<PAGE>
Registration No. 2-74667
Registration No.811-3301
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No.
Post-Effective Amendment No. 32 [X]
AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 34 [X]
(Check appropriate box or boxes)
--------------------------------
SEPARATE ACCOUNT NO. 301
of
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
(Exact Name of Registrant)
--------------------------
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
(Name of Depositor)
1290 Avenue of the Americas, New York, New York 10104
(Address of Depositor's Principal Executive Offices)
+
Depositor's Telephone Number, including Area Code: 1-(800) 248-2138
--------------------------
ROBIN WAGNER
VICE PRESIDENT AND COUNSEL
The Equitable Life Assurance Society of the United States
1290 Avenue of the Americas, New York, New York 10104
(Names and Addresses of Agents for Service)
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Please send copies of all communications to:
PETER E. PANARITES
Freedman, Levy, Kroll & Simonds
1050 Connecticut Avenue, N.W., Suite 825
Washington, D.C. 20036
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<PAGE>
Approximate Date of Proposed Public Offering: Continuous
It is proposed that this filing will become effective (check
appropriate box):
[ ] Immediately upon filing pursuant to paragraph (b) of Rule 485.
[X] On May 1, 2000 pursuant to paragraph (b) of Rule 485.
[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485.
[ ] On (date) pursuant to paragraph (a)(1) of Rule 485.
[ ] 75 days after filing pursuant to paragraph (a)(2) of Rule 485.
[ ] On (date) pursuant to paragraph (a)(3) of Rule 485.
If appropriate, check the following box:
[ ] This post-effective amendment designates a new effective date for
previously filed post-effective amendment.
Title of Securities Being Registered:
Units of interest in separate account under variable annuity contracts.
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<PAGE>
Equitable Life's 300+ Series
Certificates under Group Annuity
Contracts
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PROSPECTUS [GRAPHIC OF EQUITABLE LOGO]
MAY 1, 2000
<PAGE>
Equitable Life's 300+ Series
Certificates under Group Annuity Contracts
PROSPECTUS DATED MAY 1, 2000
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This prospectus contains important information that you should know before
purchasing, or taking any other action under a Certificate. Also, at the end of
this prospectus you will find attached the prospectus for EQ Advisors Trust,
which contains important information about the Funds. Please read and keep these
prospectuses for future reference.
WHAT IS EQUITABLE LIFE'S 300+ SERIES?
Equitable Life's 300+ Series Certificates are group annuity contracts issued by
The Equitable Life Assurance Society of the United States. They provide a means
for the accumulation of retirement savings and for income. You invest to
accumulate on a tax-deferred basis in one or more of our variable investment
funds ("Funds") or guaranteed rate accounts ("GRAs"), the "investment options"
in Equitable Life's 300+ Series.
<TABLE>
<CAPTION>
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VARIABLE INVESTMENT FUNDS
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<S> <C>
o Alliance Money Market o Alliance Conservative
o Alliance Intermediate Investors
Government Securities o Alliance Growth Investors
o Alliance High Yield o MFS Emerging Growth
o EQ/Balanced* Companies
o Alliance Growth & Income o BT Equity 500 Index
o Alliance Common Stock o Lazard Small Cap Value
o EQ/Aggressive Stock** o T. Rowe Price International
o Alliance Global Stock
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</TABLE>
* Formerly known as Alliance Balanced.
** Formerly known as Alliance Aggressive Stock.
You may allocate amounts to any of the Funds. They, in turn, invest in a
corresponding securities portfolio ("Portfolio") of EQ Advisors Trust. Your
investment results in a Fund will depend on the investment experience of the
related Portfolio and timing of transactions such as contributions and
transfers. Each Fund is a subaccount of our Separate Account No. 301.
GUARANTEED RATE ACCOUNTS. You may allocate amounts to the GRAs which offer
guarantees of principal, as well as interest at rates we set.
TYPES OF CONTRACTS. We offer the Certificates for use as:
o Regular IRAs or Roth IRAs
o Tax Sheltered Annuities ("TSAs")
o Simplified Employee Pensions ("SEP")
o Savings Incentive Match Plans for Employees ("SIMPLE")
A registration statement relating to this offering has been filed with the
Securities and Exchange Commission ("SEC"). A Statement of Additional
Information, or "SAI," dated May 1, 2000, which is part of the registration
statement, is available free of charge upon request by writing to us or calling
1-800-248-2138, our toll-free number. The SAI has been incorporated by reference
into this prospectus. The table of contents for the SAI appears at the back of
this prospectus.
THE SEC HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE. THE CERTIFICATES ARE NOT INSURED BY THE FDIC OR ANY OTHER
AGENCY. THEY ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF ANY BANK AND ARE NOT BANK
GUARANTEED. THEY ARE SUBJECT TO INVESTMENT RISKS AND POSSIBLE LOSS OF PRINCIPAL.
---------------------------------
Copyright 2000 The Equitable Life Assurance Society of the United States, New
York, New York 10104. All rights reserved.
<PAGE>
Contents of this prospectus
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2
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EQUITABLE LIFE'S 300+ SERIES
<TABLE>
<CAPTION>
<S> <C>
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Index of Key Words and Phrases 4
Equitable Life's 300+ Series Certificates at a Glance -
Key Features 5
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FEE TABLE 6
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Examples 7
Condensed financial information 8
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1 CERTIFICATE FEATURES 9
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How Do I Purchase and Contribute to My Certificate? 9
Owner and Annuitant Requirements 10
How Do I Make My Contributions? 10
What Are My Investment Options Within the Certificate? 11
Portfolios of EQ Advisors Trust 11
Guaranteed Rate Accounts 11
Allocating Your Contributions 12
Your Right to Cancel Within a Certain Number of Days 13
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2 DETERMINING YOUR CERTIFICATE'S VALUE 14
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Your Account Balance in the Funds 14
Your Account Balance in the GRAs 14
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3 TRANSFERRING YOUR MONEY AMONG
INVESTMENT OPTIONS 15
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</TABLE>
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"We," "our" and "us" refers to Equitable Life.
When we address the reader of this prospectus with words such as "you" and
"your," we mean the person who has the right or responsibility that the
prospectus is discussing at that point. This is usually the Certificate owner
who we may also refer to as the "participant."
<PAGE>
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3
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<TABLE>
<CAPTION>
<S> <C>
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4 ACCESSING YOUR MONEY 16
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Withdrawing Your Account Balance 16
Choosing Your Retirement Payout Options 16
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5 CHARGES AND EXPENSES 19
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Charges that Equitable Life Deducts 19
Charges for State Premium and Other Applicable Taxes 19
Charges That EQ Advisors Trust Deducts 19
Certain Expense Limitations 20
Life Annuity Administrative Charge 20
SEP and SIMPLE Enrollment Fee 20
Guaranteed Rate Accounts Withdrawal Charge 21
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6 PAYMENT OF DEATH AND DISABILITY BENEFIT 22
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Your Beneficiary and Payment of Death Benefit 22
When the Participant Dies Before Distributions Begin 22
When the Participant Dies After the Retirement Date 22
Disability Payment 22
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7 TAX INFORMATION 23
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Tax Changes 23
Tax-Sheltered Annuity Arrangements (TSAs) 23
Individual Retirement Annuities (Regular and Roth IRAs) 23
IRAs Under Simplified Employee Pension Plans (SEPs and
SIMPLEs) 23
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8 MORE INFORMATION 25
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About Equitable Life 25
About Separate Account No. 301 25
About EQ Advisors Trust 25
About the General Account 26
Dates and Prices at Which Certificate Events Occur 26
About Your Voting Rights 26
About the Group Annuity Contracts 27
IRS Disqualification 27
About Legal Proceedings 27
About Our Independent Accountants 28
Transfers of Ownership, Collateral Assignments, Loans,
and Borrowing 28
Underwriter 28
Reports and Additional Information 28
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9 INVESTMENT PERFORMANCE 29
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Benchmarks 29
Annual Percent Changes in Unit Value 30
Annualized Rates of Returns 31
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10 APPENDIX I: CONDENSED FINANCIAL
INFORMATION A-1
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11 TABLE OF CONTENTS OF STATEMENT OF
ADDITIONAL INFORMATION S-1
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12 HOW TO REACH US back cover
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</TABLE>
<PAGE>
Equitable Life's 300+ Series
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4
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INDEX OF KEY WORDS AND PHRASES
This index should help you locate more information on the terms used in this
prospectus.
<TABLE>
<CAPTION>
PAGE
<S> <C>
Accessing Your Money 16
account balance 14
annuitant 17
Annuity Payout Options 17
beneficiary 22
Business Day 10
cash value 14
Charges and Expenses 19
contributions 10
Death Benefit 22
Guaranteed Rate Accounts 12
Investment Options 11
Investment Performance 29
Key Features 5
Payout Options 16
Portfolio cover
Processing Office back cover
Regular IRA 23
Retirement Payout Options 16
Right to Cancel 13
Roth IRA 23
SAI S-1
SEPs 23
SIMPLEs 23
Tax Information 23
Transferring Your Money 15
TSA 23
Unit 14
Variable Investment Funds 11
Voting Rights 26
</TABLE>
<PAGE>
Equitable Life's 300+ Series
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5
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EQUITABLE 300+ SERIES CERTIFICATES AT A GLANCE - KEY FEATURES
PROFESSIONAL INVESTMENT MANAGEMENT
Equitable Life's 300+ Series Funds invest in different Portfolios managed by
professional investment advisers.
GUARANTEED RATE ACCOUNTS
o New GRAs with one and three-year guarantee periods offered quarterly.
o Principal guaranteed; interest guaranteed when GRA is held to maturity of
guarantee period.
TAX ADVANTAGES OF PLAN
o On contributions
Pre-tax contributions except for certain IRAs and for Roth IRAs.
o On earnings inside the Certificate
No tax on any dividends, interest or capital gains until you make
withdrawals or receive distributions.
o On transfers inside the Certificate
No tax on transfers among investment options.
o On payout
Tax-favored payout alternatives.
If you are buying a contract to fund a retirement plan that already provides tax
deferral under Federal income tax rules, you should do so for the contract's
features and benefits other than tax deferral. The tax deferral of the contract
does not provide additional benefits
MINIMUM CONTRIBUTION AMOUNTS
o Equitable Life has no minimum (If you are contributing through an employer,
the employer may have a minimum).
ACCESS TO YOUR MONEY
o Lump sum withdrawals (You may be subject to a withdrawal charge for certain
withdrawals or transfers from the GRAs. You may also incur income tax and a
penalty tax on any withdrawal.)
PAYOUT ALTERNATIVES
o Fixed annuity payout benefit
o Periodic distribution option
o Single sum payment
o Other annuity or optional retirement benefits we may offer
ADDITIONAL FEATURES
o Transfers among the Funds.
o Transfers from the GRAs, subject to special rules
o Toll-free telephone access to information regarding your account and use of
AIM system for transfers
FEES AND CHARGES
o Participant service charge assessed quarterly for certain administrative
services. Maximum of $30 per year.
o Administrative charge, for expenses not covered by the participant service
charge, assessed daily against assets of the Funds at an annual rate of
0.25%.
o Other expenses charged directly to the Funds for operating expenses. o 7%
charge, not to exceed interest earned, on amounts withdrawn or transferred
from GRAs. There are exceptions to withdrawal charge.
o Annual expenses of EQ Advisors Trust Portfolios are calculated as a
percentage of net assets in each Portfolio. These expenses include
management fees ranging from 0.25% to 0.85% annually, other expenses and,
for certain portfolios, 12b-1 fees of 0.25% annually.
o One-time enrollment fee of $25 for each employee Certificate owner
participating in a SEP or SIMPLE; payable by the employee or the employer.
o Annuitization fee of up to $350 if a participant elects an annuity option
at retirement. A higher fee may apply when an optional annuity benefit,
other than the normal form of annuity, is elected.
The above is not a complete description of all material provisions of the
Certificates. For more detailed information we urge you to read the contents of
this prospectus, as well as your Certificate. Please feel free to speak with us
if you have any questions.
<PAGE>
Fee table
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6
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The fee table below will help you understand the various charges and expenses
that apply under your Certificate. The table reflects Fund charges you will
directly incur under the Certificate, as well as charges and expenses of the
Portfolios that you will bear indirectly. Charges designed to approximate
certain taxes that may be imposed on us, such as state premium taxes in your
state, and enrollment fees may also apply. Also, an annuity administrative fee
may apply when your annuity payments are to begin. Each of the charges and
expenses is further discussed under "Charges and Expenses" later in this
prospectus. For a complete description of Portfolio charges and expenses, please
see the attached prospectus for EQ Advisors Trust. The Fund charges shown in the
table are expressed as an annual percentage of daily net assets, in each Fund.
The EQ Advisors Trust annual expenses are shown as a percentage of average daily
net assets in each Portfolio.
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CERTIFICATE OWNER TRANSACTION EXPENSES:
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Sales load on purchases None
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Maximum annual participant service charge $30
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EQ ADVISORS TRUST ANNUAL EXPENSES
<TABLE>
<CAPTION>
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FUND RELATED EXPENSES TRUST RELATED EXPENSES
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OTHER TOTAL ANNUAL
EXPENSES EXPENSES
ADMINISTRATION OTHER MANAGEMENT 12B-1 (AFTER EXPENSE (AFTER EXPENSE TOTAL
CHARGE EXPENSES TOTAL FEES(1) FEES(2) LIMITATION)(3) LIMITATION)(4) EXPENSES
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
Alliance Money Market 0.25% 0.12% 0.37% 0.34% N/A 0.05% 0.39% 0.76%
Alliance High Yield 0.25% 0.51% 0.76% 0.60% N/A 0.05% 0.65% 1.41%
Alliance Common Stock 0.25% 0.11% 0.36% 0.46% N/A 0.04% 0.50% 0.86%
EQ/Aggressive Stock 0.25% 0.24% 0.49% 0.60% N/A 0.04% 0.64% 1.13%
Alliance Intermediate
Government Securities 0.25% 0.16% 0.41% 0.35% N/A 0.07% 0.42% 0.83%
Alliance Growth & Income 0.25% 0.18% 0.43% 0.59% N/A 0.05% 0.64% 1.07%
Alliance Global 0.25% 0.19% 0.44% 0.73% N/A 0.09% 0.82% 1.26%
Alliance Conservative
Investors 0.25% 0.44% 0.69% 0.60% N/A 0.07% 0.67% 1.36%
Alliance Growth Investors 0.25% 0.35% 0.60% 0.57% N/A 0.05% 0.62% 1.22%
EQ/Balanced 0.25% 0.12% 0.37% 0.57% N/A 0.05% 0.62% 0.99%
BT Equity 500 Index 0.25% 0.15% 0.40% 0.25% 0.25% 0.10% 0.60% 1.00%
Lazard Small Cap Value 0.25% 0.15% 0.40% 0.75% 0.25% 0.10% 1.10% 1.50%
MFS Emerging Growth
Companies 0.25% 0.12% 0.37% 0.65% 0.25% 0.10% 1.00% 1.37%
T. Rowe Price International
Stock 0.25% 0.14% 0.39% 0.85% 0.25% 0.15% 1.25% 1.64%
</TABLE>
(1) The management fees shown reflect revised management fees, effective on May
1, 2000 which were approved by shareholders at a meeting on April 14, 2000.
The management fee shown for T. Rowe Price International Stock does not
reflect the waiver of a portion of the portfolio's investment management
fees that is currently in effect. The management fee for each portfolio
cannot be increased without a vote of each portfolio's shareholders. The
annual amount of management fees applicable to the Alliance Money Market
Portfolio and Alliance Intermediate Government Securities Portfolio is, in
each case, limited to 0.35% of the value of the Portfolio's average daily
net assets. This limitation is a Certificate right for participants who
enrolled prior to May 1, 1987 and cannot be changed without their prior
consent. Equitable Life has voluntarily agreed to impose this limitation
for all other participants in those Portfolios and reserves the right to
discontinue the limitation at any time. Absent this limitation, the
management and advisory fees for the Alliance Intermediate Government
Securities Portfolio would be 0.50% and for the Alliance Money Market
Portfolio would be 0.34%, since actual fees were less than the limitation.
See "Charges and Expenses-Expense Limitations."
(2) Applicable Portfolio shares are subject to fees imposed under the
distribution plan (the "Rule 12b-1 Plan") adopted by EQ Advisors Trust
pursuant to Rule 12b-1 under the Investment Company Act of 1940. The 12b-1
fee will not be increased for the life of the contracts.
(3) The amounts shown as "Other Expenses" will fluctuate from year to year
depending on actual expenses. See footnote (4) for any expense limitation
agreements.
On October 18, 1999, the Alliance portfolios became part of the portfolios
of EQ Advisors Trust. The "Other Expenses" for these portfolios have been
restated to reflect the estimated expenses that would have been incurred
had these portfolios been portfolios of EQ Advisors Trust for the entire
year ended December 31, 1999. The restated expenses reflect an increase of
0.01% for each of these portfolios.
<PAGE>
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7
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(4) Equitable Life, EQ Advisors Trust's manager, has entered into an expense
limitation agreement with respect to certain portfolios. Under this
agreement Equitable Life has agreed to waive or limit its fees and assume
other expenses. Under the expense limitation agreement, total annual
operating expenses of certain portfolios (other than interest, taxes,
brokerage commissions, capitalized expenditures and extraordinary expenses)
are limited as a percentage of the average daily net assets of each of the
following portfolios: 1.75% for T. Rowe Price International Stock; 1.10%
for Lazard Small Cap Value; 1.00% for MFS Emerging Growth Companies; and
0.60% for BT Equity 500 Index. The expense limitations for the BT Equity
500 Index, MFS Emerging Growth Companies, and T. Rowe Price International
Stock portfolios reflect an increase effective on May 1, 2000. The expense
limitation for the Lazard Small Cap Value Portfolio reflects a decrease
effective on May 1, 2000.
Absent the expense limitation, the "Other Expenses" for 1999 on an
annualized basis for each of the portfolios would have been as follows:
0.30% for T. Rowe Price International Stock; 0.26% for Lazard Small Cap
Value; 0.17% for MFS Emerging Growth Companies; and 0.18% for BT Equity 500
Index.
Each portfolio may at a later date make a reimbursement to Equitable Life
for any of the management fees waived or limited and other expenses assumed
and paid by Equitable Life pursuant to the expense limitation agreement
provided that, among other things, such portfolio has reached sufficient
size to permit such reimbursement to be made and provided that the
portfolio's current annual operating expenses do not exceed the operating
expense limit determined for such portfolio. For more information see the
prospectus for EQ Advisors Trust.
EXAMPLES
The examples below show the expenses that a hypothetical participant would pay,
assuming a $1,000 contribution is invested in one of the Funds listed, and a 5%
annual return on assets(1). The expenses are the same whether or not the
participant withdraws amounts held in any of the Funds. For purposes of the
examples, the participant service charge is computed by applying a charge of $12
to the average number of participants for the year, divided by average assets
for each Fund for the same period.
These examples should not be considered a representation of past or future
expenses for each Fund or Portfolio. Actual expenses may be greater or less than
those shown below. Similarly, the annual rate of return assumed in the examples
is not an estimate or guarantee of future investment performance.
<TABLE>
<CAPTION>
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1 YEAR 3 YEARS 5 YEARS 10 YEARS
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<S> <C> <C> <C> <C>
Alliance Money Market $7.96 $24.88 $43.26 $96.35
Alliance Intermediate Government
Securities 8.77 22.41 47.61 105.80
Alliance High Yield 14.67 45.55 78.64 172.01
Alliance Balanced 10.40 32.45 56.26 124.49
Alliance Growth & Income 11.22 34.96 60.56 133.71
Alliance Common Stock 9.08 28.36 49.24 109.33
Alliance Aggressive Stock 11.82 36.83 63.77 140.57
Alliance Global 13.14 40.89 70.70 155.28
Alliance Conservative Investors 14.16 44.00 76.00 166.47
Alliance Growth Investors 12.74 39.65 68.57 150.78
MFS Emerging Growth Companies 14.26 44.31 - -
BT Equity 500 Index 10.50 32.76 - -
Lazard Small Cap Value 15.58 48.34 - -
T. Rowe Price International Stock 16.99 52.66 - -
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</TABLE>
(1) The amount accumulated from the $1,000 contribution could not be paid in
the form an annuity at the end of any of the periods shown in the
examples. This is because the minimum amount applied must be $2,000 and
the initial annuity payment must be at least $20. See "Certificate
Provisions-Retirement Benefits." In some cases, charges for state premium
or other taxes will be deducted from the amount applied.
