As filed with the Securities and Exchange Commission on September 27, 1996
REGISTRATION NO. ___________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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TO
FORM S-6
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FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT TRUSTS
REGISTERED ON FORM N-8 B-2
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PHOENIX LIFE AND ANNUITY VARIABLE UNIVERSAL LIFE ACCOUNT
(EXACT NAME OF TRUST)
PHOENIX LIFE AND ANNUITY COMPANY
(NAME OF DEPOSITOR)
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ONE AMERICAN ROW
HARTFORD, CONNECTICUT 06115
(COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES)
DONA D. YOUNG, ESQUIRE
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
PHOENIX LIFE AND ANNUITY COMPANY
ONE AMERICAN ROW
HARTFORD, CONNECTICUT 06115
(NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE)
---------------
COPIES TO:
MICHAEL BERENSON, ESQ. RICHARD J. WIRTH, ESQ.
JORDEN BURT BERENSON & JOHNSON LLP COUNSEL
1025 THOMAS JEFFERSON ST. N.W. PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
SUITE 400 EAST ONE AMERICAN ROW
WASHINGTON, D.C. 20007-0805 HARTFORD, CONNECTICUT 06115
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DECLARATION REQUIRED BY RULE 24F-2
Pursuant to Rule 24f-2 under the Investment Company Act of 1940, the Registrant
has chosen to register an indefinite amount of securities being offered.
---------------
Amount of filing fee:
Approximate date of proposed public offering:
As soon as practicable after the effective date of this Registration
Statement.
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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),
may determine.
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Registrant is relying on the exemptive relief provided by Rule 6e-3(T) under the
Investment Company Act of 1940 and elects to be governed by subparagraph
(b)(13)(i)(A) of that Rule.
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<PAGE>
CROSS REFERENCE TO ITEMS REQUIRED
BY FORM N-8B-2
N-8B-2 ITEM CAPTION IN PROSPECTUS
- ----------- ---------------------
1 The VUL Account
2 Phoenix Life and Annuity Company
3 Not Applicable
4 Sales of Policies
5 The VUL Account
6 The VUL Account
7 Not Applicable
8 Not Applicable
9 Legal Proceedings
10 The Policy
11 Investments of the VUL Account
12 Investments of the VUL Account
13 Charges and Deductions; Investments of the VUL Account
14 Premium Payment; Allocation of Issue Premium; Right to
Cancel Period
15 Allocation of Issue Premium; Transfer of Policy Value
16 Investments of the VUL Account
17 Surrenders
18 Allocation of Issue Premium; Transfer of Policy
Value; Reinvestment and Redemption
19 Voting Rights; Reports
20 Not Applicable
21 Policy Loans
22 Not Applicable
23 Safekeeping of the VUL Account's Assets
24 Not Applicable
25 Phoenix Life and Annuity Company
26 Charges and Other Deductions; Investments of the VUL Account
27 Phoenix Life and Annuity Company
28 Phoenix Life and Annuity Company; The Directors and
Executive Officers of Phoenix Life and Annuity Company
29 Not Applicable
30 Not Applicable
31 Not Applicable
32 Not Applicable
33 Not Applicable
34 Not Applicable
35 Phoenix Life and Annuity Company
36 Not Applicable
37 Not Applicable
38 Sales of Policies
39 Sales of Policies
40 Not Applicable
41 Sales of Policies
42 Not Applicable
43 Not Applicable
44 Determination of Sub-account Values
45 Not Applicable
46 Determination of Sub-account Values
47 Allocation of Issue Premium; Determination of Sub-account
Values
48 Not Applicable
49 Not Applicable
50 Not Applicable
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N-8B-2 ITEM CAPTION IN PROSPECTUS
- ----------- ---------------------
51 Phoenix Life and Annuity Company; The Policy; Charges and
Deductions
52 Investments of the VUL Account
53 Federal Tax Considerations
54 Not Applicable
55 Not Applicable
56 Not Applicable
57 Not Applicable
58 Not Applicable
59 Not Applicable
<PAGE>
VARIABLE LIFE INSURANCE POLICY
ISSUED BY: PHOENIX LIFE AND ANNUITY COMPANY
101 MUNSON STREET
P.O. BOX 810
GREENFIELD, MASSACHUSETTS 01302-0810
TELEPHONE: (800) 892-4885
PROSPECTUS
___________________, 1996
This Prospectus describes Flexible Premium Variable Life Insurance Policies
(the "Policies"), offered by Phoenix Life and Annuity Company ("Phoenix"). An
applicant chooses the amount of Issue Premium desired and it is then shown in
the Policy. Generally, the minimum Issue Premium Phoenix will accept is 1/6 of
the Planned Annual Premium. Phoenix may, in some cases, accept less than that
amount. The amount and payment frequency of Planned Annual Premiums are as shown
in the Policy. If too much is paid in premium in the early Policy Years, the
Policy could become a "modified endowment contract." This would cause loans and
other amounts received under the Policy to be subject to tax and/or penalties.
Currently, Phoenix notifies a Policyowner when a Policy becomes a modified
endowment contract.
Premium payments are allocated to one or more of the Sub-accounts of the
Phoenix Life and Annuity Variable Universal Life Account (the "VUL Account") or
to the Guaranteed Interest Account ("GIA"), as specified in the applicant's
application for insurance. The VUL Account is divided into Sub-accounts, each of
which invests in a corresponding series of The Phoenix Edge Series Fund (the
"Fund"). For certain Policyowners, the Issue Premium is first allocated to the
Money Market Sub-account before being allocated according to the instructions in
the application.
There is no guaranteed minimum Policy Value except for that portion of
Policy Value invested in the GIA, which has a 4% minimum interest rate
guarantee. The Policy Value not invested in the GIA will vary to reflect the
investment experience of the Sub-accounts of the VUL Account to which premiums
have been allocated. A Policyowner bears the investment risk for all amounts so
allocated. The Policy will remain in effect so long as the Policy Value or Cash
Surrender Value is sufficient to pay certain monthly charges imposed in
connection with the Policy.
The death benefit under the Policy equals the Policy's face amount on the
date of the Insured's death or, if greater, the Policy Value on the date of
death increased by the applicable percentage set forth in the Policy. Other
death benefit options also are available.
A Policyowner may cancel the Policy within 10 days (or longer in some
states), after the Policyowner receives it or 10 days after Phoenix mails or
delivers a written notice of withdrawal right to the Policyowner, or within 45
days of completing the application, whichever is latest.
It may not be advantageous to purchase a Policy as a replacement for your
current life insurance or to supplement an existing life insurance policy.
This Prospectus is valid only if accompanied by or preceded by current
prospectuses for the Funds. This Prospectus and the prospectuses for the Funds
should be read and retained for future reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
1
<PAGE>
TABLE OF CONTENTS
Heading Page
- -----------------------------------------------------------------
VARIABLE LIFE INSURANCE POLICY ........................... 1
TABLE OF CONTENTS ........................................ 2
FINANCIAL HIGHLIGHTS ..................................... 3
SPECIAL TERMS ............................................ 3
SUMMARY .................................................. 4
PHOENIX AND THE VUL ACCOUNT............................... 5
Phoenix ............................................... 5
The VUL Account ....................................... 6
The GIA ............................................... 6
THE POLICY ............................................... 6
Introduction .......................................... 6
Eligible Purchasers ................................... 7
Premium Payment ....................................... 7
Allocation of Issue Premium ........................... 7
Right to Cancel Period ................................ 7
Temporary Insurance Coverage .......................... 8
Transfer of Policy Value .............................. 8
Determination of Sub-account Values ................... 8
Death Benefit ......................................... 9
Surrenders ............................................ 9
Policy Loans .......................................... 10
Lapse ................................................. 11
Payment of Premiums During Period of Disability ....... 11
Additional Insurance Options .......................... 11
Additional Rider Benefits ............................. 11
INVESTMENTS OF THE VUL ACCOUNT ........................... 12
Participating Mutual Fund.............................. 12
Investment Advisers to The Phoenix Edge Series Fund.... 13
Reinvestment and Redemption ........................... 13
Substitution of Investments ........................... 13
Performance History ................................... 13
CHARGES AND DEDUCTIONS ................................... 14
Monthly Deduction .................................. 14
Premium Taxes ...................................... 15
Federal Tax Charge.................................. 15
Mortality and Expense Risk Charge .................. 15
Investment Management Charge ....................... 15
Other Charges ...................................... 16
GENERAL PROVISIONS ....................................... 17
Postponement of Payments .............................. 17
Payment by Check ...................................... 17
The Contract .......................................... 17
Suicide ............................................... 17
Incontestability ...................................... 17
Change of Owner or Beneficiary ........................ 17
Assignment ............................................ 17
Misstatement of Age or Sex ............................ 17
PAYMENT OF PROCEEDS ...................................... 17
Surrender and Death Benefit Proceeds .................. 17
Payment Options ....................................... 18
FEDERAL TAX CONSIDERATIONS ............................... 18
Introduction .......................................... 18
Phoenix's Tax Status .................................. 19
Policy Benefits ....................................... 19
Business-Owned Policies................................ 19
Modified Endowment Contracts .......................... 19
Limitations on Unreasonable Mortality
and Expense Charges ................................ 20
Qualified Plans ....................................... 20
Diversification Standards ............................. 20
Change of Ownership or Insured or Assignment .......... 21
Other Taxes ........................................... 21
VOTING RIGHTS ............................................ 21
The Fund. ............................................. 21
Phoenix................................................ 21
THE DIRECTORS AND EXECUTIVE OFFICERS OF PHOENIX........... 21
SAFEKEEPING OF THE VUL ACCOUNT'S ASSETS .................. 22
SALES OF POLICIES ........................................ 22
STATE REGULATION ......................................... 22
REPORTS .................................................. 22
LEGAL PROCEEDINGS ........................................ 22
LEGAL MATTERS ............................................ 22
REGISTRATION STATEMENT ................................... 22
FINANCIAL STATEMENTS ..................................... 22
APPENDIX A ............................................... 25
APPENDIX B ............................................... 26
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT BE LAWFULLY MADE. NO DEALER, SALESPERSON, 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.
2
<PAGE>
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A UNIT OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
The Sub-accounts commenced operations as of the date
of this Prospectus; therefore, data for these
Sub-accounts is not yet available.
SPECIAL TERMS
- --------------------------------------------------------------------------------
As used in this Prospectus, the following terms have the indicated meanings:
ATTAINED AGE: The age of the Insured on the birthday nearest the most recent
Policy Anniversary.
BENEFICIARY: The person or persons specified by the Policyowner as entitled to
receive the death benefits under a Policy.
CASH SURRENDER VALUE: The Policy Value less any surrender charge that would
apply on the date of surrender and less any Debt.
DEATH BENEFIT GUARANTEE: An additional benefit rider available with the Policy
that guarantees a death benefit equal to the initial face amount or the face
amount as later increased or decreased, provided that Minimum Required Premiums
are paid. See "Additional Rider Benefits."
DEBT: Outstanding loans against a Policy, plus accrued interest.
GENERAL ACCOUNT: The general asset account of Phoenix.
GUARANTEED INTEREST ACCOUNT (GIA): An allocation option under which amounts
deposited are guaranteed to earn a fixed rate of interest. Excess interest also
may be credited, in the sole discretion of Phoenix.
IN FORCE: Conditions under which the coverage under a Policy is in effect and
the Insured's life remains insured.
INSURED: The person upon whose life the Policy is issued.
IN WRITING (WRITTEN REQUEST): In a written form satisfactory to
Phoenix and delivered to Variable and Universal Life Administration.
ISSUE PREMIUM: The premium payment made in connection with the
issue of the Policy.
MINIMUM REQUIRED PREMIUM: The required premium as specified in the Policy. An
increase or decrease in the face amount of the Policy will change the Minimum
Required Premium amount.
MONTHLY CALCULATION DAY: The first Monthly Calculation Day is the same day as
the Policy Date. Subsequent Monthly Calculation Days are the same day of each
month thereafter or, if such day does not fall within a given month, the last
day of that month will be the Monthly Calculation Day.
PAYMENT DATE: The Valuation Date on which a premium payment or loan repayment is
received at Phoenix, unless it is received after the close of the New York Stock
Exchange, in which case it will be the next Valuation Date.
PHOENIX: Phoenix Life and Annuity Company ("Phoenix"), Hartford,
Connecticut.
PLANNED ANNUAL PREMIUM: The premium amount that the Policyowner agrees to pay
each Policy Year. It must be at least equal to the Minimum Required Premium
required for the face amount of insurance selected and must be no greater than
the maximum premium allowed for the face amount selected.
POLICY ANNIVERSARY: Each anniversary of the Policy Date.
POLICY DATE: The Policy Date as shown on the Schedule Page of the Policy. It is
the date from which Policy Years and Policy Anniversaries are measured.
POLICY MONTH: The period from one Monthly Calculation Day up to but not
including the next Monthly Calculation Day.
POLICYOWNER (OWNER): The owner of a Policy.
POLICY VALUE: The sum of a Policy's share in the values of each Sub-account of
the VUL Account plus the Policy's share in the values of the GIA.
POLICY YEAR: The first Policy Year is the one-year period from the Policy Date
up to, but not including, the first Policy Anniversary. Each succeeding Policy
Year is the one-year period from the Policy Anniversary up to but not including
the next Policy Anniversary.
PROPORTIONATE: Amounts allocated to Sub-accounts on a proportionate basis are
allocated by increasing (or decreasing) a Policy's share in the value of the
affected Sub-accounts so that such shares maintain the same ratio to each other
before and after the allocation.
SUB-ACCOUNTS: Accounts within the VUL Account to which non-loaned assets under
a Policy are allocated.
UNIT: A standard of measurement used in determining the value of a Policy. The
value of a Unit for each Sub-account will reflect the investment performance of
that Sub-account and will vary in dollar amount.
VALUATION DATE: For any Sub-account, each date on which the net asset value of
the Fund is determined.
VALUATION PERIOD: For any Sub-account, the period in days from the end of one
Valuation Date through the next.
VARIABLE AND UNIVERSAL LIFE ADMINISTRATION: Variable and Universal Life
Administration Division of Phoenix.
VUL ACCOUNT: Phoenix Life and Annuity Variable Universal Life Account.
3
<PAGE>
SUMMARY
- --------------------------------------------------------------------------------
1. WHAT IS THE DIFFERENCE BETWEEN THE POLICY AND A CONVENTIONAL FIXED BENEFIT
LIFE INSURANCE POLICY?
Like conventional fixed benefit life insurance, so long as the Policy
remains In Force, the Policy will provide for: (1) the payment of a death
benefit to a Beneficiary upon the Insured's death; (2) the accumulation of cash
value; and (3) surrender rights and Policy loan privileges.
The Policy differs from conventional fixed benefit life insurance by
allowing Policyowners to allocate premiums to one or more Sub-accounts of the
VUL Account or to the GIA. Each Sub-account invests exclusively in a designated
portfolio of the Fund. Also, under the Policy, the Policy Value invested in the
VUL Account is not guaranteed and may increase or decrease depending upon the
investment experience of the Sub-accounts of the VUL Account. Accordingly, the
Policyowner bears the investment risk of any depreciation in value of the
underlying assets but reaps the benefits of any appreciation in value. See
"Policy Value."
In addition, unlike conventional fixed benefit life insurance, a
Policyowner also has the flexibility to make additional premium payments and to
thereby adjust the Policy Value. However, unlike conventional fixed benefit
life insurance, the Policy does not require a Policyowner to adhere to a fixed
premium payment schedule. Moreover, after the payment of the Issue Premium, the
failure to make additional premium payments will not in itself cause the Policy
to lapse. Conversely, the payment of additional premiums will not guarantee
that the Policy will remain In Force. Generally, lapse will occur when the Cash
Surrender Value is insufficient to pay certain charges deducted on the Monthly
Calculation Day, and a grace period expires without payment of the additional
amount required. See "Lapse."
If a Whole Life Exchange Option Rider is attached to the Policy,
the Policy may be exchanged for a fixed benefit whole life policy. (See
"Additional Rider Benefits.")
2. IS THERE A GUARANTEED ACCOUNT OPTION?
Yes. A Policyowner may elect to have premium payments allocated to the GIA.
Amounts allocated to the GIA earn a fixed rate of interest and Phoenix also may,
in its sole discretion, credit excess interest. (See Appendix A.)
3. WHAT IS THE DEATH BENEFIT UNDER THE POLICY?
The Policy provides for the payment of benefits upon the death of the
Insured. Upon application for a Policy, an applicant designates an Issue
Premium. The Policy indicates the face amount of insurance. The death benefit
will equal the face amount on the date of the Insured's death or, if greater,
the Policy Value on the date of the Insured's death increased by the applicable
percentage set forth in the Policy. If the increased death benefit option is
selected, the death benefit will equal the face amount on the date of the
Insured's death plus the Policy Value or, if greater, the Policy Value on the
date of the Insured's death increased by the applicable percentage set forth in
the Policy. Guaranteed death benefit and living benefits riders also are
available. See "Death Benefit."
4. HOW LONG WILL THE POLICY REMAIN IN FORCE?
The Policy will lapse only when the Cash Surrender Value is
insufficient to pay the monthly deduction (see "Charges and Deductions--Monthly
Deductions"), and a grace period expires without payment of the additional
amount required. In this respect, the Policy differs in two important respects
from a conventional fixed benefit life insurance Policy. First, the failure to
pay additional premiums will not automatically cause the Policy to lapse.
Second, the payment of premiums of any prespecified amount does not guarantee
that the Policy will remain In Force. A rider is available to ensure that
premium payments will continue during a period of disability.
5. WHAT CHARGES ARE THERE IN CONNECTION WITH THE POLICY?
MONTHLY DEDUCTION: A deduction is made each Policy Month from
the Policy Value (excluding the value of the loaned portion of the GIA) to pay
the cost of insurance provided under the Policy; the cost of any rider benefits
provided; any unpaid balance of the Issue Expense Charge; and an administrative
charge as shown on the Schedule Page of the Policy. The administrative charge
may vary but in no event will it exceed $10 per month. Currently, the
administrative charge is $5 per month. The administrative charge is set at a
level designed to recover actual costs and is not designed to result in any
profit to Phoenix. See "Charges and Deductions."
OTHER CHARGES: A fee equal to the lesser of $25 or 2% of the partial
surrender amount paid is deducted from the Policy Value for each partial
surrender. A partial surrender charge equal to a pro rata portion of the
applicable surrender charge that would apply to a full surrender, determined by
applying a formula, also is assessed against the VUL Account Sub-accounts or the
GIA when a partial surrender is made.
No charges are currently made from the VUL Account or the GIA for federal or
state income taxes. If Phoenix determines that such taxes may be imposed, it may
make deductions from the VUL Account to pay these taxes.
Phoenix charges each Sub-account of the VUL Account the daily equivalent of
.80% for the first 15 years and then 0.25% on an annual basis of the current
value of the Sub-account's net assets for its assumption of certain mortality
and expense risks incurred in connection with the Policy.
Premium amounts also are reduced by any applicable premium tax, a federal
tax charge of 1.50% and, for payments made during a grace period, by the amount
needed to cover any monthly deductions made during the grace period.
Investment advisory charges are imposed on an annual basis based on the
average daily net assets of the Series of the Fund as follows:
4
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PHOENIX INVESTMENT COUNSEL, INC.
--------------------------------
RATE FOR
RATE FOR FIRST RATE FOR NEXT EXCESS OVER
SERIES $250,000,000 $250,000,000 $500,000,000
- ------ -------------- ------------- ------------
Money Market....... .40% .35% .30%
Multi-Sector....... .50% .45% .40%
Balanced........... .55% .50% .45%
Total Return....... .60% .55% .50%
Growth............. .70% .65% .60%
International...... .75% .70% .65%
Strategic Theme.... .75% .70% .65%
PHOENIX-ABERDEEN ADVISORS, LLC
------------------------------
SERIES
- ------
Asia.............. 1.00%
PHOENIX REALTY SECURITIES, INC.
-------------------------------
RATE FOR
RATE FOR FIRST RATE FOR NEXT EXCESS OVER
SERIES $1,000,000,000 $1,000,000,000 $2,000,000,000
- ------ ------------- -------------- --------------
Real Estate....... .75% .70% .65%
In addition, each Series pays a portion or all of its other operating
expenses other than the management fees: the Growth, Multi-Sector, Total Return,
Money Market and Balanced Series will pay up to .15%; the Real Estate, Strategic
Theme and Asia Series will pay up to .25%; and the International Series will pay
up to .40% of its average net assets annually. See "Charges and Deductions."
6. IS THERE A RIGHT TO CANCEL PERIOD?
Yes. The Policyowner may cancel the Policy within 10 days after the
Policyowner receives it (or longer in some states), or 10 days after Phoenix
mails or delivers a written notice of withdrawal right to the Policyowner, or
within 45 days of completing the application, whichever is latest.
7. HOW ARE PREMIUMS ALLOCATED?
If the applicant elects the Temporary Money Market Allocation Amendment in
the application, Phoenix will allocate the entire Issue Premium, less applicable
charges, to the Money Market Sub-account of the VUL Account. Phoenix requires
this election for all applicants in certain states and for applicants in certain
states who indicate on their application that they intend the Policy to replace
existing insurance. At the expiration of the Right to Cancel Period for such
Policyowners, the Policy Value will be allocated among the Sub-accounts of the
VUL Account or to the GIA in accordance with the Policyowner's allocation
instructions in the application for insurance. All other Policyowners will have
their Issue Premium, less applicable charges, allocated according to the
instructions in the application on the date it is received without first having
the premium placed in the Money Market Sub-account. The Policy Value may be
allocated among the available Sub-accounts of the VUL Account, each of which
invests in shares of a designated portfolio of the Fund, or to the GIA.
8. AFTER THE INITIAL ALLOCATION, MAY I CHANGE THE ALLOCATION OF POLICY VALUE?
Yes. A Policyowner may transfer amounts among the Sub-accounts of the VUL
Account or the GIA. Only one transfer per Policy Year is permitted from the
unloaned portion of the GIA. The amount of that transfer is limited to the
higher of $1,000 or 25% of the value of the Policy in the unloaned portion of
the GIA. Also, Phoenix reserves the right to require that transfers be made by
written request. Phoenix further reserves the right to permit transfers of less
than $500 only if the entire balance in the Sub-account of the VUL Account or
the GIA is transferred. A systematic transfer program also is available. See
"Transfer of Policy Value."
9. MAY THE POLICY BE SURRENDERED?
Yes. A Policyowner may totally surrender the Policy at any time and receive
the Cash Surrender Value. Subject to certain limitations, the Policyowner also
may partially surrender the Policy at any time prior to the Maturity Date. In
the future, Phoenix may set a minimum partial surrender amount, not to exceed
$500. See "Surrenders--Partial Surrenders." A partial surrender will result in a
decrease in the death benefit under the Policy. See "Death Benefit." If the
Policy is totally or partially surrendered during the first 10 Policy Years, a
Surrender Charge will apply. See "Surrender Charge." In addition, there may be
certain tax consequences as the result of a surrender. For example, a Policy may
be a "modified endowment contract" if the amount of premium paid during the
first seven Policy Years is more than the amount that would have been paid if
the Policy had provided for paid-up benefits after the payment of seven level
annual premiums. Distributions such as loans and full or partial surrenders
under a modified endowment contract may be taxable income to the extent they
exceed the premiums paid. If such income is distributed before the Policyowner
attains age 59 1/2, a 10% penalty tax may be imposed. See "Federal Tax
Considerations."
10. WHAT IS THE POLICY'S LOAN PRIVILEGE?
A Policyowner may obtain Policy loans in an amount up to 90% of the result
of subtracting the remaining Surrender Charge from the Policy Value. The
interest rate on a loan is at an effective annual rate as stated in the Policy,
compounded daily and payable on each Policy Anniversary in arrears. The
requested loan amount is transferred from the VUL Account to the loaned portion
of the GIA and is credited with interest at an effective annual rate as stated
in the Policy. Phoenix reserves the right not to allow loans of less than $500
unless the loans are to pay premiums on another policy issued by Phoenix. See
"The Policy--Policy Loans."
The proceeds of Policy loans may be subject to federal income tax
under certain circumstances. See "Federal Tax Considerations."
11. HOW ARE INSURANCE BENEFITS PAID?
Surrender and death benefits under the Policy may be paid in a lump sum or
under one of the payment options set forth in the Policy.
See "Payment Options."
