Written Request to United Investors at
its Home Office. (The Withdrawal Charge, described below, is only applicable if
a surrender occurs in the first six Policy Years following receipt of a Purchase
Payment.) The Annual Contract Maintenance Charge, described below, is assessed
when a surrender occurs. A surrender will ordinarily be paid within seven days
of receipt of the Written Request (unless the check for your Purchase Payment
has not yet cleared your bank). The Policy will terminate as of the date of
receipt of Written Request for surrender. Surrenders are generally taxable
transactions, and may be subject to a 10% penalty tax. (See "Federal Tax
Matters.") No surrender may be made after the Retirement Date.
Restrictions Under the Texas Optional Retirement Program and Section 403(b)
Plans. The Texas Educational Code permits participants in the Texas Optional
Retirement Program ("ORP") to withdraw or surrender their interest in a variable
annuity contract issued under the ORP only upon (1) termination of employment in
the Texas public institutions of higher education, (2) retirement, or (3) death.
Accordingly, a participant in the ORP (or the participant's estate if the
participant has died) will be required to obtain a certificate of termination
from the employer or a certificate of death before the account can be redeemed.
Similar restrictions apply to variable annuity contracts used as funding
vehicles for Internal Revenue Code Section 403(b) retirement plans. Section
403(b) of the Internal Revenue Code provides for tax-deferred retirement savings
plans for employees of certain non-profit and educational organizations. In
accordance with the requirements of Section 403(b), any Policy used for a
Section 403(b) plan will prohibit distributions of (i) elective contributions
made in years beginning after December 31, 1988, and (ii) earnings on those
contributions and (iii) earnings on amounts attributable to elective
contributions held as of the end of the last year beginning before January 1,
1989. However, distributions of such amounts will be allowed upon death of the
employee, attainment of age 59-1/2, separation from service, disability, or
financial hardship, except that income attributable to elective contributions
may not be distributed in the case of hardship.
Restrictions Under Other Qualified Policies. Other restrictions on
surrenders or with respect to the election, commencement, or distribution of
benefits may apply under Qualified Policies or under the terms of the plans in
respect of which Qualified Policies are issued.
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TRANSFERS
You may transfer all or part of the value of an Investment Division to one
or more of the other Investment Divisions or to the Fixed Account at any time
prior to the Retirement Date, except as described below. You may transfer all
or a part of the values held in the Fixed Account to one or more of the variable
Investment Divisions once per Policy Year prior to the Retirement Date. This
restriction will not apply to automatic monthly transfers of a preselected
dollar amount from the Fixed Account to the Investment Divisions of the Variable
Account. The amount transferred from the Fixed Account to a variable Investment
Division may not exceed the greater of: (a) 25% of the prior Policy
Anniversary's Fixed Account Value; or (b) the amount of the prior Policy Year's
transfer. You may transfer all or a part of the values held in the variable
Investment Divisions to one or more variable Investment Divisions or to the
Fixed Account up to twelve times in a Policy Year prior to the Retirement Date.
However, if a transfer is made from the Fixed Account to any variable Investment
Division, no transfer from any variable Investment Division to the Fixed Account
may be made for six months from the transfer date. The value remaining in the
variable Investment Division or the Fixed Account after a transfer must not be
less than $250. If the value remaining would be less than $250, the transfer
request will be treated as a request for a transfer of the total value.
Transfers may be made by a Written Request or by calling United Investors
if a written authorization for telephone transfers is on file. United Investors
has the authority to honor any telephone transfer request believed to be
authentic. We employ reasonable procedures to confirm that instructions
communicated by telephone are genuine. A personal identification number is
required in order to initiate a transfer. United Investors will not be liable
for the consequences of a fraudulent telephone transfer request we believe to be
authentic when we have followed those procedures. And as a result, you bear the
risk of loss arising from such a fraudulent request if you authorize telephone
transfers.
Each transfer will be made, without the imposition of any fee or charge, at
the end of the Valuation Period during which United Investors receives a valid,
complete transfer request. United Investors may suspend or modify this transfer
privilege at any time.
Transfers from the Fixed Account to the variable Investment Divisions are
not allowed after the Retirement Date. The Annuitant may transfer values among
the variable Investment Divisions or from the variable Investment Divisions to
the Fixed Account once per Policy Year after the Retirement Date. (See
"Available Options.")
DOLLAR COST AVERAGING
Prior to the Retirement Date you may authorize automatic transfers of a
fixed dollar amount from the Fixed Account or the Money Market Investment
Division to up to four of the other Investment Divisions of the Variable
Account. Automatic transfers will be made on a monthly basis on the day of the
month selected in your application. If the day of the month selected does not
fall on a Valuation Date, transfers will be made on the next following Valuation
Date. Transfers will be made at the unit values determined on the date of each
transfer.
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The minimum automatic transfer amount is $100. If the transfer is to be
made to more than one Investment Division, a minimum of $25 must be transferred
to each Investment Division selected.
Participation in the automatic transfer program does not guarantee a
greater profit nor does it protect against loss in declining markets. Automatic
transfers will not be counted as a transfer for purposes of the twelve transfer
limit specified in Transfers above. There is no charge for this service.
DEATH BENEFIT
The Policy pays a Death Benefit to the Beneficiary if an Owner dies prior
to the Retirement Date while the Policy is in force. (If an Owner is not a
natural person, the Death Benefit is payable on the death of the first Annuitant
to die.) The Policy provides a Basic Death Benefit, but an Optional Death
Benefit Rider is available for an extra charge.
BASIC DEATH BENEFIT. The Basic Death Benefit payable on the death of the
Owner (or the Annuitant if the Owner is not a natural person) through attained
age 75 is the greatest of:
(a) the Policy Value;
(b) the total Purchase Payments made, adjusted for any amounts withdrawn
and any Withdrawal Charges on the amounts withdrawn; and
(c) the highest of the Policy Values as of the 2nd, 4th, or 6th Policy
Anniversaries, and every 6th Policy Anniversary thereafter. Purchase
Payments made after the Policy Anniversary having the highest Policy
Value will be added to the Death Benefit, and adjustments will be
made for any amounts withdrawn and any Withdrawal Charges since that
anniversary.
Adjustment for a withdrawal and Withdrawal Charges will reduce the Death
Benefit in the same proportion that the amount reduced the Policy Value on the
date of the withdrawal.
The Basic Death Benefit payable on the death of the Owner (or the Annuitant
if the Owner is not a natural person) after attained age 75 is the greater of
(a) and (b) above.
OPTIONAL DEATH BENEFIT RIDER. This rider is optional and will be available
for an additional annual charge of 0.17% of the average death benefit. (See
"Charges and Deductions.") The Death Benefit payable on the death of the Owner
(or the Annuitant if the Owner is not a natural person) through attained age 75
will be the greater of:
(a) the Policy Value; and
(b) the total Purchase Payments made, less withdrawals and Withdrawal
Charges, accumulated at an annual effective rate of 5%, subject to a
cap of 200% of Purchase Payments less withdrawals and Withdrawal
Charges.
The Death Benefit payable on the death of the Owner (or the Annuitant if
the Owner is not a natural person) after attained age 75 will be equal to the
amount of the Death Benefit on the Policy Anniversary on which age 76 is
attained and will not increase thereafter.
Note that the Optional Death Benefit could be lower than the Basic Death
Benefit, if the Policy Value had increased by greater than 5% annually and then
declined due to investment performance.
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GENERAL. We will compute the amount of the Death Benefit as of the date
the Death Benefit is paid or applied under one of the Annuity Payment Options.
We will pay the Death Benefit proceeds to the Beneficiary upon receiving due
proof of death. The Death Benefit under the Policy will be paid in a lump sum
or under one of the Annuity Payment Options. (See "Annuity Payments.") If the
Annuitant or Owner dies after the Retirement Date, the amount payable, if any,
will be as provided in the Annuity Payment Option then in effect.
If an Annuitant dies before the Retirement Date and such Annuitant is also
an Owner, or if an Owner is other than a natural person, the death will be
treated as the death of an Owner and the Death Benefit will be payable to the
Beneficiary. If an Annuitant dies before the Retirement Date and all Owners are
natural persons other than the deceased Annuitant, the Owner may name a new
Annuitant, subject to our age limitations, and the Death Benefit will not be
payable. If the Owner does not name a new Annuitant, the Owner will
automatically become the Annuitant and the Death Benefit will not be
payable.
In the event of an Owner's death, the entire Death Benefit proceeds must be
distributed within five years after the date of death. If the Beneficiary
chooses to take any portion of his interest in the Policy as an Annuity,
distributions must commence within one year of the date of death and must be
distributed over his lifetime or over a period not extending beyond his life
expectancy.
If the Beneficiary is the Owner's spouse, then in lieu of receiving the
Death Benefit proceeds, the spouse may elect to continue the Policy in force and
be treated as the original Policy Owner. If the Beneficiary elects to continue
the Policy, the Beneficiary does not have a right to receive the Death Benefit
proceeds and we will increase the Policy Value so that it equals the Death
Benefit, if greater.
As far as permitted by law, the Death Benefit proceeds under the Policy
will not be subject to any claim of the Beneficiary's creditors.
"FREE LOOK" PERIOD
If for any reason you are not satisfied with the Policy, you may return it
to us within 10 days after you receive the Policy. If you cancel the Policy
within this 10-day "Free Look" period, we will generally refund the Policy Value
plus any charges deducted prior to allocation to the Investment Divisions or the
Fixed Account, and the Policy will be void from the Policy Date. In some
states, the full amount of Purchase Payment(s) received will be refunded
instead. To cancel the Policy, you must mail or deliver it to either United
Investors' Home Office or the registered agent who sold it within 10 days after
you receive it. (See "Allocation of Purchase Payments.") The "Free Look"
period may be extended where required by state law.
CHARGES AND DEDUCTIONS
United Investors does not impose any charge or deduction against a Purchase
Payment prior to its allocation to the Variable Account or the Fixed Account
(except for a charge for any premium taxes incurred when the Purchase Payment is
accepted). However, certain charges (explained below) will be deducted in
connection with the Policy to compensate United Investors for administering and
distributing the Policy, for providing the insurance benefits set forth in the
Policy, for assuming certain risks in connection with the Policy, and for any
applicable taxes.
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WITHDRAWAL CHARGE
If you make partial withdrawals under the Policy or surrender the Policy,
then a Withdrawal Charge may be made, measured as a percent of the Purchase
Payments included in the withdrawal (in the case of a partial withdrawal) or the
amount of the total Purchase Payments (in the case of a surrender) as specified
in the following table of Withdrawal Charges:
NUMBER OF POLICY ANNIVERSARIES 6 OR
SINCE RECEIPT OF PURCHASE PAYMENT: 0 1 2 3 4 5 MORE
- ---------------------------------- - - - - - - ----
Withdrawal Charge Rate 7% 7% 6% 6% 4% 3% none
Each Policy Year, you may withdraw up to 10% of Policy Value without
incurring a Withdrawal Charge. This 10% portion is called the Free Withdrawal
Amount. Amounts withdrawn in addition to the Free Withdrawal Amount may be
subject to a Withdrawal Charge. The Withdrawal Charge is determined by
multiplying each Purchase Payment included in the withdrawal by the withdrawal
charge rate applicable to the year in which the Purchase Payment was received.
For purposes of calculating the Withdrawal Charge, (1) the oldest Purchase
Payments will be treated as the first withdrawn, newer Purchase Payments next,
and appreciation last; (2) amounts withdrawn up to the Free Withdrawal Amount
will not be considered a withdrawal of Purchase Payments; and (3) if the
Surrender Value is withdrawn, the Withdrawal Charge will apply to all Purchase
Payments not previously assessed with a Withdrawal Charge.
As shown above, the Withdrawal Charge percentage varies, depending on the
"age" of the Purchase Payments included in the withdrawal--that is, the Policy
Year in which the Purchase Payment was made. A Withdrawal Charge Rate of 7%
applies to Purchase Payments withdrawn that are less than 2 years old.
Thereafter the Withdrawal Charge Rate decreases each year until the Purchase
Payment withdrawn is 6 years old or older. Amounts representing Purchase
Payments 6 years old or older may be withdrawn without charge.
The Withdrawal Charge will be deducted from the remaining Policy Value, or
from the amount paid if the remaining value is insufficient. The Withdrawal
Charge partially compensates United Investors for sales expenses with regard to
the Policy, including agent sales commissions, the cost of printing prospectuses
and sales literature, advertising, and other marketing and sales promotional
activities.
WAIVER OF WITHDRAWAL CHARGES RIDER
If the Waiver of Withdrawal Charges Rider ("Rider") is attached to your
Policy, we may waive the withdrawal charges described above provided that the
conditions described in the Rider are met, including:
(a) the Owner or the Owner's spouse is continuously confined to a "Nursing
Home," "Hospital," or "Hospice Care Program" (as defined in the Rider)
for a combined stay of at least 30 days within a 35 day period;
(b) such confinement must have totally occurred after the Policy Date;
and
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(c) written notice and satisfactory proof of confinement are received no
later than 60 days after confinement ends.
Waiver of Withdrawal Charges is subject to all of the conditions and provisions
of the Rider. (See your Policy.) The Rider is not available in all states.
There is no charge for this Rider.
ANNUAL CONTRACT MAINTENANCE CHARGE
United Investors deducts an annual charge of $35 to partially compensate us
for expenses incurred in administering the Policy. These expenses include costs
of maintaining records, processing Death Benefit claims, surrenders, transfers
and Policy changes, providing reports to Policyowners, and overhead costs. This
charge is waived on any Policy Anniversary on which the cumulative Purchase
Payments less withdrawals equals or exceeds $30,000. This charge is guaranteed
not to increase during the life of the Policy. This deduction will be made from
the variable Investment Divisions in the same proportion that their values bear
to the Variable Account Value. Prior to the Retirement Date, this charge is
deducted on each Policy Anniversary and on a full surrender. After the
Retirement Date, this charge is not deducted.
ADMINISTRATION FEE
In addition to the Annual Contract Maintenance Charge, United Investors
deducts a daily charge from the Investment Divisions of the Variable Account at
an annual rate of 0.15% of the average daily net assets of each Investment
Division to partially compensate us for expenses incurred in administering the
Variable Account and the Policy. These expenses include costs of maintaining
records, processing Death Benefit claims, surrenders, transfers and Policy
changes, providing reports to Policyowners, and overhead costs. This charge is
guaranteed not to increase during the life of the Policy.
REDUCTION IN CHARGES FOR CERTAIN GROUPS
United Investors may reduce or eliminate the Administration Fee, Annual
Contract Maintenance Charge, or Withdrawal Charges on Policies that have been
sold to (1) employees and sales representatives of United Investors or its
affiliates; (2) customers of United Investors or distributors of the Policies
who are transferring existing policy values to a Policy; (3) individuals or
groups of individuals when sales of the contract result in savings of sales or
administrative expenses; or (4) individuals or groups of individuals where
Purchase Payments are to be made through an approved group payment method and
where the size and type of the group results in savings of administrative
expenses.
In no event will reduction or elimination of the Administration Fee, Annual
Contract Maintenance Charge, or Withdrawal Charges be permitted where such
reduction or elimination will be unfairly discriminatory to any person.
MORTALITY AND EXPENSE RISK CHARGE
United Investors deducts a daily charge from the Investment Divisions of
the Variable Account at an annual rate of 1.25% of the average daily net assets
of each Investment Division to compensate us for assuming certain mortality and
expense risks under the Policy. There is no Mortality and Expense Risk Charge
for amounts in the Fixed Account. United Investors may realize
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a profit from this charge. However, the level of this charge is guaranteed for
the life of the Policy and may not be increased. United Investors will continue
to deduct this charge after the Retirement Date.
The mortality risk borne by United Investors arises in part from its
obligation to make monthly Annuity Payments (determined in accordance with the
annuity tables and other provisions contained in the Policy) regardless of how
long all Annuitants or any individual may live. This undertaking assures that
neither an Annuitant's own longevity, nor an improvement in general life
expectancy greater than expected, will have any adverse effect on the monthly
Annuity Payments the Annuitant will receive under the Policy. It therefore
relieves the Annuitant from the risk that he will outlive the funds accumulated
for retirement. The mortality risk also arises in part because of the risk that
the Death Benefit may be greater than the Policy Value. United Investors also
assumes the risk that other expense charges may be insufficient to cover the
actual expenses incurred in connection with the Policy.