IF YOU ELECT AN ANNUITY PAYOUT OPTION UNDER WHICH WE DEDUCT A $350 ANNUITIZATION
FEE:
ASSUMING AN ANNUITY PAYOUT OPTION COULD BE ISSUED, THE EXPENSES SHOWN IN THE
ABOVE EXAMPLE WOULD, IN EACH CASE, BE INCREASED BY $4.34 BASED ON THE AVERAGE
AMOUNT APPLIED TO ANNUITY PAYOUT OPTIONS IN 1999.
<PAGE>
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CHARGE FOR WITHDRAWALS OR TRANSFERS FROM GRAS. We impose a charge of 7% of the
amount withdrawn or transferred (including the amount of the withdrawal charge),
but not more than the accumulated interest, on the amount withdrawn or
transferred, from any GRA. The charge does not apply to your contributions or at
maturity of the GRA, among other exceptions.
ANNUITIZATION FEE. If you elect the fixed annuity benefit available under your
Certificate we will deduct a charge of up to $350 at the time we provide that
benefit. The charge may be greater if, at that time, we offer more favorable
annuity purchase rates for the same benefit.
CONDENSED FINANCIAL INFORMATION
Please see APPENDIX I, at the end of this prospectus, for the unit values, as of
the dates shown, for each of the Funds.
<PAGE>
Certificate features
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9
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HOW DO I PURCHASE AND CONTRIBUTE TO MY CERTIFICATE?
You or your employer may purchase and contribute to a Certificate by making
payments to us. You may contribute under a Regular IRA, Roth IRA, SIMPLE IRA, or
under a SEP. Your employer contributes under a SEP, TSA, or SIMPLE IRA. We have
no minimum contribution amount. However, an employer may establish a minimum
contribution amount for payroll deductions. The following table summarizes
certain information regarding the Certificates and contributions.
<TABLE>
<CAPTION>
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CERTIFICATE TYPE CONTRIBUTION SOURCES CONTRIBUTION LIMITATIONS
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<S> <C>
Regular IRA o "Regular" IRA contributions o No additional regular IRA
not to exceed $2,000 each year. contributions after age
- typically pre-tax contributions o Rollovers from a qualified plan. 70 1/2.
- distributions are taxable o Rollovers from a TSA. o Rollover or direct transfer
o Rollovers from another contributions after age 70 1/2 must be
traditional individual net of required minimum distributions.
retirement arrangement.
o Direct custodian-to-custodian
transfers from other traditional
individual retirement
arrangements.
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Roth IRA o "Regular Roth" IRA contributions o Conversion rollovers after age
- after-tax contributions not to exceed $2,000 each year. 70 1/2 must be net of required
- distributions are tax-free o Conversion rollovers from a minimum distributions for the
when conditions met Regular IRA. Regular IRA you are rolling over.
o Rollovers from another Roth IRA. o You cannot make a conversion
o Direct transfers from another rollover from a Regular IRA if
Roth IRA. your adjusted gross income is
$100,000 or more.
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TSA o Employer remitted "salary o Maximum amount of contributions
- favorable tax treatment for employees reduction" and/or "nonelective" subject to tax law formula which
of tax-exempt organizations and public employer contributions. varies; maximum salary reduction
schools o Rollovers from another TSA contribution is $10,500 for
contract or arrangement. 2000.
o Direct transfers from another o Rollover or direct transfer
contract or arrangement contributions after age
complying with Code Section 70 1/2 must be net of required
403(b) by means of IRS Revenue minimum distributions.
Ruling 90-24.
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SEP o Employer contributions. o Annual employer contributions up
- simplified employee pension plans o Employee contributions permitted. to the lesser of $25,500 for
- employer contributions to a Regular IRA (only if SARSEP existed prior to 2000 or 15% of employee
issued to and owned by employee January 1, 1997) compensation.
o Employee contributions subject
to Regular IRA limits.
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SIMPLE IRA o Employee salary reduction and o Salary reduction contributions
- savings incentive match employer matching contributions up to $6,000; employer matching
plan for employees or employer non-elective contributions up to 3% of
- employer contributions to a Regular IRA contributions. employee compensation.
issued to and owned by employee
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</TABLE>
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See "Tax Information" for a more detailed discussion of certain contribution and
other limitations.
OWNER AND ANNUITANT REQUIREMENTS
The annuitant and the owner must be the same person.
HOW DO I MAKE MY CONTRIBUTIONS?
Contributions must be in the form of a check drawn on a bank in the U.S.
clearing through the Federal Reserve System, in U.S. dollars and made payable to
Equitable Life. We do not accept third party checks endorsed to us except for
rollover contributions, tax-free exchanges or trustee checks that involve no
refund. All checks are subject to collection. We reserve the right to reject a
payment if it is received in an unacceptable form.
We do not monitor whether contributions exceed limitations in the Internal
Revenue Code. However, we reserve the right to refuse contributions that we
believe to exceed those limitations.
You make contributions under a Regular IRA or Roth IRA Certificate by sending
your payment directly to us. For TSA, SEP or SIMPLE IRA Certificates, your
employer sends contributions to us on your behalf. Payroll deduction amounts
will be automatically transferred to us for allocation to the investment options
as you direct.
We invest your contributions on the date we receive them, provided they are
accompanied by a properly completed instructions form. If the date of receipt is
not a Business Day, we invest your contributions on the next Business Day.
Initial contributions must be accompanied by an application and any other form
we require to process the payments. We may retain your initial contribution for
five Business Days while we attempt to obtain any information that is missing or
unclear. If we cannot obtain the information we require within the five Business
Days, our Processing Office will inform you or your employer of the
circumstances and return the contribution unless you or your employer
specifically consent to our retaining your contribution until we receive the
required information.
OUR "BUSINESS DAY" GENERALLY IS ANY DAY ON WHICH THE NEW YORK STOCK EXCHANGE
AND EQUITABLE LIFE ARE OPEN FOR TRADING AND GENERALLY ENDS AT 4 P.M. EASTERN
TIME. WE MAY, HOWEVER, CLOSE DUE TO EMERGENCY CONDITIONS.
DISCONTINUANCE AND RESUMPTION OF CONTRIBUTIONS
If contributions are discontinued your participation under a Certificate will
remain in effect and contributions may be resumed at any time. However, under
SEP and SIMPLE Certificates, contributions may not be resumed. We reserve the
right to close a participant's account and terminate the Certificate if no
contributions are made within 120 days of the issue date of a Certificate.
We also reserve the right to close a participant's account and pay any account
balance if contributions are discontinued for at least three years from the date
of the last contribution, and either (1) the account balance does not exceed
$2,000 or (2) the annuity which the existing account balance would purchase at
the participant's retirement date would be less than $20 per month based on the
current annuity rates in effect under the Certificate.
<PAGE>
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WHAT ARE MY INVESTMENT OPTIONS WITHIN THE CERTIFICATE?
We allocate your contributions among the investment options available under the
Certificates according to your instructions. Your investment options are the
Funds and the GRAs.
VARIABLE INVESTMENT FUNDS
Your investment results in any one of the Funds will depend on the investment
performance of the underlying Portfolios. Listed below are the currently
available Portfolios, their investment objectives, and their advisers. YOU CAN
CHOOSE AMONG FUNDS THAT INVEST IN CORRESPONDING PORTFOLIOS.
PORTFOLIOS OF EQ ADVISORS TRUST
<TABLE>
<CAPTION>
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PORTFOLIO NAME OBJECTIVE ADVISER
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
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Alliance Money Market High level of current income while Alliance Capital Management L.P.
preserving assets and maintaining liquidity
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Alliance Intermediate Government High current income consistent with Alliance Capital Management L.P.
Securities relative stability of Securities principal
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Alliance High Yield High return by maximizing Alliance Capital Management L.P.
current income and, to the extent
consistent with that objective, capital
appreciation
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EQ/Balanced High return through a combination of Alliance Capital Management L.P.
current income and capital appreciation Capital Guardian Trust Company
Prudential Funds Investment Management, LLC
Jennison Associates, LLC
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Alliance Growth & Income Long-term growth through a combination of Alliance Capital Management L.P.
current income and capital appreciation
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Alliance Common Stock Long-term growth of capital and increasing Alliance Capital Management L.P.
income
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EQ/Aggressive Stock Long-term growth of capital Alliance Capital Management L.P.
MFS Financial Services Company
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Alliance Global Long-term growth of capital Alliance Capital Management L.P.
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Alliance Conservative Investors High total return without, in the adviser's Alliance Capital Management L.P.
opinion, undue risk to principal
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Alliance Growth Investors High total return consistent with the Alliance Capital Management L.P.
adviser's determination of reasonable risk
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MFS Emerging Growth Companies Long-term growth of capital Massachusetts Financial Services Company
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BT Equity 500 Index Replicate as closely as possible (before Bankers Trust Company
the deduction of Portfolio expenses) the
total return of the S&P 500
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Lazard Small Cap Value Capital appreciation Lazard Asset Management
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T. Rowe Price International Stock Long-term growth of capital Rowe Price-Fleming International, Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Other important information about the Portfolios is included in the separate
prospectus for EQ Advisors Trust attached at the end of this prospectus. We may
add or delete Portfolios under the Funds.
GUARANTEED RATE ACCOUNTS
You can allocate contributions to the GRAs that provide principal and interest
guarantees. These amounts become part of our general account assets. We discuss
our general account under "More Information."
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Currently, we offer GRAs with guarantee periods of one and three years. We may
offer additional or different guarantee periods in the future.
New one-year and three-year guarantee periods are offered each calendar quarter.
We announce a fixed interest rate for each guarantee period at least 10 days
before the beginning of the quarter. Interest rates are set according to our
procedures at the time. Thus, different interest rates may apply to different
amounts in the GRAs. All interest rates are effective interest rates, reflecting
daily compounding and the deduction of the participant service charge. The
guaranteed annual rate of interest will never be less than 3%.
At the end of a guarantee period (the maturity date), unless you instruct us
otherwise, we will automatically contribute the accumulated amount to a new
guarantee period of similar duration. If we are offering no guarantee period of
a similar duration, we will transfer the amount to the maturity period of the
shortest duration we then offer.
You may allocate amounts in maturing guarantee periods to one or more other
investment options by using the AIM System. We must receive instructions before
the maturity date. We will apply those instructions to all maturing guarantee
periods until we receive other instructions.
The amount of your contributions to the GRAs is guaranteed by us (before
deduction of any participant service charge). However, withdrawals and transfers
out of a guarantee period before a maturity date, may be subject to a withdrawal
charge. See "Charges and Expenses." For futher information regarding the GRAs,
please see "The Guaranteed Rate Accounts" in the SAI.
ALLOCATING YOUR CONTRIBUTIONS
You may allocate your contributions to one or more, or all of the Funds or GRAs.
Allocations must be in whole percentages, which you may change at any time in
writing or by telephone using our AIM System. Changes are effective on the date
we receive all necessary information. Allocation changes have no effect on
amounts already invested.
OUR ACCOUNT INVESTMENT MANAGEMENT SYSTEM (AIM SYSTEM)
Participants may use our automated AIM System to transfer between investment
options, obtain account information, change the allocation of future
contributions and maturing GRAs and hear investment performance information. To
use the AIM System, you must have a touch-tone telephone. We assign a personal
security code ("PSC") number to you after we receive your completed enrollment
form.
We have established procedures to reasonably confirm the genuineness of
instructions communicated to us by telephone when using the AIM System. The
procedures require personal identification information, including your PSC
number, prior to acting on telephone instructions, and providing written
confirmation of the transfers. Thus, we will not be liable for following
telephone instructions we reasonably believe to be genuine.
A transfer request will be effective on the Business Day we receive the request.
We will confirm all transfers in writing. We reserve the right to limit access
to this service if we determine that you are engaged in a market timing strategy
(see "Transferring your money among investment options"-"Market timing").
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YOUR RIGHT TO CANCEL WITHIN A CERTAIN NUMBER OF DAYS
If for any reason you are not satisfied with your Certificate, you may return it
to us for a refund. To exercise this cancellation right, you must mail the
Certificate directly to our Processing Office within 10 days after you receive
it. In some states, this "free look" period may be longer.
Your refund will equal your contributions under the Certificate or, if greater,
with respect to contributions allocated to the Funds, your account value,
computed on the date we receive your Certificate.
We follow these same procedures if you change your mind before you receive your
Certificate, but after you make a contribution. Please see "Tax Information" for
possible consequences of canceling your Certificate.
If you fully convert an existing Regular IRA Certificate to a Roth IRA
Certificate, you may cancel your Roth IRA Certificate and return to a Regular
IRA Certificate by following the instructions in the request for full conversion
form available from our Processing Office.
<PAGE>
Determining your Certificate's value
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We credit the full amount of your contributions under your Certificate. At any
time, the value of your Certificate is the "account balance" in the Funds and
the GRAs to which you have allocated contributions. These amounts are subject to
certain fees and charges that are reflected in your account balance, as
applicable. See "Charges and Expenses."
We refer to the amount of the account balance attributable to the GRAs as their
"cash value." The cash value of a GRA guarantee period reflects a withdrawal
charge, as described below.
YOUR ACCOUNT BALANCE IN THE FUNDS
Your contributions to one or more of the Funds are, in turn, invested in shares
of a corresponding Portfolio. The value of your interest in each Fund is
measured by "units" that are purchased with your contributions. Your units will
increase or decrease in value as though you had invested in the corresponding
Portfolio's shares directly. Your account balance, however, will decrease by the
amount of the fees and charges that we deduct under the Certificate. Your
account balance will also decrease by the dollar amount of any withdrawals that
you make.
We determine the number of units of a Fund you purchase by dividing the amount
of your contribution by the Fund's unit value for the Business Day on which we
receive your contribution. On any day, the value of your interest in a Fund
equals the number of units credited to your Certificate under that Fund,
multiplied by the value for one unit. The number of your units in any Fund does
not change unless you make additional contributions, make a withdrawal, or
transfer amounts between investment options.
YOUR ACCOUNT BALANCE IN THE GRAS
Your account balance in the GRAs, represented by their cash value, is equal to
your contributions and transfers to those options, plus accrued interest, less
withdrawals and transfers out of the GRAs and charge deductions. The cash value
of your GRAs will be less any withdrawal charge that applies on withdrawals,
including transfers, from any of your GRA guarantee periods prior to maturity.
Thus, if you withdrew an amount from a GRA period, before the maturity date, we
would pay you the cash value. Please see "The Guaranteed Rate Accounts" in the
SAI for more information.
<PAGE>
Transferring your money among Investment Options
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At any time before the date annuity benefit payments begin, you can transfer
some or all of your account balance among the investment options. Withdrawals or
transfers from the GRAs before a maturity date are restricted and may be subject
to a withdrawal charge. See "Charges and Expenses."
You may request a transfer by telephone using our AIM System. Transfer requests
should specify:
o your Social Security number,
o the amounts or percentages to be transferred, and
o the investment options to and from which the amounts are to be transferred.
We will make transfers involving the Funds as of the Business Day we receive
your transfer request and all necessary information.
Transfers are permitted to and from the guarantee periods of the GRAs, but
transfers may not be made from one guarantee period to another, nor during the
"open period" in calendar quarters when new guarantee periods are offered for
GRAs. In the case of trustee-to-trustee transfers during the open period, we
will impose a withdrawal charge. Transfers from a GRA guarantee period, like
withdrawals, may be subject to a withdrawal charge.
MARKET TIMING. You should note that the product is not designed for professional
"market timing" organizations, or other organizations or individuals engaging in
a market timing strategy making programmed transfers, frequent transfers, or
transfers that are large in relation to the total assets of the underlying
mutual fund portfolios. Market timing strategies are disruptive to the
underlying mutual fund portfolios in which the Funds invest. If we determine
that your transfer patterns among the Funds reflect a market timing strategy, we
reserve the right to take action that will prevent the use of a market timing
strategy including, but not limited to: restricting the availability of
transfers through telephone requests, facsimile transmissions, automated
telephone services, Internet services or any electronic transfer services. We
may also refuse to act on transfer instructions of an agent acting under a power
of attorney who is acting on behalf of more than one owner.
<PAGE>
Accessing your money
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WITHDRAWING YOUR ACCOUNT BALANCE
You can withdraw your account balance at any time before annuity benefits begin.
Withdrawals from the GRAs will be withdrawals of cash value, giving effect to
any withdrawal charge. No withdrawal charge applies to withdrawals from any of
the Funds.
Partial withdrawals under a periodic distribution option are subject to certain
restrictions that we describe below under "Choosing Your Retirement Payout
Options." Distributions under TSA Certificates may also be subject to certain
restrictions. For the tax consequences and restrictions relating to withdrawals
see "Tax Information" below and in the SAI.
We will consider withdrawal requests that result in a total remaining account
balance of less than $100 as a request to surrender your Certificate, unless you
tell us otherwise.
Your request for a withdrawal should be in writing on our specified form. For a
partial withdrawal, you must specify the investment options from which you want
to take the withdrawal. Otherwise, we will withdraw from each investment option
on a pro rata basis. If you request a full surrender, you must also send us your
Certificate with the request. When we receive the information we require, the
withdrawal or full surrender will become effective. If we receive only partial
information, our Processing Office will contact you for complete instructions
before processing your request.
SURRENDERING YOUR CERTIFICATE TO RECEIVE YOUR ACCOUNT BALANCE
You may surrender your Certificate to receive your account balance at any time
before you begin to receive annuity payments. For a surrender to be effective,
we must receive your written request on our prescribed form at our Processing
Office. We will determine your account balance on the date we receive the
required information. All benefits under the Certificate will terminate as of
that date.
You may receive your account balance in a single sum payment or apply all or
part of it to one or both of the annuity payout options described under
"Choosing Your Annuity Payout Options" below. For the tax consequences of
surrenders, see "Tax Information" below and in the SAI.
WHEN TO EXPECT PAYMENTS
Generally, we will fulfill requests for payments upon a withdrawal or surrender
within seven calendar days after the date we receive all necessary information
and documents we require in the circumstances. We may postpone such payments or
application of proceeds for any period during which:
(1) the New York Stock Exchange is closed or restricts trading,
(2) sales of securities or determination of the fair value of a Fund's assets
is not reasonably practicable because of an emergency, or
(3) the SEC, by order, permits us to defer payment to protect persons remaining
in the Funds.
CHOOSING YOUR RETIREMENT PAYOUT OPTIONS
When you are ready to receive retirement benefits you have a choice of several
options:
o Single sum benefit payment.
o Periodic distribution option.
o Fixed full cash refund annuity.
o Other forms of annuities we may offer.
If you choose a single sum benefit payment, your account value in the Funds and
cash value in the GRAs will be applied to provide the benefit. The cash value
may reflect a withdrawal charge.
The same amounts will be applied to provide a periodic distribution option or
the fixed full cash refund annuity under the Certificate, or any other optional
fixed annuity we may offer. However, if you elect a periodic distribution or
annuity, no withdrawal charge will be imposed on amounts derived from the GRAs.
<PAGE>
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ANNUITY PAYOUT OPTIONS
You can choose from among the following annuity payout options:
FULL CASH REFUND ANNUITY. This is the "normal form of annuity benefit." It
provides a fixed annuity for the lifetime of the annuitant. The participant's
beneficiary will receive a cash refund if, at the participant's death, the total
annuity payments do not equal the amount that we applied to provide the annuity.
This refund equals the difference between the amount applied to purchase the
annuity and the annuity payments actually received.
Once fixed payments begin, the amount of each payment does not change. We
determine the minimum amount from tables in the Certificate that show monthly
payments for each $1,000 applied (after deduction of any applicable tax charges
and the annuitization fee). If our group annuity rates for payment of proceeds
or our rate for single premium immediate annuities then in effect produces a
larger payment, we pay the larger benefit. We may change the amount of monthly
payments shown in Certificates for new participants.
PERIODIC DISTRIBUTION OPTION. An annuity option that pays out your entire
account balance in monthly, quarterly, semi-annual or annual installment
payments over a period of at least three years, as you or your beneficiary
choose. The payout period may not generally exceed applicable life expectancy
limitations, as described in "Tax Information" in the SAI.
To calculate the amount of each payment, you specify a dollar amount or a time
period. If a time period, we determine the amount of a payment by dividing the
remaining account balances by the number of remaining payments. We make
withdrawals pro-rata from each investment option. Currently, we distribute
periodic payments from the GRAs without withdrawal charges. We retain the right
to suspend these distributions from the GRAs in the future.
We require an initial monthly payment of at least $50 under the periodic
distribution option. After payments begin, you may continue to transfer amounts
among the investment options, according to our rules. By written notice, you may
make a partial withdrawal or elect to stop the periodic distribution payments
and receive your remaining account balance in a single sum.
