<PAGE> 1
As filed with the Securities and Exchange Commission on February 13, 1998.
1933 Act File No: 333-37175
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1940 Act File No: 811-08401
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. 1 [X]
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Post-Effective Amendment No. [ ]
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and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 1 [X]
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JNLNY Separate Account I
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(Exact Name of Registrant)
Jackson National Life Insurance Company of New York
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(Name of Depositor)
2900 Westchester Avenue, Purchase, New York 10577
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(Address of Depositor's Principal Executive Offices)
Depositor's Telephone Number, including Area Code:
(888) 367-5651
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With a copy to:
Thomas J. Meyer Judith A. Hasenauer
Vice Pres. & General Counsel Principal
Jackson National Life Insurance Blazzard, Grodd &
Company of New York Hasenauer, P.C.
5901 Executive Dr. P.O. Box 5108
Lansing, MI 48911 Westport, CT 06881
(Name and Address of Agent for Service)
Approximate date of proposed public offering: (Upon the effective date of this
Registration Statement)
Title of Securities Being Registered:
Individual Deferred Variable Annuity Contracts
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.
<PAGE> 2
JNLNY SEPARATE ACCOUNT I
REFERENCE TO ITEMS REQUIRED BY FORM N-4
N-4 Item Caption in Prospectus or
Statement of Additional
Information relating to
each Item
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Part A. Information Required in a Prospectus Prospectus
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1. Cover Page Cover Page
2. Definitions Not Applicable
3. Synopsis Key Facts; Fee Tables
4. Condensed Financial Information Advertising
5. General Description of Registrant, The Company; The
Depositor and Portfolio Companies Separate Account;
Investment Portfolios
6. Deductions Contract Charges
7. General Description of Variable The Annuity Contract;
Annuity Contracts Purchases; Transfers;
Access To Your Money;
Income Payments (The
Income Phase); Death
Benefit; Other
Information
8. Annuity Period Income Payments (The
Income Phase)
9. Death Benefit Death Benefit
10. Purchases and Contract Value Purchases
11. Redemptions Access To Your Money
12. Taxes Taxes
13. Legal Proceedings Other Information
14. Table of Contents of the Statement Table of Contents of the
of Additional Information Statement of Additional
Information
<PAGE> 3
Information Required in a Statement of Statement of
Part B. Additional Information Additional Information
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15. Cover Page Cover Page
16. Table of Contents Table of Contents
17. General Information and History General Information
and History
18. Services Services
19. Purchase of Securities Being Offered Purchase of Securities
Being Offered
20. Underwriters Underwriters
21. Calculation of Performance Data Calculation of
Performance
22. Annuity Payments Income Payments; Net
Investment Factor
23. Financial Statements Financial Statements
Part C.
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Information required to be included in Part C is set forth under the appropriate
item, so numbered, in Part C of this Amendment to Registration Statement.
<PAGE> 4
Please read this prospectus before investing, and keep it on file for future
reference. It contains important information about the Perspective Fixed and
Variable Annuity that you ought to know before investing.
To learn more about the Perspective Fixed and Variable Annuity contract, you can
obtain a free copy of the Statement of Additional Information (SAI) dated
______________, 1998, by calling Jackson National NY at (800) 599-5651 or by
writing Jackson National NY at: Annuity Service Center, P.O. Box 378002, Denver,
Colorado 80237-8002. The SAI has been filed with the Securities and Exchange
Commission (SEC) and is legally a part of this prospectus. The Table of Contents
of the SAI is in this prospectus. The SEC maintains a website
(http://www.sec.gov) that contains the SAI, material incorporated by reference
and other information regarding registrants that file electronically with the
SEC.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC NOR HAS THE
SEC PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE
<PAGE> 5
THE PERSPECTIVE
FIXED AND VARIABLE ANNUITY
ISSUED BY JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK AND JNLNY SEPARATE
ACCOUNT I
The fixed and variable annuity contract is an individual, flexible premium
deferred annuity with 4 guaranteed accounts which offer an interest rate that is
guaranteed by Jackson National Life Insurance Company of New York (Jackson
National NY) and 14 investment portfolios. You can put your money in any of the
guaranteed accounts and/or the investment portfolios.
The investment portfolios purchase shares of the following series of the JNL
Series Trust:
JNL Aggressive Growth Series
JNL Capital Growth Series
JNL Global Equities Series
JNL/Alger Growth Series
JNL/Putnam Growth Series
JNL/Putnam Value Equity Series
PPM America/JNL Balanced Series
PPM America/JNL High Yield Bond Series
PPM America/JNL Money Market Series
Salomon Brothers/JNL Global Bond Series
Salomon Brothers/JNL U.S. Government
& Quality Bond Series
T. Rowe Price/JNL Established Growth Series
T. Rowe Price/JNL International Equity
Investment Series
T. Rowe Price/JNL Mid-Cap Growth Series
____________, 1998
<PAGE> 6
TABLE OF CONTENTS
Key Facts
Fee Table
The Annuity Contract
The Company
The Guaranteed Accounts
The Separate Account
Investment Portfolios
Contract Charges
Purchases
Transfers
Access to Your Money
Income Payments (The Income Phase)
Death Benefit
Taxes
Other Information
Table of Contents of the Statement of Additional Information
<PAGE> 7
KEY FACTS
Annuity Service Center: 1 (800) 599-5651
Mail Address: P.O. Box 378002, Denver, Colorado 80237-8002
Delivery Address: 8055 East Tufts Avenue, Second Floor,
Denver, Colorado 80237
Home Office: 2900 Westchester Avenue, Purchase, New York
10577
The Annuity Contract The fixed and variable annuity contract
offered by Jackson National NY
provides a means for investing on a
tax-deferred basis in the guaranteed
accounts of Jackson National NY and the
investment portfolios. The contract is
intended for retirement savings or other
long-term investment purposes and provides
for a death benefit and income options.
The contract has two phases: the
accumulation phase and the income phase.
During the accumulation phase, earnings
accumulate on a tax-deferred basis and are
taxed as income when you make a withdrawal.
The income phase occurs when you begin
receiving regular payments from your
contract. The amount of money you accumulate
in your contract during the accumulation
phase will determine the amount of income
payments during the income phase.
Investment Options You can put money into any of the
guaranteed accounts and/or the investment
portfolios but you may not put your money
in more than eighteen of the investment
options during the life of your contract.
The guaranteed accounts offer an interest
rate that is guaranteed by Jackson National
NY. While your money is in a guaranteed
account, the interest your money earns and
your principal are guaranteed by Jackson
National NY.
The investment portfolios purchase shares of
series of mutual funds. These series are
described in the attached JNL Series Trust
prospectus. The value of the investment
portfolios will vary in accordance with the
investment performance of the series. You
bear the investment risk under the contract
for all amounts allocated to the investment
portfolios.
Expenses The contract has insurance features and
investment features, and there are costs
related to each.
Jackson National NY makes a deduction for
its insurance charges which is equal to
1.40% of the daily value of the contracts
invested in the investment portfolios.
During the accumulation phase, Jackson
National NY deducts a $30 annual contract
maintenance charge from your contract.
If you take your money out of the contract,
Jackson National NY may assess a withdrawal
charge. The withdrawal charge starts at 7%
in the first year and declines 1% a year to
0% after 7 years.
<PAGE> 8
There are also investment charges which
range from .75% to 1.25% of the average
daily value of the series, depending on the
series.
Jackson National NY may assess a state
premium tax charge which ranges from 0-4%,
depending upon the state, when you begin
receiving regular income payments from your
contract, when you make a withdrawal or, in
states where required, at the time premium
payments are made.
Purchases Under most circumstances, you can buy a
contract for $5,000 or more ($2,000 or more
for a qualified plan contract). You can add
$500 ($50 under the automatic payment plan)
or more at any time during the accumulation
phase.
Access to Your Money You can take money out of your contract
during the accumulation phase. At any time
during the accumulation phase, you may
withdraw premiums which are not subject to a
withdrawal charge (premiums in your annuity
for seven years or longer and not previously
withdrawn). Once every year, you may
withdraw the greater of earnings or 10% of
premiums paid (not yet withdrawn).
Withdrawals in excess of that will be
charged a withdrawal charge. You may also
have to pay income tax and a tax penalty on
any money you take out.
Income Payments If you want to receive regular income from
your annuity, you can choose one of four
options: (1) monthly payments for the
annuitant's life; (2) monthly payments for
the annuitant's life and the life of another
person (usually the annuitant's spouse); (3)
monthly payments for the annuitant's life,
but with payments continuing to you or your
designated beneficiary for 10 or 20 years if
the annuitant dies before the end of the
selected period; and (4) payments for a
period of 5 to 30 years.
During the income phase, you have the same
investment choices you had during the
accumulation phase. You can choose to have
payments come from the guaranteed accounts,
the investment portfolios or both. If you
choose to have any part of your payments
come from the investment portfolios, the
dollar amount of your payments may go up or
down. If you choose a variable income
option, you may make transfers between
investment portfolios but you may not make
transfers in to or out of the guaranteed
accounts.
Death Benefit If you die before moving to the income
phase, the person you have chosen as your
beneficiary will receive a death benefit.
The death benefit equals: (a) current
contract value OR (b) the total premiums
(less withdrawals, withdrawal charges and
<PAGE> 9
premium taxes) OR (c) the contract value at
the end of the 7th contract year PLUS all
premiums made since the 7th year (less
withdrawals, withdrawal charges and premium
taxes) -- whichever is GREATEST. The death
benefit under (c) will never exceed 250% of
premiums paid, less partial withdrawals.
Free Look You can cancel your contract within twenty
days after receiving it. On the day we
receive the contract, Jackson National NY
will return the contract value in the
investment portfolios plus any fees and
expenses deducted from the premium allocated
to the investment portfolios plus the full
amount of premium you allocated to the
guaranteed accounts.
Taxes The Internal Revenue Code provides that you
will not be taxed on the earnings on the
money held in your contract until you take
money out (this is referred to as
tax-deferral). There are different rules as
to how you will be taxed depending on how
you take the money out and the type of
contract you have (non-qualified or
qualified).
<PAGE> 10
FEE TABLE
OWNER TRANSACTION EXPENSES
<TABLE>
<CAPTION>
Withdrawal Charge (as a percentage of premium payments):
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Contribution Year of Premium Payment 1 2 3 4 5 6 7 Thereafter
Charge 7% 6% 5% 4% 3% 2% 1% 0%
</TABLE>
Transfer Fee:
No charge for first 15 transfers in a contract year; thereafter, the
fee is $25 per transfer.
Contract Maintenance Charge:
$30 per contract per year
SEPARATE ACCOUNT ANNUAL EXPENSES (as a percentage of average account value)
Mortality and Expense Risk Charges 1.25%
Administration Charge .15%
Total Separate Account Annual Expenses 1.40%
SERIES EXPENSES
(as an annual percentage of the average daily net assets of the series
underlying an investment portfolio)
<TABLE>
<CAPTION>
Other Expenses Total
Management (After Series
JNL SERIES TRUST Fee Reimbursement) Annual
Expenses
- ----------------------------------------------------------------- ------------- ----------------- ------------
<S> <C> <C> <C>
JNL Aggressive Growth Series .95% .15% 1.10%
JNL Capital Growth Series .95% .15% 1.10%
JNL Global Equities Series 1.00% .15% 1.15%
JNL/Alger Growth Series .975% .15% 1.125%
JNL/Putnam Growth Series .90% .15% 1.05%
JNL/Putnam Value Equity Series .90% .15% 1.05%
PPM America/JNL Balanced Series .75% .15% .90%
PPM America/JNL High Yield Bond Series .75% .15% .90%
PPM America/JNL Money Market Series .60% .15% .75%
Salomon Brothers/JNL Global Bond Series .85% .15% 1.00%
Salomon Brothers/JNL U.S. Government & Quality Bond Series .70% .15% .85%
T. Rowe Price/JNL Established Growth Series .85% .15% 1.00%
T. Rowe Price/JNL International Equity Investment Series 1.10% .15% 1.25%
T. Rowe Price/JNL Mid-Cap Growth Series .95% .15% 1.10%
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</TABLE>
Currently, the adviser voluntarily reimburses each of the Series for annual
expenses (excluding management fees) in excess of .15% of average daily net
assets. Prior to reimbursement, total Series annual expenses as a percentage of
net assets for the period ended December 31, 1997, were: JNL Aggressive Growth
Series -- 1.17%; JNL Capital Growth
<PAGE> 11
Series -- 1.11%; JNL Global Equities Series -- 1.37%; JNL/Alger Growth Series
- -- 1.10%; JNL/Putnam Growth Series -- 1.05%; JNL/Putnam Value Equity Series --
1.09%; PPM America/JNL Balanced Series -- 0.94%; PPM America/JNL High Yield
Bond Series -- 0.90%; PPM America/JNL Money Market Series -- 0.76%; Salomon
Brothers/JNL Global Bond Series -- 1.07%; Salomon Brothers/JNL U.S. Government
& Quality Bond Series -- 0.96%; T. Rowe Price/JNL Established Growth Series --
0.98%; T. Rowe Price/JNL International Equity Investment Series -- 1.32%; and
T. Rowe Price/JNL Mid-Cap Growth Series -- 1.06%. Voluntary reimbursements to
these Series may be modified or discontinued at any time.
EXAMPLES
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return on assets:
(a) upon surrender at the end of each time period;
(b) if the contract is not surrendered.
<TABLE>
<CAPTION>
Time Periods
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1 3
year years
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<S> <C> <C> <C>
JNL Aggressive Growth Portfolio (a) $96 $129
(b) 26 79
JNL Capital Growth Portfolio (a) 96 129
(b) 26 79
JNL Global Equities Portfolio (a) 96 131
(b) 26 81
JNL/Alger Growth Portfolio (a) 96 130
(b) 26 80
JNL/Putnam Growth Portfolio (a) 95 128
(b) 25 78
JNL/Putnam Value Equity Portfolio (a) 95 128
(b) 25 78
PPM America/JNL Balanced Portfolio (a) 94 123
(b) 24 73
PPM America/JNL High Yield Bond Portfolio (a) 94 123
(b) 24 73
PPM America/JNL Money Market Portfolio (a) 92 118
(b) 22 68
Salomon Brothers/JNL Global Bond Portfolio (a) 95 126
(b) 25 76
Salomon Brothers/JNL U.S. Government & Quality Bond Portfolio (a) 93 122
(b) 23 72
T. Rowe Price/JNL Established Growth Portfolio (a) 95 126
(b) 25 76
T. Rowe Price/JNL International Equity Investment Portfolio (a) 97 134
(b) 27 84
T. Rowe Price/JNL Mid-Cap Growth Portfolio (a) 96 129
(b) 26 79
- ------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 12
EXPLANATION OF FEE TABLE AND EXAMPLES
The purpose of the Fee Table and Examples is to assist you in understanding the
various costs and expenses that you will bear directly or indirectly. The Fee
Table reflects the expenses of the separate account and the series underlying
the investment portfolios. Premium taxes may also apply.
The Examples reflect the contract maintenance charge which is determined by
dividing the total amount of such charges expected to be collected during the
year by the total estimated average net assets of the investment portfolios.
THE EXAMPLE DOES NOT REPRESENT PAST OR FUTURE EXPENSES. ACTUAL EXPENSES MAY BE
GREATER OR LESS THAN THOSE SHOWN.
FINANCIAL STATEMENTS
The financial statements of Jackson National Life Insurance Company of New York
for the years ended December 31, 1997 and December 31, 1996 are contained in the
SAI.
<PAGE> 13
THE ANNUITY CONTRACT
The fixed and variable annuity contract offered by Jackson National NY is a
contract between you, the owner, and Jackson National Life Insurance Company of
New York, an insurance company. The contract provides a means for investing on a
tax-deferred basis in guaranteed accounts and investment portfolios. The
contract is intended for retirement savings or other long-term investment
purposes and provides for a death benefit and guaranteed income options.
The contract, like all deferred annuity contracts, has two phases: the
accumulation phase and the income phase. During the accumulation phase, earnings
accumulate on a tax-deferred basis and are taxed as income when you make a
withdrawal.
The contract offers guaranteed accounts. The guaranteed accounts offer an
interest rate that is guaranteed by Jackson National NY for the duration of the
guaranteed account period. While your money is in a guaranteed account, the
interest your money earns and your principal are guaranteed by Jackson National
NY. The value of a guaranteed account may be reduced if you make a withdrawal
prior to the end of the guaranteed account period, but will never be less than
the premium payments accumulated at 3% per year. If you choose to have your
annuity payments come from the guaranteed accounts, your payments will remain
level throughout the entire income phase.
The contract also offers investment portfolios. The investment portfolios are
designed to offer a higher return than the guaranteed accounts. HOWEVER, THIS IS
NOT GUARANTEED. IT IS POSSIBLE FOR YOU TO LOSE YOUR MONEY. If you put money in
the investment portfolios, the amount of money you are able to accumulate in
your contract during the accumulation phase depends upon the performance of the
investment portfolios you select. The amount of the income payments you receive
during the income phase also will depend, in part, on the performance of the
investment portfolios you choose for the income phase.
As the owner, you can exercise all the rights under the contract. You and your
spouse can be joint owners. You can assign the contract at any time during your
lifetime but Jackson National NY will not be bound until we receive written
notice of the assignment.
THE COMPANY
Jackson National NY is a stock life insurance company organized under the laws
of the state of New York in July 1995. Its legal domicile and principal business
address is 2900 Westchester Avenue, Purchase, New York 10577. Jackson National
NY is admitted to conduct life insurance and annuity business in the states of
New York and Michigan. Jackson National NY is ultimately a wholly-owned
subsidiary of Prudential Corporation, plc (London, England).
THE GUARANTEED ACCOUNTS
If you select a guaranteed account, your money will be placed with Jackson
National NY's other assets. The guaranteed accounts are not registered with the
SEC and the SEC does not review the information we provide to you about the
guaranteed accounts. Your contract contains a more complete description of the
guaranteed accounts.
THE SEPARATE ACCOUNT
The JNLNY Separate Account I was established by Jackson National NY on September
12, 1997, pursuant to the provisions of New York law, as a segregated asset
account of the company. The separate account meets the definition of a "separate
account" under the federal securities laws and is registered with the SEC as a
unit investment trust under the Investment Company Act of 1940, as amended.