OPTIONAL DEATH BENEFIT RIDER CHARGE
If you choose the Optional Death Benefit Rider, there will be an annual
charge to compensate United Investors for the additional mortality risk. This
charge is 0.17% of the average death benefit amount, and it is deducted on each
Policy Anniversary (on a surrender of the Policy a pro rata portion is
deducted), through the cancellation of accumulation units. It is not deducted
after the Retirement Date. The average death benefit amount is the mean of the
death benefit amount on the Policy Anniversary (or the date of surrender) and
the preceding Policy Anniversary.
TRANSACTION CHARGE
You may request up to 12 withdrawals per Policy Year without a Transaction
Charge. After the 12th withdrawal in a Policy Year, a Transaction Charge will
apply to each additional withdrawal. The Transaction Charge will be equal to the
lesser of $20 or 2% of the amount withdrawn. This charge will be deducted from
the remaining Policy Value, or from the amount paid if the remaining value is
insufficient.
PREMIUM TAXES
United Investors will deduct a charge for any premium taxes incurred.
Depending on state and local law, premium taxes can be incurred when a Purchase
Payment is accepted, when Policy Value is withdrawn or surrendered, or when
Annuity Payments start. (State premium tax rates incurred by United Investors
currently range from 0 to 3.5%. In some states, localities charge additional
premium taxes.)
FEDERAL TAXES
Currently no charge is made to the Variable Account for Federal income
taxes that may be attributable to the Variable Account. United Investors may,
however, make such a charge in the future. Charges for other taxes, if any,
attributable to the Variable Account may also be made. (See "Federal Tax
Matters.")
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FUND EXPENSES
The value of the assets of the Variable Account will reflect the investment
management fee and other expenses incurred by the Portfolios.
ANNUITY PAYMENTS
ELECTION OF PAYMENT OPTION
The Policyowner has the sole right to elect or change an Annuity Payment
Option during the lifetime of the Owner and prior to the Retirement Date, either
in the application or by Written Request any time at least 30 days before the
Retirement Date. We may require the exchange of the Policy for a contract
covering the option selected.
RETIREMENT DATE
The first Annuity Payment will be made as of the Retirement Date. You may
select the Retirement Date in the application for the Policy. If no selection
is made, the Retirement Date will be the later of the Annuitant's age 85 or 10
years after the Policy Date, or the date required by state law. The Retirement
Date cannot be earlier than the first Policy Anniversary. You may change the
Retirement Date at any time by giving us Written Notice, provided that you give
us Written Notice at least 30 days prior to the new Retirement Date. A
Retirement Date may be the first day of any calendar month commencing 30 days
after the first Policy Anniversary. If the net amount to be applied to an
option is less than $2,000, we have the right to pay such amount in one sum.
Also, if any payment would be less than $50, we have the right to change the
frequency of payment to an interval that will result in payments of at least
$50.
AVAILABLE OPTIONS
On the Retirement Date, the Policy Value as of 14 days prior to the
Retirement Date, less any premium taxes, may be applied to make Fixed Annuity
Payments, Variable Annuity Payments, or a combination thereof. Fixed Annuity
Payments provide guaranteed annuity payments which remain fixed in amount
throughout the payment period. Fixed Annuity Payments do not vary with the
investment experience of the Investment Divisions. The dollar amount of
Variable Annuity Payments after the first is not fixed.
The Annuity Payment Options currently available are:
Option 1: Life Annuity With No Guaranteed Period--This option provides
monthly Annuity Payments during the lifetime of the Annuitant. No
payment will be made after the death of the Annuitant. It is
-----
possible that only one payment will be made under this option if
----------------------------------------------------------------
the Annuitant dies before the second payment is due; only two
-------------------------------------------------------------
payments will be made if the Annuitant dies before the third
------------------------------------------------------------
payment is due, and so forth.
-----------------------------
Option 2: Joint Life Annuity Continuing To The Survivor--This option
provides monthly Annuity Payments during the lifetime of the
Annuitant and a joint Annuitant. Payments will continue to the
survivor during the survivor's remaining lifetime. If the joint
Annuitant does not survive the Annuitant, payments will end with
the payment due just before the death of the Annuitant. It is
-----
possible that only one payment or very few payments will be made
----------------------------------------------------------------
under this option if the Annuitant and joint Annuitant both die
---------------------------------------------------------------
before or shortly after payments begin.
---------------------------------------
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Option 3: Life Annuity With 120 or 240 Monthly Payments Guaranteed--This
option provides monthly Annuity Payments during the lifetime of
the Annuitant. A guaranteed period of 120 or 240 months may be
chosen. If the Annuitant dies prior to the end of this guaranteed
period monthly Annuity Payments will be made to the Beneficiary
until the end of the guaranteed period.
United Investors may make other payment options available in the future and
other payment options can be arranged with our written consent. The Withdrawal
Charge may apply to such other Payment Options.
In the event that you have not selected an Annuity Payment Option on the
Retirement Date, we will make monthly annuity payments during the lifetime of
the Annuitant with 120 monthly payments guaranteed.
The amount of each Annuity Payment under the options described above will
depend on the sex and age of the Annuitant (or Annuitants) at the time the first
payment is due. The Annuity Payments may be more or less than the total
Purchase Payments made because (a) Variable Annuity Payments vary with the
investment experience of the underlying Portfolios and the Owner therefore bears
the investment risk under Variable Annuity Payments and (b) Annuitants may die
before the actuarially predicted date of death. As such, the amount of Annuity
Payments cannot be predicted. The method of computing the Annuity Payments is
described in more detail in the Statement of Additional Information.
The duration of the Annuity Payment Option may affect the dollar amount of
each Annuity Payment. For example, if an Annuity Payment Option guaranteed for
life is chosen, the Annuity Payments may be greater or less than the Annuity
Payments for an annuity for a guaranteed period, depending on the life
expectancy of the Annuitant.
If the actual net investment experience of the Investment Divisions after
the Retirement Date is less than the assumed investment rate, then the dollar
amount of the Variable Annuity Payments will decrease. The dollar amount of the
Variable Annuity Payments will stay level if the net investment experience
equals the assumed investment rate, and the dollar amount of the Variable
Annuity Payments will increase if the net investment experience exceeds the
assumed investment rate. For purposes of the Annuity Payments, the assumed
investment rate is 4.0% Fixed Annuity Payment amounts will be based on our Fixed
Annuity Payment rates in effect on the settlement date. These rates are
guaranteed not to be less than payments based on the 1983 Individual Annuity
Mortality Table (set back one year) with interest at 4.0%. The one year setback
results in lower payments than if no setback is used.
After the Retirement Date, Policy Value may not be withdrawn, nor may the
Policy be surrendered. The Annuitant (if other than the Owner) will be entitled
to exercise any voting rights and to reallocate the value of the Annuitant's
interest in the Investment Divisions. (See "Voting Rights" and "Transfers.")
The Policies offered by this Prospectus contain life annuity tables that
provide for different benefit payments to men and women of the same age although
they provide for unisex tables where requested and required by law.
Nevertheless, in accordance with the U.S. Supreme Court's decision in Arizona
Governing Committee v. Norris, in certain employment related situations, annuity
tables that do not vary on the basis of sex must be used. Accordingly, if the
Policy is to be used in connection with an employment related retirement or
benefit plan, consideration should be given, in consultation with your legal
counsel, to the impact of Norris on any such plan before making any
contributions under these Policies.
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DISTRIBUTOR OF THE POLICIES
MAP Investments Incorporated ("MAP"), 9020 North May Avenue, Suite 290,
Oklahoma City, Oklahoma 73120-4498, is the principal underwriter and the
distributor of the Policies. MAP may enter into written sales agreements with
various broker-dealers to aid in the distribution of the Policies. A commission
plus bonus compensation may be paid to broker-dealers or agents in connection
with sales of the Policies. Bonus compensation will be based on Purchase
Payments received (both initial and additional).
FEDERAL TAX MATTERS
(THE FOLLOWING DISCUSSION IS GENERAL AND IS NOT INTENDED AS TAX
ADVICE.)
INTRODUCTION
This discussion is not intended to address the tax consequences resulting
from all of the situations in which a person may be entitled to or may receive a
distribution under a Policy. Any person concerned about these tax implications
should consult a competent tax adviser before initiating any transaction. This
discussion is based upon United Investors' understanding of the present Federal
income tax laws as they are currently interpreted by the Internal Revenue
Service. No representation is made as to the likelihood of the continuation of
the present Federal income tax laws or of the current interpretation by the
Internal Revenue Service. Moreover, no attempt has been made to consider any
applicable state or other tax laws.
The Policy may be purchased on a non-qualified tax basis ("Nonqualified
Policy") or purchased and used in connection with plans qualifying for favorable
tax treatment ("Qualified Policy"). The Qualified Policies were designed for
use by individuals whose Purchase Payments are comprised solely of proceeds from
and/or contributions under retirement plans which are intended to qualify as
plans entitled to special income tax treatment under Sections 401(a), 403(b),
408, or 457 of the Internal Revenue Code of 1986, as amended (the "Code"). The
ultimate effect of Federal income taxes on the Policy Value, on Annuity Payments
and on the economic benefit to an Owner, the Annuitant or the Beneficiary
depends on the type of retirement plan, on the tax and employment status of the
individual concerned and on United Investors' tax status. In addition, certain
requirements must be satisfied in purchasing a Qualified Policy with proceeds
from a tax qualified plan in order to continue receiving favorable tax
treatment. Therefore, purchasers of Qualified Policies should seek competent
legal and tax advice regarding the suitability of the Policy for their
situation, the applicable requirements and the tax treatment of the rights and
benefits of a Policy. The following discussion assumes that Qualified Policies
are purchased with proceeds from and/or contributions under retirement plans
that qualify for the intended special Federal income tax treatment.
TAXATION OF ANNUITIES IN GENERAL
The following discussion assumes that the Policy will qualify as an annuity
contract for Federal income tax purposes. The Statement of Additional
Information describes such qualifications.
Section 72 of the Code governs taxation of annuities in general. United
Investors believes that an annuity owner who is a natural person generally is
not taxed on increases in the value of a Policy until distribution occurs either
in the form of a lump sum received by withdrawing all or part of the cash value
(i.e., withdrawals) or as Annuity Payments under the Annuity Payment Option
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elected. For this purpose, the assignment, pledge, or agreement to assign or
pledge any portion of the Policy Value generally will be treated as a
distribution. The taxed portion of a distribution (in the form of a lump sum
payment or an annuity) is taxed as ordinary income.
An owner of any deferred annuity contract who is not a natural person
generally must include in income any increase in the excess of the owner's
Policy Value over the owner's investment in the contract during the taxable
year. However, there are some exceptions to this rule and you may wish to
discuss these with your tax adviser.
POSSIBLE CHANGES IN TAXATION. In recent years, legislation has been
proposed that would have adversely modified the Federal taxation of certain
annuities. For example, one such proposal would have changed the tax treatment
of nonqualified annuities that did not have "substantial life contingencies" by
taxing income as it is credited to the annuity. Although as of the date of this
Prospectus Congress is not considering any legislation regarding the taxation of
annuities, there is always the possibility that the tax treatment of annuities
could change by legislation or other means (such as IRS regulations, revenue
rulings, and judicial decisions). Moreover, it is also possible that any
legislative change could be retroactive (that is, effective prior to the date of
such change).
The following discussion applies to Policies owned by natural persons.
WITHDRAWALS. In the case of a withdrawal under a Qualified Policy, a
ratable portion of the amount received is taxable, generally based on the ratio
of the "investment in the contract" to the total Policy Value. The "investment
in the contract" generally equals the portion, if any, of any Purchase Payments
paid by or on behalf of an individual under a Policy which was not excluded from
the individual's gross income. For Policies issued in connection with qualified
plans, the "investment in the contract" can be zero. Special rules may apply to
a withdrawal from a Qualified Policy with respect to "investment in the
contract" as of December 31, 1986, and in other circumstances.
Generally, in the case of a withdrawal under a Nonqualified Policy before
the annuity starting date, amounts received are first treated as taxable income
to the extent that the Policy Value immediately before the withdrawal exceeds
the "investment in the contract" at that time. Any additional amount withdrawn
is not taxable.
In the case of a full surrender under a Qualified or Nonqualified Policy,
the amount received generally will be taxable only to the extent it exceeds the
"investment in the contract."
ANNUITY PAYMENTS. Although the tax consequences may vary depending on the
Annuity Payment Option elected under the Policy, generally only the portion of
the Annuity Payment that represents the amount by which the Policy Value exceeds
the "investment in the contract" will be taxed. For Variable Annuity Payments,
in general the taxable portion of each Annuity Payment (prior to recovery of the
investment in the contract) is determined by a formula which establishes a
specific dollar amount of each Annuity Payment that is not taxed. This dollar
amount is determined by dividing the "investment in the contract" by the total
number of expected Annuity Payments. For Fixed Annuity Payments, in general
there is no tax on the amount of each payment which represents the same ratio
that the "investment in the contract" bears to the total expected value of
annuity payments for the term of the payments; however, the remainder of each
payment is taxable. In all cases, after the "investment in the contract" is
recovered, the full amount of any additional Annuity Payments is taxable.
PENALTY TAX. In the case of a distribution pursuant to a Nonqualified
Policy, there may be imposed a Federal penalty tax equal to 10% of the amount
treated as taxable income. In general, however, there is no penalty tax on
distributions: (1) made on or after the taxpayer attains age
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59-1/2, (2) made as a result of the owner's death or is attributable to the
taxpayer's disability, or (3) received in substantially equal periodic payments
as a life annuity.
QUALIFIED POLICIES. The tax rules applicable to a Qualified Policy vary
according to the type of plan and the terms and conditions of the plan. Special
favorable tax treatment may be available for certain types of contributions and
distributions. Adverse tax consequences may result from contributions in excess
of specified limits; distributions prior to age 59-1/2 (subject to certain
exceptions); distributions that do not conform to specified commencement and
minimum distribution rules; aggregate distributions in excess of a specified
annual amount; and in other specified circumstances.
We make no attempt to provide more than general information about the use
of the Policy with the various types of retirement plans. Owners and
participants under retirement plans as well as Annuitants and Beneficiaries are
cautioned that the rights of any person to any benefits under a Qualified Policy
may be subject to the terms and conditions of the plans themselves, regardless
of the terms and conditions of the Policy issued in connection with such a plan.
Some retirement plans are subject to distribution and other requirements that
are not incorporated into our Policy administration procedures. Owners,
participants and beneficiaries are responsible for determining that
contributions, distributions and other transactions with respect to the
Qualified Policy comply with applicable law. Purchasers of annuity contracts
for use with any qualified retirement plan should consult their legal counsel
and tax adviser regarding the suitability of the annuity contract.
Code Section 401(a) permits employers to establish various types of
retirement plans for employees, and permits self-employed individuals to
establish retirement plans for themselves and their employees. These retirement
plans may permit the purchase of the Policies to accumulate retirement savings
under the plans. Adverse tax or other legal consequences to the plan, to the
participant or to both may result if this Policy is assigned or transferred to
any individual as a means to provide benefit payments, unless the plan complies
with all legal requirements applicable to such benefits prior to transfer of the
Policy.
Tax Sheltered Annuity (TSA) Section 403(b) payments made by public school
systems and certain tax exempt organizations are excludable from the gross
income of the employee, subject to certain limitations. However, these payments
may be subject to FICA (Social Security) taxes. Code Section 403(b)(11)
restricts the distribution under Code Section 403(b) annuity contracts of: (1)
elective contributions made in years beginning after December 31, 1988; (2)
earnings on those contributions; and (3) earnings in such years on amounts held
as of the last year beginning before January 1, 1989. Distribution of those
amounts may only occur upon death of the employee, attainment of age 59-1/2,
separation from service, disability, or financial hardship. In addition, income
attributable to elective contributions may not be distributed in the case of
hardship.
Individual Retirement Annuities are subject to limitations on the amount
which may be contributed and deducted and the time when distributions may
commence. In addition, distributions from certain other types of retirement
plans may be placed into an Individual Retirement Annuity on a tax deferred
basis. The Internal Revenue Service has not addressed in a ruling of general
applicability whether a death benefit provision such as the provision in the
Policy comports with IRA qualification requirements.
Internal Revenue Code Section 457 provides for certain deferred
compensation plans. These plans may be offered with respect to service for
state governments, local governments, political subdivisions, agencies,
instrumentalities and certain affiliates of such entities, and tax exempt
organizations. These plans are subject to various restrictions on contributions
and distributions. These plans may permit participants to specify the form of
investments for their deferred compensation account. All investments under such
Plans are owned by the sponsoring employer and are subject to the claims of
general creditors of the employer. Depending on the terms of the
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particular plan, the employer may be entitled to draw on deferred amounts for
purposes unrelated to its Section 457 plan obligations. In general, all amounts
received under a Section 457 plan are taxable and are subject to Federal income
tax withholding as wages.