OTHER ANNUITIES OR OPTIONAL RETIREMENT BENEFITS. You may elect forms of fixed
annuities, other than the normal form of annuity benefit, we offer, including
joint and survivor annuities. Payments under life or joint life annuities that
do not specify a minimum distribution period terminate with the death of the
last surviving annuitant.
You may specify a minimum distribution period under which benefits continue to a
beneficiary. You may not specify a minimum distribution period that is greater
than your life expectancy or the life expectancy of the beneficiary. If the
beneficiary is someone other than your spouse, payments to the surviving
beneficiary are limited as the Proposed Treasury Regulations provide.
Once a life annuity takes effect, the annuitant may not redeem or change it to
any other form of benefit. If payment under an annuity continues to a
beneficiary, the beneficiary will have the right to redeem the annuity for its
commuted value. An annuity payout is available only if the amount applied to pay
the annuity is $2,000 or more and results in an initial payment of at least $20.
If you are participating under a TSA program and have not chosen a retirement
benefit the normal form of annuity will be provided unless the TSA provides
otherwise. Under certain TSAs you may be required to elect a joint and survivor
annuity payout unless your spouse consents in writing to a different election.
You can choose the date annuity payments are to begin. This is your "retirement
date." If you do not advise us of your retirement date, we will assume that it
is the date you attain age 65. You can change your retirement date in writing,
but the date must be the first day of a calendar month. Also, that date may not
be later than the date applicable for the type of qualified plan in which you
use the Certificate.
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If you have not already selected a form of annuity payout, we will send you a
form on which you may do so or confirm that the normal form of annuity is to be
provided. We will send the form six months before your retirement date. Your
account balance will remain invested until we receive your instructions. Once
you have selected a payout option and payments have begun, you may make no
further change.
The amount of the annuity payments will depend on:
o the amount applied to purchase the annuity,
o the type of payout option you choose, and,
o in the case of a life annuity, your age (or your and your joint annuitant's
ages) and in certain instances, gender.
<PAGE>
Charges and expenses
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CHARGES THAT EQUITABLE LIFE DEDUCTS
We deduct the charges described below during the accumulation period, or if you
elect either the fixed annuity option or the periodic distribution option. We
will not increase these charges for the life of your Certificate, except as
noted.
PARTICIPANT SERVICE CHARGE
On the last day of each calendar quarter, we charge your account balance to
reimburse us for certain administration expenses under the Certificates, such as
salaries and other overhead costs, travel, legal, actuarial and accounting
costs. The charge is up to $15 per year for SEP and SIMPLE IRA Certificates, and
up to $30 per year for Regular IRA, Roth IRA, and TSA Certificates. We deduct
these charges from the amounts held in the investment options in accordance with
our administrative procedures then in effect.
The participant service charge applicable to a Certificate depends on several
factors. It will vary depending on:
o whether contributions are made by payroll deduction or direct contribution,
o the number of participants contributing through the same payroll deduction
facility or group, and the total contributions that we receive from an
affiliated group, and the nature of the group purchasing the Certificates,
and the extent to which an employer provides services that we would
otherwise provide, and other circumstances that may have an impact on
administrative expenses.
We reserve the right to change the participant service charge on advance written
notice, or to impose the charge on a less or more frequent basis. In no case,
will the charge exceed $30 per year.
ADMINISTRATION CHARGE
We impose a daily charge at the annual rate of 0.25% of the net assets of each
Fund. The charge is to reimburse us for administration expenses not covered by
the participant service charge. We reflect this charge in the computation of
unit values for each Fund.
OTHER EXPENSES
We also charge certain additional costs and expenses directly to the Funds.
These include, among other things, certain expenses we incur in the operation of
the Funds, taxes, interest, SEC charges, and certain related expenses including
printing of registration statements and amendments, outside auditing and legal
expenses and recordkeeping.
We reflect these expenses in the unit values for each Fund.
CHARGES FOR STATE PREMIUM AND OTHER APPLICABLE TAXES
We deduct a charge designed to approximate certain taxes that may be imposed on
us such as state premium taxes in your state. Generally, we deduct the charge
from the amount applied to provide the annuity payout option. If the periodic
distribution is elected we will deduct the charge from each payment when made.
No charge is applied if you elect a single sum payment. The current tax charge
varies by state and ranges from 0% to 1%.
CHARGES THAT EQ ADVISORS TRUST DEDUCTS
EQ Advisors Trust deducts the following types of fees and expenses:
o Investment advisory fees ranging from 0.25% to 0.85%.
o 12b-1 fees of 0.25% applicable to Class IB shares.
o Operating expenses, such as trustees' fees, independent auditors' fees,
legal counsel fees, administrative service fees, custodian fees, and
liability insurance.
o Investment-related expenses, such as brokerage commissions.
These expenses are reflected in the daily share price of each Portfolio. For
more information about the calculation of
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these expenses, including applicable expense limitations, please refer to the
prospectuses of the Trusts.
CERTAIN EXPENSE LIMITATIONS
We will reimburse the Funds named below for certain expenses they incur in any
calendar year, as follows:
ALLIANCE MONEY MARKET, ALLIANCE COMMON STOCK, ALLIANCE INTERMEDIATE GOVERNMENT
SECURITIES AND EQ/BALANCED FUNDS
The types of expenses included are:
o Investment advisory fees and certain other expenses attributable to assets
of the Funds invested of the corresponding Portfolio.
o Administration expenses that the Funds bear directly.
The expenses subject to reimbursement do not include the following Portfolio
expenses: interest, taxes, brokerage, and extraordinary expenses permitted by
appropriate state regulatory authorities.
The annual expense limitations, above which we will reimburse the Funds, are:
o 1% of the Alliance Money Market Fund's average daily net assets.
o 1.5% of the Alliance Common Stock, Alliance Intermediate Government
Securities, and EQ/Balanced Funds' respective average daily net assets.
We cannot change these expense limitations without the participant's consent.
ALLIANCE HIGH YIELD, EQ/AGGRESSIVE STOCK AND ALLIANCE GLOBAL FUNDS
We reimburse these Funds for their aggregate expenses in excess of 1.5% of the
value of their respective average daily net assets. We may change this voluntary
expense limitation at our discretion.
ALLIANCE MONEY MARKET AND ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES FUNDS
If the amount of the respective management fees charged to the related
Portfolios exceeds 0.35% of their average daily net asset value, we will
reimburse the corresponding Funds for such excess. This expense limitation is a
contractual right for participants who enrolled before May 1, 1987, and cannot
be changed without the consent of those participants. We have voluntarily agreed
to put in place this expense limitation for participants who enrolled after May
1, 1987, and we reserve the right to discontinue this voluntary limitation at
any time.
LIFE ANNUITY ADMINISTRATIVE CHARGE
If you elect the fixed annuity option under the Certificate, at retirement we
will deduct up to $350 from the amount applied to purchase the annuity. This
amount is designed to reimburse us for administrative expenses we incur in
processing the application for the annuity and issuing each monthly payment. The
specific amount of the charge will depend on your date of enrollment. We may
give you a better annuity purchase rate than those currently guaranteed in the
Certificates. In that case, the annuity administrative charge may be greater
than $350, unless we otherwise provide in your Certificate.
SEP AND SIMPLE ENROLLMENT FEE
We charge a non-refundable fee of $25 upon the enrollment of each Participant in
a SEP or SIMPLE IRA. We collect the fee from the employer, or we deduct it from
the first contribution.
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GUARANTEED RATE ACCOUNTS WITHDRAWAL CHARGE
We impose a charge on withdrawals or transfers before the maturity of a GRA
guarantee period. The charge is 7% of the amount withdrawn or transferred during
the guarantee period, or, if less, the accumulated interest. The charge,
however, does not apply:
o at maturity of the GRA guarantee period;
o to withdrawals due to death or disability;
o when the periodic distribution installment option is elected; or
o when an annuity retirement option is elected.
However, the withdrawal charge applies to any other pre-maturity withdrawals at
retirement.
<PAGE>
Payment of death and disability benefit
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YOUR BENEFICIARY AND PAYMENT OF DEATH BENEFIT
You designate your beneficiary when you apply for your Certificate. You may
change your designation by writing to our Processing Office. You may be limited
as to the beneficiary you can designate in TSA Certificate.
The death benefit is equal to your account balance. We determine the amount of
the death benefit as of the date we receive satisfactory proof of death and any
required instructions as to the method of payment.
WHEN THE PARTICIPANT DIES BEFORE DISTRIBUTIONS BEGIN
If you die before distributions begin, we will pay the death benefit to your
beneficiary.
If the designated beneficiary is your surviving spouse, the distribution of the
account balance may begin at the earlier of (a) the date you would have attained
age 70 1/2 or (b) the date the surviving spouse elects payment to commence.
Depending on your election, we will pay the death benefit as a single sum, in
periodic installments, as an annuity or as a combination of the three. If no
death benefit election is in effect, the beneficiary may elect a single sum or
an alternate form of benefit payment.
WHEN THE PARTICIPANT DIES AFTER THE RETIREMENT DATE
If you die after distributions begin, the amount and payment mode of the
distributions may continue to the beneficiary on the same basis as before your
death, subject to minimum distribution rules.
DISABILITY PAYMENT
In the case of disability (refer to your certificate for a definition of
disability) before your retirement date, we will pay you the account balance.
TSA plans may be subject to certain restrictions.
<PAGE>
Tax information
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TAX CHANGES
Federal income tax rules include the United States laws in the Internal Revenue
Code and Treasury Department Regulations, and Internal Revenue Service
interpretations of the Internal Revenue Code. These tax rules may change. We
cannot predict whether, when, or how these rules could change. Any change could
affect Contracts purchased before the change.
TAX-SHELTERED ANNUITY ARRANGEMENTS (TSAS)
If you are an employee of a public educational institution or a tax-exempt
organization described in Code Section 501(c)(3), your employer may purchase a
TSA for you. Contributions to the TSA, whether they are made by your salary
reduction or non-elective employer contributions, are not taxable to you,
subject to annual limitations. Annuity payments, withdrawals or surrenders of
the TSA are generally taxable to you. Premature withdrawals may be subject to an
additional 10% penalty on the taxable amount. In addition, amounts attributable
to salary reduction contributions cannot be distributed before your age 59 1/2,
death, disability, separation from service or hardship. In the event of
hardship, only the salary reduction contributions can be distributed.
INDIVIDUAL RETIREMENT ANNUITIES (REGULAR AND ROTH IRAS)
You may make compensation-based contributions, subject to annual limitations, to
individual retirement arrangements. For both Regular and Roth IRAs, you must
have compensation at least equal to the amount of the contribution. Generally,
$2,000 is the maximum amount of annual contributions you may make to all of your
Regular and Roth IRAs. You may deduct all or a part of your contribution to a
Regular IRA depending on your income for the year.
You may make contributions to a Regular IRA until the year you reach age 70 1/2.
You may make contributions to a Roth IRA even after age 70 1/2, if you have
compensation and your income is within specified Federal income tax limits.
These limits do not apply to rollover or custodian-to-custodian contributions
into either kind of IRA. You and your nonworking spouse can together contribute,
annually, an aggregate maximum of $4,000 to Regular and Roth IRAs for you and
your spouse (but no more than $2,000 to any one IRA certificate).
Income credited to Regular IRAs is generally not taxable until you get a
distribution from the Certificate. Distributions from Regular IRAs are generally
fully taxable as ordinary income. Roth IRA distributions are not taxable until
all contributions to all of your Roth IRAs are recovered. After recovery of
contributions, distributions are taxable. Beginning in 2003, in certain
circumstances, Roth IRA distributions may be eligible to be fully non taxable.
The taxable portion of certain early withdrawals from Regular and Roth IRAs may
be subject to an additional 10% Federal income tax penalty.
IRAS UNDER SIMPLIFIED EMPLOYEE PENSION PLANS (SEPS AND SIMPLES)
An employer can establish a SEP for its employees and can make contributions to
a SEP for each eligible employee. A Regular IRA funding a SEP is like other
IRAs. If you are an eligible employee, you own the SEP. Most of the rules
applicable to Regular IRAs also apply. One major difference is the amount of
permissible contributions. Under contribution limits effective in 2000, an
employer can annually contribute an amount for an employee up to the lesser of
$25,500 or 15% of the employee's compensation. The employer makes this
determination without taking into account its contribution to the employee's
SEP. This limit may be subject to cost of living changes in future years.
An eligible employer may establish a "SIMPLE" plan to contribute to special
individual retirement accounts or individual retirement annuities for its
employees (SIMPLE IRAs). A SIMPLE IRA is a form of IRA, which the employee owns.
Generally, the rules applicable to Regular IRAs discussed above apply, with
certain differences, as follows:
o the employee salary reduction contribution is limited (up to $6,000 in
2000)
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o the employer must make contributions, generally a dollar-for-dollar, up to
3% of the employee's compensation or a 2% non-elective contribution to all
eligible employees;
o employees who have not participated in the employer's SIMPLE IRA plan for
at least two full years may be subject to an increased penalty tax on
withdrawals or transfers of SIMPLE IRA funds.
Further discussion of tax aspects of TSA, Regular IRA, Roth IRA, SEP and SIMPLE
IRA contributions, distributions and other matters is available in the SAI.
<PAGE>
More information
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ABOUT EQUITABLE LIFE
We are The Equitable Life Assurance Society of the United States ("Equitable
Life"), a New York stock life insurance company. We have been doing business
since 1859. Equitable Life is a wholly owned subsidiary of AXA Financial Inc.
(previously The Equitable Companies, Incorporated). The majority shareholder of
AXA Financial Inc. is AXA, a French insurance holding company for an
international group of insurance and related financial services companies. As a
majority shareholder, and under its other arrangements with Equitable Life's
parent, AXA exercises significant influence over the operations and capital
structure of Equitable Life and its parent. No other company other than
Equitable Life has any legal responsibility to pay amounts that Equitable Life
owes under the Certificates.
AXA Financial Inc. and its consolidated subsidiaries managed approximately
$462.7 billion in assets as of December 31, 1999. For over 100 years we have
been among the largest insurance companies in the United States. We are licensed
to sell life insurance and annuities in all fifty states, the District of
Columbia, Puerto Rico, and the U.S. Virgin Islands. Our home office is located
at 1290 Avenue of the Americas, New York, NY 10104.
ABOUT SEPARATE ACCOUNT NO. 301
Each Fund is a subaccount of our Separate Account No. 301. We established
Separate Account No. 301 in 1981 under special provisions of the New York
Insurance Law. These provisions prevent creditors from any other business we
conduct from reaching the assets we hold in our Separate Account No. 301 for
owners of our variable annuity contracts, including the Certificates. The
results of Separate Account No. 301's operations are accounted for without
regard to our other operations. We are the legal owner of all of the assets in
Separate Account No. 301 and may withdraw any amounts that exceed our reserves
and other liabilities with respect to the Funds under our contracts.
Separate Account No. 301 is registered under the Investment Company Act of 1940
and is classified by that act as a "unit investment trust." The SEC, however,
does not manage or supervise Equitable Life or Separate Account No. 301.
Each subaccount (Fund) within Separate Account No. 301 invests solely in Class
IA or Class IB shares, respectively, issued by the corresponding Portfolio of EQ
Advisors Trust.
We reserve the right, subject to compliance with laws that apply, to:
(1) to add Funds to, or to remove Funds from, Separate Account No. 301, or to
add other separate accounts;
(2) combine any two or more Funds;
(3) transfer the assets we determine to be the shares of the class of contracts
to which the Certificates belong from any Fund to another Fund;
(4) operate Separate Account No. 301 or any Fund as a management investment
company under the Investment Company Act of 1940 (in which case, charges
and expenses that otherwise would be assessed against an underlying mutual
fund would be assessed against Separate Account No. 301 or a Fund
directly);
(5) deregister Separate Account No. 301 under the Investment Company Act of
1940;
(6) restrict or eliminate any voting rights as to Separate Account No. 301; and
(7) cause one or more Funds to invest some or all of their assets in one or
more other trusts or investment companies.
ABOUT EQ ADVISORS TRUST
EQ Advisors Trust is registered under the Investment Company Act of 1940 and is
classified as "open-end management investment companies," more commonly called a
mutual fund. EQ Advisors Trust issues different series of shares relating to
each portfolio.
Equitable Life serves as the investment manager of EQ Advisors Trust. As such,
Equitable Life oversees the activities of the investment advisers with respect
to EQ Advisors Trust and is responsible for retaining or discontinuing the
services
<PAGE>
- ---------
26
- --------------------------------------------------------------------------------
of those advisers. (Prior to September 1999, EQ Financial Consultants, Inc., the
predecessor to AXA Advisors, LLC and an affiliate of Equitable Life, served as
investment manager to EQ Advisors Trust.)
EQ Advisors Trust commenced operations on May 1, 1997. For periods prior to
October 18, 1999 the Alliance portfolios were part of The Hudson River Trust. On
October 18, 1999, these portfolios became corresponding portfolios of EQ
Advisors Trust.
EQ Advisors Trust does not impose sales charges or "loads" for buying and
selling their shares. All dividends and other distributions on Trust shares are
reinvested in full. The Board of Trustees of EQ Advisors Trust may establish
additional Portfolios or eliminate existing Portfolios at any time. More
detailed information about EQ Advisors Trust, the Portfolio investment
objectives, policies, restrictions, risks, expenses, the Rule 12b-1 plan
relating to the Class IB shares and other aspects of the Trust's operations,
appears in the prospectus for EQ Advisors Trust attached at the end of this
prospectus or in its SAIs, which are available upon request.
ABOUT THE GENERAL ACCOUNT
Our general account supports all of our policy and contract guarantees,
including those that apply to the guaranteed rate options, and our general
obligations.
The general account is subject to regulation and supervision by the Insurance
Department of the State of New York and to the insurance laws and regulations of
all jurisdictions where we are authorized to do business. Because of exemptions
and exclusionary provisions that apply, interests in the general account have
not been registered under the Securities Act of 1933. The general account is not
an investment company under the Investment Company Act of 1940.
We have been advised that the staff of the SEC has not reviewed the portions of
this prospectus that relate to the general account. The disclosure with regard
to general accounts, however, may be subject to certain provisions of the
Federal securities laws relating to the accuracy and completeness of statements
made in prospectuses.
DATES AND PRICES AT WHICH CERTIFICATE EVENTS OCCUR
We describe below the general rules for when, and at what prices, events under
your Certificate will occur. Other portions of this prospectus describe
circumstances that may cause exceptions. We generally do not repeat those
exceptions below.
BUSINESS DAY
Our Business Day is generally any day that the New York Stock Exchange is open
for trading. Our Business Day ends at 4:00 p.m., Eastern Time for purposes of
determining the date when we apply contributions and process any other
transaction requests. We will apply contributions and process any other
transaction requests when we receive them along with all the required
information.
If your contribution, transfer or any other transaction request, containing all
the required information, reaches us on a non-Business Day or after 4:00 p.m.
Eastern Time on a Business Day, we will use the next Business Day.
CONTRIBUTIONS AND TRANSFERS
o We invest contributions allocated to the Funds at the value next determined
after the close of the Business Day.
o Contributions allocated to a GRA will receive the interest rate for that
GRA in effect for that Business Day.
o We will make transfers to or from Funds at the value next determined after
the close of the Business Day.
o Transfers to a GRA will be based on the interest rate for that GRA in
effect for the Business Day of the transfer.
ABOUT YOUR VOTING RIGHTS
As the owner of the shares of EQ Advisors Trust, we have the right to vote on
certain matters involving the Portfolios, such as:
o The election of trustees.
<PAGE>
- --------
27
- --------------------------------------------------------------------------------
o The formal approval of independent auditors selected for EQ Advisors Trust.
o Any other matters described in the prospectus for EQ Advisors Trust or
requiring a shareholders' vote under the Investment Company Act of 1940.
We will give Certificate owners the opportunity to instruct us how to vote the
number of shares attributable to their Certificates if a shareholder vote is
taken. If we do not receive instructions in time from all Certificate owners, we
will vote the shares of a portfolio for which no instructions have been received
in the same proportion as we vote shares of that portfolio for which we have
received instructions. We will also vote any shares that we are entitled to vote
directly because of amounts we have in a Portfolio in the same proportions that
Certificate owners vote.
VOTING RIGHTS OF OTHERS
Currently, we control EQ Advisors Trust. EQ Advisors Trust shares are sold to
our separate accounts and an affiliated qualified plan trust. In addition,
shares of EQ Advisors Trust are held by separate accounts of insurance companies
affiliated and unaffiliated with us. Shares held by these separate accounts will
probably be voted according to the instructions of the owners of insurance
policies and contracts issued by those insurance companies. While this will
dilute the effect of the voting instructions of the Certicate owners, we
currently do not foresee any disadvantages because of this. The Board of
Trustees of EQ Advisors Trust intends to monitor events in order to identify any
material irreconcilable conflicts that may arise and to determine what action,
if any, should be taken in response. If we believe that a response to any of
those events insufficiently protects our Certificate owners, we will see to it
that appropriate action is taken.