<PAGE> 14
The assets of the separate account legally belong to Jackson National NY and the
obligations under the contracts are obligations of Jackson National NY. However,
the contract assets in the separate account are not chargeable with liabilities
arising out of any other business Jackson National NY may conduct. All of the
income, gains and losses resulting from these assets are credited to or charged
against the contracts and not against any other contracts Jackson National NY
may issue.
The separate account is divided into investment portfolios. Jackson National NY
does not guarantee the investment performance of the separate account or the
investment portfolios.
INVESTMENT PORTFOLIOS
You can put money in any or all of the investment portfolios. The investment
portfolios purchase shares of the following series of the JNL Series Trust:
JNL Aggressive Growth Series
JNL Capital Growth Series
JNL Global Equities Series
JNL/Alger Growth Series
JNL/Putnam Growth Series
JNL/Putnam Value Equity Series
PPM America/JNL Balanced Series
PPM America/JNL High Yield Bond Series
PPM America/JNL Money Market Series
Salomon Brothers/JNL Global Bond Series
Salomon Brothers/JNL U.S. Government & Quality Bond Series
T. Rowe Price/JNL Established Growth Series
T. Rowe Price/JNL International Equity Investment Series
T. Rowe Price/JNL Mid-Cap Growth Series
The series are described in the attached JNL Series Trust prospectus. Jackson
National Financial Services, Inc. serves as investment adviser for all of the
series. Janus Capital Corporation serves as sub-adviser for the JNL Aggressive
Growth, JNL Capital Growth and JNL Global Equities Series; Fred Alger
Management, Inc. serves as sub-adviser for the JNL/Alger Growth Series; Putnam
Investment Management, Inc. serves as sub-adviser for the JNL/Putnam Growth and
JNL/Putnam Value Equity Series; PPM America, Inc. serves as sub-adviser for the
PPM America/JNL Balanced, PPM America/JNL High Yield Bond and PPM America/JNL
Money Market Series; Salomon Brothers Asset Management Inc serves as sub-adviser
for the Salomon Brothers/JNL Global Bond and Salomon Brothers/JNL U.S.
Government & Quality Bond Series; T. Rowe Price Associates, Inc. serves as
sub-adviser for the T. Rowe Price/JNL Established Growth and T. Rowe Price/JNL
Mid-Cap Growth Series; and Rowe Price-Fleming International, Inc. serves as
sub-adviser for the T. Rowe Price/JNL International Equity Investment Series.
Depending on market conditions, you can make or lose money in any of the
investment portfolios. You should read the prospectus for the series carefully
before investing. Additional investment portfolios may be available in the
future.
Voting Rights
To the extent required by law, Jackson National NY will obtain from you and
other owners of the contracts instructions as to how to vote when the series
solicits proxies in conjunction with a vote of shareholders.
<PAGE> 15
When Jackson National NY receives instructions, we will vote all the shares
Jackson Naitonal NY owns in proportion to instructions.
Substitution
Jackson National NY may be required to substitute an investment portfolio with
another portfolio. We will not do this without the prior approval of the SEC.
Jackson National NY will give you notice of our intent to do this.
CONTRACT CHARGES
There are charges and other expenses associated with the contracts that reduce
the return on your investment in the contract. These charges may be a lesser
amount where required by state law or as described below, but will not be
increased. These charges and expenses are:
Insurance Charges
Each day Jackson National NY makes a deduction for its insurance charges. We do
this as part of our calculation of the value of the accumulation units and
annuity units. On an annual basis, this charge equals 1.40% of the daily value
of the contracts invested in an investment portfolio, after expenses have been
deducted. This charge is for the mortality risks, expense risks and
administrative expenses assumed by Jackson National NY.
Contract Maintenance Charge
During the accumulation phase, Jackson National NY deducts a $30 annual contract
maintenance charge on each anniversary of the date on which your contract was
issued. If you make a complete withdrawal from your contract, the contract
maintenance charge will also be deducted. This charge is for administrative
expenses.
Jackson National NY will not deduct this charge, if when the deduction is to be
made, the value of your contract is $50,000 or more. Jackson National NY may
discontinue this practice at any time.
Transfer Fee
A transfer fee of $25 will apply to transfers in excess of 15 in a contract
year. Jackson National NY may waive the transfer fee in connection with
pre-authorized automatic transfer programs, or may charge a lesser fee where
required by state law.
Withdrawal Charge
During the accumulation phase, you can make withdrawals from your contract. At
any time during the accumulation phase, you may withdraw premiums which are not
subject to a withdrawal charge (premiums in your annuity for seven years or
longer and not previously withdrawn). Once every year, you may withdraw the
greater of earnings or 10% of premiums paid (not yet withdrawn). Withdrawals in
excess of that will be charged a withdrawal charge starting at 7% in the first
year and declining 1% a year to 0% after 7 years. The withdrawal charge
compensates us for costs associated with selling the contracts.
For purposes of the withdrawal charge, Jackson National NY treats withdrawals as
coming from the oldest premium payment first. If you make a full withdrawal, the
withdrawal charge is based on premiums remaining in the contract. If you
withdraw only part of the value of your contract, we deduct the withdrawal
charge from the remaining value in your contract.
NOTE: For tax purposes, withdrawals are considered to have come from the last
money into the contract. Thus, for tax purposes, earnings are considered to come
out first.
Jackson National NY does not assess the withdrawal charge on any payments paid
out as (1) income payments, (2) death benefits or (3) withdrawals necessary to
satisfy the minimum distribution requirements of the Internal Revenue Code.
Jackson National NY may reduce or eliminate the amount of the withdrawal charge
when the contract is sold under
<PAGE> 16
circumstances which reduce its sales expense. Some examples are: the purchase of
a contract by a large group of individuals or an existing relationship between
Jackson National NY and a prospective purchaser. Jackson National NY will not
deduct a withdrawal charge under a contract issued to an officer, director,
agent or employee of Jackson National NY or any of its affiliates.
Other Expenses
Jackson National NY pays the operating expenses of the Separate Account.
There are deductions from and expenses paid out of the assets of the series.
These expenses are described in the attached JNL Series Trust prospectus.
Premium Taxes
Some states and other governmental entities charge premium taxes or other
similar taxes. Jackson National NY is responsible for the payment of these taxes
and may make a deduction from the value of the contract for them. Premium taxes
generally range from 0% to 4% depending on the state.
Income Taxes
Jackson National NY will make a deduction from the contract for any income taxes
which it incurs because of the contract. Currently, we are not making any such
deduction.
Distribution of Contracts
Jackson National Financial Services, Inc. is located at 5901 Executive Drive,
Lansing, Michigan 48911 and serves as the distributor of the contracts. Jackson
National Financial Services, Inc. and Jackson National NY are wholly-owned
subsidiaries of Jackson National Life Insurance Company.
Commissions will be paid to broker-dealers who sell the contracts. While
commissions may vary, they are not expected to exceed 8% of any premium payment.
Under certain circumstances, Jackson National NY may pay persistency bonuses, in
addition to the standard commissions. Jackson National NY may use any of its
corporate assets to cover the cost of distribution, including any profit from
the contract insurance charges.
PURCHASES
You can buy a contract for $5,000 or more under most circumstances ($2,000 or
more for a qualified plan contract). The maximum we accept without our prior
approval is $1 million.
You can add $500 ($50 under the automatic payment plan) at any time during the
accumulation phase.
The minimum that you may allocate to a guaranteed account or investment
portfolio is $100. There is a $100 minimum balance requirement for each
guaranteed account and investment portfolio.
When you purchase a contract, Jackson National NY will allocate your premium to
one or more of the guaranteed accounts and/or the investment portfolios you have
selected. Your allocation must be in whole percentages ranging from 0% to 100%.
Jackson National NY will allocate additional premiums in the same way unless you
tell us otherwise.
Jackson National NY will issue your contract and allocate your first premium
within 2 business days after we receive your complete application and first
premium. If your application is not complete, we will contact you to get the
necessary information. If for some reason Jackson National NY is unable to
complete this process within 5 business days, we will either return your money
or get your permission to keep it until we receive all of the necessary
information.
The Jackson National NY business day closes when the New York Stock Exchange
closes, usually 4:00 p.m. Eastern time.
Accumulation Units
The contract value allocated to the investment portfolios will go up or down
depending on the performance of the
<PAGE> 17
portfolios. In order to keep track of the value of your contract, Jackson
National NY uses a unit of measure called an accumulation unit. (An accumulation
unit is similar to a share of a mutual fund.) During the income phase it is
called an annuity unit.
Every business day Jackson National NY determines the value of an accumulation
unit for each of the investment portfolios. This is done by:
1. determining the total amount of money invested in the particular
investment portfolio;
2. subtracting any insurance charges and any other charges, such as
taxes;
3. dividing this amount by the number of outstanding accumulation units.
The value of an accumulation unit may go up or down from day to day.
When you make a premium payment, Jackson National NY credits your contract with
accumulation units. The number of accumulation units credited is determined at
the close of Jackson National NY's business day by dividing the amount of the
premium allocated to any investment portfolio by the value of the accumulation
unit for that investment portfolio.
TRANSFERS
You can transfer money between guaranteed accounts and investment portfolios
during the accumulation phase. During the income phase, you can transfer money
between investment portfolios.
You can make 15 transfers every year during the accumulation phase without
charge. The minimum amount that you can transfer is $100 (unless the transfer is
made under a pre-authorized automatic transfer program). If the remaining value
in a guaranteed account or investment portfolio would be less than $100 after a
transfer, you must transfer the entire value or you may not make the transfer.
Telephone Transactions
If you elect the telephone transfer privilege on your application, you may make
transfers by telephone. You must complete your telephone call authorizing a
transfer by the close of Jackson National NY's business day (usually 4:00 p.m.
Eastern time) in order to receive that day's accumulation unit value for a
investment portfolio.
Jackson National NY has procedures which are designed to provide reasonable
assurance that telephone authorizations are genuine. Our procedures include
requesting identifying information and tape recording telephone communications.
Jackson National NY and its affiliates disclaim all liability for any claim,
loss or expense resulting from any alleged error or mistake in connection with a
telephone transfer which was not properly authorized by you. However, if Jackson
National NY fails to employ reasonable procedures to ensure that all telephone
transfers are properly authorized, we may be held liable for such losses.
Jackson National NY reserves the right to modify or discontinue at any time and
without notice the acceptance of instructions from someone other than you and/or
the telephone transfer privilege.
ACCESS TO YOUR MONEY
You can have access to the money in your contract: (1) by making either a
partial or complete withdrawal or (2) by electing to receive income payments.
Your beneficiary can have access to the money in your contract when a death
benefit is paid.
When you make a complete withdrawal you will receive the value of the contract
on the day you made the withdrawal less any premium tax, less any contract
maintenance charge, and less any withdrawal charge. Except in connection with
the systematic withdrawal program, you must withdraw at least $500 or, if less,
the entire amount in the guaranteed account or investment portfolio from which
you are making the withdrawal. After your
<PAGE> 18
withdrawal, you must have at least $100 left in the guaranteed account
or investment portfolio.
INCOME TAXES, TAX PENALTIES AND CERTAIN RESTRICTIONS MAY APPLY TO ANY WITHDRAWAL
YOU MAKE.
There are limitations on withdrawals from a qualified plan referred to as a
403(b) annuity. See "Taxes."
Systematic Withdrawal Program
You can arrange to have money automatically sent to you periodically while your
contract is still in the accumulation phase. You will have to pay taxes on money
you receive and withdrawals you make before you reach 59 1/2 may be subject to a
10% tax penalty.
We reserve the right to charge a fee for participation or to discontinue
offering this program in the future.
Suspension of Withdrawals
Jackson National NY may be required to suspend or delay withdrawals from a
contract when:
1. the New York Stock Exchange is closed (other than customary
weekend and holiday closings);
2. trading on the New York Stock Exchange is restricted;
3. an emergency exists so that it is not reasonably practicable to
dispose of shares of the investment portfolios or determine
investment portfolio values;
4. the SEC, by order, may permit for the protection of owners.
Jackson National NY has reserved the right to defer payment for a withdrawal or
transfer from the guaranteed accounts for the period permitted by law, but not
more than six months.
INCOME PAYMENTS (THE INCOME PHASE)
The income phase occurs when you begin receiving regular payments from your
contract. The income date is the month and year in which those payments begin.
The income date must be at least one year after your contract is issued. You can
choose the income date and an income option. The income options are described
below.
If you do not choose an income option, we will assume that you selected Option 3
which provides a life annuity with 120 months of guaranteed payments.
You can change the income date or income option at any time before the income
date. You must give us 7 days notice. Income payments must begin by your 90th
birthday under a non-qualified contract (or an earlier date under a qualified
contract if required by law).
At the income date, you can choose whether payments will come from the
guaranteed accounts, the investment portfolios or both. Unless you tell us
otherwise, your income payments will be based on the investment allocations that
were in place on the income date.
If you choose to have any portion of your annuity payments come from the
investment portfolio(s), the dollar amount of your payment will depend upon
three things: 1) the value of your contract in the investment portfolio(s) on
the income date, 2) the 3% assumed investment rate used in the annuity table for
the contract, and 3) the performance of the investment portfolios you selected.
If the actual performance exceeds the 3% assumed rate, your income payments will
increase. Similarly, if the actual rate is less than 3%, your income payments
will decrease.
You can choose to have income payments made monthly, quarterly, semi-annually,
or annually. However, if you have less than $2,000 to apply toward an income
option and state law permits, Jackson National NY
<PAGE> 19
may provide your payment in a single lump sum. Likewise, if your first income
payment would be less than $20 and state law permits, Jackson National NY may
set the frequency of payments so that the first payment would be at least $20.
Income Options
The annuitant is the person whose life we look to when we make income payments.
(Each description assumes that you are the owner and annuitant.)
OPTION 1 - Life Income. This income option provides monthly payments for your
life.
OPTION 2 - Joint and Survivor Annuity. This income option provides monthly
payments for your life and for the life of another person (usually your spouse)
selected by you.
OPTION 3 - Life Annuity With 120 or 240 Monthly Payments Guaranteed. This income
option provides monthly payments for your life, but with payments continuing to
your beneficiary for the remainder of 10 or 20 years (as you select) if you die
before the end of the selected period.
OPTION 4 - Income for a Specified Period. This income option provides monthly
payments for any number of years from 5 to 30.
ADDITIONAL OPTIONS - Other income options may be made available by Jackson
National NY.
If you choose an income option for which payments are based on life expectancy,
you cannot make a withdrawal during the income phase.
DEATH BENEFIT
Death of Owner Before the Income Date
If you die before moving to the income phase, the person you have chosen as your
beneficiary will receive a death benefit. If you have a joint owner, the death
benefit will be paid when the first joint owner dies and the surviving joint
owner will be treated as the beneficiary. Any other beneficiary designated will
be treated as a contingent beneficiary.
The death benefit equals: (a) current contract value OR (b) the total premiums
(less withdrawals, withdrawal charges and premium taxes) OR (c) the contract
value at the end of the 7th contract year PLUS all premiums made since the 7th
year (less withdrawals, withdrawal charges and premium taxes) -- whichever is
GREATEST. The death benefit under (c) will never exceed 250% of premiums paid,
less partial withdrawals.
The entire death benefit must be paid within 5 years of the date of death unless
the beneficiary elects to have the death benefit payable under an income option.
The death benefit payable under an income option must be paid over the
beneficiary's lifetime or for a period not extending beyond the beneficiary's
life expectancy. Payments must begin within one year of the date of death.
Unless the beneficiary chooses to receive the death benefit in a single sum, the
beneficiary must elect an income option within the 60 day period beginning with
the date Jackson National NY receives proof of death. If the beneficiary chooses
to receive the death benefit in a single sum and all the necessary requirements
are met, Jackson National NY will pay the death benefit within 7 days. If the
beneficiary is your spouse, he/she can continue the contract in his/her own name
at the then current contract value.
Death of Owner After the Income Date
If you or a joint owner die after moving to the income phase, any remaining
payments under the income option elected will continue at least as rapidly as
under the method of distribution in effect at the date of death.
<PAGE> 20
Death of Annuitant
If the annuitant is not an owner or joint owner and the annuitant dies before
the income date, you can name a new annuitant. If you do not name a new
annuitant within 30 days of the death of the annuitant, you will become the
annuitant. However, if the owner is a non-natural person (for example, a
corporation), then the death of the annuitant will be treated as the death of
the owner, and a new annuitant may not be named.
If the annuitant dies after the income date, the death benefit, if any, will be
as provided for in the income option selected. Death benefits will be paid at
least as rapidly as under the method of distribution in effect at the
annuitant's death.
TAXES
THE FOLLOWING IS GENERAL INFORMATION AND IS NOT INTENDED AS TAX ADVICE TO ANY
INDIVIDUAL. YOU SHOULD CONSULT YOUR OWN TAX ADVISER.
The Internal Revenue Code (Code) provides that you will not be taxed on the
earnings on the money held in your contract until you take money out (this is
referred to as tax - deferral). There are different rules as to how you will be
taxed depending on how you take the money out and the type of contract you have
(non-qualified or qualified).
Non-Qualified Contracts - General Taxation
You will not be taxed on increases in the value of your contract until a
distribution (either as a withdrawal or as an income payment) occurs. When you
make a withdrawal you are taxed on the amount of the withdrawal that is
earnings. For income payments, a portion of each income payment is treated as a
partial return of your premium and will not be taxed. The remaining portion of
the income payment will be treated as ordinary income. How the income payment is
divided between taxable and non-taxable portions depends on the period over
which income payments are expected to be made. Income payments received after
you have received all of your premium are treated as income.
If a non-qualified contract is owned by a non-natural person (e.g., corporation
or certain other entities other than tax-qualified trusts), the contract will
generally not be treated as an annuity for tax purposes.
Qualified and Non-Qualified Contracts
If you purchase the contract as an individual and not under any pension plan,
specially sponsored program or an individual retirement annuity, your contract
is referred to as a non-qualified contract.