PHOENIX AND THE VUL ACCOUNT
- --------------------------------------------------------------------------------
PHOENIX
Phoenix Life and Annuity Company is an indirect subsidiary of Phoenix
Home Life Mutual Insurance Company. Its executive office is at One American Row,
Hartford, Connecticut 06115, and its main administrative office is at 100 Bright
Meadow Boulevard, Enfield, Connecticut 06083-1900. Phoenix is a Missouri Stock
Company formed in March 1996. Formerly, it was Savers Life Insurance
5
<PAGE>
Company of America, chartered in Missouri. Phoenix sells insurance policies
through its own field force of full time agents and through brokers. Its
operations are conducted in ___ states.
THE VUL ACCOUNT
The VUL Account is a separate account of Phoenix registered as a unit
investment trust under the Investment Company Act of 1940, as amended, and it
meets the definition of a "separate account" under that Act. Such registration
does not involve supervision of the management of the VUL Account or Phoenix by
the Securities and Exchange Commission.
The VUL Account is divided into Sub-accounts each of which is available for
allocation of Policy Value. If, in the future, Phoenix determines that marketing
needs and investment conditions warrant, Phoenix may establish additional
Sub-accounts which will be made available to existing Policyowners to the extent
and on a basis determined by Phoenix. Each Sub-account will invest solely in
shares of the Funds allocable to one of the available portfolios, each having
the specified investment objective set forth under "Investments of the VUL
Account--Participating Mutual Fund."
Phoenix does not guarantee the investment performance of the VUL Account or
any of its Sub-accounts. The Policy Value allocated to the VUL Account depends
on the investment performance of the Fund. Thus, the Policyowner bears the full
investment risk for all monies invested in the VUL Account.
Advertisements, sales literature and other communications may contain
information about any Series' or Advisers' current investment strategies and
management style. Current strategies and style may change to respond to changing
market and economic conditions. From time to time, the Series may discuss
specific portfolio holdings or industries in such communications. To illustrate
components of overall performance, the Series may separate their cumulative and
average annual returns into income results and capital gains or losses; or cite
separately as a return figure the equity or bond portion of a Series' portfolio;
or compare a Series' equity or bond return figure to well-known indices of
market performance, including, but not limited to, the S&P 500 Index, Dow Jones
Industrial Average, First Boston High Yield Index and Salomon Brothers Corporate
and Government Bond Indices.
The VUL Account may from time to time include in advertisements containing
total returns the ranking of those performance figures relative to such figures
for groups of Sub-accounts having similar investment objectives as categorized
by ranking services such as Lipper Analytical Services, Inc., CDA Investment
Technologies, Inc., Weisenberger Financial Services, Inc., and Morningstar, Inc.
Additionally, the Funds may compare a Series' performance results to other
investment or savings vehicles (such as certificates of deposit) and may refer
to results published in various publications such as Changing Times, Forbes,
Fortune, Money, Barrons, Business Week, Investor's Daily, The Stanger Register,
Stanger's Investment Adviser, The Wall Street Journal, The New York Times,
Consumer Reports, Registered Representative, Financial Planning, Financial
Services Weekly, Financial World, U.S. News and World Report, Standard & Poor's,
The Outlook, and Personal Investor. The Funds may from time to time illustrate
the benefits of tax deferral by comparing taxable investments to investments
made through tax-deferred retirement plans. The total return also may be used to
compare the performance of a Series against certain widely acknowledged outside
standards or indices for stock and bond market performance, such as the S&P 500
Index, Dow Jones Industrial Average, Europe Australia Far East Index (EAFE),
Consumer's Price Index, Shearson Lehman Corporate Index and Shearson Lehman
T-Bond Index. The S&P 500 is a commonly quoted market value-weighted and
unmanaged index showing the changes in the aggregate market value of 500 common
stocks relative to the base period 1940-43. The S&P is composed almost entirely
of common stocks of companies listed on the New York Stock Exchange, although
the common stocks of a few companies listed on the American Stock Exchange or
traded over the counter are included. The 500 companies represented include 400
industrial, 60 transportation and 40 financial services concerns. The S&P
represents about 80% of the market value of all issues traded on the New York
Stock Exchange.
The VUL Account is administered and accounted for as part of the general
business of Phoenix, but the income, gains, or losses of the VUL Account are
credited to or charged against the assets held in the VUL Account without regard
to other income, gains, or losses of any other business Phoenix may conduct.
Under Missouri law, the assets of the VUL Account are not chargeable with
liabilities arising out of any other business Phoenix may conduct. Nevertheless
all obligations arising under the Policy are general corporate obligations of
Phoenix.
THE GIA
The GIA is not part of the VUL Account. It is accounted for as part of the
General Account. Phoenix reserves the right to limit cumulative deposits,
including transfers, to the unloaned portion of the GIA to no more than $250,000
during any one-week period. Phoenix will credit interest daily on the amounts
allocated under the Policy to the GIA. The credited rate will be uniform by
class. The loaned portion of the GIA will be credited interest at an effective
annual fixed rate of 2%. Interest on the unloaned portion of the GIA will be
credited at an effective annual rate of not less than 4%.
Bi-weekly, Phoenix sets the interest rate that will apply to any net premium
or transferred amounts deposited to the unloaned portion of the GIA. That rate
will remain in effect for such deposits for an initial guarantee period of one
full year from the date of deposit. Upon expiration of the initial one-year
guarantee period (and each subsequent one-year guarantee period thereafter), the
rate to be applied to any deposits whose guarantee period has just ended shall
be the same rate as is applied to new deposits allocated to the GIA at the time
that the guarantee period expired. This rate will likewise remain in effect for
a guarantee period of one full year from the date the new rate is applied. For
more complete information concerning the GIA, see Appendix A.
THE POLICY
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INTRODUCTION
The Policy is a variable life insurance policy. The Policy has a death
benefit, Cash Surrender Value, and loan privilege such as is associated with a
traditional fixed benefit whole life policy. The Policy differs from a fixed
benefit whole life policy, however, because the Policyowner specifies into which
of several Sub-accounts of the VUL Account or the GIA net premium is to be
allocated. Each Sub-account
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of the VUL Account, in turn, invests its assets exclusively in a portfolio of
the Funds. The Policy Value varies according to the investment performance of
the Series to which Policy Value has been allocated.
ELIGIBLE PURCHASERS
Any person up to the age of 75 is eligible to be insured under a newly
purchased Policy after providing acceptable evidence of insurability. A person
can purchase a Policy to insure the life of another person provided that the
Policyowner has an insurable interest in the life of the Insured, and the
Insured consents.
PREMIUM PAYMENT
The minimum Issue Premium for a Policy is generally 1/6 of the Planned
Annual Premium. The Issue Premium is due on the Policy Date. The Insured must be
alive when the Issue Premium is paid. Thereafter, the amount and payment
frequency of planned premiums are as shown on the Schedule Page of the Policy.
All premiums are payable at Variable and Universal Life Administration, except
that the Issue Premium may be paid to an authorized agent of Phoenix for
forwarding to the Underwriting Department of Phoenix.
Any premium payments will be reduced by the applicable premium tax and by a
federal tax charge of 1.50%. The Issue Premium also will be reduced by the Issue
Expense Charge on a pro rata basis in equal monthly installments over a 12-month
period. Any unpaid balance of the Issue Expense Charge will be paid to Phoenix
upon policy lapse or termination.
Premium payments received during a grace period also will be reduced by the
amount needed to cover any monthly deductions during the grace period. The
remainder will be applied on the Payment Date to the various Sub-accounts of the
VUL Account or to the GIA, based on the premium allocation schedule elected in
the application for the Policy or as later changed. The allocation schedule for
premium payments may be changed by calling or writing to Variable and Universal
Life Administration. Allocations to the VUL Account Sub-accounts or to the GIA
must be expressed in terms of whole percentages.
The number of units credited to a Sub-account of the VUL Account will be
determined by dividing the portion of the net premium applied to that
Sub-account by the unit value of the Sub-account on the Payment Date.
A Policyowner may increase or decrease the planned premium amount or payment
frequency at any time by written notice to Variable and Universal Life
Administration. Phoenix reserves the right to limit increases to such maximums
as may be established from time to time. Additional premium payments may be made
at any time. Each premium payment must at least equal $25 or, if made during a
grace period, the payment must equal the amount needed to prevent lapse of the
Policy.
A Policyholder also may elect a Waiver of Premium Rider. This rider provides
for the waiver of certain premium payments under the Policy under certain
conditions during a period of total disability of the Insured. Under its terms,
the specified premium will be waived upon Phoenix's receipt of proof that the
Insured is totally disabled and that the disability occurred while the rider was
In Force.
The Policy contains a total premium limit as shown on the Schedule Page.
This limit is applied to the sum of all premiums paid under the Policy. If the
total premium limit is exceeded, the Policyowner will receive the excess, with
interest at an annual rate of not less than 4%, not later than 60 days after the
end of the Policy Year in which the limit was exceeded. The Policy Value will
then be adjusted to reflect the refund. The amount to be taken from each Sub-
account or the GIA will be allocated in the same manner as provided for monthly
deductions unless the Policyowner requests otherwise in writing. The total
premium limit may be exceeded if additional premium is needed to prevent lapse
or if Phoenix determines that additional premium would be permitted by federal
laws or regulations.
A Policyowner may authorize his bank to draw $25 or more from his/her
personal checking account monthly to purchase Units in any available
Sub-account. The amount the Policyowner designates will be automatically
invested in the Sub-account of his/her choice on the date the bank draws on his
account.
Policies sold to officers, directors and employees of Phoenix (and their
spouses and children) will be credited with an amount equal to the first-year
commission that would apply on the amount of premium contributed. This option
also is available to career agents of Phoenix (and their spouses and children).
ALLOCATION OF ISSUE PREMIUM
Phoenix will generally allocate the Issue Premium less applicable charges to
the VUL Account or to the GIA upon receipt of a completed application, in
accordance with the allocation instructions in the application for a Policy.
However, Policies issued in certain states, and Policies issued in certain
states pursuant to applications which state the Policy is intended to replace
existing insurance, are issued with a Temporary Money Market Allocation
Amendment. Under this Amendment, Phoenix temporarily allocates the entire Issue
Premium paid less applicable charges (along with any other premiums paid during
the Right to Cancel Period) to the Money Market Sub-account of the VUL Account,
and, at the expiration of the Right to Cancel Period, the Policy Value of the
Money Market Sub-account is allocated among the Sub-accounts of the VUL Account
or to the GIA in accordance with the applicant's allocation instructions in the
application for insurance.
RIGHT TO CANCEL PERIOD
A Policy may be returned by mailing or delivering it to Phoenix within 10
days after the Policyowner receives it (or longer in some states); within 10
days after Phoenix mails or delivers a written notice of withdrawal right to the
Policyowner; or within 45 days after the applicant signs the application for
insurance, whichever occurs latest (the "Right to Cancel Period"). The returned
Policy is treated as if Phoenix never issued the Policy and, except for Policies
issued with a Temporary Money Market Allocation Amendment, Phoenix will return
the sum of the following as of the date Phoenix receives the returned Policy:
(i) the then current Policy Value less any unpaid loans and loan interest; plus
(ii) any monthly deductions, partial surrender fees, and other charges made
under the Policy, including investment advisory fees, or any Fund expenses
deducted. The amount returned for Policies issued with the Amendment will equal
any premiums paid less any unrepaid loans and loan interest, and less any
partial surrender amounts paid.
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Phoenix reserves the right to disapprove an application for processing
within seven days of receipt at Phoenix of the completed application for
insurance, in which event Phoenix will return the premium paid. Even after
approval of the application for processing, Phoenix reserves the right to
decline issuance of the Policy, in which event Phoenix will refund the applicant
the same amount as would have been refunded under the Policy had it been issued
but returned for refund during the Right to Cancel Period.
TEMPORARY INSURANCE COVERAGE
On the date the application for a Policy is signed and submitted with the
Issue Premium, Phoenix issues a Temporary Insurance Receipt (the "Receipt") in
connection with the application. Under the Receipt, the insurance protection
applied for (subject to the limits of liability and in accordance with the terms
set forth in the Policy and in the Receipt) takes effect on the date of the
application.
TRANSFER OF POLICY VALUE
SYSTEMATIC TRANSFER PROGRAM
A Policyowner may elect to transfer funds automatically among the
Sub-accounts or the unloaned portion of the GIA on a monthly, quarterly,
semi-annual or annual basis under the Systematic Transfer Program for Dollar
Cost Averaging ("Systematic Transfer Program"). Under this Systematic Transfer
Program, the minimum initial and subsequent transfer amounts are $25 monthly,
$75 quarterly, $150 semi-annually, or $300 annually. A Policyowner must have an
initial value of $1,000 in the GIA or the Sub-account that funds will be
transferred from and if the value in that Sub-account or the GIA drops below the
elected transfer amount, the entire remaining balance will be transferred and no
more systematic transfers will be processed. Funds may be transferred from only
one Sub-account or the GIA, but may be allocated to multiple Sub-accounts. Under
the Systematic Transfer Program, Policyowners may make more than one transfer
per Policy Year from the GIA, in approximately equal amounts over a minimum
18-month period. All transfers under the Systematic Transfer Program will be
executed on the basis of the respective values as of the first of the month
following receipt of the transfer request. If the first of the month falls on a
holiday or weekend, then the transfer will be processed on the next succeeding
business day.
NON-SYSTEMATIC TRANSFERS
Transfers among available Sub-accounts or the GIA and changes in premium
payment allocations may be requested in writing or by calling 1-800-892-4885,
between the hours of 8:30 a.m. and 4:00 p.m. Eastern Time and will be executed
on the date the request is received at Variable and Universal Life
Administration, except as noted below. Unless the Policyowner elects in writing
not to authorize telephone transfers or allocation changes, telephone transfer
orders and allocation changes also will be accepted on behalf of the Policyowner
from his/her registered representative. Phoenix and Phoenix Equity Planning
Corporation ("PEPCO") will employ reasonable procedures to confirm that
telephone instructions are genuine. They will require verification of account
information and will record telephone instructions on tape. All telephone
transfers will be confirmed in writing to the Policyowner. To the extent that
procedures reasonably designed to prevent unauthorized transfers are not
followed, Phoenix and PEPCO may be liable for following telephone instructions
for transfers that prove to be fraudulent. However, the Policyowner would bear
the risk of loss resulting from instructions entered by an unauthorized third
party that Phoenix and PEPCO reasonably believe to be genuine. These telephone
privileges may be modified or terminated at any time and, during times of
extreme market volatility, may be difficult to exercise. In such cases, the
Policyowner should submit a written request.
Phoenix reserves the right to permit transfers of less than $500 only if the
entire balance in the Sub-account or the GIA is transferred or if the Systematic
Transfer Program has been elected.
Phoenix reserves the right to prohibit a transfer to any Sub-account of the
VUL Account where the resultant value of the Policy's share in that Sub-account
immediately after the transfer would be less than $500. It further reserves the
right to require that the entire balance of a Sub-account or the GIA be
transferred if the share of the Policy in the value of that Sub-account would,
immediately after the transfer, be less than $500.
Unless Phoenix agrees otherwise or the Systematic Transfer Program has been
elected, a Policyowner may make only one transfer per Policy Year from the
unloaned portion of the GIA and the amount that may be transferred cannot exceed
the greater of $1,000 or 25% of the value of the Policy in the unloaned portion
of the GIA at the time of the transfer. Non-systematic transfers from the
unloaned portion of the GIA will be effectuated on the date of receipt by
Variable and Universal Life Administration.
For policies issued with the Temporary Money Market Allocation Amendment,
transfers may not be made until termination of the Right to Cancel Period.
DETERMINATION OF SUB-ACCOUNT VALUES
The unit value of each Sub-account of the VUL Account was set by Phoenix on
the first Valuation Date of each such Sub-account. The unit value of a
Sub-account of the VUL Account on any other Valuation Date is determined by
multiplying the unit value of that Sub-account on the just prior Valuation Date
by the Net Investment Factor for that Sub-account for the then current Valuation
Period. The unit value of each Sub-account of the VUL Account on a day other
than a Valuation Date is the unit value on the next Valuation Date. Unit values
are carried to 6 decimal places. The unit value of each Sub-account of the VUL
Account on a Valuation Date is determined at the end of that day.
The Net Investment Factor for each Sub-account of the VUL Account is
determined by the investment performance of the assets held by the Sub-account
during the Valuation Period. Each valuation will follow applicable law and
accepted procedures. The Net Investment Factor is equal to item (D) below
subtracted from the result of dividing the sum of items (A) and (B) by item (C).
(A) The value of the assets in the Sub-account on the current Valuation
Date, including accrued net investment income and realized and
unrealized capital gains and losses, but excluding the net value of any
transactions during the current Valuation Period.
(B) The amount of any dividend (or, if applicable, any capital gain
distribution) received by the Sub-account if the "ex-dividend" date for
shares of the Fund occurs during the current Valuation Period.
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(C) The value of the assets in the Sub-account as of the just prior
Valuation Date, including accrued net investment income and realized
and unrealized capital gains and losses, and including the net value of
all transactions during the Valuation Period ending on that date.
(D) The sum of the following daily charges multiplied by the number of days
in the current Valuation Period:
1. the mortality and expense risk charge; and
2. the charge, if any, for taxes and reserves for taxes on
investment income, and realized and unrealized capital
gains.
DEATH BENEFIT
GENERAL
The death benefit (under Option 1) equals the Policy's face amount on the
date of the Insured's death or, if greater, the minimum death benefit on the
date of death. Under Option 2, the death benefit equals the Policy's face amount
on the date of the Insured's death plus the Policy Value. Under either Option,
the minimum death benefit is the Policy Value on the date of death of the
Insured increased by the applicable percentage from the table contained in the
Policy, based on the Insured's attained age at the beginning of the Policy Year
in which the death occurs. If no option is elected, Option 1 will apply.
GUARANTEED DEATH BENEFIT OPTION
For Policies with a face amount of at least $50,000, a guaranteed death
benefit rider may be purchased. Under this Policy rider, if a Policyowner pays
the required premium each year as specified in the rider, the death benefit
selected will be guaranteed for a certain specified number of years, regardless
of the investment performance of the Policy, and will equal either the initial
face amount or the face amount as later changed by increases or decreases. In
order to keep this guaranteed death benefit In Force, there may be limitations
on the amount of partial surrenders or decreases in face amount permitted.
LIVING BENEFITS OPTION
In the event of a terminal illness of the Insured, an accelerated payment of
up to 75% of the Policy's death benefit (up to a maximum of $250,000) is
available if a Living Benefits Rider has been purchased. The minimum face amount
of the Policy after any such accelerated benefit payment is $10,000.
REQUESTS FOR INCREASE IN FACE AMOUNT
Any time after the first Policy Anniversary, a Policyowner may request an
increase in the face amount of insurance provided under the Policy. Requests for
face amount increases must be made in writing, and Phoenix requires additional
evidence of insurability. The effective date of the increase generally will be
the Policy Anniversary following approval of the increase. The increase may not
be less than $25,000 and no increase will be permitted after the Insured's age
75. The charge for the increase is $1.50 per $1,000 of face amount increase
requested subject to a maximum of $600. No additional monthly administration
charge will be assessed for face amount increases. Phoenix will deduct any
charges associated with the increase (the increases in cost of insurance
charges), from the Policy Value, whether or not the Policyowner pays an
additional premium in connection with the increase. The surrender charge
applicable to the Policy also will increase. At the time of the increase, the
Cash Surrender Value must be sufficient to pay the monthly deduction on that
date, or additional premiums will be required to be paid on or before the
effective date. Also, a new Right to Cancel Period (see "The Policy--Right to
Cancel Period") will be established for the amount of the increase. For a
discussion of possible implications of a material change in the Policy resulting
from the increase, see "Material Change Rules."
PARTIAL SURRENDER AND DECREASES IN FACE AMOUNT: EFFECT ON DEATH BENEFIT
A partial surrender or a decrease in face amount generally
decreases the death benefit. Upon a decrease in face amount or partial
surrender, a partial surrender charge will be deducted from Policy Value based
on the amount of the decrease or partial surrender. With a decrease in face
amount, the death benefit under a Policy would be reduced on the next Monthly
Calculation Day. With a partial surrender, the death benefit under a Policy
would be reduced immediately. A decrease in the death benefit may have certain
tax consequences. See "Federal Tax Considerations."
REQUESTS FOR DECREASE IN FACE AMOUNT
A Policyowner may request a decrease in face amount at any time after the
first Policy Year. Unless Phoenix agrees otherwise, the decrease must at least
equal $10,000 and the face amount remaining after the decrease must at least
equal $25,000. All face amount decrease requests must be in writing and will be
effective on the first Monthly Calculation Day following the date Phoenix
approves the request. A partial surrender charge will be deducted from the
Policy Value based on the amount of the decrease. The charge will equal the
applicable surrender charge that would apply to a full surrender multiplied by a
fraction (the decrease in face amount divided by the face amount of the Policy
before the decrease).
SURRENDERS
GENERAL
At any time during the lifetime of the Insured and while the Policy is In
Force, the Policyowner may partially or fully surrender the Policy by sending a
written release and surrender in a form satisfactory to Phoenix to Variable and
Universal Life Administration, along with the Policy if Phoenix so requires. The
amount available for surrender is the Cash Surrender Value at the end of the
Valuation Period during which the surrender request is received at Variable and
Universal Life Administration.
Upon partial or full surrender, Phoenix generally will pay the amount
surrendered to the Policyowner within seven days after Phoenix receives the
Written Request for the surrender. Under certain circumstances, the surrender
payment may be postponed. See "General Provisions--Postponement of Payments."
For the federal tax effects of partial and full surrenders, see "Federal Tax
Considerations."
FULL SURRENDERS
If the Policy is being fully surrendered, the Policy itself must be returned
to Variable and Universal Life Administration, along with the written release
and surrender of all claims in a form satisfactory to Phoenix. A Policyowner may
elect to have the amount paid in a lump
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sum or under a payment option. See "Surrender Charge" and "Payment Options."
PARTIAL SURRENDERS
A Policyowner may obtain a partial surrender of the Policy by requesting
that part of the Policy's Cash Surrender Value be paid. The Policyowner may do
this at any time during the lifetime of the Insured while the Policy is In Force
with a Written Request to Variable and Universal Life Administration. Phoenix
reserves the right to require that the Policy be returned before payment is
made. A partial surrender will be effective on the date the Written Request is
received or, if required, the date the Policy is received. Surrender proceeds
may be applied under any of the payment options described under "Payment of
Proceeds--Payment Options."
Phoenix reserves the right not to allow partial surrenders of less than
$500. In addition, if the share of the Policy Value in any Sub-account or in
the GIA (reduced as a result of a partial surrender) would be, immediately after
the partial surrender, less than $500, Phoenix reserves the right to require
that as part of any partial surrender, the entire remaining balance in that
Sub-account or the GIA be surrendered.
Upon a partial surrender, the Policy Value will be reduced by the sum of the
following:
(i) The Partial Surrender Amount Paid. This amount comes from a reduction
in the Policy's share in the value of each Sub-account or the GIA
based on the allocation requested at the time of the partial surrender.
If no allocation request is made, the assessment to each Sub-account
will be made in the same manner as that provided for monthly
deductions.
(ii) The Partial Surrender Fee. This fee is the lesser of $25 or 2% of the
partial surrender amount paid. The assessment to each Sub-account or
the GIA will be made in the same manner as provided for the partial
surrender amount paid.
(iii)A Partial Surrender Charge. This charge is equal to a pro rata portion
of the applicable surrender charge that would apply to a full
surrender, determined by multiplying the applicable surrender charge by
a fraction (equal to the partial surrender amount payable divided by
the result of subtracting the applicable surrender charge from the
Policy Value). This amount is assessed against the Sub-account or the
GIA in the same manner as provided for the partial surrender amount
paid.
The Cash Surrender Value will be reduced by the partial surrender amount
paid plus the partial surrender fee. The face amount of the Policy also will be
reduced by the same amount as the Policy Value is reduced as described above.
POLICY LOANS
While the Policy is In Force, a loan may be obtained against the Policy up
to the available loan value. The loan value on any day is 90% of the result of
subtracting the then remaining surrender charge from the Policy Value. The
available loan value is the loan value on the current day less any outstanding
Debt.
The amount of any loan will be added to the loaned portion of the GIA and
subtracted from the Policy's share of the Sub-accounts or the unloaned portion
of the GIA, based on the allocation requested at the time of the loan. The total
reduction will equal the amount added to the loaned portion of the GIA.
Allocations generally must be expressed in terms of whole percentages. If no
allocation request is made, the amount subtracted from the share of each
Sub-account or the unloaned portion of the GIA will be determined in the same
manner as provided for monthly deductions. Interest will be credited and the
loaned portion of the GIA will increase at an effective annual rate of 2%,
compounded daily and payable in arrears. At the end of each Policy Year and at
the time of any Debt repayment, interest credited to the loaned portion of the
GIA will be transferred to the unloaned portion of the GIA.