SEPARATE ACCOUNT NO. 301 VOTING RIGHTS
If actions relating to Separate Account No. 301 require Certificate owner
approval, Certificate owners will be entitled to one vote for each unit they
have in the Funds. We will cast votes attributable to any amounts we have in the
Funds in the same proportion as votes cast by Certificate owners.
CHANGES IN APPLICABLE LAW
The voting rights we describe in this prospectus are created under applicable
Federal securities laws. To the extent that those laws or the regulations
published under those laws eliminate the necessity to submit matters for
approval by persons having voting rights in separate accounts of insurance
companies, we reserve the right to proceed in accordance with those laws or
regulations.
ABOUT THE GROUP ANNUITY CONTRACTS
The Certificates are issued under group annuity contracts between us and Chase
Manhattan Bank, N.A. ("Chase"), whose sole purpose is to serve as a party to the
group annuity contracts. Chase has no responsibility for the administration of
any of the retirement programs described in this prospectus, for payments to the
investment options or to Participants, or for any other duties other than to
serve as the group annuity contractholder.
IRS DISQUALIFICATION
If a retirement program funded by the Certificates is found not to qualify under
the Internal Revenue Code, we may terminate the Certificate and pay the
participant, plan trustees or other designated person, the account balance. We
will, however, make a deduction for any Federal income tax payable by us because
of the non-qualification.
ABOUT LEGAL PROCEEDINGS
Equitable Life and its affiliates are parties to various legal proceedings. In
our view, none of these proceedings is likely to have a material adverse effect
upon Separate Account No. 301, our ability to meet our obligations under the
Certificates, or the distribution of the Certificates.
<PAGE>
- --------
28
- --------------------------------------------------------------------------------
ABOUT OUR INDEPENDENT ACCOUNTANTS
The financial statements of Separate Account No. 301 as of December 31, 1999 and
for each of the two years in the period ended December 31, 1999, and the
consolidated financial statements of Equitable Life as of December 31, 1999 and
1998, and for each of the three years in the period ended December 31, 1999 have
been so included in the Statement of Additional Information (SAI), and
incorporated by reference in the Prospectus, in reliance upon the reports of
PricewaterhouseCoopers LLP, independent accountants, given upon their authority
as experts in accounting and auditing.
TRANSFERS OF OWNERSHIP, COLLATERAL ASSIGNMENTS, LOANS, AND BORROWING
You cannot assign or transfer ownership of a Regular IRA, Roth IRA, TSA, SEP, or
SIMPLE Certificate except by surrender to us. Loans are not available and you
cannot assign Regular IRA, Roth IRA, TSA, SEP, and SIMPLE Certificates as
security for a loan or other obligation.
You may direct the transfer of account balances under your Regular IRA, Roth
IRA, TSA, SEP, or SIMPLE Certificate to another similar arrangement. We can
impose a withdrawal charge if one applies.
UNDERWRITER
AXA Advisors, LLC ("AXA Advisors"), the successor to EQ Financial Consultants,
Inc., an affiliate of Equitable Life, performs all sales functions for the
Certificates and may be deemed to be the principal underwriter of Separate
Account No. 301. AXA Advisors is registered with the SEC as a broker-dealer
under the Securities Exchange Act of 1934 and is a member of the National
Association of Securities Dealers, Inc. EQ Financial's principal business
address is 1290 Avenue of the Americas, New York, NY 10104. The offering of the
Certificates is intended to be continuous. We have paid no underwriting
commissions during any of the last three fiscal years with respect to units of
interest under the Certificates.
REPORTS AND ADDITIONAL INFORMATION
Before payments start under your Certificate, we will send you, at least
annually, a report showing as of a specified date: (1) the number of units you
have credited to each Fund, (2) the unit values, (3) your account balance in
each Fund and GRA and the total balance and (4) the cash values of your GRAs.
Similar reports will be sent to you if you are receiving payments under the
periodic distribution option. All transactions will be individually confirmed.
As required by the Investment Company Act of 1940, each participant will be
sent, semi-annually, a report containing financial statements and a list of the
securities held by each Portfolio.
As permitted by the SEC's rules, we omitted certain portions of the registration
statement filed with the SEC from this prospectus and SAI. You may obtain the
omitted information by: (1) requesting a copy of the registration statement from
the SEC's principal office in Washington, D.C., and paying prescribed fees, or
(2) by accessing the EDGAR Database at the SEC's web site at http://www.sec.gov.
<PAGE>
Investment performance
- -------
29
- --------------------------------------------------------------------------------
We provide the following tables to show two different measurements of the
investment performance of the Funds. We include these tables because they may be
of general interest to you. THE RESULTS SHOWN REFLECT PAST PERFORMANCE. THEY DO
NOT INDICATE HOW THE FUNDS MAY PERFORM IN THE FUTURE. THEY ALSO DO NOT REPRESENT
THE RESULTS EARNED BY ANY PARTICULAR INVESTOR. YOUR RESULTS WILL DIFFER.
Tables 1 and 2 show the rates of return of the Funds on a year-by-year and an
annualized basis. These tables take into account all asset-based charges under
the Certificate, but do not reflect the participant service charge. The results
shown are based on the actual historical investment experience of the Portfolio
in which the Fund invests. All rates of return presented are time-weighted and
include reinvestment of investment income, including interest and dividends.
BENCHMARKS
Table 2 compares the performance of the Funds to market indices that serve as
benchmarks. Market indices are not subject to any charges for investment
advisory fees, brokerage commission or other operating expenses typically
associated with a managed portfolio. Also, they do not reflect any Certificate
charges. Comparisons with these benchmarks, therefore, may be of limited use. We
include them because they are widely known and may help you to understand the
universe of securities from which each Portfolio is likely to select its
holdings. Benchmark data reflect the reinvestment of dividend income. The
benchmarks include:
ALLIANCE MONEY MARKET:
Salomon Brothers Three-Month T-Bill Index.
ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES:
Lehman Intermediate Government Bond Index
ALLIANCE HIGH YIELD:
Merrill Lynch High Yield Master Index and Credit Suisse First Boston Global High
Yield Index.
ALLIANCE GROWTH & INCOME:
75% Standard & Poor's 500 Stock Index/25% Value Line Convertible Index.
ALLIANCE COMMON STOCK:
Standard & Poor's 500 Index.
EQ/AGGRESSIVE STOCK:
50% Russell 2000 Small Stock Index and 50% Standard & Poor's Mid-Cap Total
Return Index.
ALLIANCE GLOBAL:
Morgan Stanley Capital International World Index.
ALLIANCE CONSERVATIVE INVESTORS:
70% Lehman Treasury Bond Composite Index and 30% Standard & Poor's 500 Index.
ALLIANCE GROWTH INVESTORS:
30% Lehman Government/Corporate Bond Index and 70% Standard & Poor's 500 Index.
MFS EMERGING GROWTH COMPANIES:
Russell 2000 Index.
BT EQUITY 500 INDEX:
Standard & Poor's 500 Index.
EQ/BALANCED:
50% S&P 500 Index and 50% Lehman Government/Corporate Bond Index.
LAZARD SMALL CAP VALUE:
Russell 2000 Index.
T. ROWE PRICE INTERNATIONAL STOCK:
Morgan Stanley Capital Int'l (MSCI) EAFE Index.
<PAGE>
- -----
30
- --------------------------------------------------------------------------------
TABLE 1
ANNUAL PERCENT CHANGES IN UNIT VALUE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
PERIODS ENDED DECEMBER 31
---------------------------------------
1990 1991 1992 1993
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alliance Money Market ......................... 7.7% 5.6% 3.0% 2.5%
- ---------------------------------------------------------------------------------------
Alliance Intermediate Government Securities(a) 5.9 13.7 4.9 10.0
- ---------------------------------------------------------------------------------------
Alliance High Yield ........................... (4.8) 24.6 11.3 22.3
- ---------------------------------------------------------------------------------------
EQ/Balanced ................................... (0.4) 40.7 (3.3) 11.9
- ---------------------------------------------------------------------------------------
Alliance Common Stock ......................... (12.4) 43.7 2.7 24.4
- ---------------------------------------------------------------------------------------
EQ/Aggressive Stock ........................... 7.0 75.6 3.8 16.0
- ---------------------------------------------------------------------------------------
Alliance Global ............................... 6.2 26.4 (1.3) 31.3
- ---------------------------------------------------------------------------------------
Alliance Growth & Income ...................... - - - -
- ---------------------------------------------------------------------------------------
Alliance Growth Investors ..................... - - - -
- ---------------------------------------------------------------------------------------
Alliance Conservative Investors ............... - - - -
- ---------------------------------------------------------------------------------------
MFS Emerging Growth Cos. ...................... - - - -
- ---------------------------------------------------------------------------------------
BT Equity 500 Index ........................... - - - -
- ---------------------------------------------------------------------------------------
Lazard Small Cap Value ........................ - - - -
- ---------------------------------------------------------------------------------------
T. Rowe Price Int'l Stock ..................... - - - -
- ---------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
PERIODS ENDED DECEMBER 31
-----------------------------------------------------------------------
1994 1995 1996 1997 1998 1999
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Money Market ........................ 3.8% 5.3% 4.9% 5.0% 4.9% 4.6%
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Intermediate Government Securities(a) (4.3) 13.0 3.4 6.9 7.4 (0.2)
- -------------------------------------------------------------------------------------------------------------------------------
Alliance High Yield .......................... (3.5) 19.2 22.0 17.8 (5.7) (4.2)
- -------------------------------------------------------------------------------------------------------------------------------
EQ/Balanced .................................. (8.1) 19.2 11.2 14.5 17.6 17.4
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Common Stock ........................ (2.6) 31.9 23.8 28.7 28.9 24.8
- -------------------------------------------------------------------------------------------------------------------------------
EQ/Aggressive Stock .......................... (4.1) 30.9 21.6 10.3 (0.2) 18.4
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Global .............................. 4.9 18.2 14.0 11.0 21.2 37.9
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Growth & Income ..................... (1.2)(b) 23.1 19.2 26.1 20.2 18.1
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Growth Investors .................... (3.1)(b) 24.9 11.6 15.8 18.3 25.8
- -------------------------------------------------------------------------------------------------------------------------------
Alliance Conservative Investors .............. (1.1)(b) 18.8 3.9 11.9 13.0 9.4
- -------------------------------------------------------------------------------------------------------------------------------
MFS Emerging Growth Cos ...................... - - - - 9.4 (c) 72.9
- -------------------------------------------------------------------------------------------------------------------------------
BT Equity 500 Index .......................... - - - - 7.5 (c) 19.8
- -------------------------------------------------------------------------------------------------------------------------------
Lazard Small Cap Value ....................... - - - - (8.8)(c) 1.3
- -------------------------------------------------------------------------------------------------------------------------------
T. Rowe Price Int'l Stock .................... - - - - (0.3)(c) 31.3
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Prior to September 6, 1991, the Bond Fund.
(b) From May 1, 1994, the date contributions were first allocated to these
Funds.
(c) From July 1, 1998, the date contributions were first allocated to these
Funds.
Rates of return are time weighted and include reinvestment of investment income.
The annualized rate assumes an investment of the same amount invested at the
beginning of each year with the percentage demonstrating the effective annual
rate over the period shown.
PAST PERFORMANCE IS NOT A GUARANTEE OR INDICATION OF FUTURE PERFORMANCE. NO
PROVISIONS HAVE BEEN MADE FOR THE EFFECT OF TAXES ON INCOME AND GAINS, OR ANY
TAX PENALTIES, UPON DISTRIBUTION.
<PAGE>
- -----
31
- --------------------------------------------------------------------------------
TABLE 2
ANNUALIZED RATES OF RETURN FOR PERIODS ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
DATE OF
1 YEAR 3 YEARS 5 YEARS 10 YEARS SINCE INCEPTION INCEPTION
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ALLIANCE MONEY MARKET ...... 4.6% 4.8% 4.9% 4.7% 6.3%
Salomon Bros. 3-Mo
T-Bill Index ............. 4.7 5.0 5.2 5.1 N/A* 2/5/82
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE INTERMEDIATE
GOV'T SECURITIES (A) ..... (.23) 4.6 6.0 5.9 9.2
Lehman Intermediate
Gov't Bond Index ......... 0.5 5.5 6.9 7.3 N/A* 2/5/82
- --------------------------------------------------------------------------------------------------------------------------
EQ/BALANCED ................ 17.4 16.5 16.0 11.3 13.6
50% S&P 500 Index/50%
Lehman Gov't. Corp
Bond Index ............... 9.1 16.5 17.9 13.0 N/A* 2/5/82
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE HIGH YIELD ........ (4.2) 2.1 9.2 9.2 8.6
Merrill Lynch Master ..... 1.6 5.9 9.2 10.8 N/A*
Credit Suisse First Boston
Global High Yield Index .. 1.6 5.9 9.6 10.8 N/A 6/2/87
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE COMMON STOCK ...... 24.8 27.4 27.6 18.1 18.7
Standard & Poor's 500
Index .................... 21.0 27.6 28.6 18.2 N/A* 6/1/87
- --------------------------------------------------------------------------------------------------------------------------
EQ/AGGRESSIVE STOCK ........ 18.4 9.2 15.7 15.3 14.0
50% S&P Midcap Total
Return Index/50%
Russell 2000 Small
Stock Index .............. 18.1 17.5 19.9 15.4 N/A* 6/2/87
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE GLOBAL ............ 37.9 22.9 20.1 14.9 13.3
Morgan Stanley Capital
Int'l World Index ........ 24.9 21.6 19.8 11.4 N/A* 6/2/87
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE GROWTH &
INCOME ................... 18.1 21.4 21.3 - 18.4
75% Standard & Poor's
500 Stock Index/25%
Value Line Convertible
Index .................... 20.7 23.1 25.0 - N/A* 5/1/94
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE GROWTH
INVESTORS ................ 25.8 19.9 19.2 - 16.3
30% Lehman Gov't/Corp
Bond Index/70%
Standard & Poor's 500
Index .................... 13.8 20.9 22.2 - N/A* 5/1/94
- --------------------------------------------------------------------------------------------------------------------------
ALLIANCE CONSERVATIVE
INVESTORS ................ 9.4 11.4 11.3 - 9.7
70% Lehman Treasury
Bond Composite
Index/30% Standard &
Poor's 500 Index ......... 4.2 12.1 13.6 - N/A* 5/1/94
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
- ------
32
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
DATE OF
1 YEAR 3 YEARS 5 YEARS 10 YEARS SINCE INCEPTION INCEPTION
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MFS EMERGING GROWTH
COMPANIES ................... 72.9 - - - 52.9
Russell 2000 Index .......... 21.3 - - - 8.3 7/1/98
- -----------------------------------------------------------------------------------------------------------------
BT EQUITY 500 INDEX ........... 19.8 - - - 18.3
Standard & Poor's 500 Index .. 21.0 - - - 20.5 7/1/98
- -----------------------------------------------------------------------------------------------------------------
LAZARD SMALL CAP
VALUE ....................... 1.3 - - - (5.11)
Russell 2000 Index .......... 21.3 - - - 8.3 7/1/98
- -----------------------------------------------------------------------------------------------------------------
T. ROWE PRICE INTERNATIONAL
STOCK ....................... 31.3 - - - 19.7 7/1/98
MSCI EAFE Index ............... 27.0 - - - 20.0
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Prior to September 6, 1991, the "Bond Fund."
* Not Available
Rates of return as are time weighted and include reinvestment of investment
income. The annualized rate assumes an investment of the same amount invested at
the beginning of each year with the percentage demonstrating the effective
annual rate over the period shown.
PAST PERFORMANCE IS NOT A GUARANTEE OR INDICATION OF FUTURE PERFORMANCE. NO
PROVISIONS HAVE BEEN MADE FOR THE EFFECT OF TAXES ON INCOME AND GAINS, OR ANY
TAX PENALTIES, UPON DISTRIBUTION.
<PAGE>
Appendix I: Condensed financial information
- --------
A-1
- --------------------------------------------------------------------------------
The following table shows the unit values and number of units outstanding, as of
the applicable date each Fund was first available under the Certificates and the
last business day of the periods shown.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
FOR THE YEARS ENDING DECEMBER 31,
-------------------------------------------------------------
1990 1991 1992 1993 1994
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ALLIANCE MONEY MARKET
Unit Value ........................ 20.17 21.29 21.93 22.48 23.32
Number of units outstanding (000's) 1,919 1,528 1,301 1,035 1,028
- ----------------------------------------------------------------------------------------------------
ALLIANCE INTERMEDIATE GOV'T
SECURITIES
Unit Value ........................ 28.79 32.73 34.34 37.77 36.13
Number of units outstanding (000's) 242 177 184 188 166
- ----------------------------------------------------------------------------------------------------
ALLIANCE HIGH YIELD
Unit Value ........................ 11.11 13.84 15.40 18.84 18.18
Number of units outstanding (000's) 16 27 53 78 80
- ----------------------------------------------------------------------------------------------------
EQ/BALANCED
Unit Value ........................ 33.76 47.50 45.92 51.38 47.03
Number of units outstanding (000's) 1,217 949 827 756 681
- ----------------------------------------------------------------------------------------------------
ALLIANCE COMMON STOCK
Unit Value ........................ 35.87 51.55 52.97 65.89 64.13
Number of units outstanding (000's) 930 790 736 715 694
- ----------------------------------------------------------------------------------------------------
EQ/AGGRESSIVE STOCK
Unit Value ........................ 13.34 23.43 22.54 26.14 24.95
Number of units outstanding (000's) 48 125 156 125 141
- ----------------------------------------------------------------------------------------------------
ALLIANCE GLOBAL
Unit Value ........................ 11.23 14.20 14.01 18.40 19.25
Number of units outstanding (000's) 32 42 55 153 195
- ----------------------------------------------------------------------------------------------------
ALLIANCE GROWTH & INCOME
Unit Value ........................ - - - - $ 9.92
Number of units outstanding (000's) - - - - 105
- ----------------------------------------------------------------------------------------------------
ALLIANCE CONSERVATIVE INVESTORS
Unit Value ........................ - - - - $ 9.92
Number of units outstanding (000's) - - - - 50
- ----------------------------------------------------------------------------------------------------
ALLIANCE GROWTH INVESTORS
Unit Value ........................ - - - - $ 9.79
Number of units outstanding (000's) - - - - 37
- ----------------------------------------------------------------------------------------------------
MFS EMERGING GROWTH
Unit Value ........................ - - - - -
Number of units outstanding (000's) - - - - -
- ----------------------------------------------------------------------------------------------------
BT EQUITY 500 INDEX
Unit Value ........................ - - - - -
Number of units outstanding (000's) - - - - -
- ----------------------------------------------------------------------------------------------------
LAZARD SMALL CAP VALUE
Unit Value ........................ - - - - -
Number of units outstanding (000's) - - - - -
- ----------------------------------------------------------------------------------------------------
T. ROWE PRICE INTERNATIONAL STOCK
Unit Value ........................ - - - - -
Number of units outstanding (000's) - - - - -
- ----------------------------------------------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
FOR THE YEARS ENDING DECEMBER 31,
------------------------------------------------------ INCEPTION
1995 1996 1997 1998 1999 DATE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ALLIANCE MONEY MARKET 2/5/82
Unit Value ........................ 24.55 25.77 27.05 28.38 29.68
Number of units outstanding (000's) 850 804 736 708 863
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE INTERMEDIATE GOV'T
SECURITIES 2/5/82
Unit Value ........................ 40.82 42.20 45.11 48.43 48.32
Number of units outstanding (000's) 153 130 116 133 105
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE HIGH YIELD 6/2/87
Unit Value ........................ 21.67 26.45 31.16 29.39 28.17
Number of units outstanding (000's) 87 107 136 111 51
- ---------------------------------------------------------------------------------------------------------------------
EQ/BALANCED 2/5/82
Unit Value ........................ 56.07 62.36 71.42 84.01 98.61
Number of units outstanding (000's) 617 559 523 492 471
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE COMMON STOCK 6/1/87
Unit Value ........................ 84.56 104.68 134.77 173.65 216.64
Number of units outstanding (000's) 673 692 678 666 637
- ---------------------------------------------------------------------------------------------------------------------
EQ/AGGRESSIVE STOCK 6/2/87
Unit Value ........................ 32.67 39.73 43.83 43.73 51.79
Number of units outstanding (000's) 190 187 201 199 141
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE GLOBAL 6/2/87
Unit Value ........................ 22.76 25.95 28.80 34.89 48.12
Number of units outstanding (000's) 201 214 206 196 187
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE GROWTH & INCOME 5/1/94
Unit Value ........................ 12.21 14.55 18.35 22.06 26.06
Number of units outstanding (000's) 134 231 324 344 346
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE CONSERVATIVE INVESTORS 5/1/94
Unit Value ........................ 11.79 12.25 13.71 15.49 16.94
Number of units outstanding (000's) 75 71 67 145 125
- ---------------------------------------------------------------------------------------------------------------------
ALLIANCE GROWTH INVESTORS 5/1/94
Unit Value ........................ 12.23 13.64 15.80 18.69 23.52
Number of units outstanding (000's) 93 105 126 133 137
- ---------------------------------------------------------------------------------------------------------------------
MFS EMERGING GROWTH 7/1/98
Unit Value ........................ - - - $ 11.76 20.33
Number of units outstanding (000's) - - - 4 56
- ---------------------------------------------------------------------------------------------------------------------
BT EQUITY 500 INDEX 7/1/98
Unit Value ........................ - - - $ 11.31 13.55
Number of units outstanding (000's) - - - 52 147
- ---------------------------------------------------------------------------------------------------------------------
LAZARD SMALL CAP VALUE 7/1/98
Unit Value ........................ - - - $ 8.94 9.05
Number of units outstanding (000's) - - - 7 14
- ---------------------------------------------------------------------------------------------------------------------
T. ROWE PRICE INTERNATIONAL STOCK 7/1/98
Unit Value ........................ - - - $ 10.05 13.19
Number of units outstanding (000's) - - - 4 31
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Statement of Additional Information
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S-1
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TABLE OF CONTENTS
PAGE
Tax Information .................................. SAI-2
The Guaranteed Rate Accounts ..................... SAI-19
How We Determine Unit Values ..................... SAI-23
Alliance Money Market Yield Information .......... SAI-23
Financial Statements ............................. SAI-24
PLEASE SEND ME A FREE COPY OF THE STATEMENT OF ADDITIONAL INFORMATION.