MULTIPLE NONQUALIFIED POLICIES. All nonqualified deferred annuities
entered into after October 21, 1988 that are issued by United Investors (or its
affiliates) to the same owner during any calendar year are treated as one
annuity contract for purposes of determining the amount includible in gross
income under Section 72(e) of the Code. In addition, there may be other
situations in which the Treasury Department may (under its authority to issue
regulations or otherwise) conclude that it would be appropriate to aggregate two
or more annuity contracts purchased by the same owner. Accordingly, a Policy
Owner should consult a competent tax advisor before purchasing more than one
annuity contract.
TRANSFERS. A TRANSFER OR ASSIGNMENT OF OWNERSHIP OF A POLICY, OR
DESIGNATION OF AN ANNUITANT OR OTHER BENEFICIARY WHO IS NOT ALSO THE OWNER, MAY
RESULT IN CERTAIN TAX CONSEQUENCES TO THE OWNER THAT ARE NOT DISCUSSED HEREIN.
An Owner contemplating any such transfer, assignment or designation should
contact a competent tax adviser with respect to the potential tax effects of
such transaction.
DEATH BENEFITS. Amounts may be distributed from a Policy because of the
death of an Owner or an Annuitant. Generally, such amounts are includible in
the income of the recipient as follows: (1) if distributed in a lump sum, they
are taxed in the same manner as a full surrender of the Policy, as described
above, or (2) if distributed under an annuity option, they are taxed in the same
manner as annuity payments, as described above. For these purposes, the
investment in the contract is not affected by an Owner's or Annuitant's death.
That is, the investment of the contract remains the amount of any Purchase
Payments paid which were not excluded from gross income.
GENERAL. As noted above, the foregoing comments about the Federal tax
consequences under these Policies are not exhaustive and special rules are
provided with respect to other tax situations not discussed in this Prospectus.
Further, the Federal tax consequences discussed herein reflect United Investors'
understanding of current law and the law may change. Federal estate and state
and local estate, inheritance and other tax consequences of ownership or receipt
of distributions under a Policy depend on the individual circumstances of each
owner of the Policy or recipient of the distribution. A competent tax adviser
should be consulted for further information.
VOTING RIGHTS
To the extent deemed to be required by law, United Investors will vote the
Funds' shares held in the Variable Account at shareholder meetings of the Funds
in accordance with instructions received from persons having voting interests in
the corresponding Investment Divisions of the Variable Account. If, however,
the 1940 Act or any regulation thereunder should be amended or if the present
interpretation thereof should change, or if United Investors determines that it
is allowed to vote the Fund shares in its own right, United Investors may elect
to do so. The Funds do not hold regular annual shareholder meetings.
The number of votes which are available to an Owner will be calculated
separately for each Investment Division of the Variable Account. That number
will be determined by applying his or her percentage interest, if any, in a
particular Investment Division to the total number of votes attributable to that
Investment Division. Prior to the Retirement Date, the Owner holds a voting
interest in each Investment Division to which the Policy Value is allocated.
After the Retirement Date, the person receiving Variable Annuity Payments has
the voting interest. The number of votes prior to the Retirement Date will be
determined by dividing the value of the Policy allocated to the Investment
Division by the net asset value per share of the corresponding Portfolio. After
the
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Retirement Date, the votes attributable to a Policy decrease as the value of the
Investment Divisions decrease with Variable Annuity Payments. In determining the
number of votes, fractional shares will be recognized.
The number of votes of a Portfolio which are available will be determined
as of the date coincident with the date established by that Portfolio for
determining shareholders eligible to vote at the meeting of the Fund. Voting
instructions will be solicited by written communication prior to such meeting in
accordance with procedures established by the Fund.
Portfolio shares attributable to the Policies as to which no timely
instructions are received will be voted in proportion to the voting instructions
which are received with respect to all Policies participating in the Investment
Division. Voting instructions to abstain on any item to be voted upon will be
applied on a pro rata basis to reduce the votes eligible to be cast.
Each person having a voting interest in an Investment Division will receive
proxy material, reports and other materials relating to the appropriate
Portfolio.
LEGAL PROCEEDINGS
There are no legal proceedings to which the Variable Account is a party to
or to which the assets of the Variable Account are subject. United Investors is
not involved in any litigation that is of material importance in relation to its
total assets or that relates to the Variable Account.
FINANCIAL STATEMENTS
The financial statements for United Investors (as well as the
Auditors' Report thereon) are in the Statement of Additional Information.
Neither this Prospectus nor the Statement of Additional Information contains
financial statements for the Variable Account because it has not yet commenced
operations, has no assets or liabilities, and has received no income and
incurred no expenses as of the date of this Prospectus.
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<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
A Statement of Additional Information is available which contains more
details concerning the subjects discussed in this Prospectus. The following is
the Table of Contents for that Statement:
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
THE POLICY................................................... 3
Accumulation Units........................................ 3
Annuity Units............................................. 3
Net Investment Factor..................................... 4
Determination of Annuity Payments......................... 5
Fixed Annuity Payments............................. 5
Variable Annuity Payments.......................... 5
The Contract.............................................. 6
Misstatement of Age or Sex................................ 7
Annual Report............................................. 7
Non-Participation......................................... 7
Delay or Suspension of Payments........................... 7
Ownership................................................. 8
Beneficiary............................................... 8
Change of Owner or Beneficiary............................ 9
Assignment................................................ 9
Incontestability.......................................... 9
Evidence of Survival...................................... 9
FIXED ACCOUNT................................................ 9
FEDERAL TAX MATTERS.......................................... 10
Taxation of United Investors.............................. 10
Tax Status of the Policies................................ 10
Required Distributions.................................... 12
Withholding............................................... 12
ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS............ 13
DISTRIBUTION OF THE POLICY................................... 14
SAFEKEEPING OF VARIABLE ACCOUNT ASSETS....................... 15
STATE REGULATION............................................. 15
RECORDS AND REPORTS.......................................... 16
LEGAL MATTERS................................................ 16
EXPERTS...................................................... 16
OTHER INFORMATION............................................ 17
FINANCIAL STATEMENTS......................................... 17
</TABLE>
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RETIREMAP VARIABLE ACCOUNT
STATEMENT OF ADDITIONAL INFORMATION
-----------------------------------
FOR THE
DEFERRED VARIABLE ANNUITY POLICY
Offered by
United Investors Life Insurance Company
This Statement of Additional Information expands upon subjects discussed in the
current Prospectus for the Deferred Variable Annuity Policy ("Policy") offered
by United Investors Life Insurance Company. You may obtain a copy of the
Prospectus dated _______________ __, 1997, by writing to United Investors Life
Insurance Company, Administrative Office, P.O. Box 219065, Dallas, TX 75221-
9065. Terms used in the current Prospectus for the Policy are incorporated in
this Statement.
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND SHOULD BE READ
ONLY IN CONJUNCTION WITH THE PROSPECTUS FOR THE POLICY.
Dated: ______________ ___, 1997
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
THE POLICY........................................ 3
Accumulation Units............................. 3
Annuity Units.................................. 3
Net Investment Factor.......................... 4
Determination of Annuity Payments.............. 5
Fixed Annuity Payments...................... 5
Variable Annuity Payments................... 5
The Contract................................... 6
Misstatement of Age or Sex..................... 7
Annual Report.................................. 7
Non-Participation.............................. 7
Delay or Suspension of Payments................ 7
Ownership...................................... 8
Beneficiary.................................... 8
Change of Ownership or Beneficiary............. 9
Assignment..................................... 9
Incontestability............................... 9
Evidence of Survival........................... 9
FIXED ACCOUNT..................................... 9
FEDERAL TAX MATTERS............................... 10
Taxation of United Investors................... 10
Tax Status of the Policies..................... 10
Required Distributions......................... 12
Withholding.................................... 12
ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS. 13
DISTRIBUTION OF THE POLICY........................ 14
SAFEKEEPING OF VARIABLE ACCOUNT ASSETS............ 15
STATE REGULATION.................................. 15
RECORDS AND REPORTS............................... 16
LEGAL MATTERS..................................... 16
EXPERTS........................................... 16
OTHER INFORMATION................................. 17
FINANCIAL STATEMENTS.............................. 18
</TABLE>
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<TABLE>
<CAPTION>
Corresponding Page in Prospectus
----------
<S> <C> <C>
15
13
25
29
30
</TABLE>
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THE POLICY
-----------
As a supplement to the description in the Prospectus, the following
provides additional information about the Policy.
Accumulation Units
- ------------------
An Accumulation Unit is an accounting unit used prior to the Retirement
Date to calculate the Variable Account Value. The portion of a Net Purchase
Payment that you allocate to an Investment Division of the Variable Account is
credited as Accumulation Units in that Investment Division. Similarly, the value
that you transfer to an Investment Division of the Variable Account is credited
as Accumulation Units in that Investment Division. The number of Accumulation
Units to credit is determined by dividing (1) the dollar amount allocated to the
Investment Division by (2) the Investment Division's appropriate Accumulation
Unit Value for the Valuation Period in which we received the Purchase Payment or
transfer request (in the case of the initial Purchase Payment, we will credit
Accumulation Units for that Purchase Payment based on the Accumulation Unit
value for the Policy Date).
The value of an Accumulation Unit for each Investment Division was
initially arbitrarily set at $1. The value for any later Valuation Period is
found by multiplying the Accumulation Unit Value for an Investment Division for
the last prior Valuation Period by such Investment Division's Net Investment
Factor (described below) for the following Valuation Period. Like the Policy
Value, the value of an Accumulation Unit may increase or decrease from one
Valuation Period to the next.
Annuity Units
- -------------
An Annuity Unit is an accounting unit used after the Retirement Date to
calculate the value of Variable Annuity Payments. The value of an Annuity Unit
in each Investment Division was initially set at $1. The value for any later
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<PAGE>
Valuation Period is determined by (a) multiplying the Annuity Unit Value for an
Investment Division for the last prior Valuation Period for such Investment
Division's Net Investment Factor for the following Valuation Period, and then
(b) adjusting the result to compensate for the interest rate assumed in the
annuity tables used to determine the amount of the first Variable Annuity
Payment. The value of an Annuity Unit for each Investment Division changes to
reflect the investment performance of the Portfolio underlying that Investment
Division.
Net Investment Factor
- ---------------------
The Net Investment Factor is an index applied to measure the investment
performance of an Investment Division of the Variable Account from one Valuation
Period to the next. The Net Investment Factor may be greater or less than one,
so the value of an Investment Division may increase or decrease.
The Net Investment Factor of an Investment Division for any Valuation
Period is determined by dividing (1) by (2) and subtracting (3) from the result,
where:
(1) is the result of:
(a) the net asset value per share of the Portfolio shares held in the
Investment Division determined at the end of the current
Valuation Period; plus
(b) the per share amount of any dividend or capital gain
distributions on the Portfolio shares held in the Investment
Division, if the "ex-dividend" date occurs during the current
Valuation Period; plus or minus
(c) A charge or credit for any taxes reserved for the current
Valuation Period which we determine to have resulted from the
investment operations of the Investment Division;
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<PAGE>
(2) is the result of:
(a) the net asset value per share of the Portfolio shares held in the
Investment Division, determined at the end of the previous
Valuation Period; plus or minus
(b) the charge or credit for any taxes reserved for the previous
Valuation Period; and
(3) is a deduction for the 1.25% Mortality and Expense Risk Charge and the
0.15% Administration Fee.
Determination of Annuity Payments
- ---------------------------------
At the Retirement Date, the Policy Value as of 14 days prior to the
Retirement Date, less any applicable premium taxes, may be applied to make Fixed
Annuity Payments, Variable Annuity Payments, or a combination thereof.
Fixed Annuity Payments. Fixed Annuity Payments provide guaranteed
----------------------
annuity payments which remain fixed in amount throughout the payment period.
Fixed Annuity Payments do not vary with the investment experience of the
Investment Divisions. The payment amount will be based on our Fixed Annuity
Payment rates in effect on the settlement date. These rates are guaranteed not
to be less than payments based on the 1983 Individual Annuity Mortality Table
(set back one year) with interest at 4.0%. The one year setback results in lower
rates than if no setback is used. Where requested and required by law unisex
tables will be used.
Variable Annuity Payments. The dollar amount of the first Variable
-------------------------
Annuity Payment is determined by multiplying the net value applied by purchase
rates based on the 1983 Individual Annuity Mortality Table (set back one year)
with interest at 4.0%. The one year setback results in lower rates than if no
setback is used. Where requested and required by law unisex tables will be used.
The portion of the first Variable Annuity Payment attributed to each
Investment Division is divided by the Annuity Unit Value for the Investment
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<PAGE>
Division (as of the same date that the amount of the first Variable Annuity
Payment is determined) to determine the number of Annuity Units upon which later
Variable Annuity Payments will be made. This number of Annuity Units will not
change unless subsequently changed by reallocation. The dollar amount of each
monthly Variable Annuity Payment after the first Annuity Payment will equal the
sum of the number of Annuity Units credited to each Investment Division
multiplied by the Annuity Unit Value for each respective Investment Division for
the Valuation Period as of 14 days prior to the Variable Annuity Payment.
After the Retirement Date, the Annuitant may reallocate the value of the
Annuitant's interest in the Investment Divisions, no more than once each Policy
Year, by sending a Written Request to United Investors. A reallocation will be
effected during the Valuation Period as of 14 days prior to the next Variable
Annuity Payment, by converting Annuity Units for the value transferred from an
Investment Division into Annuity Units in the Investment Division to which the
value is transferred. Reallocations may cause the number of Annuity Units to
change, but will not change the dollar amount of the Variable Annuity Payment as
of the date of reallocation.
United Investors guarantees that the dollar amount of monthly Variable
Annuity Payments after the first payment will not be affected by variations in
expenses or mortality experience.
The Contract
- ------------
The entire contract is made up of the Policy, any riders, and the written
application. All statements made in the application, in the absence of fraud,
are considered representations and not warranties. Only the statements made in
the written application can be used by us to defend a claim or void the Policy.
Changes to the Policy are not valid unless we make them in writing. They
must be signed by one of our executive officers. No agent has authority to
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change the Policy or to waive any of its provisions.
Misstatement of Age or Sex
- --------------------------
If the Annuitant's age or sex is misstated, we will adjust each benefit and
any amount to be paid to reflect the correct age and sex.
Annual Report
- -------------
At least once each Policy Year prior to the Retirement Date we will send
you a report on your Policy. It will show the current Policy Value, the current
Fixed Account Value, the current value of the Investment Divisions of the
Variable Account, the Purchase Payments paid, all charges and partial
withdrawals since the last report, the current Surrender Value and the current
Death Benefit. We will also include in the report any other information required
by state law or regulation. Further, we will send you the reports required by
the Investment Company Act of 1940. You may request additional reports during
the year but we may charge a fee for any additional reports.
Non-Participation
- -----------------
The Policy is non-participating. This means that no dividends will be paid
on your Policy. It will not share in our profits or surplus earnings.
Delay or Suspension of Payments
- -------------------------------
We will normally pay a surrender or any withdrawal within seven days after
we receive your Written Request in our Home Office. However, payment of any
amount from the Investment Divisions of the Variable Account may be delayed or
suspended whenever:
a) the New York Stock Exchange is closed other than customary weekend and
holiday closing, or trading on the New York Exchange is restricted as
determined by the Securities and Exchange Commission;
b) the Securities and Exchange Commission by order permits postponement
for the protection of Policyowners; or
-8-
<PAGE>
c) an emergency exists, as determined by the Commission, as a result of
which disposal of the securities held in the Investment Divisions is
not reasonably practicable or it is not reasonably practicable to
determine the value of the Variable Account's net assets.
Payment of any amounts from the Fixed Account may be deferred for up to six
months from the date of the request to surrender. If payment is deferred for
more than 30 days, we will pay interest on the amount deferred at a rate not
less the Guaranteed Minimum Interest Rate.
Payments under the Policy of any amounts derived from Purchase Payments
paid by check may be delayed until such time as the check has cleared your bank.
Ownership
- ---------
The Policy belongs to you, the Policyowner. Unless you provide otherwise,
you may receive all benefits and exercise all rights of the Policy prior to the
Retirement Date. These rights and the rights of any Beneficiary are subject to
the rights of any assignee. If there is more than one Owner at a given time,
all must exercise the rights of ownership by joint action.