Debt may be repaid at any time during the lifetime of the Insured while the
Policy is In Force. Any Debt repayment received by Phoenix during a grace period
will be reduced to cover any overdue monthly deductions and only the balance
will be applied to reduce the Debt. Such balance, in excess of any outstanding
accrued loan interest, will be applied to reduce the loaned portion of the GIA
and will be transferred to the unloaned portion of the GIA to the extent that
loaned amounts taken from such Account have not been previously repaid.
Otherwise, such balance will be transferred among the Sub-accounts as the
Policyowner requests upon repayment and, if no allocation request is made,
according to the most recent premium allocation schedule on file.
While there is outstanding Debt on the Policy, any payments received by
Phoenix for the Policy will be applied directly to reduce the Debt unless
specified as a premium payment by the Policyowner. Until the Debt is fully
repaid, additional Debt repayments may be made at any time during the lifetime
of the Insured while the Policy is In Force.
Failure to repay a policy loan or to pay loan interest will not terminate
the Policy except as otherwise provided under the terms of the Policy concerning
the grace period and lapse.
The proceeds of Policy loans may be subject to federal income tax
under certain circumstances. See "Federal Tax Considerations."
In the future, Phoenix may not allow Policy loans of less than $500, unless
such loan is used to pay a premium on another Phoenix policy.
The Policyowner will pay interest on the loan at an effective annual rate,
compounded daily and payable in arrears. The loan interest rates in effect are
as follows:
4% for Policy Years 1 through 10 (or the Insured's age 65 if earlier)
3% for Policy Years 11 through 15
2 1/2% for Policy Years 16 and thereafter
At the end of each Policy Year, any interest due on the Debt will be
treated as a loan and will be offset by a transfer from the Policyowner's values
to the value of the loaned portion of the GIA.
A Policy loan, whether or not repaid, has a permanent effect on the Policy
Value because the investment results of the Sub-accounts or unloaned portion of
the GIA will apply only to the amount remaining in the Sub-accounts or the
unloaned portion of the GIA. The longer a
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loan is outstanding, the greater the effect is likely to be. The effect could be
favorable or unfavorable. If the Sub-accounts or the unloaned portion of the GIA
earn more than the annual interest rate for funds held in the loaned portion of
the GIA, Policy Value does not increase as rapidly as it would have had no loan
been made. If the Sub-accounts or the unloaned portion of the GIA earn less than
the annual interest rate for funds held in the loaned portion of the GIA, Policy
Value is greater than it would have been had no loan been made. A Policy loan,
whether or not repaid, also has an effect on the Policy's Death Benefit due to
any resulting differences in Cash Surrender Value.
LAPSE
Unlike conventional life insurance policies, the payment of the Issue
Premium, no matter how large, or the payment of additional premiums will not
necessarily continue the Policy In Force to its Maturity Date.
If on any Monthly Calculation Day during the first two Policy Years, the
Policy Value is insufficient to cover the monthly deduction, a grace period of
61 days will be allowed for the payment of an amount equal to three times the
required monthly deduction. If on any Monthly Calculation Day during any
subsequent Policy Year, the Cash Surrender Value (which has become positive) is
less than the required monthly deduction, a grace period of 61 days will be
allowed for the payment of an amount equal to three times the required monthly
deduction. However, until the Cash Surrender Value becomes positive for the
first time, the Policy will not lapse as long as all premiums planned at issue
have been paid.
The Policy will continue In Force during any such grace period although
Sub-account transfers, loans, partial or full surrenders will not be permitted.
Failure to pay the additional amount within the grace period will result in
lapse of the Policy, but not before 30 days have elapsed since Phoenix mailed
written notice to the Policyowner. If a premium payment for the additional
amount is received by Phoenix during the grace period, any amount of premium
over what is required to prevent lapse will be allocated among the Sub-accounts
of the VUL Account or to the GIA in accordance with the then current premium
allocation schedule. In determining the amount of "excess" premium to be applied
to the Sub-accounts or the GIA, Phoenix will deduct the premium tax and the
amount needed to cover any monthly deductions made during the grace period. If
the Insured dies during the grace period, the death benefit will equal the
amount of the death benefit immediately prior to the commencement of the grace
period.
PAYMENT OF PREMIUMS DURING PERIOD OF DISABILITY
A Policyholder also may elect a Waiver of Premium Rider. This
rider provides for the waiver of certain premium payments under the Policy under
certain conditions during a period of total disability of the Insured. Under its
terms, the specified premium will be waived upon Phoenix's receipt of proof that
the Insured is totally disabled and that the disability occurred while the rider
was In Force. The terms of this rider may vary by state.
ADDITIONAL INSURANCE OPTIONS
While the Policy is In Force and the Insured is insurable, the Policyowner
will have the option to purchase additional insurance on the same Insured with
the same guaranteed rates as the Policy without being assessed an Issue Expense
Charge. Phoenix will require evidence of insurability and charges will be
adjusted for the Insured's new attained age and any change in risk
classification. However, if elected on the application, the Policyowner may, at
predetermined future dates, purchase additional insurance protection on the same
Insured without evidence of insurability. (See "Purchase Protection Plan
Riders.")
In addition, once each Policy Year a Policyowner may request an increase in
face amount. This request should be made within 90 days prior to the Policy
Anniversary and is subject to an issue expense charge of $1.50 per $1,000 of
increase in face amount, up to a maximum of $600, and to Phoenix's receipt of
adequate evidence of insurability. A Right to Cancel Period as described in "The
Policy" section of this Prospectus applies to each increase in face amount.
ADDITIONAL RIDER BENEFITS
A Policyowner may purchase additional benefits under a Policy. These
benefits are cancellable by the Policyowner at any time. A charge will be
deducted monthly from the Policy Value for each additional rider benefit chosen
except where noted below. More details will be included in the form of a rider
to the Policy if any of these benefits is chosen. The following benefits are
currently available; however, additional riders may be available as described in
the Policy.
o DISABILITY WAIVER OF SPECIFIED PREMIUM RIDER
Phoenix waives the specified premium if the Insured becomes
totally disabled and the disability continues for at least six months.
Premiums will be waived to the Policy Anniversary nearest the
Insured's 65th birthday (provided that the disability continues),
unless premiums have been waived continuously during the entire
five years prior to such date in which case the waiver will continue
beyond that date. The premium will be waived upon Phoenix's
receipt of proof that the Insured is totally disabled and that the
disability occurred while the rider was In Force.
o ACCIDENTAL DEATH BENEFIT RIDER
An additional death benefit will be paid if the Insured dies from bodily
injury that results from an accident if the Insured dies no later than 90
days after injury and before the Policy Anniversary nearest the Insured's
75th birthday.
o DEATH BENEFIT PROTECTION RIDER
The purchase of this rider provides that the death benefit will be
guaranteed. The amount of the guaranteed death benefit is equal to the
initial face amount, or the face amount that later may be increased or
decreased by the Policyholder, provided that certain minimum premiums are
paid. Unless Phoenix agrees otherwise, the initial face amount and the face
amount remaining after any decrease must at least equal $50,000 and the
minimum issue age of the Insured is 20. Three (3) Death Benefit Guarantee
periods are available in all states except New York. The minimum premium
required to maintain the guaranteed death benefit is based on the length of
the guarantee period as elected on the application. The three available
guarantee periods are:
LEVEL: EXPIRY DATE OF DEATH BENEFIT GUARANTEED, THE LATER OF:
1 The Policy Anniversary nearest the Insured's 70th
birthday or the 7th Policy Year
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2 The Policy Anniversary nearest the Insured's 80th
birthday or the 10th Policy Year
3 The Policy Anniversary nearest the Insured's 95th
birthday.
Level 1 or 2 guarantees may be extended provided that the Policy's Cash
Surrender Value is sufficient and the Policyowner pays the new Minimum
Required Premium.
o WHOLE LIFE EXCHANGE OPTION RIDER
This rider permits the Policyowner to exchange his Policy for a fixed
benefit whole life policy at the later of age 65 or Policy Year 15. There is
no charge for this rider.
o PURCHASE PROTECTION PLAN RIDER
Under this rider a Policyowner may, at predetermined future dates, purchase
additional insurance protection without evidence of insurability.
o LIVING BENEFITS RIDER
Under certain conditions, in the event of the terminal illness of the
Insured, an accelerated payment of up to 75% of the Policy's death benefit
(up to a maximum of $250,000) is available. The minimum face amount of the
Policy after any such accelerated benefit payment is $10,000. There is no
charge for this rider.
o CASH VALUE ACCUMULATION RIDER
This rider generally permits a Policyowner to pay more in premium than
otherwise would be permitted. This rider must be elected before the Policy
is issued. There is no charge for this rider.
INVESTMENTS OF THE VUL ACCOUNT
- --------------------------------------------------------------------------------
PARTICIPATING MUTUAL FUNDS
THE PHOENIX EDGE SERIES FUND
The VUL Account invests in corresponding Series of The Phoenix Edge Series
Fund. The Fund currently has the following Series available through the
Policies:
MONEY MARKET SERIES: The investment objective of the Money Market Series is
to provide maximum current income consistent with capital preservation and
liquidity.
GROWTH SERIES: The investment objective of the Growth Series is
to achieve intermediate and long-term growth of capital, with income
as a secondary consideration.
MULTI-SECTOR FIXED INCOME ("MULTI-SECTOR") SERIES: The investment objective
of the Multi-Sector Series is to seek long-term total return by investing in a
diversified portfolio of high yield (high risk) and high quality fixed income
securities. For a discussion of the risks associated with investing in high
yield bonds, please see the accompanying Fund prospectus.
TOTAL RETURN SERIES: The investment objective of the Total Return Series is
to realize as high a level of total rate of return over an extended period of
time as is considered consistent with prudent investment risk (total rate of
return consists of capital appreciation, current income, including dividends and
interest, possible premiums and short-term gains from purchasing and selling
options and financial futures).
INTERNATIONAL SERIES: The investment objective of the International Series
is to seek a high total return consistent with reasonable risk. The
International Series intends to invest primarily in an internationally
diversified portfolio of equity securities. It intends to reduce its risk by
engaging in hedging transactions involving options, futures contracts and
foreign currency transactions. The International Series provides a means for
investors to invest a portion of their assets outside the United States.
BALANCED SERIES: The investment objective of the Balanced Series is to seek
reasonable income, long-term capital growth and conservation of capital. The
Balanced Series intends to invest based on combined considerations of risk,
income, capital enhancement and protection of capital value.
REAL ESTATE SERIES: The investment objective of the Real Estate Securities
Series is to seek capital appreciation and income with approximately equal
emphasis. It intends under normal circumstances to invest in marketable
securities of publicly traded real estate investment trusts (REITs) and
companies that operate, develop, manage and/or invest in real estate located
primarily in the United States.
STRATEGIC THEME SERIES: The investment objective of the Strategic Theme
Series is to seek long-term appreciation of capital by identifying securities
benefiting from long-term trends present in the United States and abroad. The
Strategic Theme Series intends to invest primarily in common stocks believed to
have substantial potential for capital growth.
ASIA SERIES: The investment objective of the Asia Series is to seek
long-term capital appreciation. The Asia Series will invest primarily in a
diversified portfolio of equity securities of issuers organized and principally
operating in Asia, excluding Japan.
Each Series will be subject to the market fluctuations and risks inherent in
the ownership of any security and there can be no assurance that any Series'
stated investment objective will be realized.
In addition to being sold to the VUL Account, shares of the Fund also may
be sold to other separate accounts of Phoenix or its affiliates or of other
insurance companies.
It is conceivable that in the future it may be disadvantageous for variable
life insurance separate accounts and variable annuity separate accounts to
invest in the Fund simultaneously. Although neither Phoenix nor the Fund
currently foresees any such disadvantages either to variable life insurance
Policyowners or to variable annuity Contract Owners, the Funds' Trustees intend
to monitor events in order to identify any material conflicts between variable
life insurance Policyowners and variable annuity Contract Owners and to
determine what action, if any, should be taken in response thereto. Material
conflicts could result from, for example, (1) changes in state insurance laws,
(2) changes in federal income tax laws, (3) changes in the investment management
of any portfolio of the Fund, or (4) differences in voting instructions between
those given by variable life
12
<PAGE>
insurance Policyowners and those given by variable annuity Contract Owners.
Phoenix will, at its own expense, remedy such material conflict including, if
necessary, segregating the assets underlying the variable life insurance
policies and the variable annuity contracts and establishing a new registered
investment company.
INVESTMENT ADVISERS TO THE PHOENIX EDGE SERIES FUND
The Phoenix Edge Series Fund's investment advisers are Phoenix Investment
Counsel, Inc. ("PIC"), Phoenix Realty Securities, Inc. ("PRS") and
Phoenix-Aberdeen International Advisors, LLC ("PAIA"); collectively, the
"Advisers," which are located at 56 and 38 Prospect Street and One American Row,
respectively, Hartford, Connecticut 06115. PIC was originally organized in 1932
as John P. Chase, Inc. In addition to the Fund, it serves as investment adviser
to the Phoenix Series Fund, Phoenix Total Return Fund, Inc. and Phoenix Multi-
Portfolio Fund and as subadviser to American Skandia, Chubb America Fund, Inc.,
Sun America Series Trust and JNL Series Trust. PIC also serves as subadviser to
the Asia Series.
PRS was formed in 1994 as an indirect subsidiary of Phoenix Home Life Mutual
Insurance Company. In addition to the Fund, it serves as investment adviser to
the Real Estate Portfolio of the Phoenix Multi-Portfolio Fund.
PAIA, a Delaware limited liability company formed in 1996 and jointly owned
and managed by PM Holdings, Inc., is a direct subsidiary of Phoenix and Aberdeen
Fund Managers, Inc., a wholly-owned subsidiary of Aberdeen Trust plc. Aberdeen
Fund Managers, Inc. has its principal offices located at 1 Financial Plaza,
Suite 2210, NationsBank Tower, Fort Lauderdale, Florida 33394. While many of the
officers and directors of the Adviser have extensive experience as investment
professionals, due to its recent formation, the Adviser has no prior operating
history. Aberdeen Fund Managers, Inc. also serves as subadviser to the Asia
Series.
Aberdeen Trust was founded in 1983 and through subsidiaries operating from
offices in Aberdeen, Scotland; London, England; Singapore; and Fort Lauderdale,
Florida, provides investment management services to unit and investment trusts,
segregated pension funds and other institutional and private portfolios. As of
September 30, 1995, Aberdeen Trust, and its advisory subsidiaries, had
approximately $4 billion in assets under management.
ABKB/LaSalle Securities Limited Partnership (ABKB), a subsidiary of LaSalle
Partners, serves as subadviser to the Real Estate Series. ABKB's principal place
of business is located at 100 East Pratt Street, Baltimore, Maryland 21202. ABKB
has been a registered investment adviser since 1979.
All of the outstanding stock of PIC is owned by Phoenix Equity Planning
Corporation ("PEPCO"), an indirect majority-owned subsidiary of Phoenix Home
Life Mutual Insurance Company. PEPCO also performs bookkeeping and pricing and
administrative services for the Fund. PEPCO is registered as a broker-dealer in
50 states. The executive offices of Phoenix Home Life Mutual Insurance Company
are located at One American Row, Hartford, Connecticut 06115, and the principal
offices of PEPCO are located at 100 Bright Meadow Boulevard, P.O. Box 2200,
Enfield, Connecticut 06083-2200.
REINVESTMENT AND REDEMPTION
All dividend distributions of the Fund are automatically reinvested in
shares of the Fund at their net asset value on the date of distribution; all
capital gains distributions of the Fund, if any, are likewise reinvested at the
net asset value on the record date. Phoenix redeems Fund shares at their net
asset value to the extent necessary to make payments under the Policy.
SUBSTITUTION OF INVESTMENTS
Phoenix reserves the right, subject to compliance with the law as currently
applicable or subsequently changed, to make additions to, deletions from, or
substitutions for the investments held by the VUL Account. In the future,
Phoenix may establish additional Sub-accounts within the VUL Account, each of
which will invest in shares of a designated portfolio of the Fund with a
specified investment objective. These portfolios will be established if, and
when, in the sole discretion of Phoenix, marketing needs and investment
conditions warrant, and will be made available under existing Policies to the
extent and on a basis to be determined by Phoenix.
If shares of any of the portfolios of the Fund should no longer be available
for investment, or if in the judgment of Phoenix's management further investment
in shares of any of the portfolios should become inappropriate in view of the
objectives of the Policy, then Phoenix may substitute shares of another mutual
fund for shares already purchased, or to be purchased in the future, under the
Policy. No substitution of mutual fund shares held by the VUL Account may take
place without prior approval of the Securities and Exchange Commission and prior
notice to the Policyowner. In the event of a substitution, the Policyowner will
be given the option of transferring the Policy Value of the Sub-account in which
the substitution is to occur to another Sub-account.
PERFORMANCE HISTORY
From time to time, the VUL Account may include the performance history of
any or all Sub-accounts, in advertisements, sales literature or reports.
PERFORMANCE INFORMATION ABOUT EACH SUB-ACCOUNT IS BASED ON PAST PERFORMANCE ONLY
AND IS NOT AN INDICATION OF FUTURE PERFORMANCE. Performance information may be
expressed as yield and effective yield of the Money Market Sub-account, as yield
of the Multi-Sector Sub-account and as total return of any Sub-account. Current
yield for the Money Market Sub-account will be based on the income earned by the
Sub-account over a given seven-day period (less a hypothetical charge reflecting
deductions for expenses taken during the period) and then annualized, i.e., the
income earned in the period is assumed to be earned every seven days over a
52-week period and is stated in terms of an annual percentage return on the
investment. Effective yield is calculated similarly but reflects the compounding
effect of earnings on reinvested dividends. Yield and effective yield reflect
the recurring charges on the Account level including the monthly administrative
charge.
Yield calculations of the Money Market Sub-account used for illustration
purposes are based on the consideration of a hypothetical participant's account
having a balance of exactly one Unit at the
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<PAGE>
beginning of a seven-day period, which period will end on the date of the most
recent financial statements. The yield for the Sub-account during this seven-day
period will be the change in the value of the hypothetical participant's
account's original Unit. The following is an example of this yield calculation
for the Money Market Sub-account based on a seven-day period ending December 31,
1995.
Example:
Assumptions:
Value of hypothetical pre-existing account with exactly one unit
at the beginning of the period:................ 1.324187
Value of the same account (excluding capital changes) at the
end of the seven-day period:................... 1.325408
Calculation:
Ending account value .......................... 1.325408
Less beginning account value .................. 1.324187
Net change in account value ................... 0.001221
Base period return:
(adjusted change/beginning account value) ..... 0.000922
Current yield = return x (365/7) = ............... 4.81%
Effective yield = [(1 + return)365/7] - 1 = ...... 4.92%
The current yield and effective yield information will fluctuate, and
publication of yield information may not provide a basis for comparison with
bank deposits, other investments which are insured and/or pay a fixed yield for
a stated period of time, or other investment companies, due to charges which
will be deducted on the account level.
For the Multi-Sector Sub-account, quotations of yield will be based on all
investment income per unit earned during a given 30-day period (including
dividends and interest), less expenses accrued during the period ("net
investment income"), and are computed by dividing net investment income by the
maximum offering price per unit on the last day of the period.
When a Sub-account advertises its total return, it usually will be
calculated for one year, five years, and ten years or since inception if the
Sub-account has not been in existence for at least ten years. Total return is
measured by comparing the value of a hypothetical $10,000 investment in the
Sub-account at the beginning of the relevant period to the value of the
investment at the end of the period, assuming the reinvestment of all
distributions at net asset value and the deduction of applicable Policy charges
except for the cost of insurance and any surrender charges and premium taxes.
For those Sub-accounts within the VUL Account that have not been available
for one of the quoted periods, the standardized average annual total return
quotations will show the investment performance such Sub-account would have
achieved (reduced by the applicable charges) had it been available to invest in
shares of the Fund for the period quoted.
Below are quotations of standardized average annual total return of Series
of the Phoenix Edge Series Fund. POLICY CHARGES ARE NOT REFLECTED.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED 12/31/95
-----------------------------
COMMENCEMENT LIFE OF
SERIES DATE 1 YEAR 5 YEARS 10 YEARS FUND
- ------ ------------ ------ ------- -------- -------
Multi-Sector...... 01/01/83 20.06% 10.47% 8.87% 9.41%
Balanced.......... 05/01/92 19.88% N/A N/A 8.17%
Total Return...... 09/17/84 14.87% 11.34% 10.51% 11.33%
Growth............ 01/01/83 27.23% 18.32% 15.25% 17.33%
International..... 05/01/90 6.46% 7.86% N/A 5.02%
Money Market...... 01/01/83 2.67% 2.62% 4.38% 5.12%
ANNUAL TOTAL RETURNS*
---------------------
MULTI- TOTAL INTER- MONEY
YEAR SECTOR BALANCED RETURN GROWTH NATIONAL MARKET
1983......... 5.1% N/A N/A 31.7% N/A 7.4%
1984......... 10.3% N/A -1.4% 9.7% N/A 9.2%
1985......... 19.5% N/A 26.2% 33.7% N/A 7.1%
1986......... 18.2% N/A 14.7% 19.4% N/A 5.6%
1987......... 0.2% N/A 11.6% 6.0% N/A 5.6%
1988......... 9.5% N/A 1.4% 3.0% N/A 6.5%
1989......... 6.9% N/A 18.4% 34.4% N/A 7.9%
1990......... 4.4% N/A 5.1% 3.2% -8.9% 7.4%
1991......... 18.5% N/A 28.1% 41.5% 18.7% 5.0%
1992......... 9.1% 8.8% 9.7% 9.3% -13.6% 2.7%
1993......... 15.0% 7.8% 10.1% 18.8% 37.3% 2.1%
1994......... -6.2% -3.6% -2.2% 0.7% -0.7% 3.0%
1995......... 22.6% 22.4% 17.3% 29.9% 8.7% 4.9%
*Sales charges have not been deducted from the Annual Total Returns
THESE RATES OF RETURN ARE NOT AN ESTIMATE OR GUARANTEE OF FUTURE
PERFORMANCE. THEY DO NOT ILLUSTRATE HOW ACTUAL PERFORMANCE WILL AFFECT THE
BENEFITS UNDER A POLICY; FOR THIS INFORMATION SEE APPENDIX B "ILLUSTRATIONS OF
DEATH BENEFITS, POLICY VALUES AND CASH SURRENDER VALUES."
The Fund's Annual Reports, available upon request and without charge,
contain a discussion of the performance of the Fund and a comparison of that
performance to a securities market index.
CHARGES AND DEDUCTIONS
- --------------------------------------------------------------------------------
Charges are deducted in connection with the Policy to compensate Phoenix
for: (1) incurring expenses in distributing the Policy; (2) issuing the Policy;
(3) state and federal tax charge incurred on premiums received; (4) providing
the insurance benefits set forth in the Policy; and (5) assuming certain risks
in connection with the Policy. The nature and amount of these charges are
described more fully below.
1. MONTHLY DEDUCTION
A charge is deducted monthly from the Policy Value under a Policy ("monthly
deduction") to pay: the cost of insurance provided under the Policy, the cost of
any rider benefits provided, any unpaid balance of the Issue Expense Charge, and
an administrative charge. This administrative charge is currently set at $5 per
month but it is guaranteed not to exceed $10 per month. The monthly deduction is
deducted on each Monthly Calculation Day. It is allocated among the Sub-accounts
of the VUL Account and the unloaned portion of the GIA based on the allocation
schedule for monthly deductions specified by the applicant in the application
for a Policy or as later changed by the
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<PAGE>
Policyowner. In the event that the Policy's share in the value of the
Sub-accounts or the unloaned portion of the GIA is insufficient to permit the
withdrawal of the full monthly deduction, the remainder will be taken on a
proportionate basis from the Policy's share of each of the other Sub-accounts
and the unloaned portion of the GIA. The number of units deducted will be
determined by dividing the portion of the monthly deduction allocated to each
Sub-account or to the unloaned portion of the GIA by the unit value on the
Monthly Calculation Day. Because portions of the monthly deduction, such as the
cost of insurance, can vary from month to month, the monthly deduction itself
may vary in amount from month to month.