Equitable 300+ Series
Box 2468 G.P.O.
New York, New York 10116
ATTN: SAI Request for Separate Account
No. 301
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Name
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Address
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City State Zip
<PAGE>
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THE EQUITABLE 300+ SERIES
STATEMENT OF ADDITIONAL INFORMATION
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MAY 1, 2000
CERTIFICATES UNDER GROUP ANNUITY CONTRACTS
THE EQUITABLE LIFE ASSURANCE SOCIETY
OF THE UNITED STATES
1290 AVENUE OF THE AMERICAS, NEW YORK, NY 10104
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This SAI is not a prospectus. It should be read in conjunction with the related
Equitable 300+ Series prospectus, dated May 1, 2000. That prospectus provides
detailed information concerning the Certificates and the Funds, as well as the
Guaranteed Rate Accounts ("GRAs"), that fund the Certificates. Each Fund is a
subaccount of Equitable Life's Separate Account No. 301. The GRAs are part of
Equitable's general account. Definitions of special terms used in the SAI are
found in the prospectus.
A copy of the prospectus is available free of charge by writing to the
Processing Office (Post Office Box 2468, G.P.O. New York, NY 10116), or by
calling 1-800-248-2138 toll-free.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Tax Information ....................................... SAI-2
The Guaranteed Rate Accounts .......................... SAI-19
How We Determine Unit Values .......................... SAI-23
Alliance Money Market Fund Yield Information .......... SAI-23
Financial Statements .................................. SAI-24
</TABLE>
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Copyright 2000 The Equitable Life Assurance Society of the United States, New
York, New York 10104.
All rights reserved.
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TAX INFORMATION
This section of the SAI discusses the current federal income tax rules that
generally apply to the retirement programs described in the prospectus. The tax
rules can differ, depending on the type of program, whether Regular IRA, Roth
IRA, TSA, SEP IRA, or SIMPLE IRA. Therefore, we discuss the tax aspects of each
type of Certificate separately.
We cannot provide detailed information on all tax aspects of the Certificates.
Moreover, the tax aspects that apply to a particular participant's Certificate
may vary depending on the facts applicable to that person. We do not discuss
state income and other state taxes, federal income tax and withholding rules for
non-U.S. taxpayers, or federal gift and estate taxes. Transfers of the
Certificates, rights under the Certificates, or payments under the Certificates
may be subject to gift or estate taxes. You should not rely only on this
document, but should consult your tax adviser before you purchase a Certificate.
Federal income tax rules include the United States laws in the Internal Revenue
Code, and Treasury Department Regulations and Internal Revenue Service
interpretations of the Internal Revenue Code. Certain retirement plans may also
be subject to The Employee Retirement Income Security Act of 1974, as amended
("ERISA"), which The Department of Labor ("DOL") administers. These rules may
change. We cannot predict whether, when, or how these rules could change. Any
change could affect Certificates purchased before the change.
TAX SHELTERED ANNUITY ARRANGEMENTS (TSAS)
An employer eligible to maintain a TSA plan (also referred to as a "403(b)"
plan, program, or arrangement) for its employees may make contributions to an
annuity contract purchased for the benefit of the employee. These contributions,
if properly made, will not be currently taxable compensation to the employee.
Moreover, the employee will not be taxed on the earnings in the annuity contract
until he/she takes distributions.
Two different types of employers are eligible to maintain 403(b) plans: public
schools and specified tax-exempt organizations under Section 501(c)(3) of the
Code.
CONTRIBUTIONS TO TSAS
Annual Contributions to TSAs
Annual contributions to TSAs made through the employer's payroll are limited.
(Tax-free transfer or tax-deferred rollover contributions from another 403(b)
arrangement are not subject to these annual contribution limits.)
Commonly, some or all of the contributions to the TSA are made under a salary
reduction agreement between the employee and the employer. These contributions
are called "salary reduction" or "elective deferral" contributions. However, a
TSA can also be wholly or partially funded through nonelective employer
contributions or after-tax employee contributions. To determine the permissible
annual contribution to the participant's TSA, a participant generally must
calculate tentative annual contributions under several formulas.
Generally, this contribution limit is the lowest of the following:
- the annual "maximum exclusion allowance" for the employee in Section
403(b)(2) of the Code,
- the annual limit under Section 415 of the Code on employer
contributions to defined contribution plans and
- the annual limit on all elective deferrals.
If contributions to a TSA exceed the applicable limit in any year, the excess
will be taxable to the employee as ordinary income. In certain situations, we
may distribute excess contributions to avoid tax penalties.
SAI-2
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The annual maximum exclusion allowance for the employee under Section 403(b)(2)
of the Code is 20% of includable compensation times years of service minus
previous contributions to all qualified plans, 403(b) plans and Section 457
plans the participant participates with this employer.
The annual limit under Section 415 of the Code on employer contributions to
defined contribution plans is the lesser of $30,000 or 25% of compensation,
disregarding compensation over $170,000 in 2000.
In 2000, the annual limit on all salary reduction or elective deferral
contributions for an employee under all plans of any employer is generally
$10,500. Note, however, that the maximum salary reduction contribution by an
employee who participates in both a TSA arrangement and a Section 457 plan is
the lower maximum allowed under Section 457 of the Code. In 2000, this maximum
is $8,000.
Any excess deferral contributions not withdrawn by April 15 after the year of
the deferral may cause the contract to fail TSA rules.
Special provisions may allow "catch-up" contributions to compensate for smaller
contributions in prior years.
ROLLOVER OR DIRECT TRANSFER CONTRIBUTIONS TO TSAS
You may make rollover contributions to your TSA Certificate from TSAs under
Section 403(b) of the Code (including custodial accounts under Section 403(b)(7)
of the Code). See "Tax Deferred Rollovers and Transfers" below for a description
of rollovers. With appropriate written documentation, we will accept rollover
contributions from "conduit IRAs" for TSA funds. See "Regular Individual
Retirement Annuities" below for a description of "Conduit IRAs."
We will also accept direct transfer of TSA funds under Revenue Ruling 90-24 if:
- you provide us with acceptable documentation as to the source of funds,
and
- the Certificate that receives the funds has provisions at least as
restrictive as the source Certificate.
DISTRIBUTIONS FROM TSAS
WITHDRAWAL LIMITATIONS
You may not be able to withdraw or take payments from all or part of your TSA
until you:
- attain age 59 1/2,
- die,
- are disabled (special Federal income tax definition),
- separate from service with the employer who provided the TSA funds, or
- suffer a financial hardship. (Hardship withdrawals are limited to the
amount of your salary reduction contributions, without earnings.)
These restrictions apply to salary reduction (elective deferral) contributions
and earnings on those contributions.
These restrictions do not apply to the value of your TSA Certificate as of
December 31, 1988 attributable to salary reduction contributions and earnings.
If you directly transfer any amounts to this Certificate you must properly
notify us in writing at our Processing Office of your December 31, 1988 account
balance. Otherwise, we will view all amounts transferred as subject to
restrictions.
TAX TREATMENTS OF DISTRIBUTIONS FROM TSAS
Amounts held under TSAs are generally not subject to Federal income tax until
benefits are distributed.
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Distributions include withdrawals and annuity payments from your TSA. Death
benefits paid to a beneficiary are also taxable distributions. Unless an
exception applies, amounts distributed from TSAs are includible as ordinary
income. If you have made after-tax contributions you will have a tax basis in
your Certificate which will be recovered tax-free. You may have a tax basis in
the Certificate if the employer made contributions that were included in your
gross income in the year of the employer's contribution, for example.
The amount of any partial distribution from a TSA before the annuity starting
date is generally taxable as ordinary income to you except to the extent the
distribution is a withdrawal of your basis. Distributions are generally pro rata
withdrawals of tax basis and earnings on that tax basis.
If you elect an annuity distribution, the nontaxable portion of each payment is
(1) your tax basis in the contract divided by (2) an expected return determined
under IRS tables. The balance of each payment is taxable. The entire amount of
the payments you receive after you recover your tax basis is taxable. If you die
before recovering your tax basis and the annuity has a refund feature, the
beneficiary of the refund may recover the remaining tax basis as payments are
made. If you (and your beneficiary under a joint and survivor annuity) die
before recovering the entire basis of the annuity, a deduction is allowed on
your (or your beneficiary's) final tax return.
EARLY DISTRIBUTION PENALTY TAX
Distributions from a TSA will be subject to an additional 10% penalty tax,
unless the distribution occurs on or after you:
- die,
- are disabled (special Federal income tax definition),
- reach age 59 1/2,
- separate from service and elect a payout over your life or life
expectancy (or joint and survivor lives or life expectancies of you and
your beneficiary),
- separate from service after age 55 (any form of payout), or
- use the distribution to pay certain extraordinary medical expenses
(special Federal income tax definition).
TAX DEFERRED ROLLOVERS AND TRANSFERS
You may roll over an "eligible rollover distribution" into another eligible
retirement plan, either as a direct rollover or as a rollover you do yourself
within 60 days after you receive the distribution. To the extent that a
distribution is rolled over, it remains tax deferred.
A distribution from a TSA may be rolled over to another TSA that will accept
rollover contributions, or to a Regular IRA. Death benefits received by a
spousal beneficiary may be rolled over only to a Regular IRA.
The taxable portion of most distributions will be eligible for rollover.
However, Federal income tax rules exclude certain distributions from rollover
treatment, including (1) periodic payments for life or for a period of 10 years
or more, (2) hardship withdrawals, and (3) any required minimum distributions.
We discuss eligible rollover distributions in greater detail under "Federal and
State Income Tax Withholding and Information Reporting," below, including rules
requiring 20% income tax withholding on certain distributions from TSAs.
Amounts held under TSAs may be directly transferred (under Revenue Ruling 90-24)
to another TSA issuer in a tax-free transaction, if the successor TSA contains
the same or greater restrictions as the original TSA.
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REQUIRED MINIMUM DISTRIBUTIONS
The Required Minimum Distribution rules discussed below under "Traditional
Individual Retirement Annuities (Regular IRAs)--Required Minimum Distributions"
apply to TSAs, with this difference:
When you have to take the first required minimum distribution:
The minimum distribution rules force TSA participants to start computing and
taking annual distributions from their TSAs by a required date. When minimum
distributions must begin depends on, among other things, your age and retirement
status. Generally, you must take the first required minimum distribution with
respect to the calendar year in which you turn age 70 1/2. You may be entitled
to delay commencement of required minimum distributions for all or part of your
account balance until after age 70 1/2. These exceptions apply to the following
individuals:
o For TSA participants who have not retired from service with the
employer who provided the funds for the TSA by the calendar year the
participant turns age 70 1/2, the Required Beginning Date for minimum
distributions is extended to April 1 following the calendar year of
retirement.
o TSA plan participants may also delay commencement to age 75 of the
portion of their account balance attributable to their December 31,
1986 TSA account balance, even if retired at age 70 1/2.
IRAS
GENERAL DISCUSSION OF IRAS
"IRA" stands for individual retirement arrangement and the two basic types of
such arrangements, individual retirement accounts and individual retirement
annuities. In an individual retirement account, a trustee or custodian holds the
assets for the benefit of the IRA owner. The assets can include mutual funds and
certificates of deposit. In an individual retirement annuity, an insurance
company issues an annuity contract that serves as the IRA.
There are several types of IRAs, as follows:
- "Regular IRAs," typically funded on a pre-tax basis;
- Roth IRAs, first available in 1998, funded on an after-tax basis; and
- SEP-IRAs and SIMPLE-IRAs, issued and funded in connection with
employer-sponsored retirement plans.
Regardless of the type of IRA, your ownership interest in the IRA cannot be
forfeited. You or your beneficiaries who survive you are the only ones who can
receive the IRA's benefits or payments.
You can hold your IRA assets in as many different accounts and annuities as you
would like, as long as you meet the rules for setting up and making
contributions to IRAs. However, if you own multiple IRAs, you may be required to
aggregate IRA values or contributions for tax purposes. For further information
about individual retirement arrangements, you can read Internal Revenue Service
Publication 590 (Individual Retirement Arrangements (IRAs)). This Publication is
usually updated annually, and can be obtained from any IRS district office or
the IRS Website (www.irs.gov).
The Equitable 300+ Series IRAs are designed to qualify as "individual retirement
annuities" under Section 408(b) of the Internal Revenue Code. This SAI and the
prospectus contain the information that the Internal Revenue Service ("IRS")
requires you to have before you purchase an IRA. This section of the SAI covers
some of the special tax rules that apply to IRAs. The next section covers Roth
IRAs. We do not discuss Education IRAs in this SAI because they are not
available in individual retirement annuity form.
We have received favorable opinion letters from the IRS approving the form of
Group Individual Retirement Annuity No. 301-10,001-93 as a Regular IRA. The Roth
IRA endorsement is issued pursuant to an IRS Form and is deemed approved as to
form. This IRS approval is a determination only as to the
SAI-5
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form of the annuity. It does not represent a determination of the merits of the
annuity as an investment. The IRS approval does not address every feature
possibly available under the Equitable 300+ Series IRAs.
Cancellation
You can cancel an Equitable 300+ Series IRA Certificate by following the
directions under "Your Right to Cancel within a Certain Number of Days" in the
prospectus. You can cancel an Equitable 300+ Series Roth IRA certificate issued
as a result of a full conversion of an Equitable 300+ Series Regular IRA
certificate by following the instructions in the request for full conversion
form. The form is available from our Processing Office or your registered
representative. If you cancel a Regular IRA or Roth IRA certificate, we may have
to withhold tax, and we must report the transaction to the IRS. A Certificate
cancellation could have unfavorable tax impact.
You must also use our form to recharacterize Roth IRA Certificates as Regular
IRAs and vice versa.
TRADITIONAL INDIVIDUAL RETIREMENT ANNUITIES (REGULAR IRAS)
Contributions to Regular IRAs
Individuals may make three different types of contributions to a Regular IRA:
- "regular" contributions out of earned income or compensation;
- tax-free "rollover" contributions; or
- direct custodian-to-custodian transfers from other Regular IRAs
("direct transfers").
Limits on Contributions
Generally, $2,000 is the maximum amount of regular contributions that you may
make to all IRAs (including Roth IRAs) in any taxable year. When your earnings
are below $2,000, your earned income or compensation for the year is the most
you can contribute. This $2,000 limit does not apply to rollover contributions
or direct custodian-to-custodian transfers into a Regular IRA. You have to stop
making Regular IRA contributions for the tax year in which you reach age 70 1/2
or any tax year after that.
Special Rules for Spouses
If you are married and file a joint income tax return, you and your spouse may
aggregate your compensation to determine the permissible amount of contributions
to Regular IRAs (and Roth IRAs discussed below). Even if one spouse has no
compensation or compensation under $2,000, married individuals filing jointly
can contribute up to $4,000 for any taxable year to any combination of Regular
IRAs and Roth IRAs. (Any contributions to Roth IRAs reduce the ability to
contribute to Regular IRAs and vice versa.) The maximum amount may be less if
earned income is less and the other spouse has made IRA contributions. No more
than a combined total of $2,000 can be contributed annually to either spouse's
Traditional and Roth IRAs. Each spouse owns his or her Regular IRAs and Roth
IRAs even if contributions were funded by the other spouse. A working spouse age
70 1/2 or over can contribute up to the lesser of $2,000 or 100% of "earned
income" to a Regular IRA for a nonworking spouse until the year in which the
nonworking spouse reaches age 70 1/2.
Deductibility of Contributions
The amount of Regular IRA contributions that you can deduct for a tax year
depends on whether you are covered by an employer-sponsored tax-favored
retirement plan, as defined under special federal income tax rules. Your W-2
form will indicate whether or not you are covered by such a retirement plan.
IF YOU ARE NOT COVERED BY A RETIREMENT PLAN DURING ANY PART OF THE YEAR, you can
make fully deductible contributions to your Regular IRAs for each tax year up to
$2,000 or, if less, your earned income.
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IF YOU ARE COVERED BY A RETIREMENT PLAN DURING ANY PART OF THE YEAR, and your
adjusted gross income ("AGI") is BELOW THE LOWER DOLLAR FIGURE IN A PHASE-OUT
RANGE, you can make fully deductible contributions to your Regular IRAs for each
tax year up to $2,000 or, if less, your earned income.
IF YOU ARE COVERED BY A RETIREMENT PLAN DURING ANY PART OF THE YEAR, and your
AGI falls within a PHASE-OUT range, you can make PARTIALLY DEDUCTIBLE
CONTRIBUTIONS to your Regular IRAs.
IF YOU ARE COVERED BY A RETIREMENT PLAN DURING ANY PART OF THE YEAR, and your
AGI falls ABOVE THE HIGHER FIGURE IN THE PHASE-OUT RANGE, you may not deduct any
of your contribution to your Regular IRAs.
If you are single and covered by a retirement plan during any part of the
taxable year, the deduction for IRA contributions phases out with AGI between
$32,000 and $42,000 in 2000. This range will increase every year until 2005 when
the range is $50,000-$60,000.
If you are married and file a joint return, and you are covered by a retirement
plan during any part of the taxable year, the deduction for Regular IRA
contributions phases out with AGI between $52,000 and $62,000 in 2000. This
range will increase every year until 2007 when the range is $80,000-$100,000.
Married individuals filing separately and living apart at all times are not
considered married for purposes of this deductible contribution calculation.
Generally, the active participation in an employer-sponsored retirement plan of
an individual is determined independently for each spouse. Where spouses have
"married filing jointly" status, however, the maximum deductible Regular IRA
contribution for an individual who is not an active employee (but whose spouse
is an active participant) is phased out for taxpayers with AGI of between
$150,000 and $160,000.
To determine the deductible amount of the contribution in 2000, you determine
AGI and subtract $32,000 if you are single, or $52,000 if you are married and
file a joint return with your spouse. The resulting amount is your Excess AGI.
You then determine the limit on the deduction for Regular IRA contributions
using the following formula:
($10,000-Excess AGI) times $2,000 Equals the adjusted
--------------------- x (or earned = deductible
divided by income, if less) contribution
10,000 limit
Nondeductible Contributions
If you are not eligible to deduct part or all of the Regular IRA contribution,
you may still make nondeductible contributions on which earnings will accumulate
on a tax-deferred basis. The combined deductible and nondeductible contributions
to your Regular IRA (or the nonworking spouse's Regular IRA) may not, however,
exceed the maximum $2,000 per person limit. See "Excess Contributions" below.
You must keep your own records of deductible and nondeductible contributions in
order to prevent double taxation on the distribution of previously taxed
amounts. See "Withdrawals, Payments and Transfer of Funds Out of Regular IRAs"
below.