Beneficiary
- -----------
The Beneficiary means the person, persons or entity entitled to Death
Benefit proceeds under this Policy upon death of the Owner (or Annuitant if the
Owner is not a natural person) before the Retirement Date. If the Policy has
joint Owners and one Owner dies, the surviving Joint Owner will be deemed the
Beneficiary. The rights of any Beneficiary who dies before the Owner (or
Annuitant if the Owner is not a natural person) will pass to the surviving
Beneficiary or Beneficiaries unless you provide otherwise. If no Beneficiary is
living at the Owner's (or Annuitant's if the Owner is not a natural person)
death, we will pay the Death Benefit, if any, to the Owner, if living;
otherwise, it will be paid to the deceased's estate.
-9-
<PAGE>
Change of Ownership or Beneficiary
- ----------------------------------
Unless you provide otherwise in writing to us, you may change the Owner or
the Beneficiary during your lifetime. Any changes must be made by Written
Request filed with us. The change takes effect on the date the request was
signed, but it will not apply to payments made by us before we accept your
Written Request. We may require you to submit the Policy to us before making a
change. A change of ownership may be a taxable event.
Assignment
- ----------
You may assign the Policy, but we will not be responsible for the validity
of any assignment and no assignment will bind us until it is filed in writing at
our home office. When it is filed, your rights and the rights of any
Beneficiary will be subject to it. An assignment of the Policy may be a taxable
event.
Incontestability
- ----------------
United Investors will not contest the Policy.
Evidence of Survival
- --------------------
Where any payments under the Policy depend on the payee being alive, we may
require proof of survival prior to making the payments.
FIXED ACCOUNT
-------------
We guarantee that we will credit interest at a rate of not less than the
Guaranteed Minimum Interest Rate of 4.0% per year to amounts allocated to the
Fixed Account. We may credit interest at a rate in excess of the Guaranteed
Minimum Interest Rate.
ANY EXCESS INTEREST CREDITED WILL BE DETERMINED AT OUR SOLE DISCRETION. THE
OWNER ASSUMES THE RISK THAT INTEREST CREDITED TO FIXED ACCOUNT ALLOCATIONS MAY
NOT EXCEED THE GUARANTEED MINIMUM INTEREST RATE.
-10-
<PAGE>
-11-
<PAGE>
-12-
<PAGE>
-13-
<PAGE>
-14-
<PAGE>
FEDERAL TAX MATTERS
--------------------
Taxation of United Investors
- ----------------------------
United Investors is taxed as a life insurance company under Part 1 of
Subchapter L of the Internal Revenue Code of 1986 (the "Code"). Since the
Variable Account is not an entity separate from United Investors and its
operations form a part of United Investors, it will not be taxed separately as
-15-
<PAGE>
a "regulated investment company" under Subchapter M of the Code. Investment
income and realized net capital gains on the assets of the Variable Account are
reinvested and taken into account in determining the Policy Value. As a result,
such investment income and realized net capital gains are automatically retained
as part of the reserves under the Policy. Under existing federal income tax law,
United Investors believes that Variable Account investment income and realized
net capital gains should not be taxed to the extent that such income and gains
are retained as part of the reserves under the Policy.
Tax Status of the Policies
- --------------------------
Section 817(h) of the Code provides that the investments of the Variable
Account must be "adequately diversified" in accordance with Treasury regulations
in order for the Policies to qualify as annuity contracts under Section 72 of
the Code. The Variable Account, through each Portfolio of the Funds, intends to
comply with the diversification requirements prescribed by the Treasury in
Treas. Reg. Section 1.817-5, which affect how the Portfolios' assets may be
invested. United Investors does not control any of the Funds or their
Portfolios' investments. However, it has entered into an agreement regarding
participation in each Fund, which requires each participating Portfolio of the
Funds to be operated in compliance with the diversification requirements
prescribed by the Treasury.
In certain circumstances, owners of variable annuity contracts may be
considered the owners, for federal income tax purposes, of the assets of the
separate account used to support their contracts. In those circumstances,
income and gains from the separate account assets would be includible in the
variable contract owner's gross income. The IRS has stated in published rulings
that a variable contract owner will be considered the owner of separate account
assets if the contract owner possesses incidents of ownership in those assets,
such as
-16-
<PAGE>
the ability to exercise investment control over the assets. The Treasury
Department also announced, in connection with the issuance of regulations
concerning diversification, that those regulations "do not provide guidance
concerning the circumstances in which investor control of the investments of a
segregated asset account may cause the investor (i.e., the Policyowner), rather
than the insurance company, to be treated as the owner of the assets in the
account." This announcement also stated that guidance would be issued by way of
regulations or rulings on the "extent to which policyholders may direct their
investments to particular subaccounts without being treated as owners of the
underlying assets."
The ownership rights under the Policy are similar to, but different in
certain respects from, those described by the IRS in rulings in which it was
determined that policy owners were not owners of separate account assets. For
example, the Policyowner has additional flexibility in allocating premium
payments and Policy Values. These differences could result in a Policyowner
being treated as the owner of a pro rata portion of the assets of the Variable
Account. In addition, United Investors does not know what standards will be set
forth, if any, in the regulations or rulings which the Treasury Department has
stated it expects to issue. United Investors therefore reserves the right to
modify the Policy as necessary to attempt to prevent a Policyowner from being
considered the owner of a pro rata share of the assets of the Variable Account.
Required Distributions
- ----------------------
In order to be treated as an annuity contract for federal income tax
purposes, Section 72(s) of the Code requires any nonqualified Policy to provide
that (a) if any Owner dies on or after the annuity starting date but prior to
the time the entire interest in the Policy has been distributed, the remaining
-17-
<PAGE>
portion of such interest will be distributed at least as rapidly as under the
method of distribution being used as of the date of that Owner's death; and (b)
if any Owner dies prior to the annuity starting date, the entire interest in the
Policy will be distributed within five years after the date of that Owner's
death.
These requirements will be considered satisfied as to any portion of the
Owner's interest that is payable as annuity payments which will begin within one
year of that Owner's death and which will be made over the life of the Owner's
designated Beneficiary or over a period not extending beyond his life
expectancy.
If the Owner's designated Beneficiary is the surviving spouse of the Owner,
the Policy may be continued with the surviving spouse as the new Owner and no
distributions will be required.
Withholding
- -----------
Pension and annuity distributions generally are subject to withholding for
the recipient's federal income tax liability at rates that vary according to the
type of distribution and the recipient's tax status. Generally, the recipient
is given the opportunity to elect not to have tax withheld from distributions.
However, certain distributions from Section 401(a) and 403(b) plans are subject
to mandatory withholding.
ADDITION, DELETION OR SUBSTITUTION OF INVESTMENTS
-------------------------------------------------
United Investors reserves the right, subject to compliance with applicable
law, to make additions to, deletions from, or substitutions for, the shares of
the Funds that are held by the Variable Account (or any Investment Division) or
that the Variable Account (or any Investment Division) may purchase. United
Investors reserves the right to eliminate the shares of any of the Portfolios of
the Funds and to substitute shares of another Portfolio of the Funds or any
other
-18-
<PAGE>
investment vehicle or of another open-end, registered investment company if laws
or regulations are changed, if the shares of any of the Funds or a Portfolio are
no longer available for investment, or if in our judgment further investment in
any Portfolio should become inappropriate in view of the purposes of the
Investment Division. United Investors will not substitute any shares
attributable to a Policyowner's interest in an Investment Division of the
Variable Account without notice and prior approval of the Securities and
Exchange Commission and the insurance regulator of the state where the Policy
was delivered, where required. Nothing contained herein shall prevent the
Variable Account from purchasing other securities for other series or classes of
policies, or from permitting a conversion between series or classes of policies
on the basis of requests made by Policyowners.
United Investors also reserves the right to establish additional Investment
Divisions of the Variable Account, each of which would invest in a new Portfolio
of one of the Funds, or in shares of another investment company or suitable
investment, with a specified investment objective. New Investment Divisions may
be established when, in the sole discretion of United Investors, marketing needs
or investment conditions warrant, and any new Investment Divisions will be made
available to existing Policyowners on a basis to be determined by United
Investors. United Investors may also eliminate one or more Investment Divisions
if, in its sole discretion, marketing, tax, or investment conditions warrant.
In the event of any such substitution or change, United Investors may, by
appropriate endorsement, make such changes in the Policies as may be necessary
or appropriate to reflect such substitution or change. If deemed by United
Investors to be in the best interests of persons having voting rights under the
Policies, the Variable Account may be operated as a management company under the
Investment Company Act of 1940, it may be deregistered under that Act in the
-19-
<PAGE>
event such registration is no longer required, or it may be combined with other
United Investors separate accounts.
DISTRIBUTION OF THE POLICY
--------------------------
The Policies will be sold by individuals who, in addition to being licensed
as life insurance agents for United Investors, are also registered
representatives of MAP Investments Incorporated ("MAP"), the principal
underwriter of the Policies, or of broker-dealers or banks who have entered into
written sales agreements with MAP. MAP is registered with the Securities and
Exchange Commission under the Securities Exchange Act of 1933 as a broker-dealer
and is a member of the National Association of Securities Dealers, Inc. The
Policies are offered to the public through brokers licensed under the federal
securities laws and state insurance laws that have entered into agreements with
MAP. The offering of the Policies is continuous, and MAP does not anticipate
discontinuing the offering of the Policies. However, MAP reserves the right to
discontinue the offering of the Policies.
United Investors may reduce or eliminate the Administrative Fee, Annual
Contract Maintenance Charge, or Withdrawal Charges on Policies that have been
sold to: (1) employees and sales representatives of United Investors or its
affiliates; (2) customers of United Investors or distributors of the Policies
who are transferring existing policy values to a Policy; or (3) individuals or
groups of individuals when sales of the Policy result in savings of sales
expenses.
SAFEKEEPING OF VARIABLE ACCOUNT ASSETS
--------------------------------------
United Investors holds the assets of the Variable Account. The assets are
kept physically segregated and held separate and apart from United Investors'
general account. United Investors maintains records of all purchases and
-20-
<PAGE>
redemptions of Fund shares by each of the Investment Divisions.
STATE REGULATION
----------------
United Investors is subject to regulation by the Missouri Department of
Insurance. An annual statement is filed with the Missouri Department of
Insurance on or before March 1 of each year covering the operations and
reporting on the financial condition of United Investors as of December 31 of
the preceding year. Periodically, the Missouri Department of Insurance or other
authorities examine the liabilities and reserves of United Investors and the
Variable Account, and a full examination of United Investors' operations is
conducted periodically by the National Association of Insurance Commissioners.
In addition, United Investors is subject to the insurance laws and
regulations of other states within which it is licensed or may become licensed
to operate. Generally, the insurance department of any other state applies the
laws of the state of domicile in determining permissible investments. A Policy
is governed by the law of the state in which it is delivered. The values and
benefits of each Policy are at least equal to those required by such state.
RECORDS AND REPORTS
--------------------
All records and accounts relating to the Variable Account will be
maintained by United Investors. As presently required by the Investment Company
Act of 1940 and regulations promulgated thereunder, reports containing such
information as may be required under that Act or by any other applicable law or
regulation will be sent to Owners at their last known address of record.
-21-
<PAGE>
LEGAL MATTERS
-------------
Legal advice regarding certain matters relating to federal securities laws
applicable to the issuance of the Policy described in the Prospectus have been
provided by Sutherland, Asbill & Brennan, L.L.P., of Washington, D.C. All
matters of Missouri law pertaining to the Policy, including the validity of the
Policy and United Investors' right to issue the Policy under Missouri Insurance
Law and any other applicable state insurance or securities laws, have been
passed upon by James L. Sedgwick, Esq., President of United Investors.
EXPERTS
-------
The balance sheets of United Investors Life Insurance Company as of
December 31, 1996 and 1995, and the related statements of operations,
shareholder's equity, and cash flows for each of the years in the three-year
period ended December 31, 1996 have been included herein in reliance upon the
report of KPMG Peat Marwick LLP, independent certified public accountants,
appearing elsewhere herein, and upon the authority of said firm as experts in
accounting and auditing. The report of KPMG Peat Marwick LLP on the financial
statements of United Investors Life Insurance Company refers to changes in
accounting principles in 1993 to adopt the provisions of Statement of Financial
Accounting Standards Board's (FASB's) Statement of Financial Accounting
Standards (Statement) No. 106, "Employer's Accounting for Postretirement Benefit
Plans Other than Pensions", FASB Statement No. 109 "Accounting for Income Taxes"
and FASB Statement No. 115 "Accounting for Certain Investments in Debt and
Equity Securities".
-22-
<PAGE>
OTHER INFORMATION
-----------------
A Registration Statement has been filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, with respect to the
Policies discussed in this Statement of Additional Information. Not all of the
information set forth in the Registration Statement, amendments and exhibits
thereto has been included in this Statement of Additional Information.
Statements contained in this Statement of Additional Information concerning the
content of the Policies and other legal instruments are intended to be
summaries. For a complete statement of the terms of these documents, reference
should be made to the instruments filed with the Securities and Exchange
Commission.
FINANCIAL STATEMENTS
--------------------
The financial statements of United Investors, which are included in this
Statement of Additional Information, should be considered only as bearing on the
ability of United Investors to meet its obligations under the Policies. They
should not be considered as bearing on the investment performance of the assets
held in the Variable Account.
There are no financial statements for the Variable Account because as of
the date of this Statement of Additional Information it had not commenced
operations and had no assets or liabilities.
-23-
<PAGE>
PART C
- ------
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
---------------------------------
(a) Financial Statements
--------------------
Financial Statements to be filed by amendment.
(b) Exhibits
--------
(1) Resolution of the Board of Directors of United Investors Life
Insurance Company ("United Investors") authorizing establishment of
the RetireMAP Variable Account./1/
(2) Custody agreements: Not applicable.
(3) (A) Principal Underwriting Agreement./2/
(B) Form of Broker-Dealer Sales Agreement./2/
(4) (A) Form of Annuity Policy./1/
(B) Optional Death Benefit Rider./1/
(C) Waiver of Withdrawal Charges Rider./1/
(5) Form of Application./1/
(6) (A) Certificate of Incorporation of United Investors./3/
(B) By-Laws of United Investors./4/
(7) Reinsurance contracts: Not applicable.
(8) (A) Participation Agreement for:
(i) TMK/United Funds, Inc./5/
(ii) Federated Insurance Series./5/
(iii) Scudder Variable Life Investment Fund./5/
(iv) Dreyfus Variable Investment Fund./5/
(v) MFS Variable Insurance Trust./5/
(vi) Warburg Pincus Trust and Warburg Pincus Trust
II./5/
(B) Form of Administration Agreement./2/
(9) Opinion and Consent of James L. Sedgwick, Esq./5/
(10) (A) Consent of Sutherland, Asbill & Brennan, L.L.P./5/
(B) Consent of KPMG Peat Marwick LLP./5/
(11) Certain additional financial statements: Not applicable.
(12) Agreements/understandings for providing initial capital: Not
applicable.
(13) Performance Data Calculations: Not applicable.
(14) Financial Data Schedules: Not applicable.
(15) Power of Attorney./2/
- ----------------------------------
1 Incorporated herein by reference to the corresponding exhibit to the
initial Registration Statement on Form N-4 (File No. 333-12507) filed on
behalf of the RetireMAP Variable Account by United Investors on September
23, 1996.
2 Filed herewith.
C - 1
<PAGE>
3 Incorporated herein by reference to Exhibit 6(a) to the Registration
Statement on Form S-6 (File No. 33-11465), filed on behalf of United
Investors Life Variable Account on January 22, 1987.
4 Incorporated herein by reference to Exhibit 6(b) to the Registration
Statement on Form S-6 (File No. 33-11465), filed on behalf of United
Investors Life Variable Account on January 22, 1987.
5 To be filed by amendment.
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
---------------------------------------
Name and Principal Position and Offices
Business Address* with Depositor
- ----------------- --------------
Ronald K. Richey Director, Chairman of the Board
and Chief
Executive Officer
James L. Sedgwick Director and President
W. Thomas Aycock Vice President and Chief
Actuary, and Director
Charles T. Clayton, Jr. Vice President
Michael J. Klyce Vice President and Treasurer
John H. Livingston Secretary and Associate Counsel, and Director
James L. Mayton, Jr. Vice President and Controller
Carol A. McCoy Director and Assistant
Secretary
Anthony L. McWhorter Director
Ross W. Stagner Vice President and Director
William L. Surber Vice President and Director
Keith A. Tucker Director and Vice Chairman
________________________
* The principal business address of each person listed is United Investors
Life Insurance Company, P. O. Box 10207, Birmingham, Alabama 35202-0207.