If you purchase the contract under a pension plan, specially sponsored program,
or an individual retirement annuity, your contract is referred to as a qualified
contract. Examples of qualified plans are: Individual Retirement Annuities
(IRAs), Tax-Sheltered Annuities (sometimes referred to as 403(b) contracts),
H.R. 10 Plans (sometimes referred to as Keogh Plans), and pension and
profit-sharing plans, which include 401(k) plans.
Withdrawals - Non-Qualified Contracts
If you make a withdrawal from your contract, the Code treats the withdrawal as
first coming from earnings and then from your premium payments. Withdrawn
earnings are includible in income.
The Code also provides that any amount received under an annuity contract which
is included in income may be subject to a 10% penalty. Some withdrawals will be
exempt from the penalty. They include any amounts: (1) paid on or after the
taxpayer reaches age 59 1/2; (2) paid after you die; (3) paid if the taxpayer
becomes totally disabled (as that term is defined in the Code); (4) paid in a
series of substantially equal payments made annually (or more frequently) under
a lifetime annuity; (5) paid under an immediate annuity; or (6) which come from
premiums made prior to August 14, 1982.
<PAGE> 21
Withdrawals - Qualified Contracts
There are special rules that govern qualified contracts. We have provided
additional discussion in the Statement of Additional Information.
Withdrawals - Tax-Sheltered Annuities
The Code limits the withdrawal of premiums from certain Tax-Sheltered Annuities.
Withdrawals can only be made when an owner: (1) reaches age 59 1/2; (2) leaves
his/her job; (3) dies; (4) becomes disabled (as that term is defined in the
Code); or (5) in the case of hardship. However, in the case of hardship, the
owner can only withdraw the premium and not any earnings.
Withdrawals - Roth IRAs
Beginning in 1998, individuals may purchase a new type of non-deductible IRA,
known as a Roth IRA. Qualified distributions from Roth IRAs are entirely tax
free. A qualified distribution requires that the individual has held the Roth
IRA for at least five years and, in addition, that the distribution is made
either after the individual reaches age 59 1/2, on the individual's death or
disability, or as qualified first-time home purchase, subject to $10,000
lifetime maximum, for the individual, a spouse, child, grandchild, or ancestor.
Withdrawals - Investment Adviser Fees
The Internal Revenue Service has, through a series of Private Letter Rulings,
held that the payment of investment adviser fees from an IRA or a Tax-Sheltered
Annuity is permissible under certain circumstances and will not be considered a
distribution for income tax purposes. The Rulings require that in order to
receive this favorable tax treatment, the annuity contract must, under a written
agreement, be solely liable (not jointly with the contract owner) for payment of
the adviser's fee and the fee must actually be paid from the annuity contract to
the adviser. Withdrawals from non-qualified contracts for the payment of
investment fees will be considered distributions from the contract.
Assignment
An assignment may be a taxable event. If the contract is issued pursuant to a
qualified plan, there may be limitations on your ability to assign the contract.
Diversification
The Code provides that the underlying investments for a variable annuity must
satisfy certain diversification requirements in order to be treated as an
annuity contract. Jackson National NY believes that the underlying investments
are being managed so as to comply with these requirements.
Neither the Code nor the Internal Revenue Service Regulations issued to date
provide guidance as to the circumstances under which you, because of the degree
of control you exercise over the underlying investments, and not Jackson
National NY would be considered the owner of the shares of the investment
portfolios. If this occurs, it will result in the loss of the favorable tax
treatment for the contract.
It is unknown to what extent owners are permitted to select investment
portfolios, to make transfers among the investment portfolios or the number and
type of investment portfolios from which owners may select. If any guidance is
provided which is considered a new position, then the guidance would generally
be applied prospectively. However, if such guidance is considered not to be a
new position, it may be applied retroactively. This would mean that you, as the
owner of the contract, could be treated as the owner of the investment
portfolios. Due to the uncertainty in this area, Jackson National NY reserves
the right to modify the contract in an attempt to maintain favorable tax
treatment.
OTHER INFORMATION
Dollar Cost Averaging
You can arrange to automatically have a regular amount of money periodically
transferred into the investment portfolios.
<PAGE> 22
This theoretically gives you a lower average cost per unit over time than you
would receive if you made a one time purchase.
To participate in this program, you must have a total contract value of at least
$15,000 (unless we waive this requirement).
Jackson National NY does not currently charge for participation in this program.
We may do so in the future.
Rebalancing
You can arrange to have Jackson National NY automatically reallocate money
between investment portfolios periodically to keep the blend you select.
Jackson National NY does not currently charge for participation in this program.
We may do so in the future.
Free Look
You can cancel your contract within twenty days after receiving it. On the day
we receive the contract, Jackson National NY will return the contract value in
the investment portfolios plus any fees and expenses deducted from the premium
allocated to the investment portfolios plus the full amount of premium you
allocated to the guaranteed accounts.
Advertising
From time to time, Jackson National NY may advertise several types of
performance for the investment portfolios. Total return is the overall change in
the value of an investment in an investment portfolio over a given period of
time. Standardized average annual total return is calculated in accordance with
SEC guidelines. Non-standardized total return may be for periods other than
those required or may otherwise differ from standardized average annual total
return. Yield refers to the income generated by an investment over a given
period of time.
Performance will be calculated by determining the percentage change in the value
of an accumulation unit by dividing the increase (decrease) for that unit by the
value of the accumulation unit at the beginning of the period. Performance will
reflect the deduction of the insurance charges and may reflect the deduction of
the contract maintenance charge and withdrawal charge. The deduction of the
contract maintenance and/or the withdrawal charge would reduce the percentage
increase or make greater any percentage decrease.
If a series has been in existence for a longer period than the investment
portfolio, performance will be based upon the period quoted.
Market Timing and Asset Allocation Services
Market timing and asset allocation services offered by third parties must comply
with Jackson National NY's administrative systems, rules and procedures.
Modification of the Contract
Only the President, Vice President,
<PAGE> 23
Secretary or Assistant Secretary of Jackson National NY may approve a change to
or waive a provision of the contract. Any change or waiver must be in writing.
Jackson National NY may change the terms of the contract in order to comply with
changes in applicable law, or otherwise as deemed necessary by Jackson National
NY.
Legal Proceedings
There are no material legal proceedings, other than ordinary routine litigation
incidental to the business, to which Jackson National Life Insurance Company of
New York, Jackson National Financial Services, Inc., and the JNLNY Separate
Account I are parties.
Questions
If you have questions about your contract, you may call us at (800) 599-5651, or
write to us at: Jackson National NY Annuity Service Center, P.O. Box 378002,
Denver, Colorado 80237-8002.
<PAGE> 24
TABLE OF CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION
General Information and History ........................................... 2
Services .................................................................. 2
Purchase of Securities Being Offered ...................................... 2
Underwriters .............................................................. 2
Calculation of Performance ................................................ 3
Additional Tax Information ................................................ 7
Income Payments; Net Investment Factor ....................................15
Financial Statements ......................................................17
<PAGE> 25
STATEMENT OF ADDITIONAL INFORMATION
___________, 1998
INDIVIDUAL DEFERRED FIXED AND VARIABLE ANNUITY CONTRACTS
ISSUED BY THE JNLNY SEPARATE ACCOUNT I
OF JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK
This Statement of Additional Information is not a prospectus. It contains
information in addition to and more detailed than set forth in the Prospectus
and should be read in conjunction with the Prospectus dated ____________, 1998.
The Prospectus may be obtained from Jackson National Life Insurance Company of
New York by writing P.O. Box 378002, Denver, Colorado 80237-8002, or calling
1-800-599-5651.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
General Information and History 2
Services 2
Purchase of Securities Being Offered 2
Underwriters 2
Calculation of Performance 3
Additional Tax Information 7
Income Payments; Net Investment Factor 15
Financial Statements 17
</TABLE>
1
<PAGE> 26
GENERAL INFORMATION AND HISTORY
JNLNY Separate Account I (Separate Account) is a separate investment
account of Jackson National Life Insurance Company of New York (Jackson
National NY). In September 1997, the company changed its name from First
Jackson National Life Insurance Company to its present name. Jackson National
NY is a wholly-owned subsidiary of Jackson National Life Insurance Company, and
is ultimately a wholly-owned subsidiary of Prudential Corporation plc, London,
England, the largest life insurance company in the United Kingdom.
SERVICES
Jackson National NY has responsibility for administration of the contracts
and the Separate Account. We maintain records of the name, address, taxpayer
identification number and other pertinent information for each contract owner
and the number and type of contracts issued to each contract owner, and records
with respect to the value of each contract.
Jackson National NY is also the custodian of the assets of the Separate
Account. As custodian, we maintain a record of all purchases and redemptions
of shares of the series underlying the investment portfolios.
Price Waterhouse LLP, 100 East Wisconsin Avenue, Milwaukee, Wisconsin
53202, audits and reports on Jackson National NY's financial statements,
including the financial statements of the Separate Account, and performs other
professional accounting, auditing and advisory services when engaged to do so
by Jackson National NY.
Blazzard, Grodd & Hasenauer, P.C. of Westport, Connecticut has provided
advice on certain matters relating to the federal securities and income tax
laws in connection with the contracts described in the Prospectus.
PURCHASE OF SECURITIES BEING OFFERED
The contracts will be sold by licensed insurance agents in states where
the contracts may be lawfully sold. The agents will be registered
representatives of broker-dealers that are registered under the Securities
Exchange Act of 1934 and members of the National Association of Securities
Dealers, Inc. (NASD).
UNDERWRITERS
The contracts are offered continuously and are distributed by Jackson
National Financial Services, Inc. (JNFSI), 5901 Executive Drive, Lansing,
Michigan 48911. JNFSI is a subsidiary of Jackson National Life Insurance
Company.
2
<PAGE> 27
CALCULATION OF PERFORMANCE
When Jackson National NY advertises performance for an investment
portfolio (except the PPM America/JNL Money Market Portfolio), we will include
quotations of standardized average annual total return to facilitate comparison
with standardized average annual total return advertised by other variable
annuity separate accounts. We will calculate average annual standardized total
return according to the standard methods prescribed by rules of the Securities
and Exchange Commission. Standardized average annual total return for a
specific period is calculated by taking a hypothetical $1,000 investment in an
investment portfolio at the offering on the first day of the period ("initial
investment"), and computing the ending redeemable value ("redeemable value") of
that investment at the end of the period. The redeemable value is then divided
by the initial investment and expressed as a percentage, carried to at least
the nearest hundredth of a percent. Standardized average annual total return
is annualized and reflects the deduction of the insurance charges and the
contract maintenance charge. The redeemable value also reflects the effect of
any applicable withdrawal charge that may be imposed at the end of the period.
No deduction is made for premium taxes which may be assessed by certain states.
3
<PAGE> 28
Jackson National NY may also advertise non-standardized total return.
Non-standardized total return may be for periods other than those required to
be presented or may otherwise differ from standardized average annual total
return. Because the contract is designed for long term investment,
non-standardized total return that does not reflect the deduction of any
applicable withdrawal charge may be advertised. Reflecting the deduction of
the withdrawal charge decreases the level of performance advertised.
Non-standardized total return may also assume a larger initial investment which
more closely approximates the size of a typical contract.
The non-standardized average annual total returns that each investment
portfolio (except the PPM America/JNL Money Market Portfolio) would have
achieved if it had been invested in the corresponding series for the periods
indicated, calculated in a manner similar to standardized average annual total
return but assuming a hypothetical initial investment of $10,000 and without
deducting the withdrawal charge, are as follows:
<TABLE>
<CAPTION>
One Year Commencement
Period Ended of Operations to
December 31, December 31,
------------ ------------
1997 1997
---- ----
<S> <C> <C>
JNL Aggressive Growth Portfolio* 11.03% 19.59%
----- -----
JNL Capital Growth Portfolio* 13.40% 23.08%
----- -----
JNL Global Equities Portfolio* 17.40% 28.81%
----- -----
JNL/Alger Growth Portfolio** 24.44% 15.11%
----- -----
JNL/ Putnam Growth Portfolio* 20.15% 27.49%
----- -----
JNL/ Putnam Value Equity Portfolio* 20.11% 24.71%
----- -----
PPM America/JNL Balanced Portfolio 16.77% 15.48%
----- -----
PPM America/JNL High Yield Bond Portfolio* 13.31% 11.42%
----- -----
Salomon Brothers/JNL Global Bond Portfolio* 9.07% 10.68%
----- -----
Salomon Brothers/JNL U.S. Government & Quality
Bond Portfolio* 7.63% 5.61%
----- -----
T. Rowe Price/JNL Established Growth Portfolio* 27.63% 26.49%
----- -----
T. Rowe Price/JNL International Equity
Investment Portfolio* 1.30% 7.48%
----- -----
T. Rowe Price/JNL Mid-Cap Growth Portfolio* 16.55% 25.44%
----- -----
</TABLE>
* Corresponding series commenced operations on May 15, 1995.
**Corresponding series commenced operations on October 16, 1995.
4
<PAGE> 29
Standardized average annual total return quotations will be current to the
last day of the calendar quarter preceding the date on which an advertisement
is submitted for publication. Both standardized average annual total return
quotations and non-standardized total return quotations will be based on
rolling calendar quarters and will cover at least periods of one, five, and ten
years, or a period covering the time the investment portfolio has been in
existence, if it has not been in existence for one of the prescribed periods.
If the corresponding series has been in existence for longer than the
investment portfolio, the non-standardized total return quotations will show
the investment performance the investment portfolio would have achieved
(reduced by the applicable charges) had it been held in the series for the
period quoted.
Quotations of standardized average annual total return and
non-standardized total return are based upon historical earnings and will
fluctuate. Any quotation of performance should not be considered a guarantee
of future performance. Factors affecting the performance of a series include
general market conditions, operating expenses and investment management. An
owner's withdrawal value upon surrender of a contract may be more or less than
original cost.
Jackson National NY may advertise the current annualized yield for a
30-day period for an investment portfolio. The annualized yield of an
investment portfolio refers to the income generated by the investment portfolio
over a specified 30-day period. Because this yield is annualized, the yield
generated by an investment portfolio during the 30-day period is assumed to be
generated each 30-day period. The yield is computed by dividing the net
investment income per accumulation unit earned during the period by the price
per unit on the last day of the period, according to the following formula:
a-b 6
YIELD = 2[(---+1) -1]
cd
Where:
a = net investment income earned during the period by the Series
attributable to shares owned by the investment portfolio.
b = expenses for the investment portfolio accrued for the period (net
of reimbursements).
c = the average daily number of accumulation units outstanding during
the period.
d = the maximum offering price per accumulation unit on the last day
of the period.
5
<PAGE> 30
Net investment income will be determined in accordance with rules
established by the Securities and Exchange Commission. Accrued expenses will
include all recurring fees that are charged to all contracts.
Because of the charges and deductions imposed by the Separate Account, the
yield for an investment portfolio will be lower than the yield for the
corresponding series. The yield on amounts held in the investment portfolios
normally will fluctuate over time. Therefore, the disclosed yield for any
given period is not an indication or representation of future yields or rates
of return. An investment portfolio's actual yield will be affected by the
types and quality of portfolio securities held by the series and the series
operating expenses.
Any current yield quotations of the PPM America/JNL Money Market
Portfolio, subject to Rule 482 of the Securities Act of 1933, will consist of a
seven calendar day historical yield, carried at least to the nearest hundredth
of a percent. The yield will be calculated by determining the net change,
exclusive of capital changes, in the value of a hypothetical pre-existing
account having a balance of one accumulation unit at the beginning of the base
period, subtracting a hypothetical charge reflecting deductions from contracts,
and dividing the net change in account value by the value of the account at the
beginning of the period to obtain a base period return and multiplying the base
period return by (365/7). The PPM America/JNL Money Market Portfolio's
effective yield is computed similarly but includes the effect of assumed
compounding on an annualized basis of the current yield quotations of the
Portfolio.
The PPM America/JNL Money Market Portfolio's yield and effective yield
will fluctuate daily. Actual yields will depend on factors such as the type of
instruments in the series' portfolio, portfolio quality and average maturity,
changes in interest rates, and the series' expenses. Although the investment
portfolio determines its yield on the basis of a seven calendar day period, it
may use a different time period on occasion. The yield quotes may reflect the
expense limitations described in the series' Prospectus or Statement of
Additional Information. There is no assurance that the yields quoted on any
given occasion will be maintained for any period of
6
<PAGE> 31
time and there is no guarantee that the net asset values will remain constant.
It should be noted that neither a contract owner's investment in the PPM
America/JNL Money Market Portfolio nor that Portfolio's investment in the PPM
America/JNL Money Market Series, is guaranteed or insured. Yields of other
money market funds may not be comparable if a different base or another method
of calculation is used.
ADDITIONAL TAX INFORMATION
NOTE: INFORMATION CONTAINED HEREIN SHOULD NOT BE SUBSTITUTED FOR THE
ADVICE OF A PERSONAL TAX ADVISER. JACKSON NATIONAL NY DOES NOT MAKE ANY
GUARANTEE REGARDING THE TAX STATUS OF ANY CONTRACT OR ANY TRANSACTION INVOLVING
THE CONTRACTS. PURCHASERS BEAR THE COMPLETE RISK THAT THE CONTRACTS MAY NOT BE
TREATED AS "ANNUITY CONTRACTS" UNDER FEDERAL INCOME TAX LAWS. IT SHOULD BE
FURTHER UNDERSTOOD THAT THE FOLLOWING DISCUSSION IS NOT EXHAUSTIVE AND THAT
SPECIAL RULES NOT DESCRIBED IN THIS PROSPECTUS MAY BE APPLICABLE IN CERTAIN
SITUATIONS. MOREOVER, NO ATTEMPT HAS BEEN MADE TO CONSIDER ANY APPLICABLE
STATE OR OTHER TAX LAWS.
General
Section 72 of the Internal Revenue Code of 1986, as amended (the "Code")
governs taxation of annuities in general. An individual owner is not taxed on
increases in the value of a contract until distribution occurs, either in the
form of a withdrawal or as annuity payments under the annuity option elected.
For a withdrawal received as a total surrender (total redemption or a death
benefit), the recipient is taxed on the portion of the payment that exceeds the
cost basis of the contract. For a payment received as a partial withdrawal,
federal tax liability is determined on a last-in, first-out basis, meaning
taxable income is withdrawn before the cost basis of the contract is withdrawn.