(a) ISSUE EXPENSE CHARGE. A cost-based issue administration charge is
assessed on a pro rata basis in equal monthly installments over a
12-month period to compensate Phoenix for underwriting and start-up
expenses in connection with issuing a Policy. The issue administrative
charge is $1.50 per $1,000 of face amount, up to a maximum charge of
$600. Phoenix may reduce or eliminate the Issue Expense Charge for
Policies issued under group or sponsored arrangements. Generally,
administrative costs per Policy vary with the size of the group or
sponsored arrangement, its stability as indicated by its term of
existence and certain characteristics of its members, the purposes for
which the Policies are purchased and other factors. The amounts of any
reductions will be considered on a case-by-case basis and will reflect
the reduced administration costs expected as a result of sales to a
particular group or sponsored arrangement.
(b) COST OF INSURANCE. In order to calculate the monthly cost of
insurance charge, Phoenix multiplies the applicable cost of
insurance rate by the difference between the death benefit
selected (death benefit Option 1 if no selection is made) and
the Policy Value. Generally, cost of insurance rates are based
on the sex, issue age, duration and risk class. However, in
certain states and for policies issued in conjunction with
certain qualified plans, cost of insurance rates are not based
on sex. The actual monthly cost of insurance rates are based
on Phoenix's expectations of future mortality experience. They
will not, however, be greater than the guaranteed cost of
insurance rates set forth in the Policy. These guaranteed
maximum rates are equal to 100% of the 1980
Commissioner's Standard Ordinary ("CSO") Mortality Table,
with appropriate adjustment for the Insured's risk
classification. Any change in the cost of insurance rates will
apply to all persons of the same sex, issue age and risk class
whose Policies have been In Force for the same length of time.
The risk class of an Insured may affect the cost of insurance
rate. Phoenix currently places Insureds into a preferred or
standard risk class or a risk class involving a higher mortality
risk, depending upon the health of the Insured as determined
by medical information that Phoenix requests. In an otherwise
identical Policy, Insureds in the preferred or standard risk
class will have a lower cost of insurance than those in the risk
class with the higher mortality risk. The standard risk class
also is divided into categories: smokers, nonsmokers and
those who have never smoked. Non-smokers will generally
incur a lower cost of insurance than similarly situated
Insureds who smoke.
2. PREMIUM TAXES
Various states and subdivisions impose a tax on premiums received by
insurance companies. Phoenix charges an average premium tax charge of 2.25%. The
premium tax charge represents an amount Phoenix considers necessary to pay all
premium taxes imposed by such states and any subdivisions thereof, and Phoenix
does not expect to derive a profit from this charge. These taxes are deducted
from the Issue Premium, and from each subsequent premium payment.
3. FEDERAL TAX CHARGE
A charge equal to 1.50% of each premium will be deducted from each premium
payment to cover the estimated cost to Phoenix of the federal income tax
treatment of deferred acquisition costs. The SEC maximum sales load has been
reduced to reflect this charge.
4. MORTALITY AND EXPENSE RISK CHARGE
Phoenix will deduct a daily charge from the VUL Account at an annual rate of
0.80% of the average daily net assets of the VUL Account to compensate for
certain risks assumed in connection with the Policy. A reduced annual rate of
.25% will apply after the 15th Policy Year. This charge is not deducted from the
GIA.
The mortality risk assumed by Phoenix is that Insureds may live for a
shorter time than projected because of inaccuracies in that projecting process
and, accordingly, that an aggregate amount of death benefits greater than that
projected will be payable. The expense risk assumed is that expenses incurred in
issuing the Policies may exceed the limits on administrative charges set in the
Policies. If the expenses do not increase to an amount in excess of the limits,
or if the mortality projecting process proves to be accurate, Phoenix may profit
from this charge. Phoenix also assumes risks with respect to other contingencies
including the incidence of Policy loans, which may cause Phoenix to incur
greater costs than anticipated when designing the Policies. To the extent
Phoenix profits from this charge, it may use those profits for any proper
purpose, including the payment of sales expenses or any other expenses that may
exceed income in a given year.
5. INVESTMENT MANAGEMENT CHARGE
As compensation for investment management services to the Funds, the
Advisers are entitled to fees, payable monthly and based on an annual percentage
of the average aggregate daily net asset values of each Series as summarized in
the following table:
PHOENIX INVESTMENT COUNSEL, INC.
--------------------------------
RATE FOR
RATE FOR FIRST RATE FOR NEXT EXCESS OVER
SERIES $250,000,000 $250,000,000 $500,000,000
- ------ -------------- ------------- ------------
Money Market........ .40% .35% .30%
Multi-Sector........ .50% .45% .40%
Balanced............ .55% .50% .45%
Total Return........ .60% .55% .50%
Growth.............. .70% .65% .60%
International....... .75% .70% .65%
Strategic Theme..... .75% .70% .65%
PHOENIX-ABERDEEN ADVISORS, LLC
------------------------------
SERIES
- ------
Asia................ 1.00%
15
<PAGE>
PHOENIX REALTY SECURITIES, INC.
-------------------------------
RATE FOR
RATE FOR FIRST RATE FOR NEXT EXCESS OVER
SERIES $1,000,000,000 $1,000,000,000 $2,000,000,000
- ------ -------------- -------------- --------------
Real Estate......... .75% .70% .65%
In addition, each Series pays a portion or all of its other annual operating
expenses other than the management fees: the Growth, Multi-Sector, Total Return,
Money Market and Balanced Series will pay up to .15%; the Real Estate, Strategic
Theme and Asia Series will pay up to .25%; the International Series will pay up
to .40%; of its average net assets annually. See "Charges and Deductions."
6. OTHER CHARGES
SURRENDER CHARGE
During the first 10 Policy Years, there is a difference between the amount
of Policy Value and the amount of Cash Surrender Value of the Policy. This
difference is the Surrender Charge, consisting of a contingent deferred sales
charge designed to recover expenses for the distribution of Policies that are
terminated by surrender before distribution expenses have been recouped, and a
contingent deferred issue charge designed to recover expenses for the
administration of Policies that are terminated by surrender before
administrative expenses have been recouped. These are contingent charges because
they are paid only if the Policy is surrendered (or the face amount is reduced
or the Policy lapses) during this period. They are deferred charges because they
are not deducted from premiums. The contingent deferred issue charge is set at a
level designed to recover actual costs and is not designed to result in any
profit to Phoenix.
During the first 10 Policy Years, the full surrender charge as described
below will apply if the Policyowner either surrenders the Policy for its Cash
Surrender Value or lets the Policy lapse. The applicable surrender charge in any
Policy Month is the full surrender charge minus any surrender charges that have
been previously paid. There is no surrender charge after the 10th Policy Year.
During the first two Policy Years the maximum surrender charge that a
Policyowner could pay while he/she owns the Policy is equal to either A plus B
(as defined below) or the amount shown in the Policy's Surrender Charge
Schedule, whichever is less. After the first two Policy Years the maximum
surrender charge that a Policyowner could pay is based on the amount shown in
the Policy's Surrender Charge Schedule.
A (the contingent deferred sales charge) is equal to:
1) 28.5% of all premiums paid (up to and including the amount
stated in the Policy's Surrender Charge Schedule, which is
calculated according to a formula contained in a Securities
and Exchange Commission rule); plus
2) 8.50% of all premiums paid in excess of this amount but not
greater than twice this amount; plus
3) 7.5% of all premiums paid in excess of twice this amount.
B (the contingent deferred issue charge) is equal to:
$5 per $1,000 of initial face amount.
As an example, the following illustrates the maximum surrender charge on a
$100,000 Policy for a male age 35 who has never smoked, who has paid $3,000 in
premium payments, and who surrenders the Policy in the 70th Policy Month. The
Policy's Surrender Charge Schedule would show that the maximum surrender charge
to be paid would be equal to either A plus B (shown below) or the amount shown
in the chart in the Policy (also shown below), whichever is less:
Example: If this Policyowner surrenders his policy in the 70th
Policy month his surrender charge will be $1,186.78, as given in the
table.
Example: If this Policyowner surrenders his policy in the first two years he
may be eligible to receive a refund of a portion of the surrender charge,
depending on the amount of premium paid, or, in other words, his surrender
charge may be reduced. The surrender charge in the first 2 years would be equal
to the lesser of the amount in the surrender charge table and the sum of the
following:
1) 28.5% of premiums paid up to $1,076.72, plus
2) 8.5% of premiums paid in excess of $1,076.72 but not
greater than $2,153.43, plus
3) 7.5% of premiums paid in excess of $2,153.43, plus $500
If this Policyowner surrendered his policy in the 2nd year after paying
$2,000 of premiums his surrender charge would be the lesser of $1,307.54 from
the table, and $385.34, thus equaling $385.34. Thus, in this case, the
Policyowner would pay less surrender charge if he surrenders his policy in the
first two Policy Years.
SURRENDER CHARGE TABLE
----------------------
POLICY SURRENDER POLICY SURRENDER POLICY SURRENDER
MONTH CHARGE MONTH CHARGE MONTH CHARGE
------ --------- ------ --------- ------ ---------
1-60 $1307.54 80 $1066.03 100 $727.09
61 1295.46 81 1053.95 101 690.65
62 1283.39 82 1041.88 102 654.22
63 1271.31 83 1029.80 103 617.78
64 1259.24 84 1017.73 104 581.35
65 1247.16 85 1005.65 105 544.91
66 1235.08 86 993.58 106 508.48
67 1223.01 87 981.50 107 472.05
68 1210.93 88 969.43 108 435.61
69 1198.86 89 957.35 109 399.18
70 1186.78 90 945.28 110 362.74
71 1174.71 91 933.20 111 326.31
72 1162.63 92 921.13 112 289.97
73 1150.56 93 909.05 113 253.44
74 1138.48 94 896.97 114 217.01
75 1126.41 95 884.90 115 180.57
76 1114.33 96 872.82 116 144.14
77 1102.26 97 836.39 117 107.70
78 1090.18 98 799.95 118 71.27
79 1078.10 99 763.52 119 34.83
120 .00
Phoenix may reduce the surrender charges for Policies issued under group or
sponsored arrangements. The amount of reduction will be considered on a
case-by-case basis and will reflect the reduced costs to Phoenix expected as a
result of sales to a particular group or sponsored arrangement.
16
<PAGE>
PARTIAL SURRENDER FEE
A fee equal to the lesser of $25 or 2% of the amount withdrawn from the
Policy is deducted from the Policy Value upon a partial surrender of the Policy
to recover the actual costs of processing the partial surrender request. The
assessment to each Sub-account or to the GIA will be made in the same manner as
provided for the partial surrender amount paid. That is, that the Policy's share
in the value of each Sub-account or the GIA will be reduced based on the
allocation made at the time of the partial surrender. If no allocation request
is made, the assessment to each Sub-account and to the GIA will be made in the
same manner as provided for monthly deductions.
PARTIAL SURRENDER CHARGE
A charge as described below is deducted from the Policy Value upon a partial
surrender of the Policy. The charge is equal to a pro rata portion of the
applicable surrender charge that would apply to a full surrender, determined by
multiplying the applicable surrender charge by a fraction (equal to the partial
surrender amount payable divided by the result of subtracting the applicable
surrender charge from the Policy Value). This amount is assessed against the
Sub-accounts or the GIA in the same manner as provided for with respect to the
partial surrender amount paid.
A partial surrender charge also is deducted from Policy Value upon a
decrease in face amount. The charge is equal to the applicable surrender charge
multiplied by a fraction (equal to the decrease in face amount divided by the
face amount of the Policy prior to the decrease).
TAXES
Currently no charge is made to the VUL Account for federal income taxes that
may be attributable to the VUL Account. Phoenix may, however, make such a charge
in the future. Charges for other taxes, if any, attributable to the VUL Account
also may be made. See "Charges and Deductions--Other Charges."
GENERAL PROVISIONS
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POSTPONEMENT OF PAYMENTS
GENERAL
Payment of any amount upon complete or partial surrender, Policy loan, or
benefits payable at death (in excess of the initial face amount) or maturity may
be postponed: (i) for up to six months from the date of the request, for any
transactions dependent upon the value of the GIA; (ii) whenever the New York
Stock Exchange is closed other than for customary weekend and holiday closings,
or trading on the New York Stock Exchange is restricted as determined by the
Securities and Exchange Commission; or (iii) whenever an emergency exists, as
determined by the Commission as a result of which disposal of securities is not
reasonably practicable or it is not reasonably practicable to determine the
value of the VUL Account's net assets. Transfers also may be postponed under
these circumstances.
PAYMENT BY CHECK
Payments under the Policy of any amounts derived from premiums paid by check
may be delayed until such time as the check has cleared the Policyowner's bank.
THE CONTRACT
The Policy and the copy of the application attached thereto are the entire
contract. Only statements in the application can be used to void the Policy. The
statements are considered representations and not warranties. Only an executive
officer of Phoenix can agree to change or waive any provisions of the Policy.
SUICIDE
If the Insured commits suicide within two years after the Policy's Date of
Issue, Phoenix will pay only the Policy Value adjusted by the addition of any
monthly deductions and other fees and charges made under the Policy and the
subtraction of any Debt owed to Phoenix under the Policy.
INCONTESTABILITY
Phoenix cannot contest the Policy or any rider attached to it after it has
been In Force during the lifetime of the Insured for two years from the Policy
Date.
CHANGE OF OWNER OR BENEFICIARY
The Beneficiary, as named in the Policy application or subsequently changed,
will receive the Policy benefits at the Insured's death. If the named
Beneficiary dies before the Insured, the contingent Beneficiary, if named,
becomes the Beneficiary. If no Beneficiary survives the Policyowner, the
benefits payable at the Insured's death will be paid to the Policyowner's
estate.
As long as the Policy is In Force, the Policyowner and the Beneficiary may
be changed by Written Request, satisfactory to Phoenix. A change in Beneficiary
will take effect as of the date the notice is signed, whether or not the Insured
is living when the notice is received by Phoenix. Phoenix will not, however, be
liable for any payment made or action taken before receipt of the notice.
ASSIGNMENT
The Policy may be assigned. Phoenix will not be bound by the assignment
until a written copy has been received and will not be liable with respect to
any payment made prior to receipt. Phoenix assumes no responsibility for
determining whether an assignment is valid.
MISSTATEMENT OF AGE OR SEX
If the age or sex of the Insured has been misstated, the death benefit will
be adjusted based on what the cost of insurance charge for the most recent
monthly deduction would have purchased based on the correct age and sex.
PAYMENT OF PROCEEDS
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SURRENDER AND DEATH BENEFIT PROCEEDS
Death benefit proceeds and the proceeds of full or partial surrenders will
be processed at unit values next computed after Phoenix receives the request for
surrender or due proof of death, provided such request is complete and in good
order. Payment of surrender or death benefit proceeds usually will be made in
one lump-sum within seven days, unless another payment option has been elected.
Payment of the death benefit proceeds, however, may be delayed if the claim for
payment of the death benefit proceeds needs
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to be investigated; e.g., to ensure payment of the proper amount to the proper
payee. Any such delay will not be beyond that reasonably necessary to
investigate such claims consistent with insurance practices customary in the
life insurance industry. In addition, under certain conditions, in the event of
the terminal illness of the Insured, an accelerated payment of up to 75% of the
Policy's death benefit (up to maximum of $250,000), is available under the
Living Benefits Rider. The minimum face amount remaining after any such
accelerated benefit payment is $10,000.
While the Insured is living, the Policyowner may elect a payment option for
payment of the death benefit proceeds to the Beneficiary. The Policyowner may
revoke or change a prior election before the Insured's death, unless such right
has been waived. The Beneficiary may make or change an election prior to payment
of the death benefit proceeds, unless the Policyowner has made an election which
does not permit such further election or changes by the Beneficiary.
A written form satisfactory to Phoenix is required to elect, change, or
revoke a payment option.
The minimum amount of surrender or death benefit proceeds that may be
applied under any income option is $1,000.
If the Policy is assigned as collateral security, Phoenix will pay any
amount due the assignee in one lump sum. Any remaining proceeds will remain
under the option elected.
PAYMENT OPTIONS
All or part of the surrender or death proceeds of a Policy may be applied
under one or more of the following payment options or such other payment options
or alternative versions of the options listed as Phoenix may choose to make
available in the future.
OPTION 1--LUMP SUM.
Payment in one lump sum.
OPTION 2--LEFT TO EARN INTEREST.
A payment of interest during the payee's lifetime on the amount payable as a
principal sum. Interest rates are guaranteed to be at least 3% per year.
OPTION 3--PAYMENT FOR A SPECIFIC PERIOD.
Equal income installments are paid for a specified period of years whether
the payee lives or dies. The first payment will be on the date of settlement.
The assumed interest rate on the unpaid balance is guaranteed not to be less
than 3% per year.
OPTION 4--LIFE ANNUITY WITH SPECIFIED PERIOD CERTAIN.
Equal installments are paid until the later of: (A) The death of the
payee; (B) The end of the period certain. The first payment will be on the date
of settlement. The period certain must be chosen at the time this option is
elected. The periods certain that may be chosen are as follows: (A) Ten years;
(B) Twenty years; (C) Until the installments paid refund the amount applied
under this option; and if the payee is not living when the final payment falls
due, that payment will be limited to the amount which needs to be added to the
payments already made to equal the amount applied under this option. If, for the
age of the payee, a period certain is chosen that is shorter than another period
certain paying the same installment amount, Phoenix will deem the longer period
certain as having been elected. Any life annuity provided under Option 4 is
calculated using an interest rate guaranteed to be no less than 3 3/8% per year,
except that any life annuity providing a period certain of 20 years or more is
calculated using an interest rate guaranteed to be no less than 3 1/4% per year.
OPTION 5--LIFE ANNUITY.
Equal installments are paid only during the lifetime of the payee. The first
payment will be on the date of settlement. Any life annuity as may be provided
under Option 5 is calculated using an interest rate guaranteed to be no less
than 3 1/2% per year.
OPTION 6--PAYMENTS OF A SPECIFIED AMOUNT.
Equal installments of a specified amount, out of the principal sum and
interest on that sum, are paid until the principal sum remaining is less than
the amount of the installment. When that happens, the principal sum remaining
with accrued interest will be paid as a final payment. The first payment will be
on the date of settlement. The payments will include interest on the principal
sum remaining at a rate guaranteed to equal at least 3% per year. This interest
will be credited at the end of each year. If the amount of interest credited at
the end of the year exceeds the income payments made in the last 12 months, that
excess will be paid in one sum on the date credited.
OPTION 7--JOINT SURVIVORSHIP ANNUITY WITH 10 YEAR PERIOD CERTAIN.
The first payment will be on the date of settlement. Equal income
installments are paid until the latest of: (A) The end of the 10-year period
certain; (B) The death of the Insured; (C) The death of the other named
annuitant. The other annuitant must be named at the time this option is elected
and cannot later be changed. The other annuitant must have an attained age of at
least 40. Any joint survivorship annuity as may be provided under this option is
calculated using an interest rate guaranteed to be no less than 3 3/8% per year.
For additional information concerning the above payment options, see the
Policy.
FEDERAL TAX CONSIDERATIONS
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INTRODUCTION
The ultimate effect of federal income taxes on values under the VUL Account
and on the economic benefit to the Policyowner or Beneficiary depends on
Phoenix's tax status and upon the tax status of the individual concerned. The
discussion contained herein is general in nature and is not intended as tax
advice. For complete information on federal and state tax considerations, a
qualified tax adviser should be consulted. No attempt is made to consider any
estate and inheritance taxes, or any state, local or other tax laws. Because the
discussion herein is based upon Phoenix's understanding of federal income tax
laws as they are currently interpreted, Phoenix cannot guarantee the tax status
of any Policy. No representation is made regarding the likelihood of
continuation of current federal income tax laws, Treasury regulations, or of the
current interpretations by the Internal Revenue Service. Phoenix reserves the
right to make changes to the Policy in order to assure that it will continue to
qualify as a life insurance contract for federal income tax purposes.
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PHOENIX'S TAX STATUS
Phoenix is taxed as a life insurance company under the Internal Revenue Code
of 1986, as amended (the "Code"). For federal income tax purposes, neither the
VUL Account nor the GIA is a separate entity from Phoenix and their operations
form a part of Phoenix.
Investment income and realized capital gains on the assets of the VUL
Account are reinvested and taken into account in determining the value of the
VUL Account. Investment income of the VUL Account, including realized net
capital gains, is not taxed to Phoenix. Due to Phoenix's tax status under
current provisions of the Code, no charge currently will be made to the VUL
Account for Phoenix's federal income taxes which may be attributable to the VUL
Account. Phoenix reserves the right to make a deduction for taxes if the federal
tax treatment of Phoenix is determined to be other than what Phoenix currently
believes it to be, if changes are made affecting the tax treatment to Phoenix of
variable life insurance contracts, or if changes occur in Phoenix's tax status.
If imposed, such charge would be equal to the federal income taxes attributable
to the investment results of the VUL Account.
POLICY BENEFITS
DEATH BENEFIT PROCEEDS. The Policy, whether or not it is a "modified
endowment contract" (see the discussion on modified endowment contracts below),
should be treated as meeting the definition of a life insurance contract for
federal income tax purposes under Section 7702 of the Code. As such, the death
benefit proceeds thereunder should be excludable from the gross income of the
Beneficiary under Code Section 101(a)(1). Also, the Policyowner should not be
deemed to be in constructive receipt of the Policy Value, including increments
thereon. See, however, the sections below on possible taxation of amounts
received under the Policy, via full surrender, partial surrender or loan. In
addition, a benefit paid under a Living Benefit Rider may be taxable as income
in the year of receipt.
Code Section 7702 imposes certain conditions with respect to premiums
received under a Policy. Phoenix intends to monitor the premiums to assure
compliance with such conditions. However, in the event that the premium
limitation is exceeded during the year, Phoenix may return the excess premium,
with interest, to the Policyowner within 60 days after the end of the Policy
Year, and maintain the qualification of the Policy as life insurance for federal
income tax purposes.
FULL SURRENDER. Upon full surrender of a Policy for its Cash Surrender
Value, the excess, if any, of the Policy Value (unreduced by any outstanding
indebtedness) over the premiums paid will be treated as ordinary income for
federal income tax purposes. The full surrender of a Policy which is a "modified
endowment contract" may result in the imposition of an additional 10% tax on any
income received.
PARTIAL SURRENDER. If the Policy is a "modified endowment contract," partial
surrenders are fully taxable to the extent of income in the Policy and are
possibly subject to an additional 10% tax. See the discussion on "modified
endowment contracts" below. If the Policy is not a "modified endowment
contract," partial surrenders still may be taxable, as follows. Code Section
7702(f)(7) provides that where a reduction in death benefits occurs during the
first 15 years after a Policy is issued and there is a cash distribution
associated with that reduction, the Policyowner may be taxed on all or a part of
the amount distributed. A reduction in death benefits may result from a partial
surrender. After 15 years, the proceeds will not be subject to tax, except to
the extent such proceeds exceed the total amount of premiums paid but not
previously recovered. Phoenix suggests you consult with your tax adviser in
advance of a proposed decrease in death benefits or a partial surrender as to
the portion, if any, which would be subject to tax, and, in addition, as to the
impact such partial surrender might have under the rules affecting "modified
endowment contracts." The benefit payment under the Living Benefits Rider is not
considered a partial surrender.
LOANS. Phoenix believes that any loan received under a Policy will be
treated as indebtedness of the Policyowner. If the Policy is a "modified
endowment contract," loans are fully taxable to the extent of income in the
Policy and are possibly subject to an additional 10% tax. See the discussion on
"modified endowment contracts" below. If the Policy is not a "modified endowment
contract," Phoenix believes that no part of any loan under a Policy will
constitute income to the Policyowner.
The deductibility by the Policyowner of loan interest under a Policy may be
limited under Code Section 264, depending on the circumstances. Any Policyowner
intending to fund premium payments through borrowing should consult a tax
adviser with respect to the tax consequences thereof. Under the "personal"
interest limitation provisions of the Code, interest on Policy loans used for
personal purposes is not tax deductible. Other rules may apply to allow all or
part of the interest expense as a deduction if the loan proceeds are used for
"trade or business" or "investment" purposes. See your tax adviser for further
guidance.
BUSINESS-OWNED POLICIES
If the Policy is owned by a business or a corporation, the Code may impose
additional restrictions. The Code limits the interest deduction on
business-owned Policy loans and may impose tax upon the inside build-up of
corporate-owned life insurance policies through the corporate alternative
minimum tax.
MODIFIED ENDOWMENT CONTRACTS
GENERAL. Pursuant to Code Section 72(e), loans and other amounts received
under "modified endowment contracts" will, in general, be taxed to the extent of
accumulated income (generally, the excess of Policy Value over premiums paid).