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
-------------------------------------------------------------------
REGISTRANT
----------
C - 2
<PAGE>
The Depositor, United Investors Life Insurance Company, Inc. ("United
Investors"), is wholly owned by United Investors Management Company (formerly
TMK/United, Inc.), which in turn is indirectly owned by Torchmark Corporation.
The following table shows the persons controlled by or under common control with
United Investors, their Parent Company, and the state or jurisdiction of
incorporation. All companies are 100% owned by their Parent Company, unless
otherwise indicated, which is indirectly owned by Torchmark Corporation. The
Registrant is a segregated asset account of United Investors.
<TABLE>
<CAPTION>
Parent State/Jurisdiction
Company Co. Code of Incorporation
- ------- -------- ------------------
<S> <C> <C>
American Income Life Insurance Co. D Indiana
Parent State/Jurisdiction
Company Co. Code of Incorporation
- ------- -------- ------------------
American Life and Accident Insurance Co. B Texas
Brown-Service Funeral Homes Co., Inc. C Alabama
(Services burial insurance policies)
Family Service Life Insurance Co. C Texas
Famlico, Inc. A Texas
Fiduciary Trust Company of New Hampshire G* New Hampshire
First United American Life Insurance Co. E New York
Globe Insurance Agency, Inc. B Arkansas
Globe Life And Accident Insurance Co. D Delaware
Globe Marketing Services Inc. B Oklahoma
Liberty National Auto Club, Inc. C Alabama
Liberty National GroupCare, Inc. C Alabama
Liberty National Life Insurance Co. D Alabama
Living Decisions, Inc. E Texas
Maxwell's Energy Company, Inc. D Alabama
Sentinel American Life Insurance Co. A Texas
</TABLE>
C - 3
<PAGE>
<TABLE>
<S> <C> <C>
Stonegate Management Company H Alabama
Stonegate Realty Company H Delaware
Torch Royalty Company F Delaware
Torchmark Corporation Delaware
(Holding company)
Torchmark Development Corporation D Alabama
Torchmark Distributors, Inc. G Missouri
(Distributor for mutual funds)
Unicon Agency, Inc. G New York
United American Insurance Co. D Delaware
</TABLE>
- ------------------------
* Parent company owns 99% of the common stock.
<TABLE>
<CAPTION>
Parent State/Jurisdiction
Company Co. Code of Incorporation
- ------- -------- ------------------
<S> <C> <C>
</TABLE>
C - 4
<PAGE>
<TABLE>
<S> <C> <C>
United Investors Life Insurance Co. F Missouri
United Investors Management Co. C** Delaware
W & R Insurance Agency, Inc. G Missouri
W & R Insurance Agency of Alabama, Inc. G Alabama
W & R Insurance Agency of Arkansas, Inc. G Arkansas
W & R Insurance Agency of Massachusetts, Inc. G Massachusetts
W & R Insurance Agency of Montana, Inc. G Montana
W & R Insurance Agency of Nevada, Inc. G Nevada
W & R Insurance Agency of Utah, Inc. G Utah
W & R Insurance Agency of Wyoming, Inc. G Wyoming
Waddell & Reed, Inc. F Delaware
(Insurance sales; investment manager)
Waddell & Reed Asset Management Co. G Missouri
Waddell & Reed Financial Services, Inc. F Missouri
Waddell & Reed Investment Management Co. G Kansas
Waddell & Reed Leasing, Inc. G Missouri
(Equipment leasing partnerships)
Waddell & Reed Services Co. G Missouri
(Shareholder services)
</TABLE>
________________________
** Parent company owns 81%.
Parent Company Codes
- -------------------------------------------
C - 5
<PAGE>
A Family Service Life Insurance Co.
B Globe Life And Accident Insurance Co.
C Liberty National Life Insurance Co.
D Torchmark Corporation
E United American Insurance Co.
F United Investors Management Co.
G Waddell & Reed, Inc.
H Torchmark Development Corporation
ITEM 27. NUMBER OF POLICY OWNERS
-----------------------
(Not Applicable)
ITEM 28. INDEMNIFICATION
---------------
Article XII of United Investors' By-Laws provides as follows:
"Each Director or officer, or former Director or officer, of this
Corporation, and his legal representatives, shall be indemnified by the
Corporation against liabilities, expenses, counsel fees and costs,
reasonably incurred by him or his estate in connection with, or arising out
of, any action, suit, proceeding or claim in which he is made a party by
reason of his being, or having been, such Director or officer; and any
person who, at the request of this Corporation, serves as Director or
officer of another corporation in which this Corporation owns corporate
stock, and his legal representatives, shall in like manner be indemnified
by this Corporation; provided that, in either case
C - 6
<PAGE>
shall the Corporation indemnify such Director or officer with respect to
any matters as to which he shall be finally adjudged in any such action,
suit or proceeding to have been liable for misconduct in the performance of
his duties as such Director or officer. The indemnification herein provided
for shall apply also in respect of any amount paid in compromise of any
such action, suit, proceeding or claim asserted against such Director or
officer (including expenses, counsel fees, and costs reasonably incurred in
connection therewith), provided that the Board of Directors shall have
first approved such proposed compromise settlement and determined that the
officer or Director involved is not guilty of misconduct, but in taking
such action any Director involved shall not be qualified to vote thereof,
and if for this reason a quorum of the Board cannot be obtained to vote on
such matters, it shall be determined by a committee of three (3) persons
appointed by the shareholders at a duly called special meeting or at a
regular meeting. In determining whether or not a Director or officer is
guilty of misconduct in relation to any such matter, the Board of Directors
or committee appointed by the shareholders, as the case shall be, may rely
conclusively upon an opinion of independent legal counsel selected by such
Board or committee. The rights to indemnification herein provided shall not
be exclusive of any other rights to which such Director or officer may be
lawfully entitled."
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to Directors, officers and controlling provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a Director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such Director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
ITEM 29. PRINCIPAL UNDERWRITERS
----------------------
(a) MAP Investments Incorporated ("MAP") is the principal underwriter of the
Policies as defined in the Investment Company Act of 1940. It is not the
principal underwriter, depositor, sponsor, or investment adviser for any other
investment company.
(b) The following table provides certain information with respect to each
director, officer, or partner of MAP.
Name and Principal Positions and Offices
Business Address* With Underwriter
- ----------------- ----------------
D. Mark Davenport Director, President, Treasurer
C - 7
<PAGE>
Terry L. Johnson Vice President, Secretary
(c) Commissions Received by Each Principal Underwriter
from the Registrant during the Registrant's Last Fiscal Year
------------------------------------------------------------
<TABLE>
<CAPTION>
Net
Underwriting
Name of Principal Discounts and Compensation Brokerage
Underwriter Commissions on Redemption Commissions Compensation
- ----------------- ----------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
MAP Investments (not applicable) (not applicable) (not applicable) (not applicable)
Incorporated
</TABLE>
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
--------------------------------
All accounts and records required to be maintained by Section 31(a) of the
1940 Act and the rules under it are maintained by United Investors at its home
office.
ITEM 31. MANAGEMENT SERVICES
-------------------
All management contracts are discussed in Part A or Part B.
ITEM 32. UNDERTAKINGS
------------
(a) Registrant undertakes that it will file a Post-Effective Amendment to this
Registration Statement as frequently as 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) Registrant undertakes that it will include either (1) as part of any
application to purchase a contract offered by the Prospectus, a space that an
applicant can check to request a Statement of Additional Information, or (2) a
post card or similar written communication affixed to or included in the
Prospectus that the applicant can remove to send for a Statement of Additional
Information.
(c) Registrant undertakes to deliver any Statement of Additional Information
and any financial statements required to be made available under this Form
promptly upon written or oral request to United Investors at the address or
phone number listed in the Prospectus.
(d) United Investors represents that the fees and charges deducted under the
Policy, in the aggregate, are reasonable in relation to the services rendered,
the expenses expected to be incurred, and the risks assumed by United
Investors.
STATEMENT PURSUANT TO RULE 6c-7
-------------------------------
United Investors and the Variable Account rely on 17 C.F.R. Sections
270.6c-7 and represent that the provisions of that Rule have been or will be
complied with. Accordingly, United Investors and the Variable Account are
exempt
C - 8
<PAGE>
from the provisions of Sections 22(e), 27(c)(1) and 27(d) of the Investment
Company Act of 1940 with respect to any variable annuity contract participating
in such account to the extent necessary to permit compliance with the Texas
Optional Retirement Program.
SECTION 403(b) REPRESENTATIONS
------------------------------
United Investors represents that it is relying on a no-action letter dated
November 28, 1988, to the American Council of Life Insurance (Ref. No. IP-6-88)
regarding Sections 22(e), 27(c)(1), and 27(d) of the Investment Company Act of
1940, in connection with redeemability restrictions on Section 403(b) policies,
and that paragraphs numbered (1) through (4) of that letter will be complied
with.
C - 9
<PAGE>
SIGNATURES
----------
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant, RetireMap Variable Account, has duly caused this
Registration Statement to be signed on its behalf in the City of Birmingham and
the State of Alabama on the 5th day of March, 1997.
RETIREMAP VARIABLE ACCOUNT
(REGISTRANT)
By: UNITED INVESTORS LIFE INSURANCE COMPANY
(DEPOSITOR)
By: /s/ James L. Sedgwick
-----------------------------
James L. Sedgwick, President
As required by the Securities Act of 1933, this Registration Statement has
been signed by the following persons in the capacities and on the dates
indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
_________________________ Director, Chairman of _____________
Ronald K. Richey the Board and Chief
Executive Officer
/s/ James L. Sedgwick Director and President March 5, 1997
- ------------------------- -------------
James L. Sedgwick
/s/ W. Thomas Aycock Vice President and March 5, 1997
- ------------------------- -------------
W. Thomas Aycock Chief Actuary, and
Director
/s/ Michael J. Klyce March 6, 1997
- ------------------------- Vice President and -------------
Michael J. Klyce Treasurer
/s/ John H. Livingston Secretary and Associate March 5, 1997
- ------------------------- -------------
John H. Livingston Counsel and Director
/s/ James L. Mayton, Jr. Vice President and March 5, 1997
- ------------------------- -------------
James L. Mayton, Jr. Controller
_________________________ Director _____________
Anthony L. McWhorter
_________________________ Director and Assistant _____________
Carol A. McCoy Secretary
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
/s/ Ross W. Stagner Vice President March 5, 1997
- ------------------------- -------------
Ross W. Stagner and Director
/s/ William L. Surber Vice President March 5, 1997
- ------------------------- -------------
William L. Surber and Director
_________________________ Director and Vice _____________
Keith A. Tucker Chairman
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- --------------------------------------
<S> <C>
(3)(A) Principal Underwriting Agreement
(3)(B) Form of Broker-Dealer Sales Agreement
(8)(B) Form of Administration Agreement
(15) Power of Attorney
</TABLE>
<PAGE>
PRINCIPAL UNDERWRITER'S AGREEMENT
---------------------------------
IT IS HEREBY AGREED by and between UNITED INVESTORS LIFE INSURANCE
COMPANY ("INSURANCE COMPANY") on behalf of RETIREMAP VARIABLE ACCOUNT
(the "Variable Account") and MAP INVESTMENTS, INC. ("PRINCIPAL UNDERWRITER")
as follows:
I
INSURANCE COMPANY proposes to issue and sell Individual Variable Deferred
Annuity Contracts (Form-V96) (the "Contracts") of the Variable Account to the
public through PRINCIPAL UNDERWRITER. The PRINCIPAL UNDERWRITER agrees to
provide sales service subject to the terms and conditions hereof. The Contracts
to be sold are more fully described in the registration statement and prospectus
hereinafter mentioned. Such Contracts will be issued by INSURANCE COMPANY
through the Variable Account.
II
INSURANCE COMPANY grants PRINCIPAL UNDERWRITER the exclusive right,
during the term of this Agreement, subject to registration requirements of the
Securities Act of 1933 and the Investment Company Act of 1940 and the provisions
of the Securities Exchange Act of 1934, to be the distributor of the Contracts
issued through the Variable Account. PRINCIPAL UNDERWRITER will sell the
Contracts under such terms as set by INSURANCE COMPANY and will make such sales
to purchasers permitted to buy such Contracts as specified in the prospectus.
1
<PAGE>
III
PRINCIPAL UNDERWRITER shall be compensated for its distribution services
under the terms and conditions as set forth in a marketing agreement between the
PRINCIPAL UNDERWRITER and INSURANCE COMPANY.
IV
On behalf of the Variable Account, INSURANCE COMPANY shall furnish
PRINCIPAL UNDERWRITER with copies of all prospectuses, financial statements and
other documents which PRINCIPAL UNDERWRITER reasonably requests for use in
connection with the distribution of the Contracts. INSURANCE COMPANY shall
provide to PRINCIPAL UNDERWRITER such number of copies of the current effective
prospectuses as PRINCIPAL UNDERWRITER shall request.
V
PRINCIPAL UNDERWRITER is not authorized to give any information, or to make
any representations concerning the Contracts or the Variable Account of
INSURANCE COMPANY other than those contained in the current registration
statements or prospectuses relating to the Variable Account filed with the
Securities and Exchange Commission or such sales literature as may be authorized
by INSURANCE COMPANY.
VI
Both parties to this Agreement agree to keep the necessary records as
indicated by applicable state and federal law and to render the necessary
assistance to one another for the accurate and timely preparation of such
records.
2
<PAGE>
VII
This Agreement shall be effective upon the execution hereof and will remain
in effect unless terminated as hereinafter provided.
This Agreement may at any time be terminated by mutual consent of the
parties hereto.
VIII
All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed to have been given on the date
of service if served personally on the party to whom notice is to be given, or
on the date of mailing if sent by First Class Mail, Registered or Certified,
postage prepaid and properly addressed.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
signed on their behalf by their respective officers thereunto duly authorized.
EXECUTED this ____ day of ___________, 1997.
INSURANCE COMPANY
UNITED INVESTORS LIFE INSURANCE
COMPANY
BY:
--------------------------------
ATTEST:
-----------------------
Secretary
PRINCIPAL UNDERWRITER
MAP INVESTMENTS, INC.
BY:
--------------------------------
ATTEST:
-----------------------
Secretary
3
<PAGE>
SELLING AGREEMENT
Agreement dated as of __________________, 199_, by and among United
Investors Life Insurance Company, a Missouri corporation ("Life Company"); MAP
Investments, Inc., an Oklahoma corporation ("Distributor"); ___________________,
a ____________________ corporation ("Broker/Dealer") and ______________________,
("Insurance Agent").
RECITALS:
A. Pursuant to a distribution agreement with Distributor, Life Company has
appointed Distributor as the principal underwriter of the variable annuity
contracts identified in Schedule 1 to this Agreement at the time that this
Agreement is executed, and such other variable annuity contracts or
variable life insurance contracts that may be added to Schedule 1 from time
to time in accordance with Section 2(f) of this Agreement. Such contracts
together with any fixed annuity contracts shown on Schedule 1 shall be
referred to herein as "Contracts".
B. The parties to this Agreement desire that Broker/Dealer and Insurance Agent
be authorized to solicit applications for the sale of the Contracts to the
general public subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and of the mutual promises and
covenants hereinafter set forth, the parties agree as follows:
1. Additional Definitions
(a) Affiliate - With respect to a person, any other person controlling,
---------
controlled by, or under common control with, such person.
(b) Agent - An individual associated with Insurance Agent and
-----
Broker/Dealer who is appointed by Life Company as an agent for the
purpose of soliciting applications.
(c) NASD - The National Association of Securities Dealers, Inc.
----
(d) 1933 Act - The Securities Act of 1933, as amended.
--------
(e) 1934 Act - The Securities and Exchange Act of 1934, as amended.
--------
(f) 1940 Act - The Investment Company Act of 1940, as amended.
--------
1
<PAGE>
(g) Premium - A payment made under a Contract to purchase benefits under
-------
such Contract.
(h) Prospectus - With respect to each Contract, the prospectus for such
----------
Contract included within the Registration Statement for such Contract;
provided, however, that, if the most recently filed prospectus, filed
pursuant to Rule 497 under the 1933 Act subsequent to the date on
which the Registration Statement became effective differs from the
prospectus on file at the time the Registration Statement became
effective, the term "Prospectus" shall refer to the most recently
filed prospectus filed under Rule 497 from and after the date on which
it shall have been filed.