If you are making nondeductible contributions in any taxable year, or you have
made nondeductible contributions to a Regular IRA in prior years and are
receiving distributions from any Regular IRA, you must file the required
information with the IRS. Moreover, if you are making nondeductible Regular IRA
contributions, you must retain all income tax returns and records pertaining to
such contributions until interests in all Regular IRAs are fully distributed.
When You Can Make Contributions
If you file your tax returns on a calendar year basis like most taxpayers, you
have until the April 15 return filing deadline (without extensions) of the
following calendar year to make your Regular IRA contributions for a tax year.
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Excess Contributions
Excess contributions to Regular IRAs are subject to a 6% excise tax for the year
in which made and for each year after until withdrawn. The following are excess
contributions to Regular IRAs:
- "regular" contributions of more than $2,000;
- "regular" contributions of more than earned income for the year, if
that amount is under $2,000;
- "regular" contributions to a Regular IRA made after you reach age
70 1/2; and
- rollover contributions of amounts that are not eligible to be rolled
over (for example, after-tax contributions to a qualified plan or
minimum distributions required to be made after age 70 1/2).
You can avoid the excise tax by withdrawing an excess contribution (rollover or
"regular") before the due date (including extensions) for filing your federal
income tax return for the year. If it is an excess "regular" Regular IRA
contribution, you cannot take a tax deduction for the amount withdrawn. The
excess contribution withdrawn is not includable in income and is not subject to
the 10% additional penalty tax on early distributions (discussed below under
"Early Distribution Penalty Tax"). You do have to withdraw any earnings
attributable to the excess contribution. The withdrawn earnings would be
includable in your gross income and could be subject to the 10% penalty tax.
Even after the due date for filing your return, you may withdraw an excess
rollover contribution, without income inclusion or 10% penalty, if (1) the
rollover was from a qualified retirement plan to a Regular IRA, (2) the excess
contribution was due to incorrect information that the plan provided, and (3)
you took no tax deduction for the excess contribution.
ROLLOVERS AND TRANSFERS
You may make rollover contributions to a Regular IRA from these sources:
- qualified plans;
- TSAs (including Internal Revenue Code Section 403(b)(7) custodial
accounts); and
- other Regular IRAs.
You may also recharacterize Roth IRA funds as Regular IRA funds, in accordance
with special federal income tax rules, if you use the forms we prescribe.
Any amount contributed to a Regular IRA after you attain age 70 1/2 must be net
of your required minimum distribution for the year in which the rollover or
direct transfer contribution is made.
ROLLOVERS FROM QUALIFIED PLANS OR TSAS
There are two ways to do rollovers:
- Do it yourself
You actually receive a distribution that can be rolled over and you
roll it over to a Regular IRA within 60 days after the date you receive
the funds. The distribution from your qualified plan or TSA will be net
of 20% mandatory federal income tax withholding. If you want, you can
replace the withheld funds yourself and roll over the full amount.
- Direct rollover
You tell your qualified plan trustee or TSA issuer/custodian/fiduciary
to send the distribution directly to your Regular IRA issuer. Direct
rollovers are not subject to mandatory federal income tax withholding.
All distributions from a TSA or qualified plan are eligible rollover
distributions, unless the distribution is:
- only after-tax contributions you made to the plan;
- "required minimum distributions" after age 70 1/2 or separation from
service;
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- a hardship withdrawal;
- substantially equal periodic payments made at least annually for your
life (or life expectancy) or the joint lives (or joint life
expectancies) of you and your designated beneficiary;
- substantially equal periodic payments made for a specified period of 10
years or more;
- if you have contributed too much, corrective distributions which fit
specified technical tax rules;
- a loan that is treated as a deemed distribution;
- a death benefit payment to a beneficiary who is not your surviving
spouse; and
- a qualified domestic relations order distribution to a beneficiary who
is not your current spouse or former spouse.
ROLLOVERS FROM REGULAR IRAS TO REGULAR IRAS
You may roll over amounts from one Regular IRA to one or more of your other
Regular IRAs if you complete the transaction within 60 days after you receive
the funds. You may make such a rollover only once in every 12-month period for
the same funds. Trustee-to-trustee or custodian-to-custodian direct transfers
are not rollover transactions. You can make these more frequently than once in
every 12-month period.
The surviving spouse beneficiary of a deceased individual can roll over or
directly transfer an inherited Regular IRA to one or more other Regular IRAs.
Also, in some cases, Regular IRAs can be transferred on a tax-free basis between
spouses or former spouses as a result of a court ordered divorce or separation
decree.
WITHDRAWALS, PAYMENTS AND TRANSFERS OF FUNDS OUT OF REGULAR IRAS
No Federal Income Tax Law Restrictions on Withdrawals
You can withdraw any or all of your funds from a Regular IRA at any time. You do
not need to wait for a special event like retirement.
Taxation of Payments
Earnings in Regular IRAs are not taxable until you or your beneficiary receives
them. Taxable payments or distributions include withdrawals from your
Certificate, surrender of your Certificate and annuity payments from your
Certificate. Death benefits are also taxable. Except as discussed below, the
amount of any distribution from a Regular IRA is fully taxable as ordinary
income.
If you have ever made nondeductible IRA contributions to any Regular IRA (it
does not have to be to this particular Regular IRA Certificate), those
contributions are recovered tax free when you get distributions from any Regular
IRA. You must keep permanent tax records of all of your nondeductible
contributions to Regular IRAs. At the end of any year in which you have received
a distribution from any Regular IRA, you compute the nontaxable portion of the
distribution as follows:
- divide (1) your total nondeductible Regular IRA contributions (less any
amounts previously withdrawn tax free) by (2) the total account
balances of all Regular IRAs you own at the end of the year plus all
Regular IRA distributions made during the year;
- multiply this amount by all distributions from the Regular IRA during
the year.
In addition, a distribution is not taxable if:
- the amount received is a withdrawal of excess contributions, as
described under "Excess Contributions" above;
- the entire amount received is rolled over to another Regular IRA (see
"Rollovers and Transfers" above); or
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- in certain limited circumstances, where the Regular IRA acts as a
"conduit," you roll over the entire amount into a qualified plan or TSA
that accepts rollover contributions. To get this "conduit" Regular IRA
treatment:
o the source of funds you used to establish the Regular IRA must have
been a rollover contribution from a qualified plan, and
o the entire amount received from the Regular IRA (including any
earnings on the rollover contribution) must be rolled over into
another qualified plan within 60 days of the date received.
Similar rules apply in the case of a TSA.
You may lose conduit treatment, if you make an eligible rollover distribution
contribution to a Regular IRA and you commingle this contribution with other
contributions. In that case, you may not be able to roll over these eligible
rollover distribution contributions and earnings to another qualified plan (or
TSA) at a future date.
Distributions from a Regular IRA are not eligible for ten-year averaging and
long-term capital gain treatment available to certain distributions from
qualified plans.
REQUIRED MINIMUM DISTRIBUTIONS
Lifetime Required Minimum Distributions
You must start taking annual distributions from your Regular IRAs beginning at
age 70 1/2.
When you have to take the first required minimum distribution
The first required minimum distribution is for the calendar year in which you
turn age 70 1/2. You have the choice to take this first required minimum
distribution during the calendar year you actually reach age 70 1/2, or to delay
taking it until the first three-month period in the next calendar year (January
1 -- April 1). Distributions must start no later than your "Required Beginning
Date," which is April 1st of the calendar year after the calendar year in which
you turn age 70 1/2. If you choose to delay taking the first annual minimum
distribution, then you will have to take two minimum distributions in that year,
the delayed one for the first year and the actual one for that year. Once
minimum distributions begin, they must be made at some time each year.
How you can calculate required minimum distributions
There are two approaches to taking required minimum distributions,
"account-based" or "annuity-based." If you choose an "account-based" method,
you divide the value of your Regular IRA as of December 31st of the past
calendar year by a life expectancy factor from IRS tables. This gives you the
required minimum distribution amount for that particular IRA for that year. If
you choose an account-based method, the required minimum distribution amount
will vary each year as the account value and your life expectancy factors
change. If you choose an "annuity-based" method, you do not have to do annual
calculations. You apply the account value to an annuity payout for your life or
the joint lives of you and a designated beneficiary, or for a period certain not
extending beyond applicable life expectancies.
If you pick an account-based method, you have a choice of life expectancy
factors, depending on whether you choose a method based only on your life
expectancy, or the joint life expectancies of you and another individual. You
can decide to "recalculate" your life expectancy every year by using your
current life expectancy factor. You can decide instead to use the "term certain"
method, where you reduce your life expectancy by one every year after the
initial year. If your spouse is your designated beneficiary for figuring out
annual account-based required minimum distributions, you can also annually
"recalculate" your spouse's life expectancy if you want. If you choose someone
who is not your spouse as your designated beneficiary for the purpose of
figuring out annual account-based required minimum
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distributions, you have to use the "term certain" method of calculating that
person's life expectancy. If you pick a nonspouse designated beneficiary, you
may also have to do another special calculation.
If you pick an account-based method, you can later apply your Regular IRA funds
to a life annuity-based payout. You can only do this if you already chose to
recalculate your life expectancy annually (and your spouse's life expectancy if
you select a spousal joint annuity). For example, if you anticipate selecting a
form of life annuity payout after you are age 70 1/2, you must have elected to
recalculate life expectancies.
Whether you have to pick the same method to calculate your required minimum
distributions for all of your Regular IRAs and other retirement plans.
You can choose a different method and a different beneficiary for each of your
Regular IRAs and other retirement plans. For example, you can choose an annuity
payout from one IRA, a different annuity payout from a qualified plan, and an
account-based annual withdrawal from another IRA.
If you take more than you need to for any year.
The correct required minimum distribution amount for your Regular IRAs is
calculated on a year-by-year basis. There are no carry-back or carry-forward
provisions. Also, you cannot apply required minimum distribution amounts you
take from your qualified plans to the amounts you have to take from your Regular
IRAs and vice versa. However, the IRS will let you figure out the required
minimum distribution for each Regular IRA that you maintain, using the method
that you picked for that particular IRA. You can add these required minimum
distribution amount calculations together. As long as the total amount you take
out every year satisfies your overall Regular IRA required minimum distribution
amount, you may choose to take your annual required minimum distribution from
any one or more Regular IRAs that you own.
If you take less than you need to for any year.
Your IRA could be disqualified, and you could have to pay tax on the entire
value. Even if your IRA is not disqualified, you could have to pay a 50% penalty
tax on the shortfall (required amount for Regular IRAs less amount actually
taken). It is your responsibility to meet the required minimum distribution
rules. We will remind you when our records show that your age 70 1/2 is
approaching. If you do not select a method with us, we will assume you are
taking your required minimum distribution from another Regular IRA that you own.
Required minimum distribution payments after you die.
If you die after either (1) the start of annuity payments, or (2) your Required
Beginning Date, your beneficiary must receive payment of the remaining values in
the certificate at least as rapidly as under the distribution method before your
death. In some circumstances, your surviving spouse may elect to become the
owner of the Regular IRA and halt distributions until he or she reaches age
70 1/2.
If you are using the recalculation method for determining life expectancy, the
payments to a beneficiary may accelerate after your death.
If you die before your Required Beginning Date and before annuity payments
begin, federal tax rules require complete distribution of your entire value in
the Certificate within five years after your death. Payments to a designated
beneficiary over the beneficiary's life or over a period certain that does not
extend beyond the beneficiary's life expectancy are also permitted, if these
payments start within one year of your death. A surviving spouse beneficiary can
also (1) delay starting any payments until you would have attained 70 1/2 or (2)
roll over your Regular IRA into his or her own Regular IRA.
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PAYMENTS TO A BENEFICIARY AFTER YOUR DEATH
Regular IRA death benefits are taxed the same as Regular IRA distributions.
BORROWING AND LOANS ARE PROHIBITED TRANSACTIONS
You cannot get loans from a Regular IRA. You cannot use a Regular IRA as
collateral for a loan or other obligation. If you borrow against your IRA or use
it as collateral, its tax-favored status will be lost as of the first day of the
tax year in which this prohibited event occurs. If this happens, you must
include in federal gross income for that year an amount equal to the fair market
value of the Regular IRA Certificate as of the first day of that tax year, less
the amount of any nondeductible contributions not previously recovered. Also,
the early distribution penalty tax of 10% will apply if you have not reached age
59 1/2 before the first day of that tax year.
EARLY DISTRIBUTION PENALTY TAX
A penalty tax of 10% of the taxable portion of a distribution applies to
distributions from a Regular IRA made before you reach age 59 1/2. The extra
penalty tax does not apply if the distribution is covered by an exception. No
penalty tax applies to pre-age 59 1/2 distributions made:
- on or after your death;
- because you are disabled (special federal income tax definition);
- used to pay certain extraordinary medical expenses (special federal
income tax definition);
- used to pay medical insurance premiums for unemployed individuals
(special federal income tax definition);
- used to pay certain first-time home buyer expenses (special federal
income tax definition);
- used to pay certain higher education expenses (special federal income
tax definition); or
- in the form of substantially equal periodic payments made at least
annually over your life (or your life expectancy), or over the joint
lives of you and your beneficiary (or your joint life expectancy) using
an IRS-approved distribution method.
ROTH INDIVIDUAL RETIREMENT ANNUITIES (ROTH IRAS)
This section of the SAI covers some of the special tax rules that apply to Roth
IRAs. If the rules are the same as those that apply to Regular IRAs, we will
refer you to the same topic under "Regular IRAs."
The Equitable 300+ Series Roth IRA Certificate is designed to qualify as a Roth
individual retirement annuity under Sections 408A and 408(b) of the Internal
Revenue Code.
Contributions to Roth IRAs
Individuals may make four different types of contributions to a Roth IRA:
- "regular" after-tax contributions out of earnings;
- taxable "rollover" contributions from Regular IRAs ("conversion"
contributions); tax-free rollover contributions from other Roth IRAs;
or tax-free direct custodian-to-custodian transfers from other Roth
IRAs ("direct transfers").
REGULAR CONTRIBUTIONS TO ROTH IRAS
Limits on regular Contributions:
Generally, $2,000 is the maximum amount that you may contribute to all IRAs
(including Roth IRAs) in any taxable year. This $2,000 limit does not apply to
rollover contributions or direct custodian-to--
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custodian transfers into a Roth IRA. Any contributions to Roth IRAs reduce the
ability to contribute to Regular IRAs and vice versa. When your earnings are
below $2,000, your earned income or compensation for the year is the most you
can contribute. If you are married and file a joint income tax return, you and
your spouse may combine your compensation to determine the amount of regular
contributions you are permitted to make to Roth IRAs and Regular IRAs. See the
discussion above under Regular IRAs.
With a Roth IRA, you can make regular contributions when you reach 70 1/2, as
long as you have earnings. But, you cannot make contributions for any year that:
o your federal income tax filing status is "married filing jointly" and
your adjusted gross income is over $160,000; or;
o your federal income tax filing status is "single" and your adjusted
gross income is over $110,000.
However, you can make regular Roth IRA contributions in reduced amounts when:
o your federal income tax filing status is "married filing jointly" and
your adjusted gross income is between $150,000 and $160,000; or,
o your federal income tax filing status is "single" and your adjusted
gross income is between $95,000 and $110,000.
If you are married and filing separately and your adjusted gross income is
between $0 and $10,000 the amount of regular contribution you are permitted to
make is phased out. If your adjusted gross income is more than $10,000 you
cannot make a regular Roth IRA contribution.
When you can make Contributions
Same as Regular IRAs.
Deductibility of Contributions
Roth IRA contributions are not tax-deductible.
ROLLOVERS AND DIRECT TRANSFERS
You may make rollover contributions to a Roth IRA from only two sources:
- another Roth IRA ("tax-free rollover contribution"); or
- another Regular IRA, including a SEP-IRA or SIMPLE-IRA, in a taxable
"conversion" rollover ("conversion contribution").
You may not make contributions to a Roth IRA from a qualified plan under Section
401(a) of the Internal Revenue Code, or a tax-sheltered arrangement under
Section 403(b) of the Internal Revenue Code. You may make direct transfer
contributions to a Roth IRA only from another Roth IRA.
The difference between a rollover transaction and a direct transfer transaction
is the following: In a rollover transaction you actually take possession of the
funds rolled over, or constructively receive them in the case of a change from
one type of plan to another. In a direct transfer transaction, you never take
possession of the funds, but direct the first Roth IRA custodian, trustee, or
issuer to transfer the first Roth IRA funds directly to Equitable, as the Roth
IRA issuer. You can make direct transfer transactions only between identical
plan types (for example, Roth IRA to Roth IRA). You can also make rollover
transactions between identical plan types. However, you can only use rollover
transactions between different plan types (for example, Regular IRA to Roth
IRA).
You may make both Roth IRA to Roth IRA rollover transactions and Roth IRA to
Roth IRA direct transfer transactions. This can be accomplished on a completely
tax-free basis. However you may make Roth IRA to Roth IRA rollover transactions
only once in any 12-month period for the same funds. Trustee-to-trustee or
custodian-to-custodian direct transfers can be made more frequently than once a
year. Also, if you send us the rollover contribution to apply it to a Roth IRA,
you must do so within 60 days after you receive the proceeds from the original
IRA to get rollover treatment.
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The surviving spouse beneficiary of a deceased individual can roll over or
directly transfer an inherited Roth IRA to one or more other Roth IRAs. In some
cases, Roth IRAs can be transferred on a tax-free basis between spouses or
former spouses because of a court-ordered divorce or separation decree.
CONVERSION CONTRIBUTIONS TO ROTH IRAS
In a conversion rollover transaction, you withdraw (or are deemed to withdraw)
all or a portion of funds from a Regular IRA you maintain and convert it to a
Roth IRA within 60 days after you receive (or are deemed to receive) the Regular
IRA proceeds. Unlike a rollover from a Regular IRA to another Regular IRA, the
conversion rollover transaction is not tax exempt. Instead, the distribution
from the Regular IRA is generally fully taxable. For this reason, we are
required to withhold 10% federal income tax from the amount converted unless you
elect out of such withholding. (If you have ever made nondeductible regular
contributions to any Regular IRA--whether or not it is the Regular IRA you are
converting--a pro rata portion of the distribution is tax exempt.)
There is, however, no early distribution penalty tax on the Regular IRA
withdrawal that you are converting to a Roth IRA, even if you are under age
59 1/2.
You cannot make conversion contributions to a Roth IRA for any taxable year in
which your adjusted gross income exceeds $100,000. (For this purpose, you
compute your adjusted gross income without the gross income stemming from the
Regular IRA conversion.) You also cannot make conversion contributions to a Roth
IRA for any taxable year in which your federal income tax filing status is
"married filing separately."
Finally, you cannot make conversion contributions to a Roth IRA to the extent
that the funds in your Regular IRA are subject to the annual required minimum
distribution rule applicable to Regular IRAs beginning at age 70 1/2.
WITHDRAWALS, PAYMENTS AND TRANSFERS OF FUNDS OUT OF ROTH IRAS
You can withdraw any or all of your funds from a Roth IRA at any time without
restriction. You do not need to wait for a special event like retirement.
DISTRIBUTIONS FROM ROTH IRAS
Distributions include withdrawals from your Certificate, surrender of your
Certificate and annuity payments from your Certificate. Death benefits are also
distributions.
The following distributions from Roth IRAs are free of income tax:
- rollovers from a Roth IRA to another Roth IRA;
- direct transfers from a Roth IRA to another Roth IRA;
- "qualified distributions" from Roth IRAs; and
- return of excess contributions or amounts recharacterized to a Regular
IRA.
Qualified Distributions from Roth IRAs
A qualified distribution from a Roth IRA is any distribution made (1) after the
five-taxable year period beginning with the first taxable year for which you
made any contribution to any Roth IRA (whether or not the one from which the
distribution is being made) and (2) for one of the following reasons:
- you reach age 59 1/2;
- you die;
- you become disabled (special federal income tax definition); or
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- your distribution is a "qualified first-time homebuyer distribution"
(special federal income tax definition; $10,000 lifetime total limit
for these distributions from all of your Traditional and Roth IRAs).
It is not possible to have a tax-free qualified distribution from a Roth IRA
before 2003 because of the five year aging requirement.
Nonqualified Distributions from Roth IRAs
Distributions from Roth IRAs that are not qualified distributions are
potentially taxable as ordinary income. Nonqualified distributions receive
return-of-investment-first treatment. Only the difference between the amount of
the distribution and the amount of contributions to all of your Roth IRAs is
taxable. You have to reduce the amount of contributions to all of your Roth IRAs
to reflect any previous tax-free recoveries.