Policies are "modified endowment contracts" if they meet the definition of life
insurance, but fail the "7-pay test." This test essentially provides that the
cumulative premiums paid under the Policy at any time during the Policy's first
seven years cannot exceed the sum of the net level premiums that would have been
paid on or before that time had the Policy provided for paid-up future benefits
after the payment of seven level annual premiums. In addition, a modified
endowment contract includes any life insurance contract that is received in
exchange for a modified endowment contract. Premiums paid during a Policy Year
that are returned by Phoenix (with interest) within 60 days after the end of the
Policy Year will not cause the Policy to fail the 7-pay test.
REDUCTION IN BENEFITS DURING THE FIRST SEVEN YEARS. If there is a
reduction in benefits during the first seven Policy Years, the premiums
are redetermined for purposes of the 7-pay test as if the Policy had
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originally been issued at the reduced death benefit level and the new limitation
is applied to the cumulative amount paid for each of the first seven Policy
Years.
Distributions Affected. If a Policy fails to meet the 7-pay test, it is
considered a modified endowment contract only as to distributions in the year in
which the death benefit reduction takes effect and all subsequent Policy Years.
However, distributions made in anticipation of such failure (there is a
presumption that distributions made within two years prior to such failure were
"made in anticipation") also are considered distributions under a modified
endowment contract. If the Policy satisfies the "7-pay test" for seven years,
distributions and loans generally will not be subject to the modified endowment
contract rules.
PENALTY TAX. Any amounts taxable under the modified endowment contract rule
will be subject to an additional 10 percent excise tax, with certain exceptions.
This additional tax will not apply in the case of distributions: (i) made on or
after the taxpayer attains age 59 1/2; (ii) which are attributable to the
taxpayer's disability (within the meaning of Code Section 72(m)(7)); or (iii)
which are part of a series of substantially equal periodic payments (not less
frequently than annually) made for the life (or life expectancy) of the taxpayer
or the joint lives (or life expectancies) of the taxpayer and his Beneficiary.
MATERIAL CHANGE RULES. Any determination of whether the Policy meets the
"7-pay test" will begin again any time the Policy undergoes a "material change,"
which includes any increase in death benefits or any increase in or addition of
a qualified additional benefit, with the following two exceptions. First, if an
increase is attributable to premiums paid "necessary to fund" the lowest death
benefit and qualified additional benefits payable in the first seven Policy
Years or to the crediting of interest with respect to these premiums, the
"increase" does not constitute a material change. Second, to the extent provided
in regulations, if the death benefit or qualified additional benefit increases
as a result of a cost-of-living adjustment based on an established broad-based
index specified in the Policy, this does not constitute a material change if (1)
the cost-of-living determination period does not exceed the remaining premium
payment period under the Policy, and (2) the cost-of-living increase is funded
ratably over the remaining premium payment period of the Policy. A reduction in
death benefits is not considered a material change unless accompanied by a
reduction in premium payments.
A material change may occur at any time during the life of the Policy
(within the first seven years or thereafter), and future taxation of
distributions or loans would turn on whether the Policy satisfied the applicable
"7-pay test" from the time of the material change. An exchange of policies is
considered to be a material change for all purposes.
SERIAL PURCHASE OF MODIFIED ENDOWMENT CONTRACTS. All modified endowment
contracts issued by the same insurer (or affiliated companies of the insurer) to
the same Policyowner within the same calendar year will be treated as one
modified endowment contract in determining the taxable portion of any loans or
distributions made to the Policyowner. The Treasury has been given specific
legislative authority to issue regulations to prevent the avoidance of the new
distribution rules for modified endowment contracts. A qualified tax adviser
should be consulted about the tax consequences of the purchase of more than one
modified endowment contract within any calendar year.
LIMITATIONS ON UNREASONABLE MORTALITY AND EXPENSE CHARGES
The Code imposes limitations on unreasonable mortality and expense charges
for purposes of ensuring that a Policy qualifies as a life insurance contract
for federal income tax purposes. The mortality charges taken into account to
calculate permissible premium levels may not exceed those charges required to be
used in determining the federal income tax reserve for the Policy, unless
Treasury regulations prescribe a higher level of charge. In addition, the
expense charges taken into account under the guideline premium test are required
to be reasonable, as defined by the Treasury regulations. Phoenix intends to
comply with the limitations in calculating the premium it is permitted to
receive from the Policyowner.
QUALIFIED PLANS
A Policy may be used in conjunction with certain qualified plans. Since the
rules governing such use are complex, a purchaser should not use the Policy in
conjunction with a qualified plan until he has consulted a competent pension
consultant or tax adviser.
DIVERSIFICATION STANDARDS
To comply with the diversification regulations under Code Section 817(h),
("Diversification Regulations") each Portfolio of the Fund is required to
diversify its investments. The Diversification Regulations generally require
that on the last day of each quarter of a calendar year no more than 55 percent
of the value of the Fund's assets is represented by any one investment, no more
than 70 percent is represented by any two investments, no more than 80 percent
is represented by any three investments, and no more than 90 percent is
represented by any four investments. A "look-through" rule applies to treat a
pro rata portion of each asset of the Fund as an asset of the VUL Account;
therefore, each Series of the Fund will be tested for compliance with the
percentage limitations. For purposes of these diversification rules, all
securities of the same issuer are treated as a single investment, but each
United States government agency or instrumentality is treated as a separate
issuer.
The general diversification requirements are modified if any of the assets
of the VUL Account are direct obligations of the United States Treasury. In this
case, there is no limit on the investment that may be made in United States
Treasury securities, and for purposes of determining whether assets other than
United States Treasury securities are adequately diversified, the generally
applicable percentage limitations are increased based on the value of the VUL
Account's investment in United States Treasury securities. Notwithstanding this
modification of the general diversification requirements, the portfolios of the
Fund will be structured to comply with the general diversification standards
because they serve as an investment vehicle for certain variable annuity
contracts which must comply with these standards.
In connection with the issuance of the Diversification Regulations, the
Treasury announced that such regulations do not provide guidance concerning the
extent to which Policyowners may direct their investments to particular
divisions of a separate account. It is possible that a revenue ruling or other
form of administrative pronouncement in this regard may be issued in the near
future. It is
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not clear, at this time, what such a revenue ruling or other pronouncement will
provide. It is possible that the Policy may need to be modified to comply with
such future Treasury announcements. For these reasons, Phoenix reserves the
right to modify the Policy, as necessary, to prevent the Policyowner from being
considered the owner of the assets of the VUL Account.
Phoenix intends to comply with the Diversification Regulations to assure
that the Policies continue to qualify as a life insurance contract for federal
income tax purposes.
CHANGE OF OWNERSHIP OR INSURED OR ASSIGNMENT
Changing the Policyowner or the Insured or an exchange or assignment of the
Policy may have tax consequences depending on the circumstances. Code Section
1035 provides that a life insurance contract can be exchanged for another life
insurance contract, without recognition of gain or loss, assuming that no money
or other property is received in the exchange, and that the policies relate to
the same Insured. If the surrendered policy is subject to a policy loan, this
may be treated as the receipt of money on the exchange. Phoenix recommends that
any person contemplating such actions seek the advice of a qualified tax
consultant.
OTHER TAXES
Federal estate tax, state and local estate, inheritance and other tax
consequences of ownership, or receipt of Policy proceeds depend on the
circumstances of each Policyowner or Beneficiary. Phoenix does not make any
representations or guarantees regarding the tax consequences of any Policy with
respect to these types of taxes.
VOTING RIGHTS
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THE FUND
Phoenix will vote the Fund shares held by the Sub-accounts of the VUL
Account at any regular and special meetings of shareholders of the Fund. To the
extent required by law, such voting will be in accordance with instructions
received from the Policyowner. However, if the Investment Company Act of 1940 or
any regulation thereunder should be amended or if the present interpretation
thereof should change, and as a result Phoenix determines that it is permitted
to vote the Fund shares at its own discretion, it may elect to do so.
The number of votes that a Policyowner has the right to cast will be
determined by applying the Policyowner's percentage interest in a Sub-account to
the total number of votes attributable to the Sub-account. In determining the
number of votes, fractional shares will be recognized.
Fund shares held in a Sub-account for which no timely instructions are
received, and Fund shares which are not otherwise attributable to Policyowners,
will be voted by Phoenix in proportion to the voting instructions that are
received with respect to all Policies participating in that Sub-account. Voting
instructions to abstain on any item to be voted upon will be applied to reduce
the votes eligible to be cast by Phoenix.
Each Policyowner will receive proxy materials, reports, and other materials
relating to the Fund.
Phoenix may, when required by state insurance regulatory authorities,
disregard voting instructions if the instructions require that the shares be
voted so as to cause a change in the sub-classification or investment objective
of one or more of the portfolios of the Fund or to approve or disapprove an
investment advisory contract for the Fund. In addition, Phoenix itself may
disregard voting instructions in favor of changes initiated by a Policyowner in
the investment policies or the Investment Adviser of the Fund if Phoenix
reasonably disapproves of such changes. A change would be disapproved only if
the proposed change is contrary to state law or prohibited by state regulatory
authorities or Phoenix determined that the change would have an adverse effect
on the General Account because the proposed investment policy for a portfolio
may result in overly speculative or unsound investments. In the event Phoenix
does disregard voting instructions, a summary of that action and the reasons for
such action will be included in the next periodic report to Policyowners.
Phoenix
A Policyowner (or the payee entitled to payment under a payment option if a
different person) will have the right to vote at annual meetings of all Phoenix
Policyholders for the election of members of the Board of Directors of Phoenix
and on other corporate matters, if any, where a Policyholder's vote is taken. At
meetings of all of the Phoenix Policyholders, a Policyholder (or payee) may cast
only one vote as the holder of a Policy, irrespective of Policy Value or the
number of the Policies held.
THE DIRECTORS AND EXECUTIVE OFFICERS OF PHOENIX
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Phoenix is managed by its Board of Directors, the members of
which are elected by its Policyholders, including Owners of the
Policies. See "Voting Rights."
The following are the Directors and Executive Officers of Phoenix:
DIRECTORS
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Richard Henry Booth Philip Robert McLoughlin
Robert Gerald Chipkin Charles J. Paydos
Robert William Fiondella David William Searfoss
Joseph Edward Kelleher Simon Yeh-Cheng Tan
Robert George Lautensack Dona Davis Young
EXECUTIVE OFFICERS PRINCIPAL OCCUPATION
- ------------------ --------------------
Robert William Fiondella, Chairman of the Board, President
Chairman and President and Chief Executive Officer
Richard Henry Booth, Executive Vice President, Strategic
Executive Vice President Development; formerly President,
Traveler's Insurance Company
Philip Robert McLoughlin, Executive Vice President and
Executive Vice President Chief Investment Officer
Charles J. Paydos, Executive Vice President
Executive Vice President
David William Searfoss, Executive Vice President and
Executive Vice President, Chief Financial Officer
CFO & Treasurer
Dona Davis Young, Executive Vice President, Individual
Executive Vice President Insurance and General Counsel
Joseph Edward Kelleher, Senior Vice President
Senior Vice President
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Robert George Lautensack, Senior Vice President
Senior Vice President
Simon Yeh-Cheng Tan, Senior Vice President, Individual
Senior Vice President Market Development
The above positions listed under Principal Occupation are held in the
Company's parent, Phoenix Home Life Mutual Insurance Company (except where
otherwise indicated) and reflect the last held position in the organization
during the past five years.
SAFEKEEPING OF THE VUL ACCOUNT'S ASSETS
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The assets of the VUL Account are held by Phoenix. The assets of the VUL
Account are kept physically segregated and held separate and apart from the
general account of Phoenix. Phoenix maintains records of all purchases and
redemptions of shares of the Fund.
SALES OF POLICIES
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Policies may be purchased from registered representatives of W.S. Griffith
& Co., Inc. ("W. S. Griffith") licensed to sell Phoenix insurance policies. W.
S. Griffith, an indirect wholly-owned subsidiary of Phoenix Home Life Mutual
Insurance Company, is registered as a broker-dealer with the Securities and
Exchange Commission under the Securities Exchange Act of 1934 and is a member of
the National Association of Securities Dealers, Inc. Policies also may be
purchased from other broker-dealers registered under the Securities Exchange Act
of 1934 whose representatives are authorized by applicable law to sell Policies
under terms of agreements provided by PEPCO. Sales commissions will be paid to
registered representatives on purchase payments received by Phoenix under these
Policies. Total sales commission of a maximum of 50% of premiums will be paid by
Phoenix to PEPCO. To the extent that the sales charge under the Policies is less
than the sales commissions paid with respect to the Policies, Phoenix will pay
the shortfall from its general account assets, which will include any profits it
may derive under the Policies.
Phoenix through PEPCO will sponsor sales contests, training and educational
meetings and provide to all qualifying dealers, from its own profits and
resources, additional compensation in the form of trips, merchandise or expense
reimbursement. Brokers and dealers other than PEPCO also may make customary
additional charges for their services in effecting purchases, if they notify the
Fund of their intention to do so.
STATE REGULATION
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Phoenix is subject to the provisions of the Missouri insurance laws
applicable to stock life insurance companies and to regulation and supervision
by the Missouri Superintendent of Insurance. Phoenix also is subject to the
applicable insurance laws of all the other states and jurisdictions in which it
does an insurance business.
State regulation of Phoenix includes certain limitations on the investments
which it may make, including investments for the VUL Account and the GIA. It
does not include, however, any supervision over the investment policies of the
VUL Account.
REPORTS
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All Policyowners will be furnished with those reports required by the
Investment Company Act of 1940 and regulations promulgated thereunder, or under
any other applicable law or regulation.
LEGAL PROCEEDINGS
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The VUL Account is not engaged in any litigation. Phoenix is not involved in
any litigation that would have a material adverse effect on the ability of
Phoenix to meet its obligations under the Policies.
LEGAL MATTERS
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The organization of Phoenix, its authority to issue variable life insurance
Policies, and the validity of the Policy have been passed upon by Richard J.
Wirth, Counsel, Phoenix. Legal matters relating to the federal securities and
income tax laws have been passed upon for Phoenix by Jorden Burt Berenson &
Johnson, LLP.
REGISTRATION STATEMENT
- --------------------------------------------------------------------------------
A Registration Statement has been filed with the Securities and Exchange
Commission, under the Securities Act of 1933 as amended, with respect to the
securities offered hereby. This Prospectus does not contain all the information
set forth in the Registration Statement and amendments thereto and exhibits
filed as a part thereof, to all of which reference is made for further
information concerning the VUL Account, Phoenix and the Policy. Statements
contained in this Prospectus as to the content of the Policy and other legal
instruments are summaries. For a complete statement of the terms thereof,
reference is made to such instruments as filed.
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The consolidated financial statements of Phoenix contained herein should be
considered only as bearing upon Phoenix's ability to meet its obligations under
the Policy, and they should not be considered as bearing on the investment
performance of the VUL Account. The financial statements of the VUL Account are
for the Sub-accounts available as of the period ended December 31, 1995.
22
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY
CONSOLIDATED FINANCIAL STATEMENTS
[To be filed by Amendment]
23
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY
VARIABLE UNIVERSAL LIFE ACCOUNT
THE EFFECTIVE DATE OF THE PHOENIX LIFE AND ANNUITY VARIABLE UNIVERSAL LIFE
ACCOUNT IS THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT, THEREFORE,
FINANCIAL DATA IS NOT AVAILABLE.
24
<PAGE>
APPENDIX A
THE GUARANTEED INTEREST ACCOUNT
Contributions to the Guaranteed Interest Account ("GIA") under the Policy
and transfers to the GIA become part of the Phoenix General Account (the
"General Account"), which supports insurance and annuity obligations. Because of
exemptive and exclusionary provisions, interest in the General Account has not
been registered under the Securities Act of 1933 ("1933 Act") nor is the General
Account registered as an investment company under the Investment Company Act of
1940 ("1940 Act"). Accordingly, neither the General Account nor any interest
therein is specifically subject to the provisions of the 1933 or 1940 Acts and
the staff of the Securities and Exchange Commission has not reviewed the
disclosures in this Prospectus concerning the GIA. Disclosures regarding the GIA
and the General Account, however, may be subject to certain generally applicable
provisions of the federal securities laws relating to the accuracy and
completeness of statements made in prospectuses.
The General Account is made up of all of the general assets of Phoenix other
than those allocated to any separate account. Premium payments will be allocated
to the GIA and, therefore, the General Account, as elected by the Policyowner at
the time of purchase or as subsequently changed. Phoenix will invest the assets
of the General Account in assets chosen by it and allowed by applicable law.
Investment income from General Account assets is allocated between Phoenix and
the contracts participating in the General Account, in accordance with the terms
of such contracts.
Investment income from the General Account allocated to Phoenix includes
compensation for mortality and expense risks borne by it in connection with
General Account contracts.
The amount of investment income allocated to the Policies will vary from
year to year in the sole discretion of Phoenix. However, Phoenix guarantees that
it will credit interest at a rate of not less than 4% per year, compounded
annually, to amounts allocated to the unloaned portion of the GIA. The loaned
portion of the GIA will be credited interest at an effective annual rate of 2%.
Phoenix may credit interest at a rate in excess of 4% per year; however, it is
not obligated to credit any interest in excess of 4% per year.
Bi-weekly, Phoenix will set the excess interest rate, if any, that will
apply to amounts deposited to the GIA. That rate will remain in effect for such
deposits for an initial guarantee period of one full year from the date of
deposit. Upon expiration of the initial one-year guarantee period (and each
subsequent one-year guarantee period thereafter), the rate to be applied to any
deposits whose guaranteed period has just ended will be the same rate as is
applied to new deposits allocated at that time to the GIA. This rate will
likewise remain in effect for a guarantee period of one full year from the date
the new rate is applied.
Excess interest, if any, will be determined by Phoenix based on information
as to expected investment yields. Some of the factors that Phoenix may consider
in determining whether to credit interest to amounts allocated to the GIA and
the amount thereof, are general economic trends, rates of return currently
available and anticipated on investments, regulatory and tax requirements and
competitive factors. ANY INTEREST CREDITED TO AMOUNTS ALLOCATED TO THE GIA IN
EXCESS OF 4% PER YEAR WILL BE DETERMINED IN THE SOLE DISCRETION OF PHOENIX AND
WITHOUT REGARD TO ANY SPECIFIC FORMULA. THE CONTRACT OWNER ASSUMES THE RISK THAT
INTEREST CREDITED TO GIA ALLOCATIONS MAY NOT EXCEED THE MINIMUM GUARANTEE OF 4%
FOR ANY GIVEN YEAR.
Phoenix is aware of no statutory limitations on the maximum amount of
interest it may credit, and the Board of Directors has set no limitations.
However, inherent in Phoenix's exercise of discretion in this regard is the
equitable allocation of distributable earnings and surplus among its various
Policyholders and Contract Owners.
Excess interest, if any, will be credited on the GIA Policy Value. Phoenix
guarantees that, at any time, the GIA Policy Value will not be less than the
amount of premium payments allocated to the GIA, plus interest at the rate of 4%
per year, compounded annually, plus any additional interest which Phoenix may,
in its discretion, credit to the GIA, less the sum of all annual administrative
or surrender charges, any applicable premium taxes, and less any amounts
surrendered or loaned. If the Policyowner surrenders the Policy, the amount
available from the GIA will be reduced by any applicable surrender charge and
annual administration charge. See "Deductions and Charges."
IN GENERAL, ONE TRANSFER PER CONTRACT YEAR IS ALLOWED FROM THE GIA. THE AMOUNT
WHICH CAN BE TRANSFERRED IS LIMITED TO THE GREATER OF $1,000 OR 25% OF THE
CONTRACT VALUE IN THE GIA AS OF THE LAST CONTRACT ANNIVERSARY. UNDER THE
SYSTEMATIC TRANSFER PROGRAM, TRANSFERS OF APPROXIMATELY EQUAL AMOUNTS MAY BE
MADE OVER A MINIMUM 18-MONTH PERIOD. NON-SYSTEMATIC TRANSFERS FROM THE GIA WILL
BE EFFECTUATED ON THE DATE OF RECEIPT BY VARIABLE PRODUCTS OPERATIONS, UNLESS
OTHERWISE REQUESTED BY THE CONTRACT OWNER.
25
<PAGE>
APPENDIX B
ILLUSTRATIONS OF DEATH BENEFITS, POLICY VALUES ("ACCOUNT VALUES"),
AND CASH SURRENDER VALUES.
The tables on the following pages illustrate how a Policy's death benefits,
account values and Cash Surrender Value could vary over time assuming constant
hypothetical gross (after tax) annual investment returns of 0% and 12%. The
Policy benefits will differ from those shown in the tables if the annual
investment returns are not absolutely constant. That is, the figures will be
different if the returns averaged 0% to 12% over a period of years but went
above or below those figures in individual Policy Years. The Policy benefits
also will differ, depending on your premium allocations to each Sub-account of
the VUL Account, if the overall actual rates of return averaged 0% to 12% but
went above or below those figures for the individual Sub-accounts. The tables
are for standard risk males and females who have never smoked. In states where
cost of insurance rates are not based on the insured's sex, the tables
designated "male" apply to all standard risk insureds who have never smoked.
Account values and Cash Surrender Values may be lower for smokers or former
smokers or for risk classes involving higher mortality risk. Planned premium
payments are assumed to be paid at the beginning of each Policy Year. The
difference between the Policy Value and the Cash Surrender Value in the first 10
years is the surrender charge. Tables are included for death benefit Option 1
and Option 2.
The Death Benefit, Account Value, and Cash Surrender Value amounts reflect
the following current charges:
1. Issue Expense Charge of $150.
2. Monthly Administrative Charge of $5 per month ($10 per month guaranteed
maximum).
3. Premium Tax Charge of 2.25%.
4. A Federal Tax Charge of 1.5%.
5. Cost of Insurance Charge. The tables illustrate cost of insurance at both
the current rates and at the maximum rates guaranteed in the Policies. (See
"Charges and Deductions--Cost of Insurance.")
6. Mortality and Expense Risk Charge, which is a daily charge equivalent to
.80% on an annual basis (for 15 Policy Years, then .25% on an annual basis
in subsequent years), against the VUL Account for mortality and expense
risks. (See "Charges and Deductions--Mortality and Expense Risk Charge.")
These illustrations also assume an average investment advisory
fee of .66% on an annual basis, of the average daily net asset value of each of
the Series of the Funds. These illustrations also assume other ongoing average
Fund expenses of .18%. Management may decide to limit the amount of expense
reimbursement in the future. If this reimbursement had not been in place for the
fiscal year ended December 31, 1995, total operating expenses for the
Multi-Sector, Real Estate, Strategic Theme and Asia Series, would have been
approximately 0.73%, 1.98%, 1.33% and 2.40% respectively, of the average net
assets of the Series. (See "Charges and Deductions--Investment Management
Charge.")
Taking into account the Mortality and Expense Risk Charge and the investment
advisory fees and expenses, the gross annual investment return rates of 0% and
12% on the Funds' assets are equivalent to net annual investment return rates of
approximately -1.63% and 10.28%, respectively. For individual illustrations,
interest rates ranging between 0% and 12% may be selected in place of the 12%
rate.
The hypothetical returns shown in the tables are without any tax charges
that may be attributable to the VUL Account in the future. If such tax charges
are imposed in the future, then in order to produce after tax returns equal to
those illustrated for 0% and 12%, a sufficiently higher amount in excess of the
hypothetical interest rates would have to be earned. (See "Charges and
Deduction--Other Charges--Taxes.")
The second column of each table shows the amount that would accumulate if an
amount equal to the premiums paid were invested to earn interest, after taxes,
at 5% compounded annually. These tables show that if a Policy is returned in its
very early years for payment of its Cash Surrender Value, that Cash Surrender
Value may be low in comparison to the amount of the premiums accumulated with
interest. Thus, the cost of owning a Policy for a relatively short time may be
high.
On request, we will furnish the Policyowner with a comparable illustration
based on the age and sex of the proposed insured person(s), standard risk
assumptions and the initial face amount and planned premium chosen.