(i) Registration Statement - With respect to each Contract, the most
----------------------
recent effective registration statement(s) filed with the SEC or the
most recent effective post-effective amendment(s) thereto with respect
to such Contract, including financial statements included therein and
all exhibits thereto. There may be more than one Registration
Statement in effect at a time for a Contract; in such case, any
reference to "the Registration Statement" for a Contract shall refer
to any or all, depending on the context, of the Registration
Statements for such Contract.
(j) SEC - The Securities and Exchange Commission.
---
(k) Service Center - Policy Service Office:
--------------
P.O. Box 10207, Birmingham, Alabama 35202-0207
2. Authorization of Broker/Dealer and Insurance Agent
(a) Distributor hereby authorizes Broker/Dealer under the securities laws,
and Life Company hereby authorizes and appoints Insurance Agent under
the insurance laws, each in a non-exclusive capacity, to distribute
the Contracts. Broker/Dealer and Insurance Agent accept such
authorization and appointment and shall use their best efforts to find
purchasers for the Contracts, in each case acceptable to Life Company.
(b) Life Company shall notify Broker/Dealer and Insurance Agent in writing
of all states and jurisdictions in which Life Company is licensed to
sell the Contracts. Broker/Dealer and Insurance Agent acknowledge that
no territory is exclusively assigned hereunder, and Life Company
reserves the right in its sole discretion to establish or appoint one
or more agencies in any jurisdiction in which Insurance Agent
transacts business hereunder.
2
<PAGE>
(c) Insurance Agent is vested under this Agreement with power and
authority to select and recommend individuals associated with
Insurance Agent for appointment as Agents of Life Company, and only
individuals so recommended by Insurance Agent shall become Agents,
provided that Life Company reserves the right in its sole discretion
to refuse to appoint any proposed agent or, once appointed, to
terminate the same at any time with or without cause.
(d) Neither Broker/Dealer nor Insurance Agent shall expend or contract for
the expenditure of the funds of Life Company. Broker/Dealer and
Insurance Agent each shall pay all expenses incurred by each of them
in the performance of this Agreement, unless otherwise specifically
provided for in this Agreement or unless Life Company and Distributor
shall have agreed in advance in writing to share the cost of certain
expenses. Initial and renewal state appointment fees for Insurance
Agent and appointees of Insurance Agent as Agents of Life Company will
be paid by Life Company according to the terms set forth in the rules
and regulations as may be adopted by Life Company from time to time.
Neither Broker/Dealer nor Insurance Agent shall possess or exercise
any authority on behalf of Distributor or Life Company other than that
expressly conferred on Broker/Dealer or Insurance Agent by this
Agreement. In particular, and without limiting the foregoing, neither
Broker/Dealer nor Insurance Agent shall have any authority, nor shall
either grant such authority to any Agent, on behalf of Distributor or
Life Company: to make, alter or discharge any Contract or other
contract entered into pursuant to a Contract; to waive any Contract
forfeiture provision; to extend the time of paying any Premiums; or to
receive any monies or Premiums from applicants for or purchasers of
the Contracts (except for the sole purpose of forwarding monies or
Premiums to Life Company).
(e) Broker/Dealer and Insurance Agent acknowledge that Life Company has
the right in its sole discretion to reject any applications or
Premiums received by it and to return or refund to an applicant such
applicant's Premium.
(f) Schedule 1 to this Agreement may be amended by Distributor and Life
Company in their sole discretion from time to time to include other
variable annuity contracts, fixed annuity contracts, or variable life
insurance contracts, or to delete contracts from the Schedule.
(g) Distributor and Life Company acknowledge that Broker/Dealer and
Insurance Agent are each an independent contractor. Accordingly,
Broker/Dealer and Insurance Agent are not obliged or expected to give
full time and energies to the performance of their obligations
hereunder, nor are Broker/Dealer and Insurance Agent obliged or
expected to represent
3
<PAGE>
Distributor or Life Company exclusively. Nothing herein contained
shall constitute Broker/Dealer, Insurance Agent, the Agents or any
agents or representatives of Broker/Dealer or Insurance Agent as
employees of Distributor or Life Company in connection with
solicitation of applications for the Contracts.
3. Licensing and Registration of Broker/Dealer, Insurance Agent and Agents
(a) Broker/Dealer represents and warrants that it is a Broker/Dealer
registered with the SEC under the 1934 Act, and is a member of the
NASD in good standing. Broker/Dealer must, at all times when
performing its functions and fulfilling its obligations under this
Agreement, be duly registered as a Broker/Dealer under the 1934 Act
and as required by applicable law, in each state or other jurisdiction
in which Broker/Dealer intends to perform its functions and fulfill
its obligations hereunder.
(b) Insurance Agent represents and warrants that it is a licensed life
insurance agent where required to solicit applications. Insurance
Agent must, at all times when performing its functions and fulfilling
its obligations under this Agreement, be duly licensed to sell the
Contracts in each state or other jurisdiction in which Insurance Agent
intends to perform its functions and fulfill its obligations
hereunder.
(c) Broker/Dealer shall ensure that no individual shall offer or sell the
Contracts on its behalf in any state or other jurisdiction in which
the Contracts may lawfully be sold unless such individual is an
associated person of Broker/Dealer (as that term is defined in Section
3(a)(18) of the 1934 Act) and duly registered with the NASD and any
applicable state securities regulatory authority as a registered
person of Broker/Dealer qualified to distribute the Contracts in such
state or jurisdiction. Broker/Dealer shall be solely responsible for
the background investigations of the Agents to determine their
qualifications and will provide Life Company upon request with copies
of such investigations.
(d) Insurance Agent shall ensure that no individual shall offer or sell
the Contracts on behalf of Insurance Agent in any state or other
jurisdiction unless such individual is duly affiliated as an agent of
Insurance Agent, duly licensed and appointed as an agent of Life
Company, and appropriately licensed, registered or otherwise qualified
to offer and sell the Contracts to be offered and sold by such
individual under the insurance laws of such state or jurisdiction.
Insurance Agent shall be responsible for investigating the character,
work experience and background of any proposed agent prior to
recommending appointment as agent of Life Company. Upon request, Life
4
<PAGE>
Company shall be provided with copies of such investigation. All
matters concerning the licensing of any individuals recommended for
appointment by Insurance Agent under any applicable state insurance
law shall be a matter directly between Insurance Agent and such
individual, and the Insurance Agent shall furnish Life Company with
proof of proper licensing of such individual or other proof,
reasonably acceptable to Life Company. Broker/Dealer and Insurance
Agent shall notify Distributor and Life Company immediately upon
termination of an Agent's association with Broker/Dealer or Insurance
Agent.
(e) Without limiting the foregoing, Broker/Dealer and Insurance Agent
represent that they are in compliance with the terms and conditions of
letters issued by the Staff of the SEC with respect to the non-
registration as a broker/dealer of an insurance agency associated with
a registered broker/dealer. Broker/Dealer and Insurance Agent shall
notify Distributor immediately in writing if Broker/Dealer and/or
Insurance Agent fail to comply with any such terms and conditions and
shall take such measures as may be necessary to comply with any such
terms and conditions.
4. Broker/Dealer and Insurance Agent Compliance
(a) Broker/Dealer and Insurance Agent hereby represent and warrant that
they are duly in compliance with all applicable federal and state
securities laws and regulations, and all applicable insurance laws and
regulations. Broker/Dealer and Insurance Agent each shall carry out
their respective obligations under this Agreement in continued
compliance with such laws and regulations. Broker/Dealer shall be
responsible for securities training, supervision and control of the
Agents in connection with their solicitation activities with respect
to the Contracts and shall supervise Agents' compliance with
applicable federal and state securities law and NASD requirements in
connection with such solicitation activities. Broker/Dealer and
Insurance Agent shall comply, and shall ensure that Agents comply,
with the rules and procedures established by Life Company from time to
time, and the rules set forth below, and Broker/Dealer and Insurance
Agent shall be solely responsible for such compliance.
(b) Broker/Dealer, Insurance Agent and Agents shall not offer or attempt
to offer the Contracts, nor solicit applications for the Contracts,
nor deliver Contracts, in any state or jurisdiction in which the
Contracts may not lawfully be sold or offered for sale.
(c) Broker/Dealer, Insurance Agent and Agents shall not solicit
applications for the Contracts without delivering the Prospectus for
the Contracts, the then-
5
<PAGE>
currently effective prospectus(es) for the underlying fund(s)
and, where required by state insurance law, the then-currently
effective statement of additional information for the Contracts.
(d) Broker/Dealer, Insurance Agent and Agents shall not recommend the
purchase of a Contract to an applicant unless each has reasonable
grounds to believe that such purchase is suitable for the applicant in
accordance with, among other things, applicable regulations of any
state insurance commission, the SEC and the NASD.
(e) Insurance Agent shall return promptly to Life Company all receipts for
delivered Contracts, all undelivered contracts and all receipts for
cancellation, in accordance with the requirements established by Life
Company and/or as required under state insurance law. Upon issuance of
a Contract by Life Company and delivery of such Contract to Insurance
Agent, Insurance Agent shall promptly deliver such Contract to its
purchaser. For purposes of this provision "promptly" shall be deemed
to mean not later than five calendar days. Life Company will assume
that a Contract will be delivered by Insurance Agent to the purchaser
of such Contract within five calendar days for purposes of determining
when to transfer premiums initially allocated to the Money Market
Account available under such Contracts to the particular investment
options specified by such purchaser. As a result, if purchasers
exercise the free look provisions under such Contracts, Broker/Dealer
shall indemnify Life Company for any loss incurred by Life Company
that results from Insurance Agent's failure to deliver such Contracts
to the purchasers within the contemplated five calendar day period.
(f) In the event that Premiums are sent to Insurance Agent or
Broker/Dealer, rather than to the Service Center, Insurance Agent and
Broker/Dealer shall promptly (and in any event, not later than two
business days) remit such Premiums to Life Company at the Service
Center. Insurance Agent and Broker/Dealer acknowledge that if any
Premium is held at any time by either of them, such Premium shall be
held on behalf of the customer, and Insurance Agent or Broker/Dealer
shall segregate such premium from their own funds and promptly (and in
any event, within 2 business days) remit such Premium to Life Company.
All such Premiums, whether by check, money order or wire, shall at all
times be the property of Life Company.
(g) Neither Broker/Dealer nor Insurance Agent, nor any of their directors,
partners, officers, employees, registered persons, associated persons,
agents or affiliated persons, in connection with the offer or sale of
the Contracts, shall give any information or make any representations
or
6
<PAGE>
statements, written or oral, concerning the Contracts, the underlying
funds or fund Shares, other than information or representations
contained in the Prospectuses, statements of additional information
and Registration Statements for the Contracts, or a fund prospectus,
or in reports or proxy statements therefor, or in promotional, sales
or advertising material or other information supplied and approved in
writing by Distributor and Life Company.
(h) Broker/Dealer and Insurance Agent shall not use or implement any
promotional, sales or advertising material relating to the Contracts
without the prior written approval of Distributor and Life Company.
(i) Broker/Dealer and Insurance Agent shall be solely responsible under
applicable tax laws for the reporting of compensation paid to Agents.
(j) Broker/Dealer and Insurance Agent each represent that it maintains and
shall maintain such books and records concerning the activities of the
Agents as may be required by the SEC, the NASD and any appropriate
insurance regulatory agencies that have jurisdiction and that may be
reasonably required by Life Company. Broker/Dealer and Insurance Agent
shall make such books and records available to Life Company upon
written request.
(k) Broker/Dealer and Insurance Agent shall promptly furnish to Life
Company or its authorized agent any reports and information that Life
Company may reasonably request for the purpose of meeting Life
Company's reporting and record keeping requirements under the
insurance laws of any state, under any applicable federal and state
securities laws, rules and regulations, and the rules of the NASD.
(l) Broker/Dealer shall secure and maintain a fidelity bond (including
coverage for larceny and embezzlement), issued by a reputable bonding
company, covering all of its directors, officers, agents and employees
who have access to funds of Insurance Company. This bond shall be
maintained at Broker/Dealer's expense in at least the amount
prescribed under Article III, Section 32 of the NASD Rules of Fair
Practice. Broker/Dealer shall upon request provide Distributor with a
copy of said bond. Broker/Dealer shall also secure and maintain errors
and omissions insurance acceptable to Distributor and covering
Broker/Dealer, Insurance Agent and Agents. Broker/Dealer hereby
assigns any proceeds received from a fidelity bonding company, errors
and omissions or other liability coverage, to Distributor or Life
Company as their interests may appear, to the extent of their loss due
to activities covered by the bond, policy or other liability coverage.
If there
7
<PAGE>
is any deficiency amount, whether due to a deductible or otherwise,
Broker/Dealer shall promptly pay such amount on demand. Broker/Dealer
hereby indemnifies and holds harmless Distributor or Life Company from
any such deficiency and from the costs of collection thereof,
including reasonable attorneys' fees.
5. Sales Materials
(a) During the term of this Agreement, Distributor and Life Company will
provide Broker/Dealer and Insurance Agent, without charge, with as
many copies of Prospectuses (and any supplements thereto), current
fund prospectus(es) (and any supplements thereto), and applications
for the Contracts, as Broker/Dealer or Insurance Agent may reasonably
request. Upon termination of this Agreement, Broker/Dealer and
Insurance Agent will promptly return to Distributor any Prospectuses,
applications, fund prospectuses, and other materials and supplies
furnished by Distributor or Life Company to Broker/Dealer or Insurance
Agent or to the Agents.
(b) During the term of this Agreement, Distributor will be responsible for
providing and approving all promotional, sales and advertising
material to be used by Broker/Dealer and Insurance Agent. Distributor
will file such materials or will cause such materials to be filed with
the SEC, the NASD, and/or with any state securities regulatory
authorities, as appropriate.
6. Commission Agreement
(a) During the term of this Agreement, Distributor and Life Company shall
pay to Broker/Dealer or Insurance Agent, as applicable, commissions
and fees set forth in Schedule 2 to this Agreement. The payment of
such commissions and fees shall be subject to the terms and conditions
of this Agreement and those set forth on Schedule 2. Schedule 2,
including the commissions and fees therein, may be amended at any
time, in any manner, and without prior notice, by Distributor or Life
Company. Any amendment to Schedule 2 will be applicable to any
Contract for which any application or Premium is received by the
Service Center on or after the effective date of such amendment.
However, Life Company reserves the right to amend such Schedule with
respect to subsequent premiums and renewal commissions and the right
to amend such Schedule pursuant to this subsection even after
termination of this Agreement. Compensation with respect to any
Contract shall be paid to Insurance Agent only for so long as
Insurance Agent is the agent-of-record and maintains compliance with
applicable state insurance laws and only while this Agreement is in
effect.
8
<PAGE>
(b) No compensation shall be payable, and Broker-Dealer and Insurance
Agent agree to reimburse Distributor and Life Company for any
compensation that may have been paid to Broker-Dealer, Insurance Agent
or any Agents in any of the following situations: (i) Insurance
Company, in its sole discretion, determines not to issue the Contract
applied for; (ii) Insurance company refunds the premiums upon the
applicant's surrender or withdrawal pursuant to any "free-look"
privilege; (iii) Insurance Company refunds the premiums paid by
applicant as a result of a complaint by applicant; (iv) Insurance
Company determines that any person soliciting an application who is
required to be licensed or any other person or entity receiving
compensation for soliciting applications or premiums for the Contracts
is not or was not duly licensed as an insurance agent; or (v) any
other situation listed on Schedule 2.
(c) Agents shall have no interest in this Agreement or right to any
commissions to be paid by Distributor or Life Company to Insurance
Agent. Insurance Agent shall be solely responsible for the payment of
any commission or consideration of any kind to Agents. Insurance Agent
shall have no right to withhold or deduct any commission from any
Premiums in respect of the Contract which it may collect unless and
only to the extent that Schedule 2 of this Agreement permits Insurance
Agent to net its commissions against Premiums collected. Insurance
Agent shall have no interest in any compensation paid by Life Company
to Distributor or any affiliate, now or hereafter, in connection with
the sale of any Contracts hereunder.
7. Term and Termination
This Agreement may not be assigned except by written consent of the parties
hereto and shall continue for an indefinite term, subject to the
termination by any party hereto upon thirty days' advance written notice to
the other parties, except that in the event Distributor or Broker/Dealer
ceases to be a registered broker/dealer or a member of the NASD, or
Insurance Agent ceases to be properly licensed, this Agreement shall
immediately terminate. Upon its termination, all authorizations, rights and
obligations under this Agreement shall cease, except the agreements in
Sections 6, 8 and 10 which shall survive any such termination.