For contracts issued in connection with non-qualified plans, the cost basis is
generally the premiums, while for contracts issued in connection with qualified
plans there may be no cost basis. The taxable portion of a withdrawal is taxed
at ordinary income tax rates. Tax penalties may also apply.
For annuity payments, a portion of each payment in excess of an exclusion
amount is includable in taxable income. The exclusion amount for payments
based on a fixed annuity option is determined by multiplying the payment by the
ratio that the cost basis of the contract (adjusted for any period certain or
refund feature) bears to the expected return under the contract. The exclusion
amount for payments based on a variable annuity option is determined by
dividing the cost basis of the contract (adjusted for any period certain or
refund guarantee) by the number of years over which the annuity is expected to
be paid. Payments received after the investment in the contract has been
recovered (i.e. when the total of the excludable amounts equal the investment
in the contract) are fully taxable. The taxable portion is taxed at ordinary
income tax
7
<PAGE> 32
rates. For certain types of qualified plans there may be no cost
basis in the contract within the meaning of Section 72 of the Code. Owners,
annuitants and beneficiaries under the contracts should seek competent
financial advice about the tax consequences of distributions.
Jackson National NY is taxed as a life insurance company under the Code.
For federal income tax purposes, the Separate Account is not a separate entity
from Jackson National NY and its operations form a part of Jackson National NY.
Withholding Tax on Distributions
The Code generally requires Jackson National NY (or, in some cases, a plan
administrator) to withhold tax on the taxable portion of any distribution or
withdrawal from a contract. For "eligible rollover distributions" from
contracts issued under certain types of qualified plans, 20% of the
distribution must be withheld, unless the payee elects to have the distribution
"rolled over" to another eligible plan in a direct transfer. This requirement
is mandatory and cannot be waived by the owner.
An "eligible rollover distribution" is the estimated taxable portion of
any amount received by a covered employee from a plan qualified under Section
401(a) or 403(a) of the Code, or from a tax sheltered annuity qualified under
Section 403(b) of the Code (other than (1) a series of substantially equal
annuity payments for the life (or life expectancy) of the employee, or joint
lives (or joint life expectancies) of the employee, and his or her designated
beneficiary, or for a specified period of ten years or more; and (2) minimum
distributions required to be made under the Code). Failure to "rollover" the
entire amount of an eligible rollover distribution including an amount equal to
the 20% portion of the distribution that was withheld) could have adverse tax
consequences, including the imposition of a penalty tax on premature
withdrawals, described later in this section.
Withdrawals or distributions from a contract other than eligible rollover
distributions are also subject to withholding on the estimated taxable portion
of the distribution, but the owner may elect in such cases to waive the
withholding requirement. If not waived, withholding is imposed (1) for
periodic payments, at the rate that would be imposed if the payments were
wages, or (2) for other distributions, at the rate of 10%. If no withholding
exemption certificate is in effect for the payee, the rate under (1) above is
computed by treating the payee as a married individual claiming 3 withholding
exemptions.
Generally, the amount of any payment of interest to a non-resident alien
of the United States shall be subject to withholding of a tax equal to thirty
(30%) percent of such amount or, if applicable, a lower treaty rate. A payment
may not be subject to withholding where the recipient sufficiently establishes
that such payment is effectively connected to the recipient's conduct of a
trade or business in the United States and such payment is included in
recipient's gross income.
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<PAGE> 33
Diversification -- Separate Account Investments
Section 817(h) of the Code imposes certain diversification standards on
the underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not adequately
diversified, in accordance with regulations prescribed by the United States
Treasury Department ("Treasury Department"). Disqualification of the contract
as an annuity contract would result in imposition of federal income tax to the
owner with respect to earnings allocable to the contract prior to the receipt
of payments under the contract. The Code contains a safe harbor provision
which provides that annuity contracts such as the contracts meet the
diversification requirements if, as of the close of each calendar quarter, the
underlying assets meet the diversification standards for a regulated investment
company, and no more than 55% of the total assets consist of cash, cash items,
U.S. government securities and securities of other regulated investment
companies.
The Treasury Department has issued Regulations establishing
diversification requirements for the investment portfolios underlying variable
contracts. The Regulations amplify the diversification requirements for
variable contracts set forth in the Code and provide an alternative to the safe
harbor provision described above. Under the Regulations, an investment
portfolio will be deemed adequately diversified if (1) no more than 55% of the
value of the total assets of the portfolio is represented by any one
investment; (2) no more than 70% of the value of the total assets of the
portfolio is represented by any two investments; (3) no more than 80% of the
value of the total assets of the portfolio is represented by any three
investments; and (4) no more than 90% of the value of the total assets of the
portfolio is represented by any four investments.
Jackson National NY intends that each series of the JNL Series Trust will
be managed by its respective investment adviser in such a manner as to comply
with these diversification requirements.
The Treasury Department has indicated that the diversification Regulations
do not provide guidance regarding the circumstances in which contract owner
control of the investments of the Separate Account will cause the contract
owner to be treated as the owner of the assets of the Separate Account, thereby
resulting in the loss of favorable tax treatment of the contract. At this time
it cannot be determined whether additional guidance will be provided and what
standards may be contained in such guidance.
The amount of owner control which may be exercised under the contract is
different in some respects from the situations addressed in published rulings
issued by the Internal Revenue Service in which it was held that the policy
owner was not the owner of the assets of the separate account. It is unknown
whether these differences, such as the owner's ability to transfer among
investment choices or the number and type of investment choices available,
would cause the owner to be considered as the owner of the assets of the
Separate Account resulting in the
9
<PAGE> 34
imposition of federal income tax to the owner with respect to earnings
allocable to the contract prior to receipt of payments under the contract.
In the event any forthcoming guidance or ruling is considered to set forth
a new position, such guidance or ruling will generally be applied only
prospectively. However, if such ruling or guidance was not considered to set
forth a new position, it may be applied retroactively resulting in the owner
being retroactively determined to be the owner of the assets of the Separate
Account.
Due to the uncertainty in this area, Jackson National NY reserves the
right to modify the contract in an attempt to maintain favorable tax treatment.
Multiple Contracts
The Code provides that multiple annuity contracts which are issued within
a calendar year to the same contract owner by one company or its affiliates are
treated as one annuity contract for purposes of determining the tax
consequences of any distribution. Such treatment may result in adverse tax
consequences including more rapid taxation of the distributed amounts from such
multiple contracts. Owners should consult a tax adviser prior to purchasing
more than one non-qualified annuity contract in any calendar year.
Contracts Owned by Other than Natural Persons
Under Section 72(u) of the Code, the investment earnings on premiums for
contracts will be taxed currently to the owner if the owner is a non-natural
person, e.g., a corporation or certain other entities. Such contracts
generally will not be treated as annuities for federal income tax purposes.
However, this treatment is not applied to contracts held by a trust or other
entity as an agent for a natural person nor to contracts held by certain
qualified plans. Purchasers should consult their own tax counsel or other tax
adviser before purchasing a contract to be owned by a non-natural person.
Tax Treatment of Assignments
An assignment or pledge of a contract may have tax consequences, and may
also be prohibited by ERISA in some circumstances. Owners should, therefore,
consult competent legal advisers should they wish to assign or pledge their
contracts.
Qualified Plans
The contracts offered by the Prospectus are designed to be suitable for
use under various types of qualified plans. Taxation of owners in each
qualified plan varies with the type
10
<PAGE> 35
of plan and terms and conditions of each specific plan. Owners,
annuitants and beneficiaries are cautioned that benefits under a qualified plan
may be subject to the terms and conditions of the plan, regardless of the terms
and conditions of the contracts issued to fund the plan.
Tax Treatment of Withdrawals
Non-Qualified Plans
Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the contract value exceeds the aggregate
Premiums made, any amount withdrawn not in the form of an annuity payment will
be treated as coming first from the earnings and then, only after the income
portion is exhausted, as coming from the principal. Withdrawn earnings are
included in a taxpayer's gross income. Section 72 further provides that a 10%
penalty will apply to the income portion of any distribution. The penalty is
not imposed on amounts received: (1) after the taxpayer reaches 59 1/2; (2)
upon the death of the owner; (3) if the taxpayer is totally disabled as defined
in Section 72(m)(7) of the Code; (4) in a series of substantially equal
periodic payments made at least annually for the life (or life expectancy) of
the taxpayer or for the joint lives (or joint life expectancies) of the
taxpayer and his beneficiary; (5) under an immediate annuity; or (6) which are
allocable to premium payments made prior to August 14, 1982.
Qualified Plans
In the case of a withdrawal under a qualified contract, a ratable portion
of the amount received is taxable, generally based on the ratio of the
individual's cost basis to the individual's total accrued benefit under the
retirement plan. Special tax rules may be available for certain distributions
from a qualified contract. Section 72(t) of the Code imposes a 10% penalty tax
on the taxable portion of any distribution from qualified retirement plans,
including contracts issued and qualified under Code Sections 401 (H.R. 10 and
Corporate Pension and Profit Sharing plans), 403(b) (tax-sheltered annuities)
and 408(b) (IRAs). To the extent amounts are not included in gross income
because they have been rolled over to an IRA or to another eligible qualified
plan, no tax penalty will be imposed.
The tax penalty will not apply to the following distributions: (1) if
distribution is made on or after the date on which the owner or annuitant (as
applicable) reaches age 59 1/2; (2) distributions following the death or
disability of the owner or annuitant (as applicable) (for this purpose
"disability" is defined in Section 72(m)(7) of the Code); (3) after separation
from service, distributions that are part of substantially equal periodic
payments made not less frequently than annually for the life (or life
expectancy) of the owner or annuitant (as applicable) or the joint lives (or
joint life expectancies) of such owner or annuitant (as applicable) and his or
her designated beneficiary; (4) distributions to an owner or annuitant (as
applicable) who has separated from service after he has attained age 55; (5)
distributions made to the owner or annuitant (as applicable) to the extent such
distributions do not exceed the amount allowable as a
11
<PAGE> 36
deduction under Code Section 213 to the owner or annuitant (as applicable) for
amounts paid during the taxable year for medical care; (6) distributions made
to an alternate payee pursuant to a qualified domestic relations order; (7)
distributions from an IRA for the purchase of medical insurance (as described
in Section 213(d)(1)(D) of the Code) for the contract owner or annuitant (as
applicable) and his or her spouse and dependents if the contract owner or
annuitant (as applicable) has received unemployment compensation for at least
12 weeks(this exception will no longer apply after the contract owner or
annuitant (as applicable) has been re-employed for at least 60 days); (8)
distributions from an Individual Retirement Annuity made to the owner or
annuitant (as applicable) to the extent such distributions do not exceed the
qualified higher education expenses (as defined in Section 72(t)(7) of the
Code) of the owner or annuitant (as applicable) for the taxable year; and (9)
distributions from an Individual Retirement Annuity made to the owner or
annuitant (as applicable) which are qualified first-time home buyer
distributions (as defined in Section 72(t)(8) of the Code).
The exception stated in items (4) and (6) above do not apply in the case
of an IRA. The exception stated in (3) above applies to an IRA without the
requirement that there be a separation from service.
Withdrawals of amounts attributable to contributions made pursuant to a
salary reduction agreement (in accordance with Section 403(b)(11) of the Code)
are limited to the following: when the owner attains age 59 1/2, separates from
services, dies, becomes disabled (within the meaning of Section 72(m)(7) of the
Code), or in the case of hardship. Hardship withdrawals do not include any
earnings on salary reduction contributions. These limitations on withdrawals
apply to: (1) salary reduction contributions made after December 31, 1988; (2)
income attributable to such contributions; and (3) income attributable to
amounts held as of December 31, 1988. The limitations on withdrawals do not
affect rollovers or exchanges between certain qualified plans. Tax penalties
may also apply. While the foregoing limitations only apply to certain
contracts issued in connection with Section 403(b) qualified plans, all owners
should seek competent tax advice regarding any withdrawals or distributions.
The taxable portion of a withdrawal or distribution from contracts issued
under certain types of plans may, under some circumstances, be "rolled over"
into another eligible plan so as to continue to defer income tax on the taxable
portion. Effective January 1, 1993, such treatment is available for an
"eligible rollover distribution" made by certain types of plans (as described
above under "Taxes -- Withholding Tax on Distributions") that is transferred
within 60 days of receipt into another eligible plan or an IRA, or an
individual retirement account described in section 408(a) of the Code. Plans
making such eligible rollover distributions are also required, with some
exceptions specified in the Code, to provide for a direct transfer of the
distribution to the transferee plan designated by the recipient.
Amounts received from IRAs may also be rolled over into other IRAs,
individual retirement accounts or certain other plans, subject to limitations
set forth in the Code.
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<PAGE> 37
Generally, distributions from a qualified plan generally must commence no
later than April 1 of the calendar year following the year in which the
employee attains the later of age 70 1/2 or the date of retirement. In the
case of an IRA, distribution must commence no later than April 1 of the
calendar year following the year in which the owner attains age 70 1/2.
Required distributions must be over a period not exceeding the life or life
expectancy of the individual or the joint lives or life expectancies of the
individual and his or her designated beneficiary. If the required minimum
distributions are not made, a 50% penalty tax is imposed as to the amount not
distributed.
Types of Qualified Plans
The following are general descriptions of the types of qualified plans
with which the contracts may be used. Such descriptions are not exhaustive and
are for general information purposes only. The tax rules regarding qualified
plans are very complex and will have differing applications depending on
individual facts and circumstances. Each purchaser should obtain competent tax
advice prior to purchasing a contract issued under a qualified plan.
Contracts issued pursuant to qualified plans include special provisions
restricting contract provisions that may otherwise be available and described
in this Prospectus. Generally, contracts issued pursuant to qualified plans are
not transferable except upon surrender or annuitization. Various penalty and
excise taxes may apply to contributions or distributions made in violation of
applicable limitations. Furthermore, certain withdrawal penalties and
restrictions may apply to surrenders from qualified plan contracts.
(a) H.R. 10 Plans
Section 401 of the Code permits self-employed individuals to
establish qualified plans for themselves and their employees, commonly
referred to as "H.R. 10" or "Keogh" Plans. Contributions made to the
plan for the benefit of the employees will not be included in the gross
income of the employees until distributed from the plan. The tax
consequences to owners may vary depending upon the particular plan
design. However, the Code places limitations and restrictions on all
plans on such items as: amounts of allowable contributions; form, manner
and timing of distributions; transferability of benefits; vesting and
non-forfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, withdrawals and
surrenders. Purchasers of contracts for use with an H.R. 10 Plan should
obtain competent tax advice as to the tax treatment and suitability of
such an investment.
(b) Tax-Sheltered Annuities
Section 403(b) of the Code permits the purchase of "tax-sheltered
annuities" by public schools and certain charitable, educational and
scientific organizations described
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<PAGE> 38
in Section 501(c)(3) of the Code. These qualifying employers may make
contributions to the contracts for the benefit of their employees. Such
contributions are not included in the gross income of the employee until
the employee receives distributions from the contract. The amount of
contributions to the tax-sheltered annuity is limited to certain maximums
imposed by the Code. Furthermore, the Code sets forth additional
restrictions governing such items as transferability, distributions,
non-discrimination and withdrawals. Employee loans are not allowed
under these contracts. Any employee should obtain competent tax advice as
to the tax treatment and suitability of such an investment.
(c) Individual Retirement Annuities
Section 408(b) of the Code permits eligible individuals to
contribute to an individual retirement program known as an "Individual
Retirement Annuity" ("IRA"). Under applicable limitations, certain
amounts may be contributed to an IRA which will be deductible from the
individual's gross income. These IRAs are subject to limitations on
eligibility, contributions, transferability and distributions. Sales of
contracts for use with IRAs are subject to special requirements imposed
by the Code, including the requirement that certain informational
disclosure be given to persons desiring to establish an IRA. Purchasers
of contracts to be qualified as IRAs should obtain competent tax advice
as to the tax treatment and suitability of such an investment.
(d) Corporate Pension and Profit-Sharing Plans
Sections 401(a) and 401(k) of the Code permit corporate employers to
establish various types of retirement plans for employees. These
retirement plans may permit the purchase of the contracts to provide
benefits under the plan. Contributions to the plan for the benefit of
employees will not be included in the gross income of the employee until
distributed from the plan. The tax consequences to owners may vary
depending upon the particular plan design. However, the Code places
limitations on all plans on such items as amount of allowable
contributions; form, manner and timing of distributions; vesting and
non-forfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, transferability of
benefits, withdrawals and surrenders. Purchasers of contracts for use
with corporate pension or profit sharing plans should obtain competent
tax advice as to the tax treatment and suitability of such an investment.
(e) Non-Qualified Deferred Compensation Plans -- Section 457
Under Section 457 of the Code, governmental and certain other
tax-exempt employers may establish, for the benefit of their employees,
deferred compensation plans which may invest in annuity contracts. The
Code, as in the case of qualified plans, establishes limitations and
restrictions on eligibility, contributions and distributions. Under these
plans, contributions made for the benefit of the employees will not be
included in the employees' gross income until distributed from the plan.
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<PAGE> 39
(f) Roth IRAs
Beginning in 1998, individuals may purchase a new type of
non-deductible IRA, known as a Roth IRA. Purchase payments for a Roth
IRA are limited to $2,000 per year. This limitation is phased out for
adjusted gross income between $95,000 and $110,000 in the case of single
taxpayers, between $150,000 and $160,000 in the case of married
taxpayers filing joint returns, and between $0 and $15,000 in the case of
married taxpayers filing separately. An overall $2,000 annual limitation
continues to apply to all of a taxpayer's IRA contributions, including
Roth IRAs and non-Roth IRAs.
Qualified distributions from Roth IRAs are entirely tax free. A
qualified distribution requires that the individual has held the Roth IRA
for at least five years and, in addition, that the distribution is made
either after the individual reaches age 59 1/2, on the individual's death
or disability, or as a qualified first-time home purchase, subject to a
$10,000 lifetime maximum, for the individual, a spouse, child,
grandchild, or ancestor. Any distribution which is not a qualified
distribution is taxable to the extent of earnings in the distribution.