26
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY PAGE 1 OF 1
MALE 35 NEVERSMOKE
FACE AMOUNT: $100,000
INITIAL ANNUAL PREMIUM: $1,000
THE FLEX EDGE SUCCESS -- A FLEXIBLE PREMIUM
VARIABLE UNIVERSAL LIFE INSURANCE POLICY OPTION 1
<TABLE>
<CAPTION>
ASSUMING
------------------------------------------------------------------------
CURRENT CHARGES GUARANTEED CHARGES
---------------------------------- ----------------------------------
ASSUMED CASH CASH
ANNUAL PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 12.00% @ 12.00% @ 12.00% @ 0.0% @ 0.0% @ 0.0%
- ------- -------- -------- --------- --------- -------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,000 1,050 667 0 100,000 513 0 100,000
2 1,000 2,153 1,553 668 100,000 1,159 274 100,000
3 1,000 3,310 2,521 1,214 100,000 1,786 479 100,000
4 1,000 4,526 3,579 2,272 100,000 2,391 1,084 100,000
5 1,000 5,802 4,734 3,427 100,000 2,975 1,668 100,000
6 1,000 7,142 5,995 4,833 100,000 3,536 2,373 100,000
7 1,000 8,549 7,372 6,355 100,000 4,072 3,054 100,000
8 1,000 10,027 8,878 8,005 100,000 4,583 3,711 100,000
9 1,000 11,578 10,522 10,087 100,000 5,068 4,632 100,000
10 1,000 13,207 12,322 12,322 100,000 5,526 5,526 100,000
11 1,000 14,917 14,297 14,297 100,000 5,956 5,956 100,000
12 1,000 16,713 16,467 16,467 100,000 6,354 6,354 100,000
13 1,000 18,599 18,853 18,853 100,000 6,721 6,721 100,000
14 1,000 20,579 21,479 21,479 100,000 7,054 7,054 100,000
15 1,000 22,657 24,369 24,369 100,000 7,352 7,352 100,000
16 1,000 24,840 27,706 27,706 100,000 7,656 7,656 100,000
17 1,000 27,132 31,404 31,404 100,000 7,917 7,917 100,000
18 1,000 29,539 35,504 35,504 100,000 8,131 8,131 100,000
19 1,000 32,066 40,052 40,052 100,000 8,292 8,292 100,000
20 1,000 34,719 45,100 45,100 100,000 8,391 8,391 100,000
@ 65 30,000 69,761 138,936 138,936 169,502 4,309 4,309 100,000
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in year
33.
Death Benefit, Account Value, and Cash Surrender Value are based on hypothetical
gross interest rates shown, assume current and guaranteed charges and no policy
loans or withdrawals, and are calculated at the end of the Policy Year. Assumed
Premium Payments shown are assumed paid in full at the beginning of the Policy
Year. Payment of premiums shown other than in full at the beginning of the
Policy Year would reduce values and benefits below the hypothetical illustrated
amounts shown. Values shown reflect an effective annual asset charge of 1.64%
(includes mortality and expense risk charge of 0.8% for fifteen years, then
0.25% and average fund operating expenses of 0.84% applicable to the investment
Sub-accounts of the VUL Separate Account). Hypothetical gross interest rates are
presented for illustrative purposes only to illustrate funds allocated entirely
to the investment Sub-accounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
27
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY PAGE 1 OF 1
FEMALE 35 NEVERSMOKE
FACE AMOUNT: $100,000
INITIAL ANNUAL PREMIUM: $1,000
THE FLEX EDGE SUCCESS -- A FLEXIBLE PREMIUM
VARIABLE UNIVERSAL LIFE INSURANCE POLICY OPTION 1
<TABLE>
<CAPTION>
ASSUMING
------------------------------------------------------------------------
CURRENT CHARGES GUARANTEED CHARGES
---------------------------------- ----------------------------------
ASSUMED CASH CASH
ANNUAL PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 12.00% @ 12.00% @ 12.00% @ 0.0% @ 0.0% @ 0.0%
- ------- -------- -------- --------- --------- -------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,000 1,050 695 0 100,000 535 0 100,000
2 1,000 2,153 1,613 759 100,000 1,201 347 100,000
3 1,000 3,310 2,615 1,420 100,000 1,847 652 100,000
4 1,000 4,526 3,711 2,516 100,000 2,472 1,277 100,000
5 1,000 5,802 4,908 3,713 100,000 3,075 1,880 100,000
6 1,000 7,142 6,217 5,153 100,000 3,654 2,591 100,000
7 1,000 8,549 7,646 6,714 100,000 4,209 3,276 100,000
8 1,000 10,027 9,209 8,408 100,000 4,738 3,937 100,000
9 1,000 11,578 10,921 10,522 100,000 5,243 4,844 100,000
10 1,000 13,207 12,798 12,798 100,000 5,725 5,725 100,000
11 1,000 14,917 14,863 14,863 100,000 6,182 6,182 100,000
12 1,000 16,713 17,137 17,137 100,000 6,615 6,615 100,000
13 1,000 18,599 19,642 19,642 100,000 7,021 7,021 100,000
14 1,000 20,579 22,402 22,402 100,000 7,401 7,401 100,000
15 1,000 22,657 25,446 25,446 100,000 7,753 7,753 100,000
16 1,000 24,840 28,963 28,963 100,000 8,120 8,120 100,000
17 1,000 27,132 32,865 32,865 100,000 8,456 8,456 100,000
18 1,000 29,539 37,196 37,196 100,000 8,758 8,758 100,000
19 1,000 32,066 42,005 42,005 100,000 9,022 9,022 100,000
20 1,000 34,719 47,347 47,347 100,000 9,246 9,246 100,000
@ 65 30,000 69,761 146,721 146,721 179,001 8,829 8,829 100,000
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in year
39.
Death Benefit, Account Value, and Cash Surrender Value are based on hypothetical
gross interest rates shown, assume current and guaranteed charges and no policy
loans or withdrawals, and are calculated at the end of the Policy Year. Assumed
Premium Payments shown are assumed paid in full at the beginning of the Policy
Year. Payment of premiums shown other than in full at the beginning of the
Policy Year would reduce values and benefits below the hypothetical illustrated
amounts shown. Values shown reflect an effective annual asset charge of 1.64%
(includes mortality and expense risk charge of 0.8% for fifteen years, then
0.25% and average fund operating expenses of 0.84% applicable to the investment
Sub-accounts of the VUL Separate Account). Hypothetical gross interest rates are
presented for illustrative purposes only to illustrate funds allocated entirely
to the investment Sub-accounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
28
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY PAGE 1 OF 1
MALE 35 NEVERSMOKE
FACE AMOUNT: $100,000
INITIAL ANNUAL PREMIUM: $1,000
THE FLEX EDGE SUCCESS -- A FLEXIBLE PREMIUM
VARIABLE UNIVERSAL LIFE INSURANCE POLICY OPTION 2
<TABLE>
<CAPTION>
ASSUMING
------------------------------------------------------------------------
CURRENT CHARGES GUARANTEED CHARGES
---------------------------------- ----------------------------------
ASSUMED CASH CASH
ANNUAL PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 12.00% @ 12.00% @ 12.00% @ 0.0% @ 0.0% @ 0.0%
- ------- -------- -------- --------- --------- -------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,000 1,050 665 0 100,666 512 0 100,512
2 1,000 2,153 1,549 663 101,549 1,156 271 101,156
3 1,000 3,310 2,512 1,205 102,512 1,779 472 101,779
4 1,000 4,526 3,561 2,254 103,562 2,379 1,072 102,380
5 1,000 5,802 4,704 3,397 104,704 2,956 1,649 102,957
6 1,000 7,142 5,949 4,786 105,949 3,509 2,347 103,509
7 1,000 8,549 7,303 6,285 107,303 4,035 3,018 104,035
8 1,000 10,027 8,777 7,905 108,778 4,534 3,662 104,535
9 1,000 11,578 10,381 9,946 110,382 5,005 4,570 105,005
10 1,000 13,207 12,129 12,129 112,129 5,447 5,447 105,448
11 1,000 14,917 14,039 14,039 114,039 5,857 5,857 105,858
12 1,000 16,713 16,127 16,127 116,127 6,234 6,234 106,234
13 1,000 18,599 18,411 18,411 118,411 6,575 6,575 106,576
14 1,000 20,579 20,911 20,911 120,911 6,881 6,881 106,881
15 1,000 22,657 23,647 23,647 123,647 7,147 7,147 107,147
16 1,000 24,840 26,792 26,792 126,792 7,414 7,414 107,414
17 1,000 27,132 30,254 30,254 130,255 7,634 7,634 107,635
18 1,000 29,539 34,065 34,065 134,065 7,801 7,801 107,802
19 1,000 32,066 38,260 38,260 138,260 7,910 7,910 107,911
20 1,000 34,719 42,876 42,876 142,877 7,952 7,952 107,953
@ 65 30,000 69,761 123,877 123,877 223,878 3,030 3,030 103,031
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in year
33.
Death Benefit, Account Value, and Cash Surrender Value are based on hypothetical
gross interest rates shown, assume current and guaranteed charges and no policy
loans or withdrawals, and are calculated at the end of the Policy Year. Assumed
Premium Payments shown are assumed paid in full at the beginning of the Policy
Year. Payment of premiums shown other than in full at the beginning of the
Policy Year would reduce values and benefits below the hypothetical illustrated
amounts shown. Values shown reflect an effective annual asset charge of 1.64%
(includes mortality and expense risk charge of 0.8% for fifteen years, then
0.25% and average fund operating expenses of 0.84% applicable to the investment
Sub-accounts of the VUL Separate Account). Hypothetical gross interest rates are
presented for illustrative purposes only to illustrate funds allocated entirely
to the investment Sub-accounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
29
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY PAGE 1 OF 1
FEMALE 35 NEVERSMOKE
FACE AMOUNT: $100,000
INITIAL ANNUAL PREMIUM: $1,000
THE FLEX EDGE SUCCESS -- A FLEXIBLE PREMIUM
VARIABLE UNIVERSAL LIFE INSURANCE POLICY OPTION 2
<TABLE>
<CAPTION>
ASSUMING
------------------------------------------------------------------------
CURRENT CHARGES GUARANTEED CHARGES
---------------------------------- ----------------------------------
ASSUMED CASH CASH
ANNUAL PREMIUM ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
PREMIUM ACCUM. VALUE VALUE BENEFIT VALUE VALUE BENEFIT
YEAR PAYMENTS @ 5.0% @ 12.00% @ 12.00% @ 12.00% @ 0.0% @ 0.0% @ 0.0%
- ------- -------- -------- --------- --------- -------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 1,000 1,050 694 0 100,695 534 0 100,534
2 1,000 2,153 1,609 755 101,609 1,198 344 101,199
3 1,000 3,310 2,607 1,411 102,607 1,841 646 101,841
4 1,000 4,526 3,695 2,500 103,696 2,461 1,266 102,462
5 1,000 5,802 4,882 3,686 104,882 3,058 1,863 103,058
6 1,000 7,142 6,175 5,111 106,176 3,630 2,566 103,630
7 1,000 8,549 7,584 6,651 107,584 4,175 3,242 104,175
8 1,000 10,027 9,119 8,318 109,120 4,693 3,892 104,693
9 1,000 11,578 10,794 10,395 110,795 5,184 4,785 105,185
10 1,000 13,207 12,624 12,624 112,625 5,650 5,650 105,651
11 1,000 14,917 14,630 14,630 114,631 6,090 6,090 106,090
12 1,000 16,713 16,831 16,831 116,832 6,502 6,502 106,503
13 1,000 18,599 19,246 19,246 119,246 6,886 6,886 106,887
14 1,000 20,579 21,896 21,896 121,896 7,240 7,240 107,240
15 1,000 22,657 24,806 24,806 124,806 7,563 7,563 107,564
16 1,000 24,840 28,155 28,155 128,156 7,897 7,897 107,898
17 1,000 27,132 31,854 31,854 131,855 8,197 8,197 108,198
18 1,000 29,539 35,939 35,939 135,940 8,459 8,459 108,459
19 1,000 32,066 40,450 40,450 140,450 8,677 8,677 108,677
20 1,000 34,719 45,432 45,432 145,433 8,851 8,851 108,851
@ 65 30,000 69,761 135,439 135,439 235,440 7,658 7,658 107,659
</TABLE>
Based on 0% interest rate and guaranteed charges, the policy will lapse in year
38.
Death Benefit, Account Value, and Cash Surrender Value are based on hypothetical
gross interest rates shown, assume current and guaranteed charges and no policy
loans or withdrawals, and are calculated at the end of the Policy Year. Assumed
Premium Payments shown are assumed paid in full at the beginning of the Policy
Year. Payment of premiums shown other than in full at the beginning of the
Policy Year would reduce values and benefits below the hypothetical illustrated
amounts shown. Values shown reflect an effective annual asset charge of 1.64%
(includes mortality and expense risk charge of 0.8% for fifteen years, then
0.25% and average fund operating expenses of 0.84% applicable to the investment
Sub-accounts of the VUL Separate Account). Hypothetical gross interest rates are
presented for illustrative purposes only to illustrate funds allocated entirely
to the investment Sub-accounts of the VUL Separate Account and do not in any way
represent actual results or suggest that such results will be achieved in the
future. Actual values will differ from those shown whenever actual investment
results differ from hypothetical gross interest rates illustrated. A Guaranteed
Interest Account providing interest at a minimum guaranteed rate of 4% also is
available under this product through the General Account.
This illustration assumes a premium tax of 2.25%.
30
<PAGE>
PART II. OTHER INFORMATION
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that Section.
RULE 484 UNDERTAKING
Section 351.355 of the General and Business Corporation Law of Missouri,
provides that a corporation may indemnify any director or officer of the
corporation made, or threatened to be made, a party to an action or proceeding
other than one by or in the right of the corporation to procure a judgment in
its favor, whether civil or criminal, including an action by or in the right of
any other corporation of any type or kind, by reason of the fact that he, his
testator or intestate, served such other corporation in any capacity at the
request of the indemnifying corporation.
Article VII of the By-Laws of Phoenix Life and Annuity Company provides
that: "Each person who is or was a director, officer or employee of the
Corporation, or is or was serving at the written request of the Corporation as a
director, officer or employee of another corporation, partnership, joint
venture, trust or other enterprise shall be indemnified by the Corporation in
the manner and to the fullest extent that the Corporation has power to indemnify
such person under...the General and Business Corporation Law of Missouri..."
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that 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.
REPRESENTATIONS, DESCRIPTION AND UNDERTAKINGS PURSUANT TO PARAGRAPH
(b)(13)(iii)(F) OF RULE 6e-3(T) UNDER THE INVESTMENT COMPANY ACT OF 1940.
Registrant makes the following representations:
(1) Section 6e-3(T)(b)(13)(iii)(F) is being relied upon.
(2) The level of the mortality and expense risk charge is within the range
of industry practice for comparable flexible or scheduled contracts.
(3) Phoenix Life and Annuity Company has concluded that there is a
reasonable likelihood that the distribution financing arrangement of
Phoenix Life and Annuity Variable Universal Life Account (the "VUL
Account") will benefit the VUL Account and Policyowners.
(4) The VUL Account will invest only in management companies which have
undertaken to have a board of directors, a majority of whom are not
interested persons of the Phoenix Life and Annuity Company, formulate
and approve any plan under Rule 12b-1 to finance distribution expenses.
The methodology used to support the representation made in paragraph (2)
above is based on an analysis of selected variable life insurance policies whose
registration statements have been declared effective by the Commission which
contain similar guarantees and are sold in similar markets. Registrant
undertakes to keep and make available to the Commission on request the documents
used to support the representation in paragraph (2) above and a memorandum
setting forth the basis for the representation in paragraph (3) above.
II-1
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
This Form S-6 Registration Statement comprises the following papers and
documents:
The facing sheet.
The cross-reference sheet to Form N-8B-2.
The Prospectus describing Phoenix Life and Annuity Company Policy Form V604
and riders thereto ("Flex Edge Success"), consisting of 30 pages.
The undertaking to file reports.
The Rule 484 undertaking.
Representations, Description and Undertakings Pursuant to Paragraph
(b)(13)(iii)(F) of Rule 6e-3(T) under the Investment Company Act of 1940.
The signature page.
The powers of attorney*
Written consents of the following persons:
(a) Richard J. Wirth, Esq.
(b) Jorden Burt Berenson & Johnson LLP
(c) Price Waterhouse, LLP
(d) M. Spencer Hamilton, F.S.A.
The following exhibits:
1. The following exhibits correspond to those required by paragraph A to the
instructions as to exhibits in Form N-8B-2:
A. (1) Resolution of the Board of Directors of Depositor establishing the
VUL Account.*
(2) Not Applicable.
(3) Distribution of Policies:
(a) Form of Underwriting Agreement between Depositor and Phoenix
Equity Planning Corporation.
(b) Form of Agreement between Phoenix Equity Planning Corporation
and Independent Brokers with respect to the sale of Policies.
(c) Not Applicable.
(4) Not Applicable.
(5) Specimen Policies with optional riders
Flexible Premium Variable Universal Life Insurance Policy
Form Number V604 of Depositor
(6) (a) Charter of Phoenix Life and Annuity Company.*
(1) Certificate of Incorporation dated November 2, 1981.
(2) Certificate of Amendment of its Articles of
Incorporation dated March 16, 1984.
(3) Certificate of Amendment of its Articles of
Incorporation dated April 18, 1985.
(4) Certificate of Amendment of its Articles of
Incorporation dated December 3, 1992.
(5) Certificate of Amendment of its Articles of
Incorporation dated May 9, 1996.
(b) By-Laws of Phoenix Life and Annuity Company.*
(7) Not Applicable.
(8) Not Applicable.
(9) Not Applicable.
(10) Form of application for Flex Edge Success.
(11) Memorandum describing transfer and redemption procedures and
method of computing adjustments in payments and cash values upon
conversion to fixed benefit policies.
2. Opinion of Richard J. Wirth, Esq., Counsel of Depositor as to the legality
of the securities being registered. (See number 9 below.)
3. Not Applicable. No financial statement will be omitted from the Prospectus
pursuant to Instruction 1(b) or (c) of Part I.
4. Not Applicable.
II-2
<PAGE>
5. Financial Data Schedule
6. Consent of Jorden Burt Berenson & Johnson, LLP.
7. Consent of Price Waterhouse, LLP.
8. Consent of Richard J. Wirth, Esq.
9. Opinion and Consent of M. Spencer Hamilton, F.S.A.
--------------
* Filed herewith.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Phoenix Life and Annuity Variable Universal Life Account has duly caused this
Registration Statement to be signed on its behalf by the undersigned thereunto
duly authorized, in the City of Hartford, State of Connecticut on the 27th day
of September, 1996.
PHOENIX LIFE AND ANNUITY VARIABLE UNIVERSAL LIFE ACCOUNT
--------------------------------------------------------
(Registrant)
By: PHOENIX LIFE AND ANNUITY COMPANY
--------------------------------
(Depositor)
By: /s/ Dona D. Young
--------------------------------
*Dona D. Young, Executive Vice President,
Individual Insurance and General Counsel
ATTEST: /s/Keith D. Robbins
---------------------------
Keith D. Robbins, Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
Director September 27, 1996
- ---------------------------------------
*Richard H. Booth
Director September 27, 1996
- ---------------------------------------
*Robert G. Chipkin
Chairman of the Board, President and Chief September 27, 1996
- ---------------------------------------
*Robert W. Fiondella Executive Officer (Principal Executive Officer)
Director September 27, 1996
- ---------------------------------------
*Joseph E. Kelleher
Director September 27, 1996
- ---------------------------------------
*Robert G. Lautensack
Director September 27, 1996
- ---------------------------------------
*Philip R. McLoughlin
Director September 27, 1996
- ---------------------------------------
*Charles J. Paydos
Director, Executive Vice President, Chief September 27, 1996
- ---------------------------------------
*David W. Searfoss Financial Officer and Treasurer (Principal
Accounting and Financial Officer)
Director September 27, 1996
- ---------------------------------------
*Simon Y. Tan
Director September 27, 1996
- ---------------------------------------
*Dona D. Young
</TABLE>
By: /s/ Dona D. Young
-----------------------------------
* Dona D. Young as Attorney-in-Fact Pursuant to Powers of Attorney, copies of
which are filed herewith.
S-1(c)
<PAGE>
POWERS OF ATTORNEY
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Richard H. Booth Director and September 12, 1996
- ------------------------
Richard H. Booth Executive Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Robert W. Fiondella Chairman of the September 12, 1996
- -----------------------
Robert W. Fiondella Board of Directors
and Officer and President
(Principal Executive Officer)
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Joseph E. Kelleher Director and September 12, 1996
- -----------------------
Joseph E. Kelleher Senior Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Robert G. Lautensack Director and September 12, 1996
- ------------------------
Robert G. Lautensack Senior Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Philip R. McLoughlin Director and September 12, 1996
- ------------------------
Philip R. McLoughlin Executive Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Charles J. Paydos Director and September 12, 1996
- ------------------------
Charles J. Paydos Executive Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/David W. Searfoss Director, Executive September 12, 1996
- ------------------------
David W. Searfoss Vice President, Chief Financial
Officer and Treasurer
(Principal Accounting and
Financial Officer)
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Simon Y. Tan Director and September 12, 1996
- ------------------------
Simon Y. Tan Senior Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Dona D. Young Director and September 12, 1996
- ------------------------
Dona D. Young Executive Vice President
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Directors of Phoenix Life and
Annuity Company, hereby constitute and appoint Lewis A. Singer, Richard J. Wirth
and Dona D. Young or any of them as my true and lawful attorneys and agents with
full power to sign for me in the capacities indicated below, any or all
Registration Statements or amendments thereto filed with the Securities and
Exchange Commission under the Securities Act of 1933 and/or the Investment
Company Act of 1940 relating to the Phoenix Life and Annuity Variable Universal
Life Account, and hereby ratify and confirm my signature as it may be signed by
said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
/s/Robert G. Chipkin Director September 12, 1996
- ------------------------
Robert G. Chipkin
EXHIBIT 1.A(1)
RESOLUTION OF THE BOARD OF DIRECTORS OF DEPOSITOR
ESTABLISHING THE VUL ACCOUNT
<PAGE>
I, Keith D. Robbins, Secretary of Phoenix Life and Annuity Company, hereby
certify that the annexed vote was duly adopted by action of the Board of
Directors of Phoenix Life and Annuity Company pursuant to statutory written
consent, effective July 1, 1996, and that said vote has not been rescinded or
modified and it is in effect on the date hereof.
<PAGE>
PHOENIX LIFE AND ANNUITY COMPANY
STATUTORY WRITTEN CONSENT
IN LIEU OF
MEETING OF BOARD OF DIRECTORS
We, the undersigned, being all the Directors of Phoenix Life and
Annuity Company, do hereby waive notice of a meeting and consent to the
following resolution, such action to have the same force and effect as if taken
at a meeting duly called and held for such purpose.