8. Complaints and Investigations
(a) Distributor, Life Company, Broker/Dealer and Insurance Agent shall
cooperate fully in any insurance regulatory investigation or
proceeding or judicial proceeding arising in connection with the
Contracts marketed under this Agreement. In addition, Distributor,
Life Company, Broker/Dealer and Insurance Agent shall cooperate fully
in any securities regulatory
9
<PAGE>
investigation or proceeding or judicial proceeding with respect to
Distributor, Broker/Dealer, their Affiliates and their agents, to the
extent that such investigation or proceeding related to the Contracts
marketed under this Agreement. Without limiting the foregoing:
(i) Broker/Dealer and Insurance Agent will be notified promptly of
any customer complaint or notice of any regulatory investigation
or proceeding or judicial proceeding received by Distributor or
Life Company with respect to Insurance Agent or any Agent which
may affect the issuance of any Contract marketed under this
Agreement.
(ii) Broker/Dealer and Insurance Agent will promptly notify
Distributor and Life Company of any written customer complaint or
notice of any regulatory investigation or proceeding or judicial
proceeding received by Broker/Dealer or Insurance Agent or their
Affiliates with respect to themselves, their Affiliates, or any
Agent in connection with any Contract marketed under this
Agreement or any activity in connection with any such Contract.
(b) In the case of a customer complaint, Distributor, Life Company,
Broker/Dealer and Insurance Agent will cooperate in investigating such
complaint and any response by Broker/Dealer or Insurance Agent to such
complaint will be sent to Distributor and Life Company for approval
not less than five business days prior to its being sent to the
customer or regulatory authority, except that if a more prompt
response is required, the proposed response shall be communicated by
telephone or facsimile.
9. Modification of Agreement
This Agreement supersedes all prior agreements, either oral or written,
between the parties relating to the Contracts.
10. Indemnification
(a) Broker/Dealer and Insurance Agent, jointly and severally, shall
indemnify and hold harmless Distributor and Life Company and each
person who controls or is associated with Distributor or Life Company
within the meaning of such terms under the federal securities laws,
and any officer, director, employee or agent of the foregoing, against
any and all losses, claims, damages or liabilities, joint or several
(including any investigative, legal and other expenses reasonably
incurred in connection with, and any reasonable amounts paid in
settlement of, any action, suit or proceeding or any claim asserted),
to which they or any of them may become subject under any
10
<PAGE>
statute or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities arise out of or are based upon
any actual or alleged:
(i) violation(s) by Broker/Dealer, Insurance Agent or an Agent of
federal or state securities law or regulations, insurance law
or regulation(s), or any rule or requirement of the NASD;
(ii) unauthorized use of sales or advertising material, any oral or
written misrepresentations, or any unlawful sales practices
concerning the Contracts, by Broker/Dealer, Insurance Agent or
an Agent;
(iii) claims by the Agents or other agents or representatives of
Insurance Agent or Broker//Dealer for commissions or other
compensation or remuneration of any type;
(iv) any failure on the part of Broker/Dealer, Insurance Agent, or
an Agent to submit Premiums or applications to Life Company, or
to submit the correct amount of a Premium, on a timely basis
and in accordance with this Agreement;
(v) any failure on the part of Broker/Dealer, Insurance Agent, or
an Agent to deliver Contracts to purchasers thereof on a timely
basis as set forth in Section 4(e) of this Agreement; or
(vi) a breach by Broker/Dealer or Insurance Agent of any provision
of this Agreement.
This indemnification will be in addition to any liability which
Broker/Dealer and Insurance Agent may otherwise have.
(b) Distributor and Life Company, jointly and severally, shall indemnify
and hold harmless Broker/Dealer and Insurance Agent and each person
who controls or is associated with Broker/Dealer or Insurance Agent
within the meaning of such terms under the federal securities laws,
and any officer, director, employee or agent of the foregoing, against
any and all losses, claims, damages or liabilities, joint or several
(including any investigative, legal and other expenses reasonably
incurred in connection with, and any reasonable amounts paid in
settlement of, any action, suit or proceeding or any claim asserted),
to which they or any of them may become subject under any statute or
regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities arise out of or are based upon a breach
by Distributor or Life Company of any provision of this Agreement.
This
11
<PAGE>
indemnification will be in addition to any liability which Distributor
and Life Company may otherwise have.
(c) After receipt by a party entitled to indemnification ("indemnified
party") under this Section 10 of notice of the commencement of any
action, if a claim in respect thereof is to be made against any person
obligated to provide indemnification under this Section 10
("indemnifying party"), such indemnified party will notify the
indemnifying party in writing of the commencement thereof as soon as
practicable thereafter, provided that the omission to so notify the
indemnifying party will not relieve it from any liability under this
Section 10, except to the extent that the omission results in a
failure of actual notice to the indemnifying party and such
indemnifying party is damaged as a result of the failure to give such
notice. The indemnifying party will be entitled to participate in the
defense of the indemnified party but such participation will not
relieve such indemnifying party of the obligation to reimburse the
indemnified party for reasonable legal and other expenses incurred by
such indemnified party in defending himself or itself. The
indemnification provisions contained in this Section 10 shall remain
operative in full force and effect, regardless of any termination of
this Agreement. A successor by law of Distributor or Life Company, as
the case may be, shall be entitled to the benefits of the
indemnification provisions contained in this Section 10.
11. Rights, Remedies, etc. are Cumulative
The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to
under state and federal laws. Failure of either party to insist upon strict
compliance with any of the conditions of this Agreement shall not be
construed as a waiver of any of the conditions, but the same shall remain
in full force and effect. No waiver of any of the provisions of this
Agreement shall be deemed, nor shall constitute, a waiver of any other
provisions, whether or not similar, nor shall any waiver constitute a
continuing waiver.
12. Notices
All notices hereunder are to be made in writing and shall be given:
12
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if to Distributor, to : if to Life Company, to:
MAP Investments, Inc. United Investors Life Insurance Company
9020 North May Avenue 2001 Third Avenue South
Suite 290 Birmingham, Alabama 35233
Oklahoma City, OK 73120
if to Broker/Dealer, to If to Insurance Agent, to:
------------------------- --------------------------
------------------------- --------------------------
------------------------- --------------------------
------------------------- --------------------------
or such other address as such party may hereafter specify in writing. Each
such notice to a party shall be either hand delivered, transmitted by
registered or certified United States mail with return receipt requested or
by express courier, and shall be effective upon delivery.
13. Interpretation, Jurisdiction, Etc.
This Agreement constitutes the whole agreement between the parties hereto
with respect to the subject matter hereof, and supersedes all prior oral or
written understandings, agreements or negotiations between the parties with
respect to the subject matter hereof. No prior writings by or between the
parties hereto with respect to the subject matter hereof shall be used by
either party in connection with the interpretation of any provision of this
Agreement. This Agreement shall be construed and its provisions interpreted
under and in accordance with the internal laws of the State of Illinois
without giving effect to principles of conflict of laws.
14. Arbitration
Any controversy or claim arising out of or relating to this Agreement, or
the breach hereof, shall be settled by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association, and
judgment upon the award rendered by the arbitrator(s) may be entered in any
court having jurisdiction thereof.
15. Setoffs; Chargebacks
Broker/Dealer and Insurance Agent hereby authorize Distributor and Life
Company to set off from all amounts otherwise payable to Broker/Dealer and
Insurance Agent all liabilities of Broker/Dealer, Insurance Agent or Agent.
Broker/Dealer and Insurance Agent shall be jointly and severally liable for
the payment of all monies
13
<PAGE>
due to Distributor and/or Life Company which may arise out of this
Agreement or any other agreement between Broker/Dealer, Insurance Agent and
Distributor or Life Company including, but not limited to, any liability
for any chargebacks or for any amounts advanced by or otherwise due
Distributor or Life Company hereunder. All such amounts shall be paid to
the Distributor and Life Company within thirty days of written request
therefore. Distributor and Life Company do not waive any of its other
rights to pursue collection of any indebtedness owed by Broker/Dealer or
Insurance Agent or its Agents to Distributor or Life Company. In the event
Distributor or Life Company initiates legal action to collect any
indebtedness of Broker/Dealer, Insurance Agent or its Agents, Broker/Dealer
and Insurance Agent shall reimburse Distributor and Life Company for
reasonable attorney fees and expenses in connection therewith.
16. Headings
The headings in this Agreement are included for convenience of reference
only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
17. Counterparts
This Agreement may be executed in two or more counterparts, each of which
taken together shall constitute one and the same instrument.
18. Severability
This is a severable Agreement. In the event that any provision of this
Agreement would require a party to take action prohibited by applicable
federal or state law or prohibit a party from taking action required by
applicable federal or state law, then it is the intention of the parties
hereto that such provision shall be enforced to the extent permitted under
the law, and, in any event, that all other provisions of this Agreement
shall remain valid and duly enforceable as if the provision at issue had
never been part hereof.
14
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
UNITED INVESTORS LIFE INSURANCE COMPANY
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
MAP INVESTMENTS, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[Broker/Dealer]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[Insurance Agent]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
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FULL SERVICE AGREEMENT
AGREEMENT (this "Agreement" or "Service Agreement") made as of the _____
day of ____________, 1996, by and between United Investors Life Insurance
Company ("Client"), 2001 Third Avenue South, Birmingham, Alabama 35202, and
Alliance-One Services, L.P. ("Alliance-One"), 2000 Wade Hampton Boulevard,
Greenville, South Carolina 29615.
WHEREAS, Alliance-One uses a computerized data processing recordkeeping
system known as "Vantage-One" for certain life and annuity contracts (the
"Vantage-One System") and has the data processing equipment and administrative
support personnel (the "Facilities" or "Alliance-One's Facilities") to provide
and support administrative processing using the Vantage-One System and
Facilities for the maintenance of records, processing of information, and the
generation of output with respect thereto; and
WHEREAS, Client desires to appoint Alliance-One as Recordkeeping Service
Agent for certain of its life and annuity products (the "Contracts"), as
described in Exhibit A attached hereto, and Alliance-One desires to accept such
appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
SECTION 1 Terms of Appointment
--------------------
1.1 Subject to the conditions set forth in this Agreement, Client hereby
appoints Alliance-One as its Recordkeeping Service Agent for the Contracts and
Alliance-One hereby accepts such appointment.
1.2 Alliance-One agrees to provide the facilities, equipment, and personnel
to perform those Recordkeeping Service Functions set forth in Exhibit B1 and
Exhibit B2 in accordance with standard industry practice.
1.3 If requested to do so, Alliance-One will make on-line access to the
Vantage-One System available to Client between the hours of 7:00 a.m. and 7:00
p.m., Central Time, Monday through Friday, except for such holidays as are
observed by the New York Stock Exchange. Access to the Vantage-One System at
other times will be by mutual agreement.
1.4 The Contracts are underwritten by Client and Alliance-One shall not
provide any underwriting services.
1.5 Client shall be responsible for determining the benefits, premium
rates, adjudication of claims, and claims payment procedures applicable to such
coverage; all rules pertaining to these matters must be provided, in writing, by
Client to Alliance- One.
1.6 Alliance-One and Client may agree to a service arrangement for
additional services by signing a Work Assignment that references this Agreement.
Additional services may include:
. System Interfaces . Training Classes
. Model Office . Addition of New Plans
. Conversion Activities
. Customizations
. Ad hoc reporting Programs
1.6.1 Each Work Assignment will describe the work to be done and any
special provisions applicable to the project. In the event of a conflict
between the term of this Agreement and the term of a Work Assignment, the
term of the Work Assignment shall prevail.
1.6.2 If a Work Assignment states that services will be provided on a
"Time and Materials Basis," Alliance-One's charges for the services will be
determined by the amount of Alliance-One personnel time, computer time, and
materials used in providing the services, plus reimbursable expenses,
rather than by the results achieved. Client bears the risk of cost overruns
and delays on work performed on a Time and Materials Basis.
K:\AGREE\FULL\UNTINV.8 October 4, 1996
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1.6.3 Alliance-One will try to accommodate Client's requests
concerning the assignment of personnel to Client's projects, but Alliance-
One reserves the right to determine the assignment of its personnel.
1.6.4 If Alliance-One provides Client with an estimate of the cost or
timeframe for any additional services to be provided by Alliance-One, the
estimate will be made in good faith based on the information known to
Alliance-One.
SECTION 2 Fees and Expenses
-----------------
2.1 During the Initial Term (as defined in Section below) of this
Agreement, Client shall pay to Alliance-One upon receipt of Alliance-One's
statement the fees and charges in the amounts as set out in Exhibit A attached
hereto and made a part hereof. Alliance-One shall not be entitled to any
compensation or other payments except as expressly set forth on Exhibit A or
otherwise agreed in writing between the parties. For each renewal term of this
Agreement Alliance-One shall be entitled to receive such fees and charges as
shall be agreed upon by the parties prior to commencement of each such term,
pursuant to Section hereof.
2.2 Alliance-One may impose a late payment charge of one and one-half
percent (1 1/2%) per month, or the highest rate permitted by law, whichever is
lower, on balances outstanding for over thirty (30) days.
2.3 Amounts payable to Alliance-One are payable in full, in United States
dollars, without deduction, and are net of all sales, use, property and related
taxes and duties. Client shall pay directly or to Alliance-One sums equal to all
such taxes and duties paid or payable by reason of this Agreement or the
parties' performance hereunder, exclusive of taxes based upon the net income of
Alliance-One. Client shall not deduct from payments due Alliance-One hereunder
any amounts paid or payable to third parties for duties or taxes, however
designated, including withholding taxes (except for garnishments, tax levies,
and similar orders). All taxes payable by Client hereunder shall become due when
billed by Alliance-One to Client, or when assessed, levied or billed by the
appropriate taxing authority, even though such billing shall occur subsequent to
expiration or termination of this Agreement.
SECTION 3 Payments and Collections
------------------------
3.1 The payment to Alliance-One of any premiums or charges for insurance
and deposits by or on behalf of an insured or contract owner shall be deemed to
have been received by Client, and the payment of return premiums or claims by
Client to Alliance-One shall not be deemed payment to the insured or claimant
until such payments are received by such insured or claimant. Premiums for this
Section shall include all deposits and contractual charges.
3.2 Alliance-One will hold in a fiduciary capacity any premiums or charges
for insurance and deposits collected by it on behalf of or for Client with
respect to insureds and annuitants, and return premiums received from Client.
Alliance-One shall comply with all applicable fiduciary account statutes and
regulations. Alliance-One will immediately (and in any event within fifteen
days) remit such funds to the person or persons entitled thereto, or shall
promptly deposit (and in any event within fifteen days) them in a fiduciary
account established and maintained by Alliance-One in the name of Client.
Alliance-One shall require the bank in which such fiduciary account is
maintained to keep records clearly recording the deposits in and withdrawals
from such account on behalf of or for each insurer for which Alliance-One may
collect charges or premiums. Alliance-One shall promptly obtain and keep copies
of all such records and, upon request of Client, furnish Client with copies of
such records pertaining to deposits and withdrawals on behalf of or for Client.
Alliance- One may make withdrawals from such account for:
a. remittance to Client when entitled thereto;
b. transfer to and deposit in a claims paying account, with claims
to be paid as provided in Section below; or
c. remittance of return premiums to the person or persons entitled
thereto.
K:\AGREE\FULL\UNTINV.8 October 4, 1996
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CONTINUUM
3.3 All claims paid by Alliance-One from funds collected on behalf of
Client shall be paid only on checks or drafts of and as authorized by Client.
SECTION 4 Representations and Warranties of Alliance-One
----------------------------------------------
Alliance-One represents and warrants to Client as follows:
4.1 It is a limited partnership duly organized and existing and in good
standing.
4.2 It is empowered under applicable laws and by its charter and bylaws to
enter into and perform the services contemplated in this Agreement.
4.3 All requisite corporate proceedings have been taken to authorize it to
enter into and perform the services contemplated in this Agreement.
4.4 It has and will continue to have and maintain the necessary facilities,
equipment, and personnel to perform its duties and obligations as set forth
under this Agreement.
4.5 Whenever required by a state, it shall maintain a deposit or a bond in
favor of such state to be held in trust for the benefit and protection of
insureds and insurers whose monies Alliance-One handles. In addition,
Alliance-One shall comply with any other bond and insurance requirements of
applicable state law.