Distributions are treated as made from contributions first and therefore
no distributions are taxable until distributions exceed the amount of
contributions to the Roth IRA. The 10% penalty tax and the regular IRA
exceptions to the 10% penalty tax apply to taxable distributions from a
Roth IRA.
Amounts may be rolled over from one Roth IRA to another Roth IRA.
Furthermore, an individual may make a rollover contribution from a
non-Roth IRA to a Roth IRA, unless the individual has adjusted gross
income over $100,000 or the individual is a married taxpayer filing a
separate return. The individual must pay tax on any portion of the IRA
being rolled over that represents income or a previously deductible IRA
contribution. However, for rollovers in 1998, the individual may pay
that tax ratably over the four taxable year periods beginning with the
tax year 1998. There are no similar limitations on rollovers from a Roth
IRA to another Roth IRA.
INCOME PAYMENTS; NET INVESTMENT FACTOR
See "Income Payments (The Income Phase)" in the Prospectus.
The net investment factor is an index applied to measure the net
investment performance of an investment portfolio from one valuation date to
the next. Since the net investment factor may be greater or less than or equal
to one, and the factor that offsets the 3% investment rate assumed is slightly
less than one, the value of an annuity unit (which changes with the product of
that factor) and the net investment may increase, decrease or remain the same.
The net investment factor for any investment portfolio for any valuation
period is determined by dividing (a) by (b) and then subtracting (c) from the
result where:
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<PAGE> 40
(a) is the net result of:
(1) the net asset value of a series share held in the
investment portfolio determined as of the valuation date at
the end of the valuation period, plus
(2) the per share amount of any dividend or other
distribution declared by the series if the "ex-dividend" date
occurs during the valuation period, plus or minus
(3) a per share credit or charge with respect to any
taxes paid or reserved for by Jackson National NY during the
valuation period which are determined by Jackson National NY
to be attributable to the operation of the investment
portfolio (no federal income taxes are applicable under
present law);
(b) is the net asset value of the series share held in the
investment portfolio determined as of the valuation date at the end
of the preceding valuation period; and
(c) is the asset charge factor determined by Jackson National NY
for the valuation period to reflect the charges for assuming the
mortality and expense risks and the administration charge.
16
<PAGE> 41
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
(1) Financial statements and schedules included in Part
A:
Not Applicable
(2) Financial statements and schedules included in Part
B:
To be filed by Amendment.
Item 24.(b) Exhibits
Exhibit
No. Description
------- -----------
1. Resolution of Depositor's Board of Directors
authorizing the establishment of the Registrant,
incorporated by reference to Registrant's
Registration Statement filed via EDGAR on October 3,
1997.
2. Not Applicable
3. General Distributor Agreement dated September 19,
1997, incorporated by reference to Registrant's
Registration Statement filed via EDGAR on October 3,
1997.
4. Form of the Perspective Fixed and Variable Annuity Contract,
attached hereto.
5. Form of the Perspective Fixed and Variable Annuity Application,
attached hereto.
6.a. Declaration and Charter of Depositor, incorporated by
reference to Registrant's Registration Statement
filed via EDGAR on October 3, 1997.
b. Bylaws of Depositor, incorporated by reference to
Registrant's Registration Statement filed via EDGAR
on October 3, 1997.
7. Not Applicable
8. Not Applicable
1
<PAGE> 42
9. Opinion and Consent of Blazzard, Grodd & Hasenauer, P.C., attached
hereto.
10. Consent of Price Waterhouse LLP, attached hereto.
11. Not Applicable
12. Not Applicable
13. Not Applicable
14. Not Applicable
Item 25. Directors and Officers of the Depositor
Name and Principal Positions and Offices
Business Address with Depositor
------------------ ---------------------
Donald B. Henderson, Jr. Director
4A Rivermere Apartments
Bronxville, NY 10708
Henry J. Jacoby Director
305 Riverside Drive
New York, NY 10025
David L. Porteous Director
20434 Crestview Drive
Reed City, MI 49777
Robert L. Rosenthal Director
360 E. 72nd Street
New York, NY 10021
Robert P. Saltzman President, Chairman
5901 Executive Drive and Director
Lansing, MI 48911
Jay A. Elliott Senior Vice President
5901 Executive Drive and Director
Lansing, MI 48911
Alan C. Hahn Senior Vice President
5901 Executive Drive and Director
Lansing, MI 48911
Andrew B. Hopping Senior Vice President
5901 Executive Drive and Director
Lansing, MI 48911
2
<PAGE> 43
Clark P. Manning Senior Vice President &
5901 Executive Drive Chief Actuary
Lansing, MI 48911
J. George Napoles Senior Vice President
5901 Executive Drive
Lansing, MI 48911
David B. LeRoux Senior Vice President
5901 Executive Drive
Lansing, MI 48911
Scott L. Stoltz Senior Vice President
5901 Executive Drive
Lansing, MI 48911
Thomas J. Meyer Vice President, Secretary,
5901 Executive Drive General Counsel & Director
Lansing, MI 48911
Lisa C. Drake Vice President & Actuary
5901 Executive Drive
Lansing, MI 48911
Robert A. Fritts Vice President & Assistant
5901 Executive Drive Secretary
Lansing, MI 48911
Brion S. Johnson Vice President
5901 Executive Drive
Lansing, MI 48911
Item 26. Persons Controlled by or Under Common Control with the
Depositor or Registrant.
State of Control/
Company Organization Ownership Principal Business
- ------- ------------ --------- ------------------
Brooke Delaware 100% Organized for the
Holdings, Inc. Holborn purpose of acquiring
Delaware holding, encumbering,
Partnership transferring, or
otherwise disposing of
shares, bonds, and other
evidences of
indebtedness, securities,
and contracts of other
3
<PAGE> 44
persons, associations,
corporations, domestic or
foreign and to form or
acquire the control of
other corporations.
Brooke Delaware 100% Brooke Holding Company
Finance Holdings, Inc. Activities
Brooke Life Michigan 100% Brooke Life Insurance
Insurance Holdings, Inc.
Company
Carolina North 95% Jackson Manufacturing
Steel Carolina National Life Company
Insurance
Company
Chrissy Delaware 100% Jackson Advertising Agency
Corporation National Life
Insurance
Company
Holborn Delaware 95% Prudential Holding Company
Delaware One Limited, Activities
Partnership 2.5%
Prudential
Two Limited,
2.5%
Prudential
Three Limited
Jackson Delaware 100% Jackson Investment Adviser,
National National Life Broker/Dealer
Financial Insurance and Transfer Agent
Services, Inc. Company
Jackson Delaware 100% Jackson Advertising/
National National Life Marketing
Life Insurance Corporation and
Distributors, Company Broker/Dealer
Inc.
Jackson Michigan 100% Brooke Life Insurance
National Life
Life Insurance Insurance
Company Company
4
<PAGE> 45
JNL Series Massachusetts Common Law Investment Company
Trust Trust with
contractual
association
with Jackson
National Life
Insurance
Company
Prudential United 100% Holding Company
Corporation Kingdom Prudential
Holdings Corporation
Limited PLC
Prudential United Publicly Financial
Corporation Kingdom Traded Institution
PLC
Prudential England and 100% Holding
One Limited Wales Prudential Company
Corporation Activities
Holdings
Limited
Prudential England and 100% Holding
Two Limited Wales Prudential Company
One Limited Activities
Prudential England and 100% Holding
Three Limited Wales Prudential Company
One Limited Activities
Item 27. Number of Contract Owners as of February 12, 1998.
0
Item 28. Indemnification
Provision is made in the Company's By-Laws for indemnification by the
Company of any person made or threatened to be made a party to an action or
proceeding, whether civil or criminal by reason of the fact that he or she is or
was a director, officer or employee of the Company or then serves or has served
any other corporation in any capacity at the request of the Company, against
expenses, judgments, fines and amounts paid in settlement to the full extent
that officers and directors are permitted to be indemnified by the laws of the
State of New York.
5
<PAGE> 46
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 ("Act") may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company 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 liabilities (other than the payment by the Company of expenses incurred
or paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
Item 29. Principal Underwriter
(a) Jackson National Financial Services, Inc. acts as general
distributor for the JNLNY Separate Account I. Jackson National Financial
Services, Inc. also acts as general distributor for the Jackson National
Separate Account - I and the Jackson National Separate Account III and acts as
investment adviser for the JNL Series Trust.
(b) Directors and Officers of Jackson National Financial Services, Inc.:
Name and Positions and Offices
Business Address with Underwriter
---------------- ---------------------
Jay A. Elliott Director
5901 Executive Dr.
Lansing, MI 48911
Andrew B. Hopping President, Chief
5901 Executive Dr. Executive Officer
Lansing, MI 48911 and Director
Mark D. Nerud Chief Operating
5901 Executive Dr. Officer, Treasurer
Lansing, MI 48911 and Director
Amy D. Eisenbeis Secretary and Chief
5901 Executive Dr. Legal Officer
6
<PAGE> 47
Lansing, MI 48911
(c)
New Under- Compensation
writing on
Name of Discounts Redemption
Principal and or Annuiti- Brokerage
Underwriter Commissions zation Commissions Compensation
- ----------- ----------- ------------ ----------- ------------
Jackson
national
Financial Not Not Not Not
Services, Applicable Applicable Applicable Applicable
Inc.
Item 30. Location of Accounts and Records
Jackson National Life Insurance Company of New York
2900 Westchester Avenue
Purchase, New York 10577
Jackson National Life Insurance Company
8055 East Tufts Ave., Second Floor
Denver, Colorado 80237
Item 31. Management Services
Not Applicable
Item 32. Undertakings
(a) Not Applicable.
(b) Not Applicable.
(c) Not Applicable.
(d) Jackson National Life Insurance Company of New York
represents that the fees and charges deducted under
the contract, in the aggregate, are reasonable in
relation to the services rendered, the expenses to be
incurred, and the risks assumed by Jackson National
Life Insurance Company of New York.
(e) The Registrant hereby represents that any contract
offered by the prospectus and which is issued
pursuant to Section 403(b) of the Internal Revenue
7
<PAGE> 48
Code of 1986, as amended, is issued by the
Registrant in reliance upon, and in compliance
with, the Securities and Exchange Commission's
industry-wide no-action letter to the American
Council of Life Insurance (publicly available
November 28, 1988) which permits withdrawal
restrictions to the extent necessary to comply
with IRC Section 403(b)(11).
8
<PAGE> 49
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company
Act of 1940, the Registrant certifies that it has caused this Pre- Effective
Amendment to the Registration Statement to be signed on its behalf, in the City
of Lansing, and State of Michigan, on this 13th day of February, 1998.
JNLNY Separate Account I
---------------------------------------------------------
(Registrant)
By: Jackson National Life Insurance Company of New York
----------------------------------------------------
By: /s/ Thomas J. Meyer
----------------------------------------------------
Thomas J. Meyer
Vice President and General Counsel
Jackson National Life Insurance Company of New York
---------------------------------------------------------
(Depositor)
By: /s/ Thomas J. Meyer
----------------------------------------------------
Thomas J. Meyer
Vice President and General Counsel
As required by the Securities Act of 1933, this Pre-Effective
Amendment to the Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
/s/ Robert P. Saltzman by Thomas J. Meyer* February 13, 1998
- ------------------------------------------- -----------------
Robert P. Saltzman, President, Date
Chairman and Director
/s/ Jay A. Elliott by Thomas J. Meyer * February 13, 1998
- ------------------------------------------- -----------------
Jay A. Elliott, Senior Vice President Date
and Director
/s/ Alan C. Hahn by Thomas J. Meyer * February 13, 1998
- ------------------------------------------- -----------------
Alan C. Hahn, Senior Vice President Date
and Director
/s/ Andrew B. Hopping by Thomas J. Meyer * February 13, 1998
- ------------------------------------------- -----------------
Andrew B. Hopping, Senior Vice Date
President and Director
/s/ Thomas J. Meyer February 13, 1998
- ------------------------------------------- -----------------
Thomas J. Meyer, Vice President, Secretary, Date
General Counsel and Director
<PAGE> 50
/s/ Donald B. Henderson by Thomas J. Meyer * February 13, 1998
- ---------------------------------------------- -----------------
Donald B. Henderson, Director Date
/s/ Henry J. Jacoby by Thomas J. Meyer * February 13, 1998
- ---------------------------------------------- -----------------
Henry J. Jacoby, Director Date
/s/ David C. Porteous by Thomas J. Meyer * February 13, 1998
- ---------------------------------------------- -----------------
David C. Porteous, Director Date
/s/ Robert L. Rosenthal by Thomas J. Meyer * February 13, 1998
- ---------------------------------------------- -----------------
Robert L. Rosenthal, Director Date
/s/ Thomas J. Meyer February 13, 1998
- ---------------------------------------------- -----------------
* Thomas J. Meyer, Attorney In Fact Date
<PAGE> 51
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned as directors
and/or officers of JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK, a New
York corporation, which has filed or will file with the Securities and Exchange
Commission under the provisions of the Securities Act of 1933 and Investment
Company Act of 1940, as amended, various Registration Statements and amendments
thereto for the registration under said Acts of the sale of Individual Deferred
Fixed and Variable Annuity Contracts in connection with the JNLNY Separate
Account I and other separate accounts of Jackson National Life Insurance
Company of New York, hereby constitute and appoint Thomas J. Meyer, Andrew B.
Hopping and Robert P. Saltzman, his attorney, with full power of substitution
and resubstitution, for and in his name, place and stead, in any and all
capacities to approve and sign such Registration Statements and any and all
amendments thereto, with power where appropriate to affix the corporate seal of
said corporation thereto and to attest with seal and to file the same, with all
exhibits thereto and other granting unto said attorneys, each of them, full
power and authority to do and perform all and every act and thing requisite to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming that which said attorneys, or any of them, may lawfully do or
cause to be done by virtue hereof. This instrument may be executed in one or
more counterparts.
IN WITNESS WHEREOF, the undersigned have herewith set their names as of the
dates set forth below.
/s/ Robert P. Saltzman September 26, 1997
- ------------------------------------- ------------------
Robert P. Saltzman, President, Date
Chairman and Director
/s/ Jay A. Elliott September 26, 1997
- ------------------------------------- ------------------
Jay A. Elliott, Senior Vice President Date
and Director
/s/ Alan C. Hahn September 26, 1997
- ------------------------------------- ------------------
Alan C. Hahn, Senior Vice President Date
and Director
/s/ Andrew B. Hopping September 26, 1997
- ------------------------------------- ------------------
Andrew B. Hopping, Senior Vice Date
President and Director
<PAGE> 52
/s/ Thomas J. Meyer September 26, 1997
- ------------------------------------- ------------------
Thomas J. Meyer, Vice President, Secretary, Date
General Counsel and Director
/s/ Donald B. Henderson September 26, 1997
- ------------------------------------- ------------------
Donald B. Henderson, Director Date
/s/ Henry J. Jacoby September 26, 1997
- ------------------------------------- ------------------
Henry J. Jacoby, Director Date
/s/ David L. Porteous 9/23/97
- ------------------------------------- ------------------
David L. Porteous, Director Date
/s/ Robert L. Rosenthal September 26, 1997
- ------------------------------------- ------------------
Robert L. Rosenthal, Director Date
<PAGE> 53
EXHIBIT LIST
Exhibit
Number Description
- ------- -----------
4. Form of the Perspective Fixed and Variable Annuity Contract,
attached hereto as EX-99.B4
5. Form of the Perspective Fixed and Variable Annuity Application,
attached hereto as EX-99.B5
9. Opinion and Consent of Blazzard, Grodd & Hasenauer, P.C.,
attached hereto as EX-99.B9
10. Consent of Price Waterhouse LLP, attached hereto as
Ex-99.B10
<PAGE> 1
EXHIBIT 99.B4
2900 WESTCHESTER AVENUE
PURCHASE, NEW YORK 10577
A STOCK COMPANY
Will pay the benefits provided in this policy
subject to its terms and conditions.
JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK
2900 WESTCHESTER AVENUE
PURCHASE, NEW YORK 10577
A STOCK COMPANY
Will pay the benefits provided in this policy
subject to its terms and conditions.
[JACKSON NATIONAL LOGO]
- --------------------------------------------------------------------------------
JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK ("THE COMPANY") AGREES TO
PROVIDE BENEFITS TO THE OWNER SUBJECT TO THE PROVISIONS SET FORTH IN THIS
CONTRACT AND IN CONSIDERATION OF THE APPLICATION AND PREMIUMS WE RECEIVE.
THE VALUE OF AMOUNTS ALLOCATED TO THE SEPARATE ACCOUNT DURING THE ACCUMULATION
AND ANNUITY PERIODS IS NOT GUARANTEED AND MAY INCREASE OR DECREASE BASED UPON
THE INVESTMENT EXPERIENCE OF THE FUND UNDERLYING THE SEPARATE ACCOUNT. IF THE
ACTUAL INVESTMENT RATES EXPERIENCED BY THE SEPARATE ACCOUNT ASSETS ARE LESS THAN
4.4%, VARIABLE ANNUITY PAYMENTS WILL DECREASE OVER TIME.
THE GUARANTEED PERIOD CONTRACT VALUE IS SUBJECT TO AN INTEREST RATE ADJUSTMENT
WHICH MAY INCREASE OR DECREASE AMOUNTS PAYABLE OR WITHDRAWN, BUT THE GUARANTEED
PERIOD WITHDRAWAL VALUE WILL NEVER DECREASE TO LESS THAN THE GUARANTEED MINIMUM
VALUE.
YOU MAY WITHDRAW THE CONTRACT VALUE HELD UNDER ANY GUARANTEED PERIOD WITHOUT
INTEREST RATE ADJUSTMENT PROVIDED WE RECEIVE WRITTEN NOTICE WITHIN 30 DAYS
FOLLOWING THE END OF THE CORRESPONDING GUARANTEED PERIOD.
NOTICE OF TWENTY-DAY RIGHT TO EXAMINE POLICY
You may return this contract to the selling agent or Jackson National Life
Insurance Company of New York within 20 days after You receive it. Upon
receipt of this contract, the Company will refund the full premium allocated
to the Guaranteed Periods. The Company will also refund the amounts allocated
to the Separate Account less the amount credited to the Separate Account plus
the Separate Account Contract Value. Upon such refund, this contract shall be
void. The funds in the Separate Account will be valued as of the date a
request is received by the Company.