RESOLVED: That the Company, pursuant to the provisions of Section
372.309 of the Missouri Revised Statues hereby establishes a
separate account designated initially as the "Phoenix Life
and Anuuity Variable Universal Life Account" (hereinafter
"the Account"), for the following use and purposes, and
subject to such conditions as hereafter set forth; said use,
purposes, and conditions to be in full compliance with
Section 372.309 and all rules and regulations of the
Commissioner of Insurance of the State of Missouri; and
FURTHER
RESOLVED: That the Account shall be established for the purpose of
providing for the issuance by the Company of such variable
life insurance contracts ("Variable Contracts") as the
President may designate for such purpose and shall
constitute a separate account into which are allocated
amounts paid to the Company which are to be applied under
the terms of such Variable Contracts; and
FURTHER
RESOLVED: That the income, gains and losses, whether or not realized,
from assets allocated to the Account shall, in accordance
with the terms of the Variable Contracts, be credited to or
charged against such Account without regard to other income,
gains, or losses or the Company; and
FURTHER
RESOLVED: That the fundamental investment policy of the Account shall
be to invest or reinvest the assets of the Account in
securities issued by investment companies registered under
the Investment Company Act of 1940 as may be specified in
the respective Variable Contracts; and
<PAGE>
FURTHER
RESOLVED: That the President or any Executive Officer of the Company
be, and each hereby is, authorized to establish one or more
separate investment divisions within the Account to which
payments under the Variable Contracts will be allocated in
accordance with instructions received from contractowners,
and that the President be, and hereby is, authorized to
increase or decrease the number of investment divisions in
the Account as he deems necessary or appropriate; and
FURTHER
RESOLVED: That each such investment division shall invest only in the
shares of a single registered investment company, or a
single portfolio of a registered investment company
organized as a series fund pursuant to the Investment
Company Act of 1940; and
FURTHER
RESOLVED: That the President or any Executive Officer of the Company
be, and each hereby is, authorized to transfer funds from
time to time between the Company's general account and the
Account in order to establish the Account, facilitate the
commencement of the Account's operations or to support the
operation of the Variable Contracts with respect to the
Account as deemed necessary or appropriate and consistent
with the terms of the Contracts; and
FURTHER
RESOLVED: That the President of the Company be, and hereby is,
authorized to change the designation of the Account to such
other designation as he may deem necessary or appropriate;
and
FURTHER
RESOLVED: That the President or any Executive Officer of the Company
and each of them with full power to act without the others,
and with such assistance from the Company's auditors, legal
counsel and independent consultants or others as such
Officer may require, be, and each hereby is, authorized,
empowered and directed to take all action necessary, on
behalf of the Account, and by the Company to: (a) register
the Account as a unit investment trust under the Investment
Company Act of 1940, as amended; (b) register the Variable
Contracts in such amounts, which may be an indefinite
amount, as such officers of the Company shall from time to
time deem appropriate under the Securities Act of 1933; and
(c) take all other actions which are necessary in connection
with the offering and sale of said Contracts and for the
operation of the Account in order to comply with the
Investment Company Act of 1940, the Securities Act
<PAGE>
of 1933 and other applicable Federal laws, including the
filing of any amendments to registration statements, any
undertakings, any applications for exemptions from the
Investment Company Act of 1940 or other applicable Federal
laws, and any and all amendments to the foregoing as such
Officers of the Company shall deem necessary or appropriate;
and
FURTHER
RESOLVED: That the Company be authorized and directed to obtain any
required approvals with respect to the establishment of the
Account and marketing of the Variable Contracts, from the
Commissioner of Insurance of Missouri and any other
statutory or regulatory approvals which may be required; and
FURTHER
RESOLVED: That the Executive Officers of the Company be, and each
hereby is, authorized on behalf of the Account and on behalf
of the Company to take any and all action they may deem
necessary or advisable in order to sell the Variable
Contracts, including any registrations, filings, and
qualifications of the Company, its officers, agents,
employees, and the Contracts, under the insurance and
securities laws of any of the states of the United States of
America or other jurisdictions, and in connection therewith
to prepare, execute, deliver, and file all such
applications, reports, covenants, resolutions, applications
for exemptions, consents to service of process, and other
papers and instruments as may be required under such laws,
and to take any and all further action which said officers
may deem necessary or desirable (including entering into
whatever agreements may be necessary) in order to maintain
such registrations or qualifications for al long as said
officers or counsel deem it to be in the best interests of
the Account and the Company; and
FURTHER
RESOLVED: That upon declaration of effectiveness of the Account's
Registration Statement by the Securities and Exchange
Commission, or at such later date as may be determined by
the Executive Officers of the Company acting with the advice
of the Account's Underwriter, the Account will offer and
sell its Contracts on the terms set forth in the Prospectus
forming a part of said Registration Statement, as from time
to time supplemented or amended, and that such Contracts,
when issued and paid for in accordance with the terms of the
Prospectus, shall be validly issued, fully paid and
nonassessable; and
<PAGE>
FURTHER
RESOLVED: That the General Counsel of the Company is hereby appointed
as agent for service under registration statement filed with
the Securities and Exchange Commission and is duly
authorized to receive communications and notices from the
Securities and Exchange Commission with respect thereto; and
FURTHER
RESOLVED: That the Executive Officers of the Company be, and each
hereby is, authorized to execute and deliver all agreements,
documents and papers and to do or cause to be done all acts
and things as they may deem necessary or desirable to carry
out the foregoing resolutions and the intents and purposes
thereof.
/s/Richard H. Booth
- --------------------------
Richard H. Booth
/s/Robert W. Fiondella
- --------------------------
Robert W. Fiondella
/s/Joseph E. Kelleher
- --------------------------
Joseph E. Kelleher
/s/Philip R. McLoughlin
- --------------------------
Philip R. McLoughlin
/s/Charles J. Paydos
- --------------------------
Charles J. Paydos
/s/David W. Searfoss
- --------------------------
David W. Searfoss
/s/Simon Y. Tan
- --------------------------
Simon Y. Tan
/s/Dona D. Young
- --------------------------
Dona D. Young
/s/Robert G. Lautensack
- --------------------------
Robert G. Lautensack
Date: July 1, 1996
- --------------------------
Attest: /s/Keith D. Robbins
- ---------------------------
Keith D. Robbins
Secretary
EXHIBIT 1.A.6(a)
CHARTER OF PHOENIX LIFE AND ANNUITY COMPANY
<PAGE>
No. I00235927
---------
STATE OF MISSOURI
JAMES C. KIRKPATRICK, SECRETARY OF STATE
CORPORATION DIVISION
CERTIFICATE OF INCORPORATION
WHEREAS, An Association organized under the name of
KANSAS CITY LIFE AND ANNUITY COMPANY
has filed in the office of the Secretary of State, Articles of Association or
Agreement in writing, as provided under Chapter 376, Revised Statutes of
Missouri ('78) and has in all respects complied with the requirements of law
governing the formation of Insurance Companies:
NOW, THEREFORE, I, JAMES C. KIRKPATRICK, Secretary of State of the State of
Missouri, in virtue and by authority of law, do hereby certify that said
association has on the date hereof become a body corporate duly organized under
the name of
KANSAS CITY LIFE AND ANNUITY COMPANY
located in Kansas City, and is entitled to all rights and privileges granted to
Insurance companies under the laws of this State for a term of perpetual years,
and that the amount of the capital stock of said corporation is
40,000 shares @ $100.00 par value.
IN TESTIMONY WHEREOF, I hereunto set my hand and
affix the GREAT SEAL of the State of Missouri. Done
at the City of Jefferson, this 11/2 day of A.D.,
Nineteen Hundred and Eighty-one.
/s/ James C. Kirkpatrick
----------------------------------------
Secretary of State
<PAGE>
DECLARATION OF INTENTION
TO FORM AND
ARTICLES OF INCORPORATION
OF
KANSAS CITY LIFE AND ANNUITY COMPANY
BE IT KNOWN THAT:
We, the undersigned, being natural persons over twenty-one (21) years
of age, hereby declare our intention to organize a joint stock insurance company
under Sections 376.010 to 376.675, inclusive, Revised Statutes of Missouri,
1969, as amended, relating to life and accident insurance, and as corporators do
hereby adopt the following Articles of Incorporation:
ARTICLE I
The name of the corporation is Kansas City Life and Annuity Company.
ARTICLE II
The principal office for the transaction of the business of the
corporation shall be located in the City of Kansas City, County of Jackson,
State of Missouri, 3520 Broadway, P.O. Box 139, Kansas City, MO 64141, James B.
Slusher.
ARTICLE III
The corporation is formed for the following purposes:
To make insurance upon the lives of individuals and every assurance
pertaining thereto or connected therewith; to grant and purchase and dispose of
annuities and endowments of every kind and description whatsoever; to provide
for contracts of indemnity against death and for weekly or other periodic
indemnities for disability occasioned by accident or sickness to the person of
the insured, and to do such other things as may be permitted a corporation of
this kind by law and not prohibited by Sections 376.010 to 376.675, inclusive,
Revised Statutes of Missouri, 1969 as amended. Such accident and health
insurance shall be made a separate department of the Company.
In order to carry out the purposes for which it is organized, the
corporation shall have the following rights and powers to the extent not
inconsistent with nor prohibited by the provisions of law applicable to life
insurance companies or applicable to all insurance companies:
A. To sue and be sued, complain and defend in any court of law or
equity;
B. To have a corporate seal which may be altered at the pleasure
of the corporation and to use such seal by causing it or a
facsimile thereof to be impressed or affixed or in any manner
reproduced;
C. To purchase, hold or convey such real estate as the purposes
of the corporation shall require, and to take,
<PAGE>
hold or convey other property, real, personal, or mixed, as
shall be necessary in the transaction of its business, all to
the extent permitted by law, and more particularly as provided
by Sections 375.320, 375.325, 375.330 and 375.340, Revised
Statutes of Missouri, 1969, as amended;
D. To sell, convey, mortgage, loan, pledge or otherwise dispose
of and otherwise use and deal in and with shares, or the
interests in and obligations of other domestic and foreign
corporations, associations, partnerships or individuals, all
to the extent permitted by law;
E. To sell, lease, exchange or otherwise dispose of all or
substantially all of the property and assets of the
corporation, with or without the goodwill of the corporation
upon such terms and conditions and for such consideration
consisting in whole or in part; of money or property, real or
personal, including but not restricted to shares of any other
domestic or foreign corporations as shall be consistent with
the provisions of law applicable to such transfers under The
General and Business Corporation Act of Missouri and
consistent also with any and all provisions of law applicable
to all insurance companies;
F. To make contracts and incur liabilities which may be
appropriate to enable it to accomplish any or all of its
purposes; to issue its notes, bonds and other obligations; to
issue any of its obligations by mortgage, deed of trust or
pledge of any or all of its property, franchises or income; to
issue notes or bonds secured or unsecured; which by their
terms are convertible to shares of stock of any class upon
such terms and conditions and at such rates or prices as may
be therein provided; to enter into contracts of reinsurance,
either as reinsurer or otherwise pertaining to life, health
and accident insurance to the extent permitted by law to a
corporation of this kind;
G. To invest its capital, reserve and surplus funds of whatever
kind or character from time to time and to lend money for its
corporate purposes, and to take and hold real and personal
property as security for the payment of funds so invested or
loaned, all to the extent that such investments and loans may
be permitted by the provisions of law applicable to life,
health and accident insurance companies or applicable to all
insurance companies;
H. To elect or appoint officers and agents of the corporation and
to define their duties and fix their compensation, such
officers to consist of a President, one or more Vice
Presidents, a Secretary, one or more Assistant Secretaries, a
Treasurer, and such other officers as the Board of Directors
may from time to time deem necessary;
<PAGE>
I. To make and alter By-laws, not inconsistent with these
Articles of Incorporation or with the laws of this State for
the administration and regulation of the affairs of the
corporation;
J. To amend its Articles of Incorporation from time to time in
any and as many respects as may be desired in accordance with
Section 375.201, Revised Statutes of Missouri, 1969, as
amended; to merge and consolidate and enter into
reorganizations with other corporations, provided however that
any shareholder dissenting to such merger, consolidation or
reorganization shall have such rights as provided for by
Section 351.455. Revised Statutes of Missouri, 1969, as
amended;
K. To terminate its corporate activities and to surrender its
corporate franchise;
L. To make contributions to corporations or other organizations
formed for civic charitable or benevolent purposes or to any
incorporated or unincorporated associations, United Fund or
Community Funds not operated or used for profit to its
members, but operated for the purposes of raising funds for
and of distributing funds to other civic, charitable or
benevolent organizations or agencies; and
M. To have and exercise all of the powers necessary or convenient
to effect or accomplish any or all of the purposes for which
the corporation was formed; to exercise all powers now or
hereafter permitted by law to a corporation of this character,
and not prohibited by Sections 376.010 to 376.675, inclusive,
Revised Statutes of Missouri, 1969, as amended.
ARTICLE IV
The aggregate number of shares which the corporation shall have
authority to issue shall be Forty Thousand Shares capital stock of a par value
of One Hundred Dollars ($100.00) each, amounting in the aggregate to Four
Million Dollars ($4,000,000.00). Each share of stock shall be entitled to one
vote except that in all elections of directors, each shareholder shall have the
right of cumulative voting.
The stock of the corporation shall be sold to the original purchasers
thereof for cash or securities of the value of not less than Four Million
Dollars ($4,000,000.00), and the amount with which the corporation shall
commence business is not less than Four Million Dollars ($4,000,000.00),
consisting of a total capital of One Million Five Hundred Thousand Dollars
($1,500,000.00), and a total paid in Surplus of not less than Two Million Five
Hundred Thousand Dollars ($2,500,000.00).
<PAGE>
ARTICLE V
The property and business of the corporation shall be managed and
controlled by a Board of Directors consisting of nine (9) persons, who shall be
elected by the Shareholders at each Annual meeting of the Shareholders. The
policyholders as such shall not participate in the selection of the Directors or
in the management of the company. Vacancies on the Board of Directors may be
filled by a majority of the remaining directors. The Board of Directors is
authorized to make, alter, amend or repeal the By-Laws of the corporation,
subject to the power of the shareholders of the corporation to alter or repeal
any By-Laws made by the Board of Directors. The proper officers of this
corporation are authorized to prepare all instruments and to do all things
necessary and proper to effectuate the purposes of these Articles.
ARTICLE VI
The duration of the corporation is perpetual.
ARTICLE VII
The names and places of residence of the corporators of this
corporation are as follows:
NAME ADDRESS
J. R. Bixby 3530 Pennsylvania, Kansas City, MO 64111
Walter E. Bixby 10128 Locust, Kansas City, MO 64131
H. Marshall Chatfield 12612 Oakmont Drive, Kansas City, MO 64145
David D. Dysart 633 West 68th Terr., Kansas City, MO 64113
Richard L. Finn 7503 Northwest Kerns, Kansas City, MO 64152
Dennis M. Gaffney 9909 Rosewood, Overland Park, KS 66207
Wayne K. Hein 9221 Cherokee Place, Leawood, KS 66206
John K. Koetting 12320 West 101st Terr., Lenexa, KS 66215
C. John Malacarne 604 Tam-O-Shanter, Kansas City, MO. 64145
James M. Mortensen 3513 West 97th Place, Leawood, KS 66206
John D. Petrie 11400 West 72nd Terr., Shawnee, KS 66203
William M. Stillman, Jr. 5119 West 64th Terr., Prairie Village,
KS 66208
William E. Tipton 12124 Charlotte, Kansas City, MO 64146
<PAGE>
IN WITNESS WHEREOF, we have hereunto set our hands this 29 day of
September, 1981.
/s/ J. R. Bixby
-------------------------------------------
J. R. Bixby
/s/ Walter E. Bixby
-------------------------------------------
Walter E. Bixby
/s/ H. Marshall Chatfield
-------------------------------------------
H. Marshall Chatfield
/s/ David D. Dysart
-------------------------------------------
David D. Dysart
/s/ Richard L. Finn
-------------------------------------------
Richard L. Finn
/s/ Dennis M. Gaffney
-------------------------------------------
Dennis M. Gaffney
/s/ Wayne K. Hein
-------------------------------------------
Wayne K. Hein
/s/ John K. Koetting
-------------------------------------------
John K. Koetting
/s/ C. John Malacarne
-------------------------------------------
C. John Malacarne
/s/ James M. Mortensen
-------------------------------------------
James M. Mortensen
/s/ John D. Petrie
-------------------------------------------
John D. Petrie
/s/ William M. Stillman, Jr.
-------------------------------------------
William M. Stillman, Jr.
/s/ William E. Tipton
-------------------------------------------
William E. Tipton
<PAGE>
STATE OF MISSOURI )
) ss.
COUNTRY OF JACKSON )
On this 29th day of September, 1981, before me, personally appeared J.
R. Bixby, Walter E. Bixby, H. Marshall Chatfield, David D. Dysart, Richard L.
Finn, Dennis M. Gaffney, Wayne K. Hein, John K. Koetting, C. John Malacarne,
James M. Mortensen, John D. Petrie, William M. Stillman, Jr., and William E.
Tipton, to be know to be the persons described in and who executed the foregoing
and acknowledged that they executed the same, as their free acts and deeds.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial
seal the day and year last above stated.
/s/ James B. Slusher
-------------------------------------------
Notary Public
My Commission Expires:
James B. Slusher
Notary Public, State of Missouri
Commissioned in Jackson County
My Commission Expires Mar. 27, 1982
FILED & CERTIFICATE OF
INCORPORATION ISSUED
NOV 2, 1981
/s/ James C. Kirkpatrick
<PAGE>
STATE OF MISSOURI )
) ss.
COUNTY OF JACKSON )
We, the undersigned, being all the corporators of the above named
corporation, being duly sworn, upon our oaths each does say that the statements
and matters set forth in the foregoing Declaration of Intention to Form and
Articles of Incorporation are true.
/s/ J. R. Bixby
-------------------------------------------
J. R. Bixby
/s/ Walter E. Bixby
-------------------------------------------
Walter E. Bixby
/s/ H. Marshall Chatfield
-------------------------------------------
H. Marshall Chatfield
/s/ David D. Dysart
-------------------------------------------
David D. Dysart
/s/ Richard L. Finn
-------------------------------------------
Richard L. Finn
/s/ Dennis M. Gaffney
-------------------------------------------
Dennis M. Gaffney
/s/ Wayne K. Hein
-------------------------------------------
Wayne K. Hein
/s/ John K. Koetting
-------------------------------------------
John K. Koetting
/s/ C. John Malacarne
-------------------------------------------
C. John Malacarne
/s/ James M. Mortensen
-------------------------------------------
James M. Mortensen
/s/ John D. Petrie
-------------------------------------------
John D. Petrie
/s/ William M. Stillman, Jr.
-------------------------------------------
William M. Stillman, Jr.
/s/ William E. Tipton
-------------------------------------------
William E. Tipton
<PAGE>
No. I00235927
---------
STATE OF MISSOURI
JAMES C. KIRKPATRICK, SECRETARY OF STATE
CORPORATION DIVISION
CERTIFICATE OF AMENDMENT
I, JAMES C. KIRKPATRICK, Secretary of State of Missouri, do hereby certify that
SAVERS LIFE INSURANCE COMPANY OF AMERICA (FORMERLY: KANSAS CITY LIFE AND ANNUITY
COMPANY) a corporation organized under the Laws of Missouri, has delivered to me
and that I have filed its Certificate of Amendment of its Articles of
Incorporation; that said Corporation has in all respects complied with the
requirements of law governing the Amendment of Articles of Incorporation and
that said Articles are amended in accordance therewith.
IN WITNESS WHEREOF, I hereunto set my hand and affix
the GREAT SEAL of the State of Missouri, at the City
of Jefferson, this 16th day of March, A.D. 1984.
/s/ James C. Kirkpatrick
------------------------------------------
Secretary of State
------------------------------------------
Deputy Secretary of State
RECEIVED OF: SAVERS LIFE INSURANCE COMPANY OF AMERICA
FIFTEEN and no/100 DOLLARS, $15.00
For Credit of General Revenue Fund, on Account of Amendment Fee.
/s/ Dorothymae Miller
---------------------------
Deputy Collector of Revenue
<PAGE>
STATE OF MISSOURI
DIVISION OF INSURANCE
Department of Consumer Affairs, Regulation and Licensing
P.O. Box 690, Jefferson City, MO 65102
DIRECTOR'S CERTIFICATE OF AMENDMENT
-----------------------------------
I, C. Donald Ainsworth, Director, Division of Insurance, Department of
Consumer Affairs, Regulation and Licensing, State of Missouri, do hereby certify
that KANSAS CITY LIFE AND ANNUITY COMPANY, a corporation organized and existing
under the insurance laws of the State of Missouri, has delivered to me and I
have filed its Certificate of Amendment of Articles of Incorporation as more
fully set forth in the Certificate of Amendment of Articles of Incorporation as
attached hereto.
I further certify that I have examined the Certificate of Amendment of
Articles of Incorporation and find that it conforms to law; that the proceedings
were regular; that the condition and the assets of the company justify the
amendment and that same will not be prejudicial to the interests of the
policyholders, all as provided by law.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of
my office in Jefferson City, Missouri, this 16th day of March, 1984.
/s/ C. Donald Ainsworth
-------------------------------
C. DONALD AINSWORTH, Director
Division of Insurance
Department of Consumer Affairs,
Regulation and Licensing
State of Missouri
<PAGE>
CERTIFICATE OF AMENDMENT OF ARTICLES
OF INCORPORATION OF
KANSAS CITY LIFE AND ANNUITY COMPANY
--------------------------------------------------------------
Pursuant to the Laws of the State of Missouri, Kansas City Life and
Annuity Company, a Corporation organized under the provisions of the Laws of
Missouri, has amended its Articles of Incorporation in the following manner:
(1) The present name of the Corporation is Kansas City Life and Annuity
Company.
(2) At a special meeting of the shareholders of the Corporation held on
March 9, 1984 at 3520 Broadway, Kansas City, Missouri, consented to by Kansas
City Life Insurance Company, the sole shareholder of the capital stock of Kansas
City Life Insurance Company, and notice thereof waived, the Articles of
Incorporation were amended.
(3) The amendment to amended Article I of the Articles of Incorporation
so that Article I, as amended, reads in its entirety as follows:
"ARTICLE I
The name of the Corporation is Savers Life Insurance Company of America."
(4) That the number of shares of the Corporation outstanding and
entitled to vote at such special meeting was Fifteen Thousand (15,000).
(5) That Fifteen Thousand (15,000) of said shares were voted in favor
of the adoption of the amendment of Article I of the Articles of Incorporation
and no shares were voted against the adoption of the amendment.
IN WITNESS WHEREOF, this Certificate of Amendment has been executed in
triplicate by Kansas City Life and Annuity Company by its Vice President and its
Secretary, and is hereby verified by its Secretary affixing the Corporate Seal
this 14th day of March, 1984.
KANSAS CITY LIFE AND ANNUITY COMPANY
By: /s/ Richard L. Finn
-----------------------------
Vice President
Attest:
By: _________________
Secretary
FILED AND CERTIFICATE ISSUED
MAR 16 1984
/s/ James C. Kirkpatrick
Corporation Dept. Secretary of State
<PAGE>
STATE OF MISSOURI )
) ss.
COUNTY OF JACKSON )
I, James B. Slusher, a Notary Public, do hereby certify that on this
14th day of March, 1984, personally appeared before me Richard L. Finn, who,
being by me first sworn, declared that he is the Vice President of Kansas City
Life and Annuity Company, that he signed the foregoing document as Vice
President of the Corporation, and that the statements therein contained are
true.
/s/ James B. Slusher
------------------------------------
NOTARIAL SEAL NOTARY PUBLIC
My Commission expires March 27, 1985
( S E A L )
<PAGE>
No. I00235927
STATE OF MISSOURI
ROY D. BLUNT, SECRETARY OF STATE
CORPORATION DIVISION
CERTIFICATE OF AMENDMENT
I, ROY D. BLUNT, Secretary of State of the State of Missouri, do hereby certify
that SAVERS LIFE INSURANCE COMPANY OF AMERICA a corporation organized under the
Laws of Missouri, has delivered to me and that I have filed its Certificate of
Amendment of its Articles of Incorporation; that said Corporation has in all
respects complied with the requirements of law governing the Amendment of
Articles of Incorporation and that said Articles are amended in accordance
therewith.
NOW, THEREFORE, I, ROY D. BLUNT, Secretary of State of the State of Missouri, do
hereby certify that I have filed said Certificate of Amendment as provided by
law, and that the Articles of Incorporation of said corporation are amended in
accordance therewith.
IN TESTIMONY WHEREOF, I hereunto set my hand and
affix the GREAT SEAL of the State of Missouri. Done
at the City of Jefferson, this 18th day of April,
1985.
/s/ Roy D. Blunt
-----------------------------------
Secretary of State
RECEIVED OF: SAVERS LIFE INSURANCE COMPANY OF AMERICA
FIFTEEN and no/100 DOLLARS, $15.00
For Credit of General Revenue Fund, on Account of Incorporation Tax and Fee.
<PAGE>
STATE OF MISSOURI
DIVISION OF INSURANCE
Department of Economic Development
P.O. Box 690, Jefferson City, MO 65102-0690
DIRECTOR'S CERTIFICATE OF AMENDMENT
I, C. Donald Ainsworth, Director, Division of Insurance, Department of
Economic Development, State of Missouri, do hereby certify that Savers Life
Insurance Company of America, a corporation organized and existing under the
insurance laws of the State of Missouri, has delivered to me and I have filed
its Certificate of Amendment of Articles of Incorporation as more fully set
forth in the Certificate of Amendment of Articles of Incorporation as attached
hereto.
I further certify that I have examined the Certificate of Amendment of
Articles of Incorporation and find that it conforms to law; that the proceedings
were regular; that the condition and the assets of the company justify the
amendments and that same will not be prejudicial to the interests of the
policyholders, all as provided by law.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of
my office in Jefferson City, Missouri, this 15th day of April, 1985.
/s/ C. Donald Ainsworth
----------------------------------
C. DONALD AINSWORTH, Director
Division of Insurance
Department of Economic Development
State of Missouri
<PAGE>
CERTIFICATE OF AMENDMENT OF ARTICLES
OF INCORPORATION OF
SAVERS LIFE INSURANCE COMPANY OF AMERICA
--------------------------------------------------------------
Pursuant to the laws of the State of Missouri, Savers Life Insurance
Company of America, a Corporation organized under the provisions of the Laws of
Missouri, has amended its Articles of Incorporation in the following manner:
1. The name of the Corporation is Savers Life Insurance Company of
America. The name under which it was originally organized was Kansas City Life
and Annuity Company.