You must keep your own records of regular and conversion contributions to all
Roth IRAs to assure appropriate taxation. You may have to file information on
your contributions to and distributions from any Roth IRA on your tax return.
You may have to retain all income tax returns and records pertaining to such
contributions and distributions until your interests in all Roth IRAs are
distributed.
Like Regular IRAs, taxable distributions from a Roth IRA are not eligible for
favorable ten-year averaging and long-term capital gain treatment available to
certain distributions from qualified plans.
REQUIRED MINIMUM DISTRIBUTIONS AFTER YOUR DEATH
If you die before we have distributed the entire amount of your Roth IRA to you,
federal tax rules require complete distribution of your entire value in the
Certificate within five years after your death. Payments to a designated
beneficiary over the beneficiary's life or over a period certain that does not
extend beyond the beneficiary's life expectancy are also permitted, if these
payments start within one year of your death. If your surviving spouse is the
designated beneficiary, required minimum distributions need not be made until
after the surviving spouse's death.
PAYMENTS TO A BENEFICIARY AFTER YOUR DEATH
Distributions to a beneficiary generally receive the same tax treatment as if
the distribution had been to you.
BORROWING AND LOANS ARE PROHIBITED TRANSACTIONS
You cannot get loans from a Roth IRA. You cannot use a Roth IRA as collateral
for a loan or other obligation. If you borrow against your Roth IRA or use it as
collateral, its tax-favored status will be lost as of the first day of the tax
year in which this prohibited event occurs. If this happens, you must include in
federal gross income for that year an amount equal to the fair market value of
the Roth IRA Certificate as of the first day of that tax year, less the amount
of any nondeductible contributions not previously recovered. Also, the early
distribution penalty tax of 10% will apply if you have not reached age 59 1/2
before the first day of that tax year.
EXCESS CONTRIBUTIONS
Excess contributions to Roth IRAs are subject to a 6% excise tax for the year in
which made and for each year after until withdrawn. The following are excess
contributions to Roth IRAs:
- "regular" contributions of more than $2,000;
- "regular" contributions of more than earned income for the year,
if that amount is under $2,000; and
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- rollover contributions of amounts that are not eligible to be
rolled over (for example, conversion rollovers from a Regular
IRA for individuals with adjusted gross income in excess of
$100,000 in the conversion year.)
You can withdraw or recharacterize any contribution to a Roth IRA before the due
date (including extensions) for filing your federal income tax return for the
tax year. If you do this, you must also withdraw or recharacterize any earnings
attributable to the contribution.
EARLY DISTRIBUTION PENALTY TAX
A penalty tax of 10% of the taxable portion of a distribution applies to
distributions from a Roth IRA made before you reach age 59 1/2. The extra
penalty tax does not apply if the distribution is covered by an exception. No
penalty tax applies to pre-age 59 1/2 distributions made:
- on or after your death;
- because you are disabled (special federal income tax definition);
- used to pay certain extraordinary medical expenses (special federal
income tax definition);
- used to pay medical insurance premiums for unemployed individuals
(special federal income tax definition);
- used to pay certain first-time home buyer expenses (special federal
income tax definition);
- used to pay certain higher education expenses (special federal income
tax definition); or
- in the form of substantially equal periodic payments made at least
annually over your life (or your life expectancy), or over the joint
lives of you and your beneficiary (or your joint life expectancy) using
an IRS-approved distribution method.
Special penalty rules may apply to amounts withdrawn attributable to 1998
conversion rollovers.
IRAS UNDER SIMPLIFIED EMPLOYEE PENSION PLANS (SEP)
When an employer establishes a SEP for its employees, it can contribute to a
Regular IRA certificate for each eligible employee. The employee may also
contribute to that SEP certificate. A SEP IRA Certificate is a form of Regular
IRA Certificate, owned by the employee-participant and most of the rules
applicable to Regular IRAs discussed above apply. A major difference is the
amount of permissible contributions.
Under 2000 statutory limits, an employer can annually contribute an amount for
an employee up to the lesser of $25,500 or 15% of the employee's compensation,
which is determined without the employer's contribution to the SEP. The $25,500
maximum may be adjusted for cost of living changes in future years. These limits
may be reduced by contributions the employer makes to other qualified plans. The
employer must contribute for each employee who has reached age 21 and has worked
for the employer during at least three of the preceding five years. The employer
does not have to contribute for employees who (1) earn less than $450 in 2000,
(2) are covered by a collective bargaining agreement or (3) are non-resident
aliens who receive no earned income from sources within the United States.
Employers make their contributions under a written program that provides for (1)
withdrawals, (2) contributions under an allocation formula, and (3)
contributions that bear a uniform relationship to actual compensation, not
greater than $170,000 in 2000. Contributions cannot discriminate in favor of
highly compensated employees. An employer may integrate contributions to the SEP
with Social Security. Call our toll-free number for assistance.
SIMPLE IRAS
An eligible employer may establish a "SIMPLE" plan to make contributions to
special individual retirement accounts or individual retirement annuities for
its employees ("SIMPLE IRAs"). A SIMPLE IRA is a form of regular IRA owned by
the employee. Generally, the rules applicable to Regular IRAs,
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discussed above, apply. There are differences in the amount and type of
permissible contributions. Also, employees who have not participated in the
employer's SIMPLE IRA plan for at least two full years may be subject to an
increased penalty tax on withdrawals of SIMPLE IRA funds.
The employer cannot maintain any other qualified plan, SEP or TSA arrangement if
it makes contributions under a SIMPLE IRA plan. (Eligible employers may maintain
EDC plans.)
An employer establishing a SIMPLE plan should consult its tax advisor concerning
the various technical rules applicable to establishing and maintaining SIMPLE
IRA plans. For example, the definition of employee's "compensation" varies
depending on whether it appears in the context of employer eligibility, employee
participation, and employee or employer contributions.
Participation must be open to all employees who (1) received at least $5,000 in
compensation from the employer in any two preceding years (they do not have to
be consecutive years) and (2) are reasonably expected to receive at least $5,000
in compensation during the year. (Certain collective bargaining unit and alien
employees may be excluded.)
The only permitted contributions to a SIMPLE IRA are (1) contributions under a
salary reduction agreement entered into between the employer and the
participating employee and (2) required employer contributions (employer
matching contributions or employer nonelective contributions). (Direct transfer
and rollover contributions from other SIMPLE IRAs, but not Regular IRAs, may
also be made.) Salary reduction contributions can be any percentage of
compensation (or a specific dollar amount, if the employer's plan permits) but
are limited to $6,000 in 2000. The $6,000 elective deferral limit may be indexed
for cost of living adjustments in future years.
The employer is required to make matching contributions on behalf of each
eligible employee in an amount equal to the salary reduction contributions, up
to 3% of the employee's compensation or a 2% non-elective contribution to all
eligible employees. The employer must also follow the notification and filing
requirements outlined in the SIMPLE IRA model amendment, to avoid
non-discrimination tests.
Amounts contributed to SIMPLE IRAs are not currently taxable to employees. Only
the employer can deduct SIMPLE IRA contributions, not the employee. An employee
eligible to participate in a SIMPLE IRA is an active participant in an employer
plan and thus may not be able to deduct all or a portion of regular
contributions to his/her own IRA.
As with Regular IRAs in general, contributions and earnings accumulate tax
deferred until withdrawn and are then fully taxable. There are no withdrawal
restrictions applicable to SIMPLE IRAs. However, because of the level of
employer involvement, SIMPLE IRA plans are subject to ERISA. See "ERISA Matters"
below. The same 10% penalty on taxable early withdrawals that applies to Regular
IRAs applies to SIMPLE IRAs, subject to the same exceptions for death,
disability and attainment of age 59 1/2. For employees who have not participated
in the employer's SIMPLE IRA for two full years, that penalty is 25%.
Amounts withdrawn from a SIMPLE IRA can be rolled over to another SIMPLE IRA, to
a Regular IRA or a Roth IRA (if under the conversion rollover rules discussed
above). No rollovers from a SIMPLE IRA to any other type of IRA are permitted
for individuals under age 59 1/2 who have not participated in the employer's
SIMPLE IRA plan for two full years. For such employees, any amounts withdrawn
from a SIMPLE IRA are taxable and subject to a 25% additional tax penalty with
the exceptions noted in the preceding paragraph.
FEDERAL AND STATE INCOME TAX WITHHOLDING AND INFORMATION REPORTING
We must withhold federal income tax from distributions from annuity contracts.
You may be able to elect out of this income tax withholding in some cases.
Generally, we do not have to withhold if your distributions are not taxable. The
rate of withholding will depend on the type of distribution and, in certain
cases, the amount of your distribution. Any income tax withheld is a credit
against your income tax liability. If you do not have sufficient income tax
withheld or do not make sufficient estimated income tax payments, you may incur
penalties under the estimated income tax rules.
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You must file your request not to withhold in writing before the payment or
distribution is made. Our Processing Office will provide forms for this purpose.
You cannot elect out of withholding unless you provide us with your correct
Taxpayer Identification Number and a United States residence address. You cannot
elect out of withholding if we are sending the payment out of the United States.
You should note the following special situations:
- We might have to withhold and/or report on amounts we pay under a
free look or cancellation.
- We are generally required to withhold on conversion rollovers of
Regular IRAs to Roth IRAs, as the deemed withdrawal from the
Regular IRA is taxable.
- We are required to withhold on the gross amount of a distribution
from a Roth IRA unless you elect out of withholding. This may
result in tax being withheld even though the Roth IRA distribution
is not taxable in whole or in part.
Special withholding rules apply to foreign recipients and United States citizens
residing outside the United States. We do not discuss these rules here. Certain
states have indicated that state income tax withholding will also apply to
payments from the Certificates made to residents. In some states, you may elect
out of state withholding, even if federal withholding applies. Generally, we
will consider an election out of federal withholding to be an election out of
state withholding. If you need more information concerning a particular state or
any required forms, call our Processing Office at the toll-free number.
FEDERAL INCOME TAX WITHHOLDING ON PERIODIC ANNUITY PAYMENTS
We withhold differently on "periodic" and "non-periodic" payments. For a
periodic annuity payment, for example, unless you specify a different number of
withholding exemptions, we withhold assuming that you are married and claiming
three withholding exemptions. If you do not give us your correct Taxpayer
Identification Number, we withhold as if you are single with no exemptions.
Based on the assumption that you are married and claiming three withholding
exemptions, if you receive less than $14,888 in periodic annuity payments in
2000 your payments will generally be exempt from federal income tax withholding.
You could specify a different choice of withholding exemption or request that we
withhold tax. Your withholding election remains effective unless and until you
revoke it. You may revoke or change your withholding election at any time.
FEDERAL INCOME TAX WITHHOLDING ON NON-PERIODIC ANNUITY PAYMENTS (WITHDRAWALS)
For a non-periodic distribution (total surrender or partial withdrawal), we
withhold generally at a flat 10% rate. We apply that rate to the taxable amount
in the case of nonqualified Certificates, and to the payment amount in the case
of IRAs and Roth IRAs).
You cannot elect out of withholding if the payment is an "eligible rollover
distribution" from a TSA. If a non-periodic distribution from a TSA is not an
"eligible rollover distribution" then the 10% withholding rate applies.
MANDATORY WITHHOLDING FROM TSAS
Unless you have the distribution go directly to the new plan, eligible rollover
distributions from TSAs are subject to mandatory 20% withholding. An eligible
rollover distribution from a TSA can be rolled over to another TSA or a Regular
IRA. All distributions from a TSA are eligible rollover distributions unless
they are on the following list of exceptions:
- any after-tax contributions you made to the plan;
- any distributions that are "required minimum distributions" after
age 70 1/2 or separation from service;
- hardship withdrawals;
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- substantially equal periodic payments made at least annually for
your life (or life expectancy) or the joint lives (or joint life
expectancy) of you and your designated beneficiary;
- substantially equal periodic payments made for a specified period of
10 years or more;
- if you have contributed too much, corrective distributions which fit
specified technical tax rules;
- a death benefit payment to a beneficiary who is not your surviving
spouse; and
- a qualified domestic relations order distribution to a beneficiary
who is not your current spouse or former spouse.
A death benefit payment to your surviving spouse, or a qualified domestic
relations order distribution to your current or former spouse, may be a
distribution subject to a mandatory 20% withholding.
ERISA MATTERS
Certain TSAs and SIMPLE IRAs may be subject to some or all rules applicable to
ERISA plans. For TSAs subject to ERISA (but not SIMPLE IRAs), you need spousal
consent to make a withdrawal or other distribution under the Certificate. In
addition, unless you and your spouse elect otherwise, the retirement benefits
payable under the plan or arrangement must be in the form of a qualified joint
and survivor annuity ("QJSA"). A QJSA is an annuity payable for your life, with
a survivor annuity for the life of your spouse. The amount payable to your
spouse must be at least one-half of the amount payable to you during your
lifetime. In addition, your beneficiary must be your spouse, unless your spouse
consents in writing to the designation of a different beneficiary.
Section 404(c) of ERISA and the related DOL regulation excuses a plan fiduciary
from liability for investment losses due to your investment decisions. Thus, in
situations to which Section 404(c) and the related DOL regulation apply, you can
make and you are responsible for the results of your own investment decisions.
Section 404(c) plans must provide, among other things that a broad range of
investment choices are available to plan participants and beneficiaries and must
provide such plan participants and beneficiaries with enough information to make
informed investment decisions. Compliance with the Section 404(c) regulation is
completely voluntary by the plan sponsor. The Equitable 300+ Series TSA and
SIMPLE IRA programs provide the broad range of investment choices and
information needed in order to meet the requirements of the Section 404(c)
regulation. If the plan is intended to be a Section 404(c) plan, it is, however,
the plan sponsor's responsibility to see that the requirements of the DOL
regulation are met. Equitable Life will not be responsible if a plan fails to
meet the requirements of Section 404(c).
IMPACT OF TAXES TO EQUITABLE
The Certificates provide that we may charge Separate Account No. 301 for taxes.
We do not now, but may in the future set up reserves for such taxes.
THE GUARANTEED RATE ACCOUNTS
Contributions to a Guaranteed Rate Account, or GRA, become part of our general
account, which supports all of our insurance and annuity guarantees as well as
our general obligations.
THE GUARANTEES
We credit contributions to a GRA with interest at a fixed rate for each
guarantee period. We guarantee the amount of the contribution (before deduction
of any applicable participant service charge). The effective annual guaranteed
interest rate will always be at least 3%.
Currently, we offer GRAs with new one-year and three-year guarantee periods each
calendar quarter. We express the fixed interest rate as an effective annual
interest rate, and apply it to contributions made
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throughout the calendar quarter, or "open period," for each guarantee period.
We may close a guarantee period offered during an open period. In that case, we
may offer a new guaranteed rate for the same guarantee period for the remainder
of the open period.
We reserve the right to close a guarantee period being offered at any time based
on market conditions. Subsequent interest rate changes will not affect
contributions made during the open period. All guarantee periods of the same
duration that are opened during an open period mature on the same day. After the
last day of the open period we will apply no further contributions to those
guarantee periods. In accordance with instructions, we will allocate
contributions to guarantee periods during the next open period at the new
interest rates for that subsequent open period. You may obtain the new
guaranteed rates by calling us at the number listed on the front of this SAI.
CONTRIBUTIONS
We credit contributions to a GRA until maturity of a guarantee period with the
interest rate in effect on the date of receipt. We express the rate as an
effective annual rate, reflecting daily compounding and the deduction of the
participant service charge.
Your written request for a change in the percentage of contributions that you
allocate to a GRA guarantee period becomes effective on the date that we receive
it. Alternatively, you may make allocation or contribution instructions by
telephone through the AIM System.
WITHDRAWALS AND TRANSFERS
Amounts in the GRAs will be withdrawn or transferred on a last-in, first-out
basis, unless you specify otherwise. All other amounts withdrawn or transferred
will be subject to a withdrawal charge as discussed under "Charges and Expenses"
in the prospectus. We will deduct the withdrawal charge from (1) the remaining
amounts in your guarantee period after we process the withdrawal or transfer
payment, or (2) the amount you withdrew or transferred if remaining amounts are
insufficient.
EXAMPLE OF WITHDRAWAL CHARGE
You contribute $2,000 GRA on January 1, allocating the contribution to a
three-year guarantee period with a guaranteed interest rate of 4%. On December
31, you make a premature withdrawal of $1,000 from that GRA guarantee period.
The maximum participant service charge applicable is $30 per year ($7.50 per
quarter). We will calculate the withdrawal charge as follows:
<TABLE>
<CAPTION>
PARTICIPANT PREMATURE
SERVICE AMOUNT WITHDRAWAL CHECK ACCOUNT
DATE CONTRIBUTION INTEREST CHARGE REQUESTED CHARGE AMOUNT BALANCE
- -------- -------------- ---------- ------------- ----------- ------------ -------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
1/1 $2,000 -- -- -- -- -- $2,000.00
3/31 -- $19.71 $7.50 -- -- -- 2,012.21
6/30 -- 19.83 7.50 -- -- -- 2,024.54
9/30 -- 19.95 7.50 -- -- -- 2,036.09
12/31 -- 20.07 7.50 $1,000 $ 26.00* $1,000 1,023.56
</TABLE>
- ----------
* The lesser of (a) 7% ($75.27) of the amount withdrawn (including the amount
of the withdrawal charge) or (b) the amount of the Participant's accumulated
interest ($26.00) attributable to that same amount.
The example assumes that each quarter contains the same number of days and that
each transaction occurs on a Business Day.
CASH VALUE-ACCOUNT BALANCE ILLUSTRATION
The following tables illustrate the account balance (which does not give effect
to any withdrawal charge) and the cash value (which gives effect to the
withdrawal charge) for contributions allocated to the GRAs.