THIS IS A LEGAL CONTRACT BETWEEN YOU AND THE COMPANY.
READ YOUR CONTRACT CAREFULLY.
EXECUTED FOR THE COMPANY ON THE ISSUE DATE.
- --------------------------------------------------------------------------------
FLEXIBLE PREMIUM INDIVIDUAL DEFERRED THIS CONTRACT IS SIGNED BY THE COMPANY
FIXED AND VARIABLE ANNUITY CONTRACT.
MONTHLY INCOME AT MATURITY.
DEATH BENEFIT PRIOR TO MATURITY. /s/ Robert P. Saltzman
NONPARTICIPATING.
PRESIDENT
/s/ Thomas J. Meyer
SECRETARY
<PAGE> 2
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
PAGE
CONTRACT DATA PAGE.................................................. 3
DEFINITIONS......................................................... 5
GENERAL PROVISIONS.................................................. 8
ACCUMULATION PROVISIONS FOR PORTFOLIOS..............................11
ACCUMULATION PROVISIONS FOR GUARANTEED PERIOD.......................11
TRANSFER PROVISIONS.................................................13
WITHDRAWAL PROVISIONS...............................................15
DEATH BENEFIT PROVISIONS............................................17
INCOME PROVISIONS...................................................19
TABLE OF INCOME OPTIONS.............................................22
2
<PAGE> 3
- --------------------------------------------------------------------------------
CONTRACT DATA PAGE
- --------------------------------------------------------------------------------
Contract Number: [000VA202]
Owner(s): [John Doe]
Annuitant(s): [John Doe]
Issue Date: [12/01/92]
Issue State: New York
Income Date:
Initial Premium: [$20,000.00]
Minimum Guaranteed Rate: 3.0%
Annual Contract
Maintenance Charge: $30.00
Separate Account: Jackson National Separate Account of New York - I
Expense Risk Charge: On an annual basis, this charge equals 0.23% of
the daily net asset value of the Portfolios.
Administration Charge: On an annual basis, this charge equals 0.15% of
the daily net asset value of the Portfolios.
Mortality Risk Charge: On an annual basis, this charge equals 1.02% of
the daily net asset value of the Portfolios.
Rebalancing Fee: There is no charge for this service.
Withdrawal Charge: CONTRIBUTION YEAR OF WITHDRAWAL
PREMIUM PAYMENT CHARGE PERCENTAGE
1 7%
2 6%
3 5%
4 4%
5 3%
6 2%
7 1%
Thereafter 0%
3
<PAGE> 4
- --------------------------------------------------------------------------------
CONTRACT DATA PAGE (CONT'D)
- --------------------------------------------------------------------------------
Jackson National Life Insurance Company of New York
2900 Westchester Avenue
Purchase, New York 10577
[1/888/367-5651]
The amounts allocated to the Separate Account during the accumulation and
Annuity periods are not guaranteed and may increase or decrease based upon the
investment experience of the Fund underlying the Separate Account.
All payments and values in the Guaranteed Periods may be subject to an Interest
Rate Adjustment, the calculation of which may result in an increase or decrease
in amounts payable. In no event will the Guaranteed Period Withdrawal Value be
less than the Guaranteed Minimum Value.
4
<PAGE> 5
- --------------------------------------------------------------------------------
DEFINITIONS
- --------------------------------------------------------------------------------
ACCUMULATION UNIT. A unit of measurement used to compute Your Separate Account
Contract Value prior to the Income Date.
ANNUITANT. The natural person on whose life the Annuity benefit for this
contract is based. The Owner may change the Annuitant at any time prior to the
Income Date, unless the Owner is a non-individual. A second, or joint Annuitant,
may be named under the contract.
ANNUITY. In general, a contract purchased from an insurance company that offers
tax-deferred growth of the Owner's investment until earnings are withdrawn.
There are two types of Annuities: fixed and variable.
A FIXED ANNUITY has a minimum rate of interest guaranteed by the
insurance company prior to the Income Date. After the Income Date,
payments are guaranteed and remain fixed in amount and length of payment
period.
A VARIABLE ANNUITY'S rate of return is not guaranteed. It is based on the
performance of the underlying investments the Owner has selected. If a
variable payout is elected, the amount of each payment may change
depending upon the performance of the underlying investments.
ANNUITY UNIT. A unit of measurement used to compute the amount of the payment
received under the Income Option you have elected.
CODE. The Internal Revenue Code of 1986, as amended.
CONTRACT VALUE. The sum of the Separate Account Contract Value and the
Guaranteed Period Contract Value.
CONTRACT YEAR. A 12-month period beginning on the Issue Date and ending one day
prior to the Issue Date in the following calendar year.
CONTRIBUTION YEAR. A 12-month period beginning on the date a Premium payment is
received and ending one day prior to the Premium payment anniversary in the
following year. The Contribution Year in which a Premium is made is
"Contribution Year 1." Subsequent years are consecutively numbered beginning
with Contribution Year 2.
FUND. The JNL Series Trust.
GUARANTEED MINIMUM VALUE. The net amount of Premiums allocated to the Guaranteed
Periods, less transfers, withdrawals and associated Withdrawal Charges from the
Guaranteed Periods, and less any contract maintenance charges that have been
assessed against the Guaranteed Periods, accumulated at 3.0%, less any
Withdrawal Charge, contract maintenance charge, or Premium tax due.
5
<PAGE> 6
- --------------------------------------------------------------------------------
DEFINITIONS (CONT'D)
- --------------------------------------------------------------------------------
GUARANTEED PERIOD CONTRACT VALUE. The sum of all amounts held under this
contract in the Guaranteed Periods.
GUARANTEED PERIOD. A period of time during which the Company guarantees a
specified interest rate which is equal to or greater than the Minimum Guaranteed
Rate shown on the contract data page.
GUARANTEED PERIOD WITHDRAWAL VALUE. This amount is equal to the Guaranteed
Period Contract Value less any applicable Withdrawal Charge, contract
maintenance charge and Interest Rate Adjustment.
INCOME DATE. The date on which income payments are to begin. This date is
established when You start Your contract and can be changed in the future.
INITIAL GUARANTEED RATE. The rate of interest declared by the Company for a
specified Guaranteed Period. In no event will the Initial Guaranteed Rate be
less than the Minimum Guaranteed Rate shown on the contract data page.
INTEREST RATE ADJUSTMENT. An adjustment applied, with certain exceptions, to
amounts withdrawn, transferred or annuitized from a Guaranteed Period prior to
the end of such Guaranteed Period.
ISSUE DATE. The date your contract is issued, as shown on the contract data
page.
LATEST INCOME DATE. The date on which the Owner attains age 90 under a
Non-Qualified Plan Contract, or age 70 1/2 under a Qualified Plan Contract.
NON-QUALIFIED PLAN. A retirement plan which does not receive favorable tax
treatment under sections 401, 403, or 408 of the Internal Revenue Code, as
amended.
OWNER ("YOU," "YOUR"). The person or entity named in the application who is
entitled to exercise all rights and privileges under this contract. Usually, but
not always, the Owner is also the Annuitant. The Owner is responsible for taxes,
regardless of who receives Annuity benefits. Joint Owners share ownership in all
respects.
PORTFOLIO. A subdivision of the Separate Account invested wholly in shares of
one of the series of the Fund.
PREMIUM(S). Considerations paid into this contract by or on behalf of the Owner.
QUALIFIED PLAN. A retirement plan that qualifies for favorable tax treatment
under sections 401, 403 or 408 of the Internal Revenue Code, as amended.
SEPARATE ACCOUNT CONTRACT VALUE. The sum of the value of all Portfolio
Accumulation Units held under this contract.
6
<PAGE> 7
- --------------------------------------------------------------------------------
DEFINITIONS (CONT'D)
- --------------------------------------------------------------------------------
SUBSEQUENT GUARANTEED RATE. The rate of interest declared by the Company for the
applicable subsequent Guaranteed Period, but in no event less than the Minimum
Guaranteed Rate shown on the contract data page.
VALUATION DAY. Each day the New York Stock Exchange is open for business. The
value of the Separate Account is determined at the close of the New York Stock
Exchange (currently 4:00 p.m. Eastern Time) on each Valuation Day.
VALUATION PERIOD. The period beginning at the close of business on a particular
Valuation Day and ending at the close of business on the next succeeding
Valuation Day.
WE, OUR, US, THE COMPANY. Jackson National Life Insurance Company of New York.
WITHDRAWAL CHARGE. A charge assessed against certain withdrawals.
WITHDRAWAL VALUE. The amount You are entitled to receive if You surrender this
contract. This amount is equal to the total Contract Value minus any applicable
Withdrawal Charge, contract maintenance charge and Interest Rate Adjustment.
7
<PAGE> 8
- --------------------------------------------------------------------------------
GENERAL PROVISIONS
- --------------------------------------------------------------------------------
ASSIGNMENT. The Owner may assign this contract before the Income Date, but the
Company will not be bound by an assignment unless it is in writing and has been
recorded by the Company. We are not responsible for any payments made before an
assignment is recorded. The assignment will be effective as of the date the
appropriate form was signed. We assume no responsibility for the validity or tax
consequences of any assignment. If the contract is issued pursuant to a
Qualified Plan, it may not be assigned, pledged or otherwise transferred, except
as may be allowed under the Plan. If the Owner makes an assignment, the Owner
may have to pay income tax.
BENEFICIARY. The beneficiary is as named in the application unless later changed
by the Owner. If two or more persons are named, those surviving the Owner will
share equally unless otherwise stated. If there are no surviving beneficiaries
at the death of the Owner, the death benefit will be paid to the estate of the
Owner.
The Owner may change the beneficiary by written notice in a form satisfactory to
the Company. The change will occur on the date We receive the notice and it is
recorded by the Company. The change will be effective as of the date the
appropriate form was signed.
CONFORMITY WITH STATE LAWS. This contract will be interpreted under the laws of
the State of New York when it is issued. Any provision which, on the Issue Date,
is in conflict with New York law, is amended to conform to the minimum
requirements of such law.
CONTRACT MAINTENANCE CHARGE. An annual contract maintenance charge of no more
than $30 is charged against each contract. This charge reimburses the Company
for expenses incurred in establishing and maintaining records relating to a
contract. The contract maintenance charge will be assessed on each anniversary
of the Issue Date that occurs on or prior to the Income Date. In the event that
a total withdrawal is made, the contract maintenance charge will be assessed as
of the date of withdrawal without proration. The total contract maintenance
charge is allocated between the Portfolio(s) and the Guaranteed Period(s) in
proportion to the respective Contract Values similarly allocated.
ENTIRE CONTRACT. This contract was issued in consideration of Your application
and payment of the initial Premium. All of its pages, the application, a copy of
which is attached at issue, and all endorsements, amendments and attached riders
make up the entire contract.
MINIMUM BENEFITS. For any paid up Annuity option, cash value or death benefit,
the amount available under this contract will not be less than the minimum
requirements of the state where this contract was delivered.
MISSTATEMENT OF AGE OR SEX. If the age or sex of the Annuitant has been
misstated, the benefits will be those which the premiums paid would have
purchased at the correct age and sex. Any underpayments or overpayments will be
adjusted immediately by the Company, using an interest rate of 6% either as a
credit to or charge against the next succeeding payment by the Company.
8
<PAGE> 9
- --------------------------------------------------------------------------------
GENERAL PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
MODIFICATION OF CONTRACT. Any change or waiver of the provisions of this
Contract must be in writing and signed by the President, a Vice President, the
Secretary or Assistant Secretary of the Company. No agent has authority to
change or waive any provisions of this contract. The Company reserves the right
to change or modify the contract without prior consent or notice if federal or
state law requires Us to do so. Any such modifications will be subject to the
New York State Insurance Department's prior approval.
NONPARTICIPATING. This contract does not share in Our surplus or earnings.
PREMIUMS. Premiums are flexible. This means that the Owner may change the
amounts, frequency or timing of Premiums. The initial Premium must be at least
$5,000 for Non-Qualified Contracts and $2,000 for Qualified Contracts.
Subsequent Premiums must be at least $500 ($50 if made in connection with an
automatic payment plan). The Company reserves the right to refuse total Premiums
under this contract in excess of $1,000,000 without prior approval from the
Company. The Company may waive minimum Premium amounts.
Premiums may be allocated among one or more of the Guaranteed Periods and one or
more of the Portfolios. Such election may be made in any percent from 0% to 100%
in whole percentages. The minimum that may be allocated to a Guaranteed Period
or a Portfolio under this contract is $100.
Just like initial Premiums, Owners making subsequent Premium payments should
specify how they want their Premiums allocated. Otherwise, the Company will
automatically process the Premium based on the most recent allocation on record
with the Company.
PREMIUM TAXES. The Company may deduct from the Contract Value any Premium taxes
or other taxes payable to a state or other government entity. Should we advance
any amount due, we are not waiving any right to collect such amounts at a later
date. We will deduct any withholding taxes required by applicable law.
PROOF OF AGE, SEX OR SURVIVAL. The Company may require satisfactory proof of
correct age or sex at any time. If any payment under this contract depends on
the Annuitant, Owner, or beneficiary being alive, the Company may require
satisfactory proof of survival.
SEPARATE ACCOUNT. The Separate Account is a separate investment account of the
Company but is subject to the laws of New York state. It is shown on the
contract data page. The assets of the Separate Account are the property of the
Company. However, they are not credited with earnings or chargeable with
liabilities arising out of any other business the Company may conduct. Each
Portfolio is not chargeable with liabilities arising out of any other Portfolio.
SUSPENSION OR DEFERRAL OF PAYMENTS. We may suspend or postpone any payments from
the contract if any of the following occur:
a) The New York Stock Exchange is closed;
b) Trading on the New York Stock Exchange is restricted;
c) An emergency exists such that it is not reasonably practical to dispose of
securities in the Separate Account or to determine the value of its
assets; or
d) The Securities and Exchange Commission, by order, so permits for the
protection of security holders.
This provision will only apply to the Separate Account funds.
9
<PAGE> 10
- --------------------------------------------------------------------------------
GENERAL PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
STATEMENT OF ACCOUNT. We will provide a statement of Contract Values at least
quarterly.
Pursuant to New York state law, we will also provide you with a report every
Contract Year on your anniversary.
SUBSTITUTION OF FUND. If the shares of any series of the Fund should no longer
be available for investment by the Separate Account or if, in the judgment of
our Board of Directors, further investment in the shares of a Fund is no longer
appropriate in view of the purpose of the contract, We may substitute shares of
another mutual fund or a series within a mutual fund for Fund shares already
purchased or to be purchased in the future by Premiums held under this contract.
No substitution of securities may take place without prior approval of the New
York Insurance Department, and the Securities and Exchange Commission, under any
such requirements as it may impose.
WRITTEN NOTICE. Any notice we send to the Owner will be sent to the Owner's last
known address unless the Owner requests otherwise. Any written request or notice
must be sent to the Company. The Owner must promptly provide the Company with
notice of an address change.
10
<PAGE> 11
- --------------------------------------------------------------------------------
ACCUMULATION PROVISIONS FOR PORTFOLIOS
- --------------------------------------------------------------------------------
ACCUMULATION UNIT VALUE. The Separate Account Contract Value will go up or down
depending on the performance of the Portfolios. In order to monitor the Separate
Account Contract Value before the Income Date, the Company uses a unit of
measure called an Accumulation Unit. The value of an Accumulation Unit may go up
or down from day to day. During the income payout phase, the unit of measure is
called an Annuity Unit (please see Income Provisions for further information).
Every Valuation Day the Company determines the value of an Accumulation Unit for
each of the Portfolios. This is done by:
(1) determining the total amount of money invested in the particular Portfolio;
(2) subtracting from the amount any insurance charges and any other charges such
as taxes; and (3) dividing this amount by the number of outstanding
Accumulation Units.
When you make a Premium payment, the Company credits Your contract with
Accumulation Units. The number of Accumulation Units credited is determined by
dividing the amount of the Premium allocated to any Portfolio by the value of
the Accumulation Unit for that Portfolio.
- --------------------------------------------------------------------------------
ACCUMULATION PROVISIONS FOR GUARANTEED PERIOD
- --------------------------------------------------------------------------------
CREDITING OF INTEREST. Interest is credited and compounded daily to each
Guaranteed Period to yield an effective annual interest rate equal to the
interest rate we guaranteed at the beginning of each Guaranteed Period. We will
credit interest to the initial Premium payment from the Issue Date. We will
credit interest to subsequent Premiums from the date We receive them. The rate
of interest for each Guaranteed Period will be as declared in advance by our
Board of Directors but will never be less than 3%.
GUARANTEED PERIOD. You may allocate Premium or make transfers to one or more
Guaranteed Periods at any time prior to the Latest Income Date.
If you do not specify a Guaranteed Period at the time of renewal, we will elect
the same Guaranteed Period that has just expired. Within at least 15 days, but
not more than 45 days, prior to the end of any Guaranteed Period, We will notify
You of your ability to:
a) withdraw amounts allocated to the Guaranteed Period within 30 days following
the end of such Guaranteed Period without an Interest Rate Adjustment;
b) elect a Guaranteed Period of a different duration within 30 days following
the end of such Guaranteed Period;
c) elect a transfer to Portfolio(s) within 30 days following the end of such
Guaranteed Period; or
d) elect a Guaranteed Period with the same duration within 30 days following the
end of such Guaranteed Period.
If the Guaranteed Period elected extends beyond the Latest Income Date, We will
automatically elect the longest period that will not extend beyond such date. If
a renewal occurs within one year of the Latest Income Date, We will credit
interest up to the Latest Income Date at the then current declared guaranteed
interest rate for the one-year Guaranteed Period.
11
<PAGE> 12
- --------------------------------------------------------------------------------
ACCUMULATION PROVISIONS FOR GUARANTEED PERIOD (CONT'D)
- --------------------------------------------------------------------------------
INTEREST RATE ADJUSTMENT. Except during the 30-day period following the end of a
Guaranteed Period, any amount withdrawn or transferred from a Guaranteed Period
will be subject to an Interest Rate Adjustment. The Interest Rate Adjustment
will be calculated by multiplying the amount withdrawn, transferred or
annuitized by the formula described below:
[1 + I](m/12)
------------- -1
[1 + J](m/12)
wherein:
I = The interest rate credited to the current Guaranteed Period.