2. At a special meeting of the shareholders of the Corporation, held on
March 28, 1984, at Suite 2100 CharterBank Center, Kansas City, Missouri,
consented to by Franklin Insurance, Inc., the sole shareholder of the capital
stock of Savers Life Insurance Company of America, and notice thereof waived,
Article VII of the Articles of Incorporation were amended.
At the regular annual meeting of the shareholders of the Corporation,
held on January 14, 1985, at Suite 2100, CharterBank Center, Kansas City,
Missouri, consented to by Franklin Insurance, Inc., the sole shareholder of the
capital stock of Savers Life Insurance Company of America, and notice thereof
waived, Article V of the Articles of Incorporation were amended.
3. The amendment to Article II of the Articles of Incorporation amended
Article II so that Article II, as amended, reads in its entirety as follows:
"ARTICLE II
The principal office for the transaction of the business of the
corporation in shall be at Suite 2100 CharterBank Center, 10th and Main Streets,
Kansas City, Missouri."
The amendment to Article V amended Article V of the
Articles of Incorporation so that Article V, as amended, reads in its entirety
as follows:
"ARTICLE V
"The property and business of the corporation shall be
managed and controlled by a Board of Directors consisting of ten (10) persons,
who shall be elected by the Shareholders at each Annual meeting of the
Shareholders. The policyholders as such shall not participate in the selection
of the Directors or in the management of the company. Vacancies on the Board of
Directors may be filled by a majority of the remaining directors. The Board of
Directors is authorized to make, alter, amend or
<PAGE>
repeal the By-Laws of the corporation, subject to the power of the shareholders
of the corporation to alter or repeal any by-laws made by the Board of
Directors. The proper officers of this corporation are authorized to prepare all
instruments and to do all things necessary and proper to effectuate the purposes
of these articles."
4. Of the Fifteen Thousand (15,000) shares outstanding and entitled to
vote on the amendment to Article II, 15,000 shares were voted in favor of the
adoption of the amendment to Article II of the Articles of Incorporation and no
shares were voted against the adoption of the amendment.
Of the Twenty Thousand (20,000) shares outstanding and entitled to vote
on the amendment to Article V, 20,000 shares were voted in favor of the adoption
of the amendment to Article V of the Articles of Incorporation and no shares
were voted against the adoption of the amendment.
IN WITNESS WHEREOF, this Certificate of Amendment has been executed in
triplicate by Savers Life Insurance Company of America by its President and its
Secretary, and is hereby verified by its Secretary affixing the Corporate Seal
this 3rd day of April, 1985.
Savers Life Insurance Company of America
By: /s/ Warren D. Gardner
----------------------------------
President
Attest:
By: _________________
Secretary
<PAGE>
STATE OF KANSAS )
) ss.
COUNTY OF JOHNSON )
I, Marla G. Tanner, a Notary Public, do hereby certify that on this 3rd
day of April, 1985, personally appeared before me Warren D. Gardner, who, being
by me first sworn, declared that he is the President of Savers Life Insurance
Company of America, that he signed the foregoing document as President of the
Corporation, and that the statements therein contained are true.
/s/ Marla G. Tanner
------------------------------------
NOTARIAL SEAL NOTARY PUBLIC
My Commission expires 3/8/89
(S E A L )
FILED AND CERTIFICATE
ISSUED APR 18 1985
/s/ Roy D. Blunt
------------------------------------
Corporation Dept. Secretary of State
<PAGE>
No. I00235927
---------
STATE OF MISSOURI
ROY D. BLUNT, SECRETARY OF STATE
CORPORATION DIVISION
CERTIFICATE OF AMENDMENT
I, ROY D. BLUNT, Secretary of State of the State of Missouri, do hereby certify
that SAVERS LIFE INSURANCE COMPANY OF AMERICA a corporation organized under the
Laws of Missouri, has delivered to me and that I have filed its Certificate of
Amendment of its Articles of Incorporation; that said Corporation has in all
respects complied with the requirements of law governing the Amendment of
Articles of Incorporation and that said Articles are amended in accordance
therewith.
NOW, THEREFORE, I, ROY D. BLUNT, Secretary of State of the State of Missouri, do
hereby certify that I have filed said Certificate of Amendment as provided by
law, and that the Articles of Incorporation of said corporation are amended in
accordance therewith.
IN TESTIMONY WHEREOF, I hereunto set my hand and
affix the GREAT SEAL of the State of Missouri. Done
at the City of Jefferson, this 3rd day of December,
1992.
/s/ Roy D. Blunt
------------------------------------------
Secretary of State
RECEIVED OF: SAVERS LIFE INSURANCE COMPANY OF AMERICA
TWENTY DOLLARS, $20.00
For Credit of General Revenue Fund, on Account of Incorporation Tax and Fee.
<PAGE>
FILED AND CERTIFICATE
ISSUED DEC 03 1992
CERTIFICATE OF AMENDMENT OF ARTICLES
(TO BE EXECUTED IN TRIPLICATE)
We, the undersigned president or vice president and secretary or
assistant secretary, on our oaths swear and certify to the truth of the
following statements:
(1) NAME OF THE INSURANCE COMPANY: SAVERS LIFE INSURANCE COMPANY OF
AMERICA. IF THE NAME OF THE INSURANCE COMPANY CHANGED AS RESULT OF THIS
AMENDMENT, THE NAME OF THE INSURANCE COMPANY IMMEDIATELY BEFORE THIS AMENDMENT
WAS ------------------------.
(2) THE DATE OF THE ADOPTION OF THE AMENDMENT BY THE SHAREHOLDERS, MEMBERS
OR OTHER GROUP OF PERSONS ENTITLED TO VOTE ON THE AMENDMENT: February 28, 1992
(3) THE AMENDMENT ADOPTED (attach additional pages if necessary):
(a) Article II of the Articles of Incorporation of the company is
deleted in its entirety and replaced by the following:
"ARTICLE II
The principal office for the transaction of the
business of the corporation in the State of Missouri shall be
at 1010 Grand Avenue, Suite 500, Kansas City, Missouri 64106."
(b) The first sentence of Article V of the Articles of
Incorporation of the company is deleted in its entirety and
replaced by the following:
"The property and business of the corporation shall be
managed and controlled by a Board of Directors consisting of
nine (9) persons, who shall be elected by the Shareholders at
each Annual Meeting of the Shareholders."
(4) THE NUMBER OF SHARES, MEMBERS, OR OTHER GROUP OR PERSONS ENTITLED TO
VOTE, OR IF A MUTUAL, THE NUMBER OF THE MEMBERS PRESENT EITHER IN PERSON OR BY
PROXY ENTITLED TO VOTE: one (1)
(5) THE NUMBER OF SHARES, MEMBERS OR OTHER GROUP OF PERSONS THAT VOTED FOR
AND AGAINST SAID AMENDMENT RESPECTIVELY: For: one (1) Against: none
<PAGE>
(6) IF THE AMENDMENT EFFECTS A CHANGE IN THE NUMBER OR PAR VALUE OF
AUTHORIZED SHARES, THEN A STATEMENT SHOWING THE NUMBER OF SHARES AND PAR VALUE
THEREOF PREVIOUSLY AUTHORIZED: ______________________________________________
/s/ Dale R. Oldham
-------------------------------------------
Dale R. Oldham, President
PLACE CORPORATE SEAL HERE
(If no corporate seal, state "none".)
/s/ Joy L. Mietchen
-------------------------------------------
Joy L. Mietchen, Secretary
STATE OF KANSAS )
) ss.
COUNTY OF JOHNSON )
Subscribed and sworn to before me this 9th day of November, 1992.
/s/ Charlotte Taylor
-------------------------------------------
NOTARIAL SEAL NOTARY PUBLIC
My Commission expires 4/4/93
- -------------------------------------------------------------------------------
CERTIFICATE OF AMENDMENT OF THE DIRECTOR OF INSURANCE
(This certificate may be filled out only by the
Director of Insurance)
I certify that I have examined the above Certificate of Amendment of Articles as
executed by the insurance company and find that it conforms to law, that the
proceedings were regular, that the condition and the assets of the company
justify the amendment, and that the same will not be prejudicial to the
interests of the policyholders, all as provided by law.
So Certified, Signed, and Official Seal Affixed on this date: 11/24/92
/s/ Lewis E. Melahn
-------------------------------------
LEWIS E. MELAHN
Director of Insurance
State of Missouri
<PAGE>
No. I00235927
---------
STATE OF MISSOURI
REBECCA MCDOWELL COOK
SECRETARY OF STATE
CORPORATION DIVISION
CERTIFICATE OF AMENDMENT
I, REBECCA McDOWELL COOK, Secretary of State of the State of Missouri, do hereby
certify that PHOENIX LIFE AND ANNUITY COMPANY formerly,
SAVERS LIFE INSURANCE COMPANY OF AMERICA
a corporation organized under the Laws of Missouri, has delivered to me and that
I have filed its Certificate of Amendment of its Articles of Incorporation; that
said Corporation has in all respects complied with the requirements of law
governing the Amendment of Articles of Incorporation and that said Articles are
amended in accordance therewith.
IN TESTIMONY WHEREOF, I hereunto set my hand and
imprinted the GREAT SEAL of the State of Missouri, on
this, the 9th day of May, 1996.
/s/ Rebecca McDowell Cook
-------------------------------------------
Secretary of State
$25.00
<PAGE>
FILED AND CERTIFICATE ISSUED
MAY 09 1996
/s/ Rebecca McDowell Cook
-------------------------
Secretary of State
CERTIFICATE OF AMENDMENT OF ARTICLES
(TO BE EXECUTED IN TRIPLICATE)
We, the undersigned president or vice president and secretary or
assistant secretary, on our oaths swear and certify to the truth of the
following statements:
(1) NAME OF THE INSURANCE COMPANY: PHOENIX LIFE AND ANNUITY COMPANY
IF THE NAME OF THE INSURANCE COMPANY CHANGED AS RESULT OF THIS AMENDMENT. THE
NAME OF THE INSURANCE COMPANY IMMEDIATELY BEFORE THIS AMENDMENT WAS SAVERS LIFE
INSURANCE COMPANY OF AMERICA.
(2) THE DATE OF THE ADOPTION OF THE AMENDMENT BY THE SHAREHOLDERS, MEMBERS
OR OTHER GROUP OF PERSONS ENTITLED TO VOTE ON THE AMENDMENT: _________________
(3) THE AMENDMENT ADOPTED (attach additional pages if necessary):
ARTICLE I
The name of the Corporation is Phoenix Life and Annuity
Company.
ARTICLE II
The principal office for the transaction of the business of
the corporation shall be City of St. Louis, State of Missouri, c/o
Phoenix Home Life Mutual Insurance Company, 700 Corporate Drive,
Suite 300, St. Louis, Missouri 63105.
(4) THE NUMBER OF SHARES, MEMBERS, OR OTHER GROUP OR PERSONS ENTITLED TO
VOTE, OR IF A MUTUAL, THE NUMBER OF THE MEMBERS PRESENT EITHER IN PERSON OR BY
PROXY ENTITLED TO VOTE: 25,000
--------------------
<PAGE>
(5) THE NUMBER OF SHARES, MEMBERS OR OTHER GROUP OF PERSONS THAT VOTED FOR
AND AGAINST SAID AMENDMENT RESPECTIVELY: For: 25,000 Against: 0
---------- ---
(6) IF THE AMENDMENT EFFECTS A CHANGE IN THE NUMBER OR PAR VALUE OF
AUTHORIZED SHARES, THEN A STATEMENT SHOWING THE NUMBER OF SHARES AND PAR VALUE
THEREOF PREVIOUSLY AUTHORIZED: N/A
------------------------
/s/ Dona D. Young
-----------------------------------
NONE Vice President
PLACE CORPORATE SEAL HERE
(If no corporate seal, state "none".)
/s/ Carole A. Masters
-----------------------------------
Assistant Secretary
STATE OF CONNECTICUT )
) ss. HARTFORD
COUNTY OF HARTFORD )
Subscribed and sworn to before me this 1st day of May, 1996.
/s/ Josephine A. Melusky
---------------------------------------
NOTARIAL SEAL NOTARY PUBLIC
My Commission expires March 31, 2000
-----------------
- -------------------------------------------------------------------------------
CERTIFICATE OF AMENDMENT OF THE DIRECTOR OF INSURANCE
(This certificate may be filled out only by the
Director of Insurance)
I certify that I have examined the above Certificate of Amendment of Articles as
executed by the insurance company and find that it conforms to law, that the
proceedings were regular, that the condition and the assets of the company
justify the amendment, and that the same will not be prejudicial to the
interests of the policyholders, all as provided by law.
So Certified, Signed, and Official Seal Affixed on this date: 4/16/96
/s/ Jay Angoff
------------------------------
Director of Insurance
State of Missouri
EXHIBIT 1.A.6(b)
By-Laws of Phoenix Life and Annuity Company
<PAGE>
BYLAWS
OF
PHOENIX LIFE AND ANNUITY COMPANY
--------------------------------
ARTICLE I
Annual Meeting of Stockholders
------------------------------
SECTION 1. The annual meeting of the stockholders of Phoenix Life and
Annuity Company shall be held on the Monday immediately preceding the third
(3rd) Wednesday in January of each year, at 1:00 p.m., at the principal office
of the Company, at 700 Corporate Drive, Suite 300, St. Louis, Missouri. At such
meeting, the stockholders shall elect directors by a plurality vote to serve
until the next annual meeting of stockholders and until their successors are
elected and qualified or until their earlier resignation or removal and shall
transact all other business which may properly come before the meeting.
SECTION 2. Except as set forth in Article II, Section 4, Notice of
annual meetings, setting forth the time, place and object thereof, shall be in
writing to shareholders and delivered in person or by mail not more than fifty
(50) days nor less than ten (10) days prior to the date of the meeting.
SECTION 3. Stockholders' meetings shall be called to order by the
President, or in his absence a Vice President or the Secretary, and the
stockholders shall elect from their number a chairman and secretary.
SECTION 4. Stockholders may vote either in person or by another
stockholder as proxy. All proxies shall be in writing and shall be filed with
the Secretary before or at the time of voting.
ARTICLE II
Special Meeting of Stockholders
-------------------------------
SECTION 1. Special meetings of stockholders shall be convened by the
Secretary as often as may be requested by resolution of the Board of Directors,
or requested in writing by a majority of the capital stock of the Company. Such
request shall be in writing and filed with the Secretary, and shall state
specifically the business to be transacted at the proposed meeting, and no other
business shall be transacted thereat.
<PAGE>
SECTION 2. The Secretary shall mail notice to each stockholder of
record, not less than ten (10) days nor more than thirty (30) days before the
date of a special meeting setting forth the place, date and hour, and the object
thereof.
SECTION 3. If all of the stockholders shall meet at any time and place,
either within or without the State of Missouri, and consent to the holding of a
meeting, such meeting shall be valid, without call or notice, and at such
meeting any corporate action may be taken.
SECTION 4. Any notice required to be given of any annual or special
meeting of the stockholders of the Company may be waived in writing by the party
entitled thereto at any time, prior to or after the meeting, and such waiver
shall be deemed for all purposes to be notice of said meeting. Unless otherwise
provided in the articles of incorporation of the Company, any action required to
be taken at any annual or special meeting of stockholders of the Company, or any
action which may be taken at any annual or special meeting of such stockholders,
may be taken without a meeting, without prior notice and without a vote, if
consent in writing, setting forth the actions so taken, shall be signed by all
the holders of outstanding stock entitled to vote thereon.
ARTICLE III
Board of Directors
------------------
SECTION 1. The business and affairs of the Company shall be managed by
a Board of Directors, consisting of nine members who need not be stockholders.
The Board of Directors may exercise all powers of the Company and do all lawful
acts as are not by statute, the articles of incorporation of the Company or
these bylaws directed or required to be done or exercised by the stockholders.
SECTION 2. Directors elected to replace those whose terms expire shall
hold their offices for terms of one (1) year, and until their successors are
elected and qualified.
SECTION 3. Vacancies in the Board of Directors may be filled by the
Board, and the successors shall serve the balance of the vacated term, and until
their successors are elected.
SECTION 4. The Board of Directors shall hold its regular meetings on
the dates ordered by the Board.
- 2 -
<PAGE>
SECTION 5. Special meetings of the Board may be called by the
President, or in his absence or disability, by a Vice President, upon three (3)
days notice given personally by mail or telegraph, to each member of the Board.
SECTION 6. Any Director may waive notice of any meeting. The attendance
of a Director at any meeting shall constitute a waiver of notice of such
meeting. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the Board of Directors need be specified in the
notice or waiver of such notice of such meeting.
SECTION 7. All meetings of the Board shall be held at the principal
office of the Company, 700 Corporate Drive, Suite 300, St. Louis, Missouri, or
at such other place within or without the State of Missouri as designated in the
notice of the meeting. At any meeting, five (5) Directors shall constitute a
quorum for the transaction of business, except that when there are one (1) or
more vacancies on the Board, one (1) more than one-half (1/2) of the Directors
shall constitute a quorum. Action of the Directors shall be by a majority vote
of the Directors present, except as provided in ARTICLES VII and VIII of these
Bylaws.
SECTION 8. Any notice required to be given of any annual or special
meeting of the Board of Directors of the Company may be waived in writing by the
party entitled thereto at any time, prior to or after the meeting, and such
waiver shall be deemed for all purposes to be notice of said meeting. Unless
otherwise provided in the articles of incorporation of the Company, any action
required to be taken at any annual or special meeting of the Board of Directors
of the Company, or any action which may be taken at any annual or special
meeting of such Board of Directors, may be taken without a meeting, without
prior notice and without a vote, if consent in writing, setting forth the
actions so taken, shall be signed by all the holders of outstanding stock
entitled to vote thereon.
SECTION 9. The Board of Directors may, by resolution or resolutions
passed by a majority of the whole board, designate one or more committees, each
committee to consist of one or more Directors of the Company. The Board may
designate one or more Directors as alternate members of any committee, who may
replace any absent or disqualified member at any meeting of the committee. In
the absence of a member of a committee, the member or members thereof present at
any meeting, whether or not he or they constitute a quorum, may unanimously
appoint another member of the Board of Directors to act at the meeting in the
place of such absent member. Any
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such committee, to the extent provided in the resolution of the Board of
Directors establishing such committee, shall have and may exercise all the
powers and authority of the Board of Directors in the management of the business
and affairs of the Company; but no committee shall have the power or the
authority of the Board of Directors with respect to amending the articles of
incorporation, adopting an agreement of merger or consolidation, recommending to
the stockholders the sale, lease or exchange of all or substantially all of the
Company's properties and assets, recommending to the stockholders a dissolution
of the Company, amending the Bylaws of the Corporation or have the authority to
declare a dividend or authorize the issuance of stock.
ARTICLE IV
Advisory Directors
------------------
The Board of Directors may appoint to the office of Advisory Director
any person whose abilities and interest in the Company, in the opinion of the
Board, qualify that person to render service to the Board in an advisory
capacity. Such Advisory Directors may receive the notice of and attend meetings
of the Board of Directors, shall have no vote in the affairs of the Company and
shall not be counted for the purpose of determining a quorum or majority of the
Board for any purpose. Such Advisory Directors shall perform such special tasks
as may be assigned by the Board of Directors or the chairman. No action of the
Board shall be invalid because of the failure of any such Advisory Director to
receive notice of or to attend any meeting of the Board or to be informed of or
to approve of any action taken by the Board of Directors.
ARTICLE V
Officers
--------
The Officers of the Company shall be elected annually by the Board of
Directors at the regular meeting in April of each year, and shall consist of a
President, Secretary and Treasurer, and such additional of the following
Officers as may in the judgement of the Board of Directors be necessary and
designed by Resolution of the Board of Directors: Chairman of the Board, Vice
Chairman of the Board, Vice President, Controller, Actuary, Auditor, and such
associates and assistants as the Board shall consider appropriate.
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ARTICLE VI
Duties of Officers
------------------
SECTION 1. CHAIRMAN OF THE BOARD. The Chairman of the Board shall
preside at all meetings of the Board of Directors, and perform such other duties
as may be directed by the Board from time to time. In the absence of the
Chairman, some other member designated by the Board shall preside.
SECTION 2. VICE CHAIRMAN OF THE BOARD. The Vice Chairman of the Board
shall perform such other duties as may be directed by the Board from time to
time.
SECTION 3. PRESIDENT. The President shall be the chief executive
officer and shall perform such duties as are imposed upon him by the laws of the
state of Missouri governing corporations engaged in life insurance, or assigned
to him by the Board of Directors. He shall have immediate charge of the
preparation of the annual report of the Company and such other special reports
as may be requested by the Board; give formal approval to all policy forms and
give signature to all policies issued, sign checks and drafts and execute
releases of mortgages or deeds of trust, as may become necessary in the
transaction of the Company's business.
SECTION 4. VICE PRESIDENTS. A Vice President shall, during the absence
or disability of the President, do and perform all the acts devolving upon the
President. A Vice President is hereby expressly authorized to execute on behalf
of the Company releases of mortgages, deeds of trust, deeds of release or
conveyance to real estate, as same may become necessary in the transaction of
the business of the Company, and to execute on behalf of the Company all
instruments which may be required to carry out the acts and decisions of the
Board of Directors and to execute all instruments and documents required by the
insurance laws of the various states and jurisdictions where the Company is
authorized to do business or shall hereafter seek to become authorized to do
business, including, but not limited to, the appointment of the insurance
commissioners or superintendents of the various states and jurisdictions as
attorney to accept service of legal process.
SECTION 5. SECRETARY. The Secretary shall make and keep full and
accurate records of all meetings of the stockholders and Board of Directors, and
shall be custodian of the Corporate Seal, of the stock book and of the records
and files of the Company generally. He shall give signatures for policies,
checks, drafts and other instruments to be executed by the Company, and certify
to the authenticity of corporate records, and shall cause to be given or
published all notices required by law
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or these Bylaws to be given. He shall see that inquiries and correspondence in
connection with the business of the Company is given prompt attention, and shall
perform such other duties as may be assigned to him.
SECTION 6. CONTROLLER. The duties of the Controller shall be to
maintain adequate records of all assets, liabilities and transactions of this
Company, and in conjunction with other officials and department heads, to
initiate and enforce measures and procedures, including budgeting and cost
programs, whereby the business of this Company shall be conducted with maximum
safety, efficiency and economy. He shall in all matters be subject to control of
the Board of Directors. His powers and duties shall extend to all departments
and branch offices of the Company.
SECTION 7. TREASURER. It shall be the duty of the Treasurer to execute
such forms as are required by the statutes of any state in which the Company is
transacting business or may be applying for authority to do business therein,
and such other duties as may be assigned by the Board of Directors.
SECTION 8. ACTUARY. The Actuary and his Associate Actuary or Assistant
Actuaries, as designated by the Board of Directors of the Company, and such
clerks and employees as shall be necessary shall make and furnish actuarial
computations as required in the business of the Company and shall keep accurate
records, make reports and furnish information to the executive officers of the
Company, and perform such other duties as may be assigned to them.
SECTION 9. AUDITOR. The duties of the Auditor shall be to review and
appraise the reliability, adequacy and application of accounting, financial and
operating controls to evaluate the extent of compliance with established
policies, plans and procedures, and to ascertain whether company assets are
properly accounted for and safeguarded from losses. He shall in all matters be
subject to the control of the Board of Directors. His powers and duties shall
extend to all departments and branch offices of the Company.
SECTION 10. ASSOCIATES AND ASSISTANTS. The Board of Directors may
assign to Associates and Assistants such duties as may be necessary to the
proper transaction of Company business.
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ARTICLE VII
-----------
Each person who is or was a director, officer or employee of the
Corporation, or is or was serving at the written request of the Corporation as a
director, officer or employee of another corporation, partnership, joint
venture, trust or other enterprise shall be indemnified by the Corporation in
the manner and to the full extent that the Corporation has power to indemnify
such person under Section 351.355 of the General and Business Corporation Law of
Missouri as now in effect or hereafter amended.
The Board of Directors shall have power to cause the Corporation to
purchase and maintain insurance on behalf of any person who is or was a
director, officer or employee of the Corporation, or is or was serving at the
written request of the Corporation as a director, officer or employee of another
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the Corporation would have the
power to indemnify him against such liability under the provisions of these
Bylaws.
ARTICLE VIII
Amendments
----------
The Board of Directors at any meeting shall have power to make, amend
or repeal bylaws of the Company by an affirmative vote of a majority of all the
Directors constituting the Board; provided that notice of intention thereof,
together with a copy of the proposed amendment or new Bylaw, shall have been
mailed or delivered to each Director at least ten (10) days before such meeting
of the Board. The stockholders of the Company shall have the power to make,
amend or repeal bylaws of the Company at any meeting called for such purpose.
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