4.6 THESE WARRANTIES STATED IN THIS SECTION ARE IN LIEU OF ALL OTHER
WARRANTIES AND ALLIANCE-ONE DISCLAIMS ANY OTHER EXPRESS OR IMPLIED WARRANTIES,
INCLUDING THE WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
SECTION 5 Representations and Warranties of Client
----------------------------------------
Client represents and warrants to Alliance-One as follows:
5.1 It is a corporation duly organized and existing and in good standing.
5.2 It is empowered under the applicable laws and regulations and by its
charter and bylaws to enter into and perform this Agreement.
5.3 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
5.4 As between Client and Alliance-One, Client shall be responsible for all
compliance with all laws with respect to the Contracts and all filings with
regulatory agencies in connection with the offer, sale, or administration of the
Contracts.
5.5 It shall fulfill all lawful obligations with respect to Contracts
affected by this Agreement, regardless of any dispute between Client and
Alliance-One.
SECTION 6 Term; Termination
-----------------
6.1 Subject to termination as hereinafter provided, this Agreement shall
remain in force and effect for a period of five (5) years (the "Initial Term").
This Agreement shall be renewed automatically for additional successive terms of
one year at the end of the Initial Term and the end of each renewal term unless
terminated by either party by prior written notice to the other at least one
hundred eighty (180) days prior to the end of the Initial Term or the renewal
term.
6.2 At least ninety (90) days prior to the end of any term hereof,
Alliance-One shall give Client written notice if Alliance-One desires to
increase its fees or charges to Client or to change the manner of payment or to
change any of the other terms and conditions of this Agreement. If Alliance-One
and Client do not agree to such changed fees and charges, the manner of payment
before the end of the term during which such notice is given by Alliance-One, or
if Alliance-One does not withdraw the proposed changes, this Agreement shall
terminate at the end of such term.
K:\AGREE\FULL\UNTINV.8 October 4, 1996
Confidential & Proprietary Information The Continium Company, Inc.
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CONTINUUM
6.3 Either party may terminate this Agreement at the end of the Initial
Term or any renewal term by one hundred eighty (180) days written notice to the
other. This Agreement may be terminated or amended by mutual agreement of the
parties in writing at any time.
6.4 Either party may terminate this Agreement for cause upon written
notice sent by certified mail to the other party. "For cause" shall mean a
material breach of this Agreement or material default in the performance of any
of a party's duties and obligations hereunder which is not remedied within
thirty (30) days after written notice documenting the default is given by the
nondefaulting party.
6.5 If Alliance-One elects to terminate this Agreement for other than
nonpayment of fees and charges and if Client shall so request in writing,
Alliance-One shall continue to provide the services described herein to Client
for a period of six (6) months following such termination, such service to be
provided in accordance with the terms of this Agreement and at one hundred
twenty-five percent (125%) of the fees in effect for the term immediately
preceding such six (6) months period.
6.6 In the event that this Agreement is terminated, Alliance-One agrees
that, in order to assist in providing uninterrupted service to Client,
Alliance-One shall offer reasonable assistance to Client in converting the
records of Client from the Vantage- One System to whatever service or system is
selected by Client, subject to reimbursement to Alliance-One for such assistance
at its standard rates and fees in effect at that time.
6.7 Client shall give Alliance-One thirty (30) days advance written notice
of any termination or cancellation of this Agreement as required by applicable
law. In addition, Client shall provide fifteen (15) days advance written notice
to the Director of the Department of Insurance for the State of Arizona of any
termination or cancellation or any other change in this Agreement as required by
Arizona law.
6.8 Upon termination of this Agreement, Client will return to Alliance-One
all documentation and information relating to the Vantage-One System, and any
other similar or related materials (and any copies thereof) confidential to
Alliance-One. Subject to Section hereof, Alliance-One will return all of the
data and files of Client to it. Client agrees to allow Alliance-One reasonable
access to all such returned records in the event such access is requested by
Alliance-One for any reasonable and legitimate purpose, including as a result of
any litigation or any similar proceeding.
SECTION 7 Limitation of Liability
-----------------------
7.1 In the event malfunction of the Vantage-One System causes an error or
mistake in any record, report, data, information or output under the terms of
this Agreement, Alliance-One shall at its expense correct and reprocess such
records, provided that once Client is aware of or should have been aware of the
error or mistake Client shall promptly notify Alliance-One in writing of such
error or mistake.
7.2 Where Client's claim relates to a defect in any service, Client will
give Alliance-One a reasonable opportunity to correct the defect. If
Alliance-One is able to correct the defect within a reasonable period of time,
Alliance-One will not be liable for any damages.
7.3 In case of any claim by Client against Alliance-One related to this
Agreement or any transaction under this Agreement, regardless of the basis of
the claim, Alliance-One will be liable only for:
7.3.1 Bodily injury (including death) and damage to real property and
tangible personal property; and
7.3.2 For any other loss or injury not included in section 7.3.1, the
amount of actual loss or damage suffered by Client, up to a cumulative
aggregate of the fees paid to Alliance-One by Client under this Agreement
during the three months immediately preceding the occurrence of the claim.
7.4 Notwithstanding anything to the contrary herein, Alliance-One shall,
for the
K:\AGREE\FULL\UNTINV.8 October 4, 1996
Confidential & Proprietary Information The Continium Company, Inc.
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CONTINUUM
protection and benefit of Client, maintain errors and omissions liability
insurance coverage in an amount of at least $10,000,000 total aggregate
liability.
7.5 Notwithstanding anything to the contrary herein, Alliance-One shall not
be responsible for, and Client shall indemnify and hold Alliance-One harmless
from and against, any and all costs, expenses, losses, damages, charges, counsel
fees, payments, and liability which may be asserted against Alliance-One or for
which it may be held liable, arising out of or attributable to:
7.5.1 Any actions taken by Alliance-One in good faith and due
diligence in compliance with the terms of this Agreement;
7.5.2 Any failure by Client to comply with Federal, state or local
laws or regulations with respect to the offering and/or sale of the
Contracts or the records maintained, and/or Client's failure to use and
employ Alliance-One's System and Facilities in accordance with the
procedures set forth in the reference manuals delivered to Client, Client's
failure to utilize the control procedures set forth and described therein,
and Client's failure to verify promptly reports received through use of the
Vantage-One System and Facilities;
7.5.3 Client's refusal or failure to comply with the terms of this
Agreement, or which arise out of Client's action or willful misconduct or
which arise out of the breach of any representation or warranty of Client
hereunder;
7.5.4 Client's errors and mistakes in the use of the Vantage-One
System, Facilities and control procedures;
7.5.5 Third party claims against Client for loss or damage (including,
but not limited to, Client's policyholders and shareholders) unless caused
by the willful or grossly negligent acts of Alliance-One;
7.5.6 Alliance-One's reliance on, or use of, in performing its duties
and obligations hereunder, information, data, records and documents
received by Alliance-One from Client, its custodian or other agents; or
7.5.7 The reliance on, or the carrying out of, any instructions or
requests of Client pertaining to the normal day-to-day operations and
functions of the Vantage-One System made by any persons listed on a
"Schedule of Authorized Personnel" to be furnished to Alliance-One by
Client upon execution of this Agreement and attached as Exhibit C, and as
amended from time to time in writing by Client. Client shall immediately
provide Alliance-One with written notice of any change of authority of
persons authorized and enumerated in Exhibit C to provide Alliance-One with
instructions or directions relating to services to be performed by
Alliance-One under this Agreement.
7.6 In the event Alliance-One is unable to perform its obligations under
the terms of this Agreement because of natural disaster, strikes, equipment or
transmission failure or damage, or other causes beyond its control, Alliance-One
will use its best efforts to assist Client to obtain alternate sources of
service. Alliance-One will not be liable for any damages resulting from such
causes.
7.7 IN NO EVENT SHALL ALLIANCE-ONE BE LIABLE TO CLIENT FOR ANY CLAIM,
DAMAGE OR OTHER CAUSE OF ACTION, WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE, FOR EXEMPLARY, SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES.
7.8 The limitations of liability in this Section 7 will be enforced even if
any exclusive remedy fails of its essential purpose.
SECTION 8 Books and Records
-----------------
8.1 This Agreement shall be retained as part of the official records of
both parties for its duration and seven years thereafter.
8.2 Where a policy is issued to a trustee or trustees, a copy of the trust
K:\AGREE\FULL\UNTINV.8 5 October 4, 1996
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CONTINUUM
agreement and any amendments thereto is to be furnished to Client. Both parties
will retain such documents as part of their official records for the duration of
the policy and seven years thereafter.
8.3 Alliance-One shall establish and maintain facilities and procedures for
the safekeeping of policy forms, check forms and facsimile signature imprinting
devices, if any, and all other documents, reports, records, books, files, and
other materials relative to this Agreement and all transactions between
Alliance-One, Client, and insureds, which shall include the identity and
addresses of policyholders and certificate holders (collectively, "Books and
Records"). Alliance-One shall maintain the Books and Records at its principal
administrative office, for the duration of this Agreement and seven years
thereafter, and in accordance with prudent standards of insurance recordkeeping
and as required by applicable law.
8.4 Client and any applicable insurance regulator shall have full and free
access, during ordinary business hours, to the Books and Records, which shall be
in a form usable by them. Client and the applicable insurance regulator shall
keep confidential any of Alliance-One's confidential information or trade
secrets contained in the Books and Records, provided that the applicable
insurance regulator may use such information in a proceeding instituted against
Client or Alliance-One.
Client or its duly authorized independent auditors have the right under
this Agreement to perform on-site audits of the Books and Records directly
pertaining to the Contracts serviced by Alliance-One's Facilities hereunder at
Alliance-One's Facilities in accordance with reasonable procedures and at
reasonable frequencies. Client shall reimburse Alliance-One for all of its costs
and expenses (including personnel time and materials) incurred in connection
with such audits.
8.5 It is expressly understood and agreed that the Books and Records, but
excluding information confidential to Alliance-One as identified in Section
below, shall be the sole property of Client and that such property shall be held
by Alliance- One, as agent, during the term of this Agreement. All information
furnished by Client to Alliance-One hereunder is confidential and Alliance-One
shall not disclose such information, directly or indirectly to any third party
except to the extent that Alliance-One is required by law to make such
disclosure or as authorized by Client.
8.6 Alliance-One may use only such advertising pertaining to the business
underwritten by Client as has been approved in writing by Client in advance of
their use.
8.6.1 Client shall have the prior approval of the Director of the
Department of Insurance, State of Idaho, before approving advertising for
use by Alliance- One.
8.6.2 Alliance-One will maintain at its principal administrative
office a complete file of all advertisements, regardless of the author,
created or designed, which were used in the course of Alliance-One's
business in the State of Georgia, with a notation indicating the manner and
extent of distribution and the form number of any policy advertised. Such
file shall be subject to inspection by the Office of Commissioner of
Insurance of the State of Georgia. All such advertisements shall be
maintained in said file for a period of not less than five years.
Alliance-One shall file with the Commissioner of Insurance of the State of
Georgia on or before March 1 each year, a certification executed by an
authorized officer of Alliance-One wherein it is stated that to the best of
his or her knowledge, information and belief, the advertisements
disseminated by Alliance-One during the preceding calendar year complied,
or were made to comply in all respects, with the advertising regulations of
Georgia.
8.7 Client acknowledges that an affiliate of Alliance-One has proprietary
rights in and to the Vantage-One System and that the Vantage-One System
(including the program code, documentation, specifications, logic, and design of
the Vantage-One System) constitutes confidential material and trade secrets of
Alliance-One's affiliate.
8.7.1 Client agrees to maintain the confidentiality of, and not
disclose to any third party, the Vantage-One System, or any information
about the internal
K:\AGREE\FULL\UNTINV.8 6 October 4, 1996
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CONTINUUM
affairs, business plans, and business practices of Alliance-One or its
affiliates.
8.7.2 Alliance-One or its affiliate shall be the owner and copyright
holder of all work product that results from programming services performed
by Alliance- One for Client, including, but not limited to, program code,
documentation, specifications, logic, and design.
8.7.3 Alliance-One shall have the right, at any time, and from time to
time, to alter and modify the Vantage-One System and any systems, programs,
procedures or facilities used or employed in performing its duties and
obligations hereunder, provided that no such alterations or modifications
shall materially change or affect the operations and procedures of Client
in using or employing Alliance- One's System or Facilities hereunder
without the consent of Client, which such consent shall not be unreasonably
withheld.
8.8 Client shall, from time to time, provide Alliance-One with current
forms of contracts, prospectuses, and applications, names and states of license
of all insurance and/or broker-dealer agents and representatives authorized to
sell the Contracts.
SECTION 9 Miscellaneous
-------------
9.1 Client may not assign or sublicense or otherwise transfer voluntarily,
or by operation of law, any rights or obligations under this Agreement without
Alliance- One's prior written consent. Alliance-One may not assign this
Agreement if prohibited by applicable law nor without the consent of Client,
which consent shall not be unreasonably withheld; provided that if Client does
so reasonably withhold consent, then Alliance-One shall have the right to assign
this Agreement and Client shall then have the right to terminate this Agreement
early with at least ninety (90) days prior written notice to Alliance-One. This
Agreement shall inure to the benefit of and be binding upon the parties hereto
and their respective successors and permitted assigns.
9.2 With respect to Wyoming residents, Alliance-One will not:
9.2.1 Solicit applications for insurance or annuities for Client,
negotiate insurance or annuities on behalf of Client, or carry out and
countersign insurance policies unless licensed in Wyoming as an agent;
9.2.2 On behalf of Client, for compensation or fee, solicit, negotiate
or procure insurance or the renewal or continuance thereof for Wyoming
insureds or prospective insureds unless licensed in Wyoming as a broker; or
9.2.3 Adjust claims in Wyoming for Client by investigating and
negotiating settlements unless licensed in Wyoming as an adjuster, or an
agent or broker who adjusts or assists in the adjustment of losses arising
under policies issued by the insurers represented by that agent or through
that broker. Nothing herein shall be interpreted as to prohibit
Alliance-One from engaging in ministerial or clerical activities relating
to the payment of claims.
9.3 It is understood and agreed that all services performed hereunder by
Alliance- One shall be as an independent contractor and not as an employee of
Client.
9.4 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof, whether oral or written, and this Agreement may not be modified except
in a written instrument executed by both of the parties hereto.
9.5 All notices and requests in connection with this Agreement shall be
given or made upon the respective parties in writing and shall be deemed as
given as of the date deposited in the U.S. mails, postage prepaid, certified or
registered, return receipt requested, and addressed to the address listed on the
first page of this Agreement or to such other address as a party to receive the
notice or request so designates by written notice to the other.
9.6 This Agreement is to be construed in accordance with the laws of the
State of Missouri, without regard to conflicts of law principles.
K:\AGREE\FULL\UNTINV.8 7 October 4, 1996
Confidential & Proprietary Information The Continuum Company, Inc.
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CONTINUUM
CLIENT
By:
------------------------------
Name:
-----------------------------
(printed)
Title:
-----------------------------
Date:
-----------------------------
Alliance-One Services, L.P.
By:
------------------------------
Name:
-----------------------------
(printed)
Title:
-----------------------------
Date:
-----------------------------
K:\AGREE\FULL\UNTINV.8 8 October 4, 1996
Confidential & Proprietary Information The Continuum Company, Inc.
<PAGE>
Exhibit 15
----------
POWER OF ATTORNEY WITH RESPECT TO
UNITED INVESTORS LIFE INSURANCE COMPANY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned, an officer
and/or director of United Investors Life Insurance Company, does hereby
constitute and appoint James L. Sedgwick, Ross W. Stagner and W. Thomas Aycock,
and each of them, his/her attorney(s)-in-fact, each with the power of
substitution for him/her in any and all capacities, to sign any registration
statements and amendments thereto for United Investors Life Insurance Company as
Depositor for RetireMap Variable Account, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that each of said
attorney(s)-in-fact, or his substitute or substitutes, may do or cause to be
done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed to these
presents on this 6th day of March, 1997.
_________________________
Ronald K. Richey
/s/ James L. Sedgwick
- -------------------------
James L. Sedgwick
/s/ W. Thomas Aycock
- -------------------------
W. Thomas Aycock
/s/ Michael J. Klyce
- -------------------------
Michael J. Klyce
<PAGE>
/s/ John H. Livingston
- -------------------------
John H. Livingston
/s/ James L. Mayton, Jr.
- -------------------------
James L. Mayton, Jr.
_________________________
Anthony L. McWhorter
_________________________
Carol A. McCoy
/s/ Ross W. Stagner
- -------------------------
Ross W. Stagner
/s/ William L. Surber
- -------------------------
William L. Surber
_________________________
Keith A. Tucker