SAI-20
<PAGE>
- --------------------------------------------------------------------------------
TABLE I
ACCOUNT BALANCES AND CASH VALUES
(ASSUMING $1,000 CONTRIBUTIONS MADE ANNUALLY ON THE ENROLLMENT DATE)
<TABLE>
<CAPTION>
CASH VALUE ACCOUNT BALANCE
----------------------------- ------------------------------
ATTAINED 3% 6% 3% 6%
AGE MINIMUM ILLUSTRATED MINIMUM ILLUSTRATED
YEAR END GUARANTEE RATE GUARANTEE RATE
- ---------- ------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
1 $ 999.66 $ 999.66 $ 999.66 $ 1,029.33
2 2,000.00 2,000.00 2,029.32 2,120.42
3 3,000.00 3,047.59 3,089.86 3,276.98
4 4,000.00 4,187.72 4,182.22 4,502.93
5 5,000.00 5,396.26 5,307.36 5,802.44
6 6,013.60 6,677.32 6,466.24 7,179.91
7 7,123.70 8,035.23 7,659.89 8,640.04
8 8,267.10 9,474.63 8,889.35 10,187.77
9 9,444.80 11,000.38 10,155.70 11,828.37
10 10,657.83 12,617.68 11,460.03 13,567.40
11 11,907.25 14,332.03 12,803.50 15,410.78
12 13,194.16 16,149.23 14,187.27 17,364.76
13 14,519.67 18,075.46 15,612.55 19,435.98
14 15,884.95 20,117.27 17,080.59 21,631.47
15 17,291.19 22,281.58 18,592.68 23,958.69
16 18,739.61 24,575.75 20,150.12 26,425.54
17 20,231.49 27,007.58 21,754.29 29,040.40
18 21,768.12 29,585.31 23,406.58 31,812.16
19 23,350.85 32,317.70 25,108.44 34,750.22
20 24,981.07 35,214.04 26,861.36 37,864.56
21 26,660.19 38,284.17 28,666.87 41,165.77
22 28,389.68 41,538.50 30,526.54 44,665.05
23 30,171.06 44,988.08 32,442.00 48,374.28
24 32,005.88 48,644.65 34,414.92 52,306.07
25 33,895.74 52,520.60 36,447.04 56,473.77
26 35,842.30 56,629.12 38,540.11 60,891.52
27 37,847.26 60,984.14 40,695.98 65,574.34
28 39,912.37 65,600.47 42,916.52 70,538.14
29 42,039.43 70,493.77 45,203.68 75,799.76
30 44,230.30 75,680.68 47,559.46 81,377.07
31 46,486.89 81,178.79 49,985.91 87,289.03
32 48,811.19 87,006.80 52,485.15 93,555.70
33 51,205.21 93,184.49 55,059.37 100,198.37
34 53,671.06 99,732.83 57,710.81 107,239.61
35 56,210.88 106,674.08 60,441.80 114,703.31
36 58,826.89 114,031.80 63,254.72 122,614.84
37 61,521.38 121,830.99 66,152.03 131,001.06
38 64,296.71 130,098.12 69,136.25 139,890.45
39 67,155.30 138,861.29 72,210.00 149,313.21
40 70,099.65 148,150.24 75,375.97 159,301.34
41 73,132.33 157,996.54 78,636.91 169,888.75
42 76,255.99 168,433.61 81,995.68 181,111.41
43 79,473.35 179,496.90 85,455.22 193,007.42
44 82,787.24 191,224.00 89,018.54 205,617.20
45 86,200.55 203,654.71 92,688.76 218,983.56
46 89,716.25 216,831.28 96,469.09 233,151.91
47 93,337.43 230,798.43 100,362.83 248,170.35
48 97,067.24 245,603.61 104,373.38 264,089.91
49 100,908.94 261,297.11 108,504.24 280,964.63
50 104,865.90 277,932.21 112,759.03 298,851.84
</TABLE>
SAI-21
<PAGE>
- --------------------------------------------------------------------------------
TABLE II
ACCOUNT BALANCES AND CASH VALUES
(ASSUMING A SINGLE CONTRIBUTION OF $1,000 AND NO FURTHER CONTRIBUTION)
<TABLE>
<CAPTION>
CASH VALUE ACCOUNT BALANCE
- ---------------------------------------------------------------------------
3% 6% 3% 6%
ATTAINED MINIMUM ILLUSTRATED MINIMUM ILLUSTRATED
AGE YEAR END GUARANTEE RATE GUARANTEE RATE
- -------------- ----------- ------------- ----------- --------------
<S> <C> <C> <C> <C>
1 $ 999.66 $ 1,000.00 $ 999.66 $ 1,029.33
2 999.32 1,000.00 999.32 1,060.42
3 998.96 1,016.84 998.96 1,093.38
4 998.60 1,049.33 998.60 1,128.31
5 998.22 1,083.77 998.22 1,165.34
6 997.83 1,120.27 997.83 1,204.59
7 997.43 1,158.96 997.43 1,246.20
8 997.02 1,199.98 997.02 1,290.30
9 996.60 1,243.46 996.60 1,337.05
10 996.16 1,289.54 996.16 1,386.60
11 995.71 1,338.39 995.71 1,439.13
12 995.25 1,390.17 995.25 1,494.81
13 994.77 1,445.06 994.77 1,553.83
14 994.28 1,503.24 994.28 1,616.39
15 993.77 1,564.92 993.77 1,682.70
16 993.25 1,630.29 993.25 1,753.00
17 992.71 1,699.58 992.71 1,827.51
18 992.16 1,773.04 992.16 1,906.49
19 991.59 1,850.90 991.59 1,990.21
20 991.00 1,933.43 991.00 2,078.95
21 990.39 2,020.91 990.39 2,173.02
22 989.77 2,113.64 989.77 2,272.73
23 989.13 2,211.94 989.13 2,378.43
24 988.47 2,316.13 988.47 2,490.46
25 987.79 2,426.57 987.79 2,609.22
26 987.09 2,543.65 987.09 2,735.10
27 986.36 2,667.74 986.36 2,868.54
28 985.62 2,799.28 985.62 3,009.98
29 984.85 2,938.72 984.85 3,159.91
30 984.06 3,086.52 984.06 3,318.84
31 983.25 3,243.19 983.25 3,487.30
32 982.41 3,409.26 982.41 3,665.87
33 981.55 3,585.29 981.55 3,855.15
34 980.66 3,771.88 980.66 4,055.79
35 979.74 3,969.68 979.74 4,268.47
36 978.80 4,179.34 978.80 4,493.91
37 977.82 4,401.58 977.82 4,732.88
38 976.82 4,637.15 976.82 4,986.18
39 975.79 4,886.85 975.79 5,254.68
40 974.73 5,151.54 974.73 5,539.29
41 973.64 5,432.11 973.64 5,840.98
42 972.51 5,729.52 972.51 6,160.77
43 971.35 6,044.77 971.35 6,499.75
44 970.16 6,378.93 970.16 6,859.07
45 968.93 6,733.15 968.93 7,239.94
46 967.66 7,108.61 967.66 7,643.67
47 966.35 7,506.61 966.35 8,071.62
48 965.01 7,928.48 965.01 8,525.25
49 963.63 8,375.67 963.63 9,006.10
50 962.20 8,849.69 962.20 9,515.79
</TABLE>
SAI-22
<PAGE>
- --------------------------------------------------------------------------------
HOW WE DETERMINE UNIT VALUES
Unit values for the Funds are determined at the end of each Business Day.
The unit value of any Fund for any Business Day is equal to the unit value for
the preceding business day multiplied by the "net investment factor" for that
Fund on that Business Day.
A net investment factor for each Fund is determined every Business Day as
follows:
- First, we take the value of the shares held by the Fund in the
corresponding Portfolio of EQ Advisors Trust, at the close of business
that day (before giving effect to any amounts allocated to or withdrawn
from the Fund for that day). For this purpose, we use the share value
reported to us by the Portfolio.
- Then, we divide this amount by the value of the amounts in the Fund at
the close of business on the preceding Business Day (after giving
effect to any amounts allocated or withdrawn for that day).
- Finally, we subtract any daily charge for fees or expenses payable by
the Fund.
ILLUSTRATION OF CHANGES IN UNIT VALUES
Generally, if on a particular Business Day investment income and realized and
unrealized capital gains exceed realized and unrealized capital losses and any
expense charges, the unit value would be greater than the value for the previous
period.
For example, assume that at the close of trading on a Monday, the value of a
Fund's assets is $2,500,000, and the unit value is $10. If on the next Business
Day, Tuesday, the investment income and realized and unrealized capital gains
exceed realized and unrealized losses by $7,500, and the daily accrual for
expenses charged to the Trust is $50, the unit value for that day would be
calculated as follows:
<TABLE>
<S> <C>
1. Unit value for Monday .................................................. $ 10
2. Value of assets at close of business on Monday ......................... $2,500,000
3. Excess of investment income and realized and unrealized capital gains
over realized and unrealized losses ................................... $ 7,500
4. Daily accrual for expenses (administration charges and certain expenses
borne directly by the Funds) charged to the Investment Fund ........... $ 50
5. Value of assets, less charge for expenses, at close of business day On
Tuesday, ((2) + (3) -- (4)) ........................................... $2,507,450
6. Net investment factor ((5) divided by (2)) ............................. 1.00298
7. Unit value for Tuesday ((1) x (6)) ..................................... $ 10.0298
</TABLE>
If, on the other hand, the realized and unrealized losses exceeded investment
income and realized and unrealized capital gains on that day by $7,500, the unit
value for Tuesday would have been $9.9698.
ALLIANCE MONEY MARKET FUND YIELD INFORMATION
The Alliance Money Market Fund calculates yield information for seven-day
periods. The seven-day current yield calculation is based on a hypothetical
account balance with one unit at the beginning of the period. To determine the
seven-day rate of return, the net change in the unit value is computed by
subtracting the unit value at the beginning of the period from a unit value,
exclusive of capital changes, at the end of the period.
The net change will be reduced by the average administrative charge factor
(explained below). This reduction is made to recognize the deduction of the
participant service charge, which is not reflected in
SAI-23
<PAGE>
- --------------------------------------------------------------------------------
the unit value. See "Charges and Expenses--Participant Service Charge" in the
prospectus. Unit values reflect all other accrued expenses of the Alliance
Money Market Fund.
The adjusted net change is divided by the unit value at the beginning of the
period to obtain the adjusted base period rate of return. This seven-day
adjusted base period is multiplied return by 365/7 to produce an annualized
seven-day current yield figure that we carry to the nearest one-hundredth of
one percent.
The actual dollar amount of the participant service charge that we deduct from
the Alliance Money Market Fund will vary for each participant depending upon
how the participant allocates the account balance among the investment options.
To determine the effect of the participant service charge on the yield, we
start with the total dollar amount of the charges deducted from the Fund on the
last day of the prior quarter. This amount is multiplied by 7/91.25 to produce
an average participant service charge factor which is used in all weekly yield
computations for the ensuing quarter. The average administrative charge is then
divided by the number of Alliance Money Market Fund Units as of the end of the
prior calendar quarter, and we deduct the resulting quotient from the net
change in Unit Value for the seven-day period.
The effective yield is obtained by modifying the current yield to give effect
to the compounding nature of the Alliance Money Market Fund's investments, as
follows: compounding the unannualized adjusted base period return by adding one
to the adjusted base period return, raising the sum to a power equal to 365
divided by 7, and subtracting one from the result, i.e., effective yield =
(base period return + 1) 365/7 -- 1.
The Alliance Money Market Fund yields will fluctuate daily. Accordingly, yields
for any given period are not necessarily representative of future results. In
addition, the value of Units of the Alliance Money Market Fund will fluctuate
and not remain constant.
The Alliance Money Market Fund yields reflect charges that are not normally
reflected in the yields of other investments and therefore may be lower when
compared with yields of other investments. You should not compare Alliance
Money Market Fund yields to the return on fixed rate investments that guarantee
rates of interest for specified periods, such as the Guaranteed Rate Accounts
or bank deposits. You should not compare the yield to the yield of money market
funds made available to the general public. Those yields usually are calculated
on the basis of a constant $1 price per share, and those funds pay out earnings
in dividends that accrue on a daily basis.
The seven-day current yield for the Alliance Money Market Fund was 4.90% for
the period ended December 31, 1999. The effective yield for that period was
5.03%. Because these yields reflect the deduction of Separate Account No. 301
expenses, including the participant service charge, they are lower than the
corresponding yield figures for the Alliance Money Market Portfolio, which
reflect only the deduction of Trust-level expenses.
FINANCIAL STATEMENTS
Your should consider the financial statements of Equitable Life included herein
only as bearing upon the ability of Equitable Life to meet its obligations
under the certificates. The financial statements begin on page F-1.
SAI-24
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
The Equitable Life Assurance Society of the United States
and Contractowners of Separate Account No. 301
of The Equitable Life Assurance Society of the United States
In our opinion, the accompanying statements of assets and liabilities and the
related statements of operations and of changes in net assets present fairly,
in all material respects, the financial position of the Alliance Money Market
Fund, Alliance Intermediate Government Securities Fund, Alliance High Yield
Fund, Alliance Balanced Fund, Alliance Growth & Income Fund, Alliance Common
Stock Fund, Alliance Aggressive Stock Fund, Alliance Global Fund, Alliance
Conservative Investors Fund, Alliance Growth Investors Fund, MFS Emerging
Growth Companies Fund, BT Equity 500 Index Fund, Lazard Small Cap Value Fund,
T. Rowe Price International Stock Fund, ("EQ Advisors Trusts funds"), separate
investment funds of The Equitable Life Assurance Society of the United States
("Equitable Life") Separate Account No. 301 at December 31, 1999 and the
results of each of their operations and changes in each of their net assets for
the periods indicated, in conformity with accounting principles generally
accepted in the United States of America. These financial statements are the
responsibility of Equitable Life's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States of America which require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management and evaluating the overall financial
statement presentation. We believe that our audits, which included confirmation
of shares owned in The EQ Advisors Trust at December 31, 1999 with the transfer
agent, provide a reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
New York, New York
February 1, 2000
FSA-1
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT 301
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<CAPTION>
ALLIANCE
ALLIANCE INTERMEDIATE ALLIANCE
MONEY GOVERNMENT HIGH ALLIANCE
MARKET SECURITIES YIELD BALANCED
-------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
ASSETS:
Investments in shares of
the Trust -- at market
value (Note 2)
Cost: $ 25,791,602 ......... $25,619,244
5,293,674 ......... $5,091,236
1,903,278 ......... $1,445,116
42,052,117 ......... $46,417,882
8,204,285 .........
105,961,169 .........
6,579,089 .........
6,821,803 .........
2,084,732 .........
2,866,797 .........
1,014,232 .........
1,842,898 .........
96,889 .........
331,646 .........
Receivable for Trust
shares sold ................. -- 324 126 2,423
Receivable for policy
related transactions ........ 602,398 3,499 -- --
----------- ---------- ---------- -----------
Total Assets .................. 26,221,642 5,095,059 1,445,242 46,420,305
----------- ---------- ---------- -----------
LIABILITIES:
Payable for Trust shares
purchased ................... 607,552 -- -- --
Payable for policy related
transactions ................ -- -- 781 11,937
----------- ---------- ---------- -----------
Total Liabilities ............. 607,552 -- 781 11,937
----------- ---------- ---------- -----------
NET ASSETS .................... 25,614,090 5,095,059 1,444,461 46,408,368
=========== ========== ========== ===========
<CAPTION>
MFS
ALLIANCE ALLIANCE ALLIANCE ALLIANCE ALLIANCE EMERGING
GROWTH & COMMON AGGRESSIVE ALLIANCE CONSERVATIVE GROWTH GROWTH
INCOME STOCK STOCK GLOBAL INVESTORS INVESTORS COMPANIES
------------- --------------- ------------ ------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments in shares of
the Trust -- at market
value (Note 2)
Cost:$ 25,791,602 .........
5,293,674 .........
1,903,278 .........
42,052,117 .........
8,204,285 ......... $9,018,681
105,961,169 ......... $137,941,287
6,579,089 ......... $7,321,076
6,821,803 ......... $9,013,332
2,084,732 ......... $2,126,692
2,866,797 ......... $3,227,284
1,014,232 ......... $1,192,503
1,842,898 .........
96,889 .........
331,646 .........
Receivable for Trust
shares sold ................ 12,211 90,925 102,413 -- 40 4,071 35,986
Receivable for policy
related transactions ....... -- -- -- 4,038 -- -- --
---------- ------------ ---------- ---------- ---------- ---------- ----------
Total Assets ................ 9,030,892 138,032,212 7,423,489 9,017,370 2,126,732 3,231,355 1,228,489
---------- ------------ ---------- ---------- ---------- ---------- ----------
LIABILITIES:
Payable for Trust shares
purchased .................. -- -- -- 6,077 -- -- --
Payable for policy related
transactions ............... 13,803 199,657 106,576 -- 1,257 5,343 70,122
---------- ------------ ---------- ---------- ---------- ---------- ----------
Total Liabilities ........... 13,803 199,657 106,576 6,077 1,257 5,343 70,122
---------- ------------ ---------- ---------- ---------- ---------- ----------
NET ASSETS .................. 9,017,089 137,832,555 7,316,913 9,011,293 2,125,475 3,226,012 1,158,367
========== ============ ========== ========== ========== ========== ==========
<CAPTION>
BT LAZARD T. ROWE PRICE
EQUITY 500 SMALL CAP INTERNATIONAL
INDEX VALUE STOCK
------------ ----------- --------------
<S> <C> <C> <C>
ASSETS:
Investments in shares of
the Trust -- at market
value (Note 2)
Cost: $ 25,791,602 .......
5,293,674 .......
1,903,278 .......
42,052,117 .......
8,204,285 .......
105,961,169 .......
6,579,089 .......
6,821,803 .......
2,084,732 .......
2,866,797 .......
1,014,232 .......
1,842,898 ....... $1,996,150
96,889 ....... $ 96,457
331,646 ....... $406,391
Receivable for Trust
shares sold ............... 147 -- 14
Receivable for policy
related transactions ...... -- 27,209 471
---------- -------- --------
Total Assets ................. 1,996,297 123,666 406,876
---------- -------- --------
LIABILITIES:
Payable for Trust shares
purchased .................. -- -- --
Payable for policy related
transactions ............... 7,215 -- --
---------- -------- --------
Total Liabilities ............ 7,215 -- --
---------- -------- --------
NET ASSETS ................... 1,989,082 123,666 406,876
========== ======== ========
</TABLE>
See Notes to Financial Statements.
FSA-2
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT 301
STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
ALLIANCE
ALLIANCE INTERMEDIATE ALLIANCE ALLIANCE ALLIANCE
MONEY GOVERNMENT HIGH ALLIANCE GROWTH & COMMON
MARKET SECURITIES YIELD BALANCED INCOME STOCK
------------- -------------- ------------- ------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
INCOME AND EXPENSE:
Investment Income:
Dividends from The Trust (Note 2) ..... $ 1,027,100 $ 263,494 $ 168,075 $1,216,417 $ 20,978 $ 743,286
---------- ---------- ---------- ---------- ---------- -----------
Expenses (Note 3):
Administrative Fees ................... $ 56,025 $ 14,382 $ 5,327 $ 107,348 $ 20,624 $ 310,074
Recordkeeping fees .................... 21,427 6,944 8,955 37,950 12,859 102,055
Professional fees ..................... 2,629 786 354 5,199 930 14,659
Printing and mailing expenses. ........ 4,288 1,283 578 8,479 1,516 23,909
---------- ---------- ---------- ---------- ---------- -----------
Total expenses ...................... 84,369 23,395 15,214 158,976 35,929 450,697
Less: Reimbursement for excess expense
limitation ............................ -- 8,949 -- -- -- --
---------- ---------- ---------- ---------- ---------- -----------
Net expenses ........................ 84,369 14,446 15,214 158,976 35,929 450,697
---------- ---------- ---------- ---------- ---------- -----------
NET INVESTMENT INCOME (LOSS) ............. 942,731 249,048 152,861 1,057,441 (14,951) 292,589
---------- ---------- ---------- ---------- ---------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS (NOTE 2):
Realized gain (loss) from share
transactions .......................... 181,377 85,814 (390,786) 282,571 392,887 5,781,867
Realized gain distribution from Trust ... 761 -- 1,776 4,286,052 821,085 18,357,298
---------- ---------- ---------- ---------- ---------- -----------
Net Realized Gain (Loss) ............ 182,138 85,814 (389,010) 4,568,623 1,213,972 24,139,165
---------- ---------- ---------- ---------- ---------- -----------
Change in unrealized appreciation/
(depreciation) of investments .......... (120,580) (353,170) 151,455 1,405,187 158,274 3,636,285
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS ............................. 61,558 (267,356) (237,555) 5,973,810 1,372,246 27,775,450
---------- ---------- ---------- ---------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS .............................. $1,004,289 $ (18,308) $ (84,694) $7,031,251 $1,357,295 $28,068,039
========== ========== ========== ========== ========== ===========
<CAPTION>
ALLIANCE
AGGRESSIVE ALLIANCE
STOCK GLOBAL
-------------- --------------
<S> <C> <C>
INCOME AND EXPENSE:
Investment Income:
Dividends from The Trust (Note 2) ........ $ 22,156 $ 6,998
---------- ----------
Expenses (Note 3):
Administrative Fees ...................... $ 18,492 $ 18,483
Recordkeeping fees ....................... 14,482 12,145
Professional fees ........................ 1,011 853
Printing and mailing expenses. ........... 1,648 1,393
---------- ----------
Total expenses ......................... 35,633 32,874
Less: Reimbursement for excess expense
limitation ............................... -- --
---------- ----------
Net expenses ........................... 35,633 32,874
---------- ----------
NET INVESTMENT INCOME (LOSS) ................ (13,477) (25,876)
---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS (NOTE 2):
Realized gain (loss) from share
transactions .............................. (739,960) 296,322
Realized gain distribution from Trust ...... 431,957 556,123
---------- ----------
Net Realized Gain (Loss) ............... (308,003) 852,445
---------- ----------
Change in unrealized appreciation/
(depreciation) of investments ............. 1,563,627 1,682,085
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS ................................ 1,255,624 2,534,530
---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS ................................. $1,242,147 $2,508,654
========== ==========
</TABLE>
See Notes to Financial Statements
FSA-3
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT 301
STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
ALLIANCE ALLIANCE MFS EMERGING BT LAZARD T. ROWE PRICE
CONSERVATIVE GROWTH GROWTH EQUITY 500 SMALL CAP INTERNATIONAL
INVESTORS INVESTORS COMPANIES INDEX VALUE STOCK
-------------- ----------- -------------- ------------ ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
INCOME AND EXPENSE:
Investment Income:
Dividends from The Trust (Note 2) ....... $ 70,197 $ 45,582 $ -- $ 10,842 $ 384 $ 448
--------- -------- -------- -------- -------- -------
Expenses (Note 3):
Administrative Fees ...................... $ 5,846 $ 7,517 $ 1,330 $ 7,079 $ 439 $ 832
Recordkeeping fees ....................... 8,536 8,750 -- -- -- --
Professional fees ........................ 287 313 -- -- -- --
Printing and mailing expenses. ........... 467 513 -- -- -- --
--------- -------- -------- -------- -------- -------
Total expenses ......................... 15,136 17,093 1,330 7,079 439 832
Less: Reimbursement for excess expense
limitation ............................... -- -- -- -- -- --
--------- -------- -------- -------- -------- -