J = The interest rate that would be credited, at the time of withdrawal, to
a new Guaranteed Period with a duration equal to the number of years
remaining in the current Guaranteed Period, increased by 0.25%. When no
Guaranteed Period of the required duration is available, the rate will be
established by linear interpolation.
m = Number of complete months remaining to the end of the current Guaranteed
Period.
There will be no Interest Rate Adjustment when J is greater than I but by less
than 0.25%.
In addition, the Interest Rate Adjustment will not apply to:
a) the payment of death benefit proceeds;
b) amounts withdrawn for contract fees or charges;
c) transfers relating to dollar cost averaging from the one-year Guaranteed
Period;
d) withdrawals taken in the 30-day period following the end of a Guaranteed
Period;
e) withdrawals taken under the Free Withdrawal provision;
f) cumulative withdrawals or transfers of up to 10% of the Guaranteed Period
value in the Contract Year;
g) income options that result in payments of 5 years or greater; or
h) amounts transferred or withdrawn from any one-year guaranteed option.
In no event will a total withdrawal from the Guaranteed Periods be less than the
Guaranteed Minimum Value.
If the Company no longer issues guaranteed rate contracts, then items I and J of
the Interest Rate Adjustment will be determined by using the asked yield to
maturity of the U.S. Treasury Notes with the same remaining term, interpolating
where necessary, as published in The Wall Street Journal on the next succeeding
business day following the effective date of the Interest Rate Adjustment.
12
<PAGE> 13
- --------------------------------------------------------------------------------
TRANSFER PROVISIONS
- --------------------------------------------------------------------------------
TRANSFERS. Transfers between Portfolios and the Guaranteed Periods may be made
as described below. Transfers are not subject to Withdrawal Charges. However,
transfers from the Guaranteed Periods will be subject to any applicable Interest
Rate Adjustment. A transfer fee of no more than $25.00 will apply to transfers
in excess of 15 in a Contract Year. The dollar cost averaging and rebalancing
options are not considered transfers for purposes of calculating the transfer
fee.
The minimum transfer amount is $100. The remaining Contract Value of a Portfolio
or Guaranteed Period after a transfer must be at least $100. If a transfer would
cause a remaining value to be less than $100, all of the value must be
transferred, or no transfer can take place.
FROM PORTFOLIO TO PORTFOLIO. Both prior to and after the Income Date, the Owner
may transfer all or a portion of investment in one Portfolio to another
Portfolio. A transfer will result in the purchase of Accumulation Units in a
Portfolio and redemption of Accumulation Units in the other Portfolio. Transfers
will be effected at the end of the Valuation Period in which We receive your
request for transfer.
FROM PORTFOLIO TO THE GUARANTEED PERIOD. Prior to the Income Date, the Owner may
transfer all or a portion of the value in Portfolio(s) to a Guaranteed Period.
This will result in the redemption of Accumulation Units and will be effected at
the end of the Valuation Period in which We receive the Owner's request for
transfer.
FROM GUARANTEED PERIOD TO GUARANTEED PERIOD. Prior to the Income Date, transfers
may be made between Guaranteed Periods. Such transfers, other than from a
maturing Guaranteed Period within the 30-day period following its expiration,
will be subject to any applicable Interest Rate Adjustments.
GUARANTEED PERIOD TO PORTFOLIO(S). Prior to the Income Date, the Owner may
transfer values in Guaranteed Period(s) to the Portfolio(s). Transfers, other
than from a maturing Guaranteed Period within the 30-day period following its
expiration, will be subject to any applicable Interest Rate Adjustments.
DOLLAR COST AVERAGING ("DCA"). Under DCA, the Owner may authorize the automatic
transfer of a fixed dollar amount ($100 minimum) at regular intervals from a
source account to one or more of the Portfolios (other than the source account)
at the Accumulation Unit values determined on the dates of transfers. The source
account may be any of the Portfolios or the one-year Guaranteed Period. The
Owner may elect to have transfers made from one of these source accounts. The
intervals between transfers may be monthly, quarterly, semi-annually or annually
at the Owner's option. To qualify for DCA, there must be a minimum total
Contract Value of $15,000.
Another option under DCA is the periodic transfer of a selected percentage of
the value of the source account to one of the Portfolios (other than the source
account).
13
<PAGE> 14
- --------------------------------------------------------------------------------
TRANSFER PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
A written election of this service, on a form provided by the Company, must be
completed by the Owner in order to begin transfers. Once elected, transfers from
the source account will be processed periodically until either the value of the
source account is completely depleted or the Owner instructs the Company in
writing to cancel the transfers.
REBALANCING. The Owner may elect, on a form provided by the Company, to have
his/her Separate Account Value reallocated among Portfolios in designated
percentages on a periodic basis (monthly, quarterly, semi-annual or annual
basis, or at such other time interval as approved by the Company). The
processing fee for this service will be as indicated on the contract data page.
14
<PAGE> 15
- --------------------------------------------------------------------------------
WITHDRAWAL PROVISIONS
- --------------------------------------------------------------------------------
On or prior to the Income Date, the Owner may withdraw all or part of the
Contract Value under this contract by informing the Company. For full
withdrawal, this contract must be returned to the Company.
Except in connection with a systematic withdrawal program, the minimum partial
withdrawal amount is $500, or if less, your entire interest in the Portfolio or
Guaranteed Period from which a withdrawal is requested. The Owner's interest in
the Portfolio or Guaranteed Period must be at least $100 after the withdrawal is
completed.
The Owner may elect in writing on a form provided by the Company to take
systematic withdrawals by withdrawing a specified dollar amount (of at least
$50) on a monthly, quarterly, semiannual, or annual basis. A Withdrawal Charge
may apply to systematic withdrawals in accordance with the considerations under
"Withdrawal Charge." The Company reserves the right to discontinue offering
systematic withdrawals upon 30 days' written notice to Contract Owners; however,
any such discontinuation would not effect systematic withdrawal programs already
commenced.
Absent written notification to the contrary, withdrawals and any applicable
charges will be deducted from the Contract Value in proportion to their
allocation among the Portfolios and Guaranteed Periods. Withdrawals will be
based on values at the end of the Valuation Period in which a request for
withdrawal and the contract (in the case of a full withdrawal) is received by
the Company. Withdrawals may be subject to a Withdrawal Charge and Interest Rate
Adjustment.
DEFERMENT OF PAYMENTS. The Company may defer payments for up to six (6) months
on the fixed account portion of the contract. Subject to New York requirements,
interest will be credited during such deferral period.
WITHDRAWAL CHARGE. Except as otherwise stated in this contract, the Withdrawal
Charge for any amount withdrawn is based on the Contribution Year of Premium
payment and is a percentage of Premium payments.
The Withdrawal Charges associated with each new Premium are:
Contribution Year Withdrawal
of Premium Payment Charge Percentage
------------------ -----------------
1 7%
2 6%
3 5%
4 4%
5 3%
6 2%
7 1%
Thereafter 0%
15
<PAGE> 16
- --------------------------------------------------------------------------------
WITHDRAWAL PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
The Withdrawal Charge will be deducted from the remaining Contract Value such
that the actual reduction in Contract Value as a result of the withdrawal may be
greater than the withdrawal amount requested and paid. For purposes of
determining the Withdrawal Charge, withdrawals will be allocated first to
earnings, if any (which may be withdrawn free of Withdrawal Charge), and then to
Premium on a first-in, first-out basis such that all withdrawals are allocated
to Premium to which the lowest (if any) Withdrawal Charge applies.
Premiums that are no longer subject to the Withdrawal Charge (and not previously
withdrawn), plus earnings, may be withdrawn free of Withdrawal Charges at any
time.
FREE WITHDRAWAL. In addition, there may be a free withdrawal amount for the
first withdrawal of Premiums during a Contract Year from a Portfolio(s) or
Guaranteed Period(s). The free withdrawal amount is equal to 10% of Premium that
remains subject to the Withdrawal Charge and that has not previously been
withdrawn, less earnings. For purposes of this provision, earnings shall mean
any amount in the contract other than unliquidated Premium.
16
<PAGE> 17
- --------------------------------------------------------------------------------
DEATH BENEFIT PROVISIONS
- --------------------------------------------------------------------------------
DEATH OF OWNER BEFORE THE INCOME DATE: Upon the Owner's death, or the death of
any joint Owner, before the Income Date, the death benefit will be paid to the
beneficiary(ies) designated by You. Upon the death of a joint Owner, the
surviving joint Owner, if any, will be the designated beneficiary. Any other
beneficiary designation on record at the Company at the time of death will be
treated as a contingent beneficiary. Proceeds will be distributed on the death
of the first Owner, unless the joint Owner is the spouse.
DEATH BENEFIT AMOUNT BEFORE THE INCOME DATE: The standard death benefit is equal
to the greater of:
1. the Contract Value at the end of the Valuation Period during which due
proof of death and an election of the type of payment to the beneficiary
is received by the Company; or
2. the total Premium paid prior to the death of the Owner, minus the sum of:
a. the total withdrawals and any Withdrawal Charges assessed; and
b. Premium taxes incurred.
In addition, the Company will provide an enhanced death benefit. The enhanced
death benefit is equal to the greater of the standard death benefit and the
following amount, which is deemed to be $0 if the Owner dies prior to the
seventh (7th) Contract Year:
The Contract Value at the seventh Contract Year, plus any Premiums paid
since that time and prior to death, minus the sum of:
a. total withdrawals and any Withdrawal Charges assessed since such
seventh Contract Year; and
b. Premium taxes incurred since the seventh Contract Year,
The enhanced death benefit shall never exceed 250% of all Premiums paid to the
contract, reduced by the amount of any withdrawals.
DEATH BENEFIT OPTIONS BEFORE INCOME DATE In the event of the Owner's death or
any joint Owner's death before the Income Date, a beneficiary must request that
the death benefit be paid under one of the death benefit options below. In
addition, if the beneficiary is the spouse of the Owner, he or she may elect to
continue the contract, at the then Contract Value, in his or her own name and
exercise all the Owner's rights under the Contract. The following are the death
benefit options:
- - Option 1 - lump-sum payment of the death benefit; or
- - Option 2 - payment of the entire death benefit within 5 years of the date
of the death of the Owner or any joint Owner; or
- - Option 3 - payment of the death benefit under an Income Option over the
lifetime of the beneficiary or over a period not extending beyond the
life expectancy of the beneficiary, with distribution beginning within
one year of the date of the Owner's death or any joint Owner's death.
17
<PAGE> 18
- --------------------------------------------------------------------------------
DEATH BENEFIT PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
Any portion of the death benefit not applied under Option 3 within one year of
the date of an Owner's death must be distributed within five years of the date
of death.
If a lump-sum payment is requested, the amount will be paid within seven (7)
days of receipt of proof of death by the Company and the election unless the
suspension or deferral of payments provision is in effect.
Payment to the beneficiary, other than in a single sum, may only be elected
during the sixty-day period beginning with the date of receipt of proof of death
by the Company.
DEATH OF OWNER AFTER THE INCOME DATE: If the Owner, or any joint Owner, dies
after the Income Date, and the Owner is not an Annuitant, any remaining payments
under the Annuity option elected will continue at least as rapidly as under the
method of distribution in effect at the Owner's death.
DEATH OF ANNUITANT BEFORE INCOME DATE: Upon the death of an Annuitant, who is
not an Owner, before the Income Date, the Owner may designate a new Annuitant.
If no designation is made within 30 days of the death of the Annuitant, the
Owner will become the Annuitant.
If the Owner is a non-individual, the death of the primary Annuitant will be
treated as the death of the Owner and a new Annuitant may not be designated. A
change in the primary Annuitant will be treated as the death of the Owner.
DEATH OF ANNUITANT AFTER INCOME DATE: Upon the death of the Annuitant after the
Income Date, the death benefit, if any, will be as specified in the Income
Option elected. Death benefits will be paid at least as rapidly as under the
method of distribution in effect at the Annuitant's death.
18
<PAGE> 19
- --------------------------------------------------------------------------------
INCOME PROVISIONS
- --------------------------------------------------------------------------------
Any income benefits at the time of their commencement will not be less than
those that would be provided to a single premium immediate annuity applicant of
the same class.
INCOME DATE. The date on which Annuity payments are to begin which will be at
least one year after the Issue Date. The Owner may change the Income Date at any
time, at least seven days prior to the Income Date then indicated on the
Company's records, by written notice to the Company.
INCOME OPTIONS. The Owner, or any beneficiary who is so entitled, may elect to
receive a single sum at the end of the accumulation period. However, a single
sum distribution may be deemed to be a withdrawal, and at least a portion of it
may be subject to income tax. Alternatively, an Income Option may be elected.
The Owner may, upon written notice to the Company, elect an income option at any
time prior to the Income Date.
A change of income options is permitted if made at least seven days before the
Income Date. If no other income option is elected, monthly annuity payments will
be made in accordance with option 3 below, a life Annuity with 120 or 240
monthly payments guaranteed. Annuity payments may be made in monthly, quarterly,
semiannual or annual installments as selected by the Owner. However, if the
amount available to apply under an income option is less than $2,000, the
Company may pay the Contract Value in a single sum. In addition, if the first
payment provided would be less than $20, the Company may require the frequency
of payments be at quarterly, semi-annual or annual intervals so as to result in
an initial payment of at least $20.
Upon written notice filed with the Company, all or part of the Contract Value
will be applied to provide one of the following income options. The portion of
the Contract Value which is in the Guaranteed Period immediately prior to the
Income Date, applied to an income option, will be subject to an applicable
Interest Rate Adjustment.
- - OPTION 1 - LIFE INCOME An Annuity payable monthly during the lifetime of
the Annuitant. Under this option, no further payments are payable after the
death of the Annuitant, and there is no provision for a death benefit
payable to the beneficiary. Therefore, it is possible under option 1 for
the payee to receive only one monthly Annuity payment under this Contract.
- - OPTION 2 - JOINT AND SURVIVOR An Annuity payable monthly while both the
Annuitant and a designated second person are living. Upon the death of
either person, the monthly income payable will continue during the lifetime
of the survivor. If a reduced payment to the survivor is desired, variable
Annuity payments will be determined using either one-half or two-thirds of
the number of each type of Annuity Unit credited. Fixed payments will be
equal to either one-half or two-thirds of the fixed payment payable during
the joint life of the Annuitant and the designated second person.
Annuity payments terminate automatically and immediately upon the death of
the surviving person without regard to the number or total amount of
payments received.
There is no minimum number of guaranteed payments, and it is possible to
have only one Annuity payment if both the Annuitant and the designated
second person die before the due date of the second payment.
19
<PAGE> 20
- --------------------------------------------------------------------------------
INCOME PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
- - OPTION 3 - LIFE ANNUITY WITH 120 OR 240 MONTHLY PAYMENTS GUARANTEED An
Annuity payable monthly during the lifetime of the Annuitant with the
guarantee that if, at the death of the Annuitant, payments have been made
for fewer than the guaranteed 120 or 240 monthly periods, as elected by the
Owner, the balance of the guaranteed number of payments will be made to the
payee.
- - OPTION 4 - INCOME FOR A SPECIFIED PERIOD Under this option, a payee can
elect an Annuity payable monthly for any period of years from 5 to 30. This
election must be made for full 12-month periods. In the event the payee
dies before the specified number of payments has been made, the beneficiary
may elect to continue receiving the scheduled payments or may alternatively
elect to receive the discounted present value of any remaining guaranteed
payments in a lump sum. The discounted present value is determined by
taking the remaining guaranteed benefit as of the date the calculation is
being performed. The Company uses the rate assumed in the calculation.
- - ADDITIONAL OPTIONS. Other income options may be made available by the
Company.
FIXED ANNUITY PAYMENTS. Each fixed Annuity payment is the same amount on every
payment date. The payment is equal to:
1) Contract Value allocated to the fixed Annuity option as of the Income Date;
less
2) Any deduction for Premium tax; multiplied by
3) The appropriate Annuity factor in this Contract.
The Annuity factor is different for each income option. Reserves for fixed
Annuity payments are held in the Company's general account.
Interest in excess of the guaranteed rate may be credited by the Company. The
interest credited will never be less than the guaranteed rate.
AMOUNT OF VARIABLE ANNUITY PAYMENTS.
FIRST VARIABLE PAYMENT. The dollar amount of the first monthly Annuity payment
will be determined by applying the portion of the Contract Value allocated to
Variable Annuity payments, less any applicable Premium taxes, to the Annuity
table applicable to the income option chosen. Those tables are based on a set
amount per $1,000 of proceeds applied.
The dollars applied are divided by 1,000, and the result multiplied by the
appropriate Annuity factor appearing in the table to compute the amount of the
first monthly Annuity payment. That amount is divided by the value of an Annuity
Unit as of the Income Date to establish the number of Annuity Units representing
each variable Annuity payment. The number of Annuity Units determined for the
first variable Annuity payment remains constant for the second and subsequent
monthly variable Annuity payments, assuming that no reallocation of Contract
Values is made. The total variable Annuity payment is equal to the sum of the
Annuity payments as determined above for each Portfolio to which the Contract
Value is allocated on the Annuity date.
NUMBER OF VARIABLE ANNUITY UNITS. The number of Annuity Units for each
applicable Portfolio is the amount of the first Annuity payment attributable to
that Portfolio divided by the value of the applicable Annuity Unit for that
Portfolio as of the Income Date. The number will not change as a result of
investment experience.
20
<PAGE> 21
- --------------------------------------------------------------------------------
INCOME PROVISIONS (CONT'D)
- --------------------------------------------------------------------------------
ANNUITY UNIT VALUE. The initial value of an Annuity Unit of each Portfolio is
set as of the date of annuitizations. The value may increase or decrease from
one Valuation Period to the next. For any Valuation Period, the value of an
Annuity Unit of a particular Portfolio is the value of that Annuity Unit during
the last Valuation Period, multiplied by the net investment factor for that
Portfolio for the current Valuation Period.
The NET INVESTMENT FACTOR is an index applied to measure the net investment
performance of a Portfolio from one Valuation Day to the next.
The net investment factor for any Portfolio for any Valuation Period is
determined by dividing (a) by (b) and then subtracting (c) from the result
where:
(a) is the result of:
(1) the net asset value of a Fund share held in the Portfolio
determined as of the Valuation Day at the end of the Valuation
Period, plus
(2) the per share amount of any dividend or other distribution
declared by the Fund if the "ex-dividend" date occurs during the
Valuation Period, plus or minus
(3) a per-share credit or charge with respect to any taxes paid or
reserved for by the Company during the Valuation Period which are
determined by the Company to be attributable to the operation of
the Portfolio (no federal income taxes are applicable under
present law);
(b) is the net asset value of the Fund share held in the Portfolio
determined as of the Valuation Day at the end of the preceding
Valuation Period; and
(c) is the contract insurance charges, which include the mortality and
expense risks, and administration charges, as shown on the contract
data page (page 3 of the contract).
The result is then multiplied by a second factor which offsets the effect of the
assumed investment rate of 3% per annum.
SUBSEQUENT VARIABLE ANNUITY PAYMENTS. After the first variable Annuity payment,
payments will vary in amount according to the investment performance of the
applicable Portfolios. The amount may change from month to month.
The amount of each subsequent payment is the sum of:
The number of Annuity Units for each Portfolio as determined for the first
Annuity payment, multiplied by the value of an Annuity Unit for that
Portfolio at the end of the Valuation Period immediately preceding in which
payment is due.
We guarantee that the amount of each variable Annuity payment will not be
effected by variations in expenses or mortality experience.
BASIS OF COMPUTATION. The actuarial basis for the Table of Income Options is the
1983a Annuity Mortality Table, with interest at 3.00%.
21
<PAGE> 22
- --------------------------------------------------------------------------------
TABLE OF INCOME OPTIONS
- --------------------------------------------------------------------------------
The following table is for a contract whose net proceeds are $1,000, and will
apply pro rata to the amount payable under this Contract.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
UNDER OPTION 4 MONTHLY INSTALLMENT UNDER OPTIONS 1 OR 3
- -----------------------------------------------------------------------------------------------------------------------------
No. of Monthly Age No. of Mos. Age No. of Mos. Age No. of Mos. Age No. of Mos.
Monthly Install- of Certain of Certain of Certain of Certain
Install- ments Payee Payee Payee Payee
ments
-----------------------------------------------------------------------------------------------------------
Male Life 120 240 Male Life 120 240 Female Life 120 240 Female Life 120 240
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 17.95 40 3.67 3.66 3.61 70 7.28 6.64 5.28 40 3.44 3.43 3.42 70 6.29 5.99 5.14
72 15.17 41 3.72 3.71 3.68 71 7.56 6.82 5.33 41 3.48 3.47 3.45 71 6.52 6.17 5.20
84 13.19 42 3.77 3.76 3.70 72 7.86 7.00 5.36 42 3.52 3.51 3.48 72 6.78 6.35 5.24
96 11.71 43 3.82 3.81 3.74 73 8.19 7.17 5.39 43 3.56 3.55 3.52 73 7.02 6.54 5.30
108 10.56 44 3.89 3.86 3.79 74 8.52 7.35 5.41 44 3.60 3.59 3.56 74 7.31 6.73 5.34
120 9.64 45 3.95 3.92 3.83 75 8.90 7.53 5.43 45 3.64 3.63 3.60 75 7.82 6.92 5.37
132 8.89 46 4.00 3.98 3.89 76 9.30 7.71 5.45 46 3.70 3.69 3.64 76 7.96 7.12 5.40
144 8.26 47 4.07 4.04 3.94 77 9.71 7.89 5.47 47 3.75 3.74 3.69 77 8.32 7.33 5.43
156 7.73 48 4.14 4.10 3.99 78 10.17 8.05 5.48 48 3.80 3.79 3.74 78 8.72 7.53 5.45
168 7.28 49 4.21 4.17 4.04 79 10.66 8.21 5.49 49 3.86 3.84 3.79 79 9.16 7.73 5.46
180 6.88 50 4.28 4.24 4.10 80 11.19 8.37 5.50 50 3.92 3.91 3.83 80 9.62 7.93 5.48
192 6.55 51 4.37 4.31 4.16 81 11.75 8.51 5.50 51 3.98 3.96 3.89 81 10.13 8.11 5.49
204 6.25 52 4.45 4.39 4.22 82 12.34 8.65 5.51 52 4.05 4.02 3.95 82 10.68 8.30 5.50
216 5.97 53 4.53 4.47 4.27 83 12.97 8.77 5.51 53 4.11 4.09 4.00 83 11.28 8.47 5.50
228 5.74 54 4.63 4.55 4.33 84 13.65 8.90 5.52 54 4.20 4.17 4.06 84 11.93 8.83 5.51
240 5.52 55 4.72 4.65 4.40 85 14.36 9.00 5.52 55 4.27 4.24 4.13 85 12.64 8.77 5.51
252 5.34 56 4.83 4.74 4.47 86 15.11 9.10 5.52 56 4.36 4.31 4.19 86 13.39 8.91 5.52
264 5.16 57 4.94 4.84 4.53 87 15.91 9.19 5.52 57 4.44 4.40 4.25 87 14.20 9.02 5.52
276 5.00 58 5.05 4.94 4.60 88 16.74 9.26 5.52 58 4.53 4.49 4.31 88 15.07 9.13 5.52
288 4.86 59 5.18 5.05 4.68 89 17.84 9.34 5.52 59 4.64 4.57 4.39 89 15.99 9.21 5.52
300 4.72 60 5.31 5.17 4.73 90 18.59 9.39 5.52 60 4.74 4.68 4.45 90 16.96 9.30 5.52
312 4.60 61 5.45 5.28 4.79 61 4.86 4.78 4.52
324 4.49 62 5.61 5.42 4.86 62 4.97 4.89 4.60
336 4.38 63 5.77 5.56 4.92 63 5.10 5.00 4.67
348 4.28 64 5.94 5.69 4.98 64 5.23 5.12 4.74
360 4.19 65 6.13 5.84 5.04 65 5.38 5.25 4.81
66 6.33 5.98 5.10 66 5.54 5.38 4.88
67 6.55 6.14 5.15 67 5.70 5.52 4.95
68 6.78 6.31 5.20 68 5.88 5.67 5.01
69 7.02 6.48 5.24 69 6.08 5.83 5.08
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: The table calculations under Option 2 are available from the Company upon
request.
22
<PAGE> 1
EXHIBIT 99.B5
<TABLE>
<S><C>
JACKSON NATIONAL LIFE
- ----------------------------- [JACKSON NATIONAL LOGO]
INSURANCE COMPANY OF NEW YORK APPLICATION FOR
FIXED AND VARIABLE ANNUITY
2900 Westchester Avenue, Purchase, NY 10577 USE DARK INK ONLY
THE OWNER PREMIUM ALLOCATION (Whole
percentages must total 100%)
- -------------------------------------------------------------- --------------------------------------------------
Name Are you a U.S. citizen?
[] Yes [] No
JNL(R)Aggressive Growth ________%
- -------------------------------------------------------------- JNL Capital Growth ________%
Date of Birth Relationship JNL Global Equities ________%
JNL/Alger Growth ________%
- -------------------------------------------------------------- JNL/Eagle Core Equity ________%
Social Security Number/Federal I.D. - - JNL/Eagle Small Cap Equity ________%
JNL/Putnam Growth ________%
JNL/Putnam Value Equity ________%
- -------------------------------------------------------------- JNL/S&P Conservative Growth ________%
Address (Number and Street) JNL/S&P Moderate Growth ________%
JNL/S&P Aggressive Growth ________%
- -------------------------------------------------------------- JNL/S&P Very Aggressive Growth ________%
City State ZIP JNL/S&P Equity Growth ________%
JNL/S&P Equity Aggressive Growth ________%
- -------------------------------------------------------------- PPM America/JNL Balanced ________%
Phone / - PPM America/JNL High Yield Bond ________%
PPM America/JNL Money Market ________%
- -------------------------------------------------------------- Salomon Brothers/JNL Global Bond ________%
Salomon Brothers/JNL U.S. Government
JOINT OWNER & Quality Bond ________%
- -------------------------------------------------------------- T. Rowe Price/JNL Established Growth ________%
Name Are you a U.S. Citizen? T. Rowe Price/JNL International
[] Yes [] No Equity Investment ________%
T. Rowe Price/JNL Mid-Cap Growth ________%
- --------------------------------------------------------------
Date of Birth Relationship
- -------------------------------------------------------------- Guaranteed Options
Social Security Number/Federal I.D. - - 1 year____________% 5 year _____________%
3 year____________% 7 year _____________%
- --------------------------------------------------------------
ANNUITANT (if other than Proposed Owner) Subsequent payments will be invested as indicated
in Premium Allocation above unless the Company is
- -------------------------------------------------------------- otherwise instructed.
Name (Print as desired in policy) Are you a U.S. Citizen?
[] Yes [] No PREMIUM PAYMENT
- -------------------------------------------------------------- Initial premium with application $______________
Social Security Number/Federal I.D. - - IRC 1035 Exchange? [] Yes [] No
- -------------------------------------------------------------- Will this annuity replace any existing life
Date of Birth Age Sex insurance or annuity [] Yes [] No Details:
- -------------------------------------------------------------- Company ________________________________________
Address (Number and Street)
Policy No. _____________________________________
- --------------------------------------------------------------
City State ZIP Have you completed a State Replacement form (where
required)?
- -------------------------------------------------------------- [] Enclosed [] Not Required
Phone / -
- -------------------------------------------------------------- ANNUITY TYPE
Policy Number (Home Office Use Only) PLAN TYPE TYPE OF TRANSFER
- --------------------------------------------------------------
[] Non-tax Qualified [] IRC 1035 Exchange
JOINT ANNUITANT (optional) [] IRA-Individual Contribution year____ [] Direct Transfer
- -------------------------------------------------------------- [] IRA-Spousal Contribution year____ [] Direct Rollover
[] IRA-Custodial Contribution year____ [] Non-direct Rollover
Name Are you a U.S. Citizen? [] IRA-SEP Contribution year____ [] Trustee to Trustee
[] Yes [] No [] IRA-Roth Contribution year____ [] Transfer
[] 403(b)
- -------------------------------------------------------------- [] 401(k) Qualified Savings Plan
Social Security Number/Federal I.D. - - [] HR-10 (KEOGH) Plans
[] Other ________________________________________________
- --------------------------------------------------------------
Date of Birth Relationship
- --------------------------------------------------------------
THE BENEFICIARY
- --------------------------------------------------------------
(PRIMARY) NAME
- --------------------------------------------------------------
Date of Birth Relationship
- --------------------------------------------------------------
CONTINGENT NAME
- --------------------------------------------------------------
Date of Birth Relationship
- --------------------------------------------------------------
</TABLE>
V2555 11/95
<PAGE> 2
<TABLE>
<S><C>
DOLLAR-COST AVERAGING (Minimum $15,000) SYSTEMATIC WITHDRAWAL PROGRAM
- --------------------------------------------------------------------------- --------------------------------------------
I authorize the Company to transfer the following amount as indicated below
(min. $100). Transfers are available from all variable accounts and the By checking "yes" below, I hereby elect to
one-year guaranteed account. (Check transfer frequency.) participate in the Systematic Withdrawal
[ ] Monthly [ ] Quarterly [ ] Semiannually [ ] Annually Program. In so doing, I authorize the
Please make the first transfer on __/__/19__(m/d/y) Company to forward the appropriate
administrative form for my review and
SOURCE FUND DESTINATION FUND AMOUNT signature. I understand that this request
(One source fund only) $ is subject to the terms of the contract,
- -------------------- ---------------- ------------------ and receipt of a properly executed form.
$
- -------------------- ---------------- ------------------
$
- -------------------- ---------------- ------------------
$
- -------------------- ---------------- ------------------ [ ] Yes [ ] No
$
- -------------------- ---------------- ------------------
- --------------------------------------------------------------------------- --------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
PRE-AUTHORIZED CHECK [PICTURE] REBALANCING
(attach voided check) ------------------------------------
- ------------------------------------------------------------------------------------------ Rebalancing to begin
I authorize JNL/NY to withdraw $_____________________starting_______________(month), 19__ on__/__/__(date).
from my checking account for future premiums to the Contract with the following frequency: Rebalancing should occur:
[ ] Monthly [ ] 5th or [ ] 20th [ ] Quarterly (20th of January, April, July and [ ] Monthly [ ] Quarterly
October) [ ] Semiannually [ ] Annually
- ------------------------------------------------------------------------------------------ ------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
IMPORTANT: MAKE ALL CHECKS PAYABLE ONLY TO JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK
- ------------------------------------------------------------------------------------------------------------------------------------
1. I hereby represent to the best of my knowledge and belief 4. I have been given a current Prospectus for this variable
that each of the statements and answers contained above annuity and for each Series listed above.
are full, complete and true.
2. The Social Security or taxpayer identification number shown 5. The Contract I (we) have applied for is suitable for my
above is certified to be correct. (our) insurance investment objective, financial
situation and needs.
3. I UNDERSTAND THAT ANNUITY PREMIUMS, BENEFITS, AND SURRENDER 6. I UNDERSTAND THAT AMOUNTS PAYABLE FROM THE GUARANTEED
VALUES, IF ANY, WHEN BASED ON THE INVESTMENT EXPERIENCE OF ACCOUNT OPTION UNDER THIS CONTRACT ARE SUBJECT TO AN
A SEPARATE ACCOUNT OF JNL/NY, ARE VARIABLE AND MAY BE INTEREST RATE ADJUSTMENT IF WITHDRAWN OR TRANSFERRED
INCREASED OR DECREASED, AND THE DOLLAR AMOUNTS ARE NOT PRIOR TO THE END OF THE APPLICABLE GUARANTEED PERIOD.
GUARANTEED.
- ------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Dated and signed Signature of Annuitant
at
----------------------------------- ------------------------------------------------------------------------------------
City State Signature of Owner if other than Annuitant Title
------------------------------------------------------------------------------------
on 19 Joint Owner or Joint Annuitant
---------------------------- -----
------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
REGISTERED REPRESENTATIVE STATEMENT
Agent statement: To the best of my knowledge and belief, this application [ ] WILL [ ] WILL NOT replace any life insurance or
annuities. I have complied with requirements for disclosure and/or replacement as necessary.
I certify that I am authorized and qualified to discuss the Contract.
- ------------------------------------------------------------------------------------------------------------------------------------
Agent/Representative's Full Name (Please Print) JNL/NY Agent Number Phone No.
- ------------------------------------------------------------------------------------------------------------------------------------
Address City State
- ------------------------------------------------------------------------------------------------------------------------------------
Signature of Agent/Representative Date
- ------------------------------------------------------------------------------------------------------------------------------------
Broker/Dealer Name and No. Agent Number
- ------------------------------------------------------------------------------------------------------------------------------------
APPLICATION, FUNDS AND TRANSFER PAPERWORK MUST BE SENT TO: [JACKSON NATIONAL LIFE INSURANCE COMPANY OF NEW YORK LOGO]
Jackson National Life Insurance Company of New York JACKSON NATIONAL LIFE
Service Center INSURANCE COMPANY OF NEW YORK
P.O. Box 0809 -----------------------------
Denver, CO 80263-0809 Insuring your financial future.(R)
Home Office: Purchase, New York
1/800/599-5651
FOR APPLICATION QUESTIONS OR ASSISTANCE, PLEASE CALL 800/599-5651 (7:00 A.M. TO 6:00 P.M. MT).
</TABLE>
V2555 11/95
<PAGE> 1
EXHIBIT-99.B9
Blazzard, Grodd & Hasenauer, P.C.
ATTORNEYS AT LAW
943 POST ROAD EAST * P.O. BOX 5108
NORSE N. BLAZZARD WESTPORT, CONNECTICUT 06881-5108
LESLIE E. GRODD TELEPHONE (203) 226-7866
JUDITH A. HASENAUER FACSIMILE (203) 454-4206
WILLIAM E. HASENAUER
RAYMOND A. O'HARA III SUITE 213, OCEANWALK MALL
LYNN KORMAN STONE 101 NORTH OCEAN DRIVE
HOLLYWOOD, FLORIDA 33019
TELEPHONE (305) 920-4004
FACSIMILE (305) 920-6902
February 3, 1998
Board of Directors
Jackson National Life Insurance Company of New York
2900 Westchester Avenue
Purchase, New York 10577
Re: Opinion of Counsel - JNLNY Separate Account I
---------------------------------------------
Gentlemen:
You have requested our Opinion of Counsel in connection with the filing with
the Securities and Exchange Commission of a Pre-Effective Amendment to a
Registration Statement on Form N-4 for the Individual Flexible Purchase Payment
Deferred Variable Annuity Contracts (the "Contracts") to be issued by Jackson
National Life Insurance Company of New York and its separate account, JNLNY
Separate Account I.
We have made such examination of the law and have examined such records and
documents as in our judgment are necessary or appropriate to enable us to
render the opinions expressed below.
We are of the following opinions:
1. JNLNY Separate Account I a Unit Investment Trust as that term is
defined in Section 4(2) of the Investment Company Act of 1940 (the "Act"), and
is currently registered with the Securities and Exchange Commission, pursuant
to Section 8(a) of the Act.
<PAGE> 2
2. Upon the acceptance of purchase payments made by an Owner pursuant
to a Contract issued in accordance with the Prospectus contained in the
Registration Statement and upon compliance with applicable law, such an Owner
will have a legally-issued, fully paid, non-assessable contractual interest
under such Contract.
You may use this opinion letter, or a copy thereof, as an exhibit to the
Registration Statement.
We consent to the reference to our Firm under the caption "Services"
contained in the Statement of Additional Information which forms a part of the
Registration Statement.
Sincerely,
BLAZZARD, GRODD & HASENAUER, P.C.
By: /s/ Lynn Korman Stone
----------------------
Lynn Korman Stone
<PAGE> 1
EX-99.B10
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the reference to us under the heading "Services" in the
Statement of Additional Information constituting part of this Pre-Effective
Amendment No. 1 to the registration statement on Form N-4.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Chicago, Illinois
February 6, 1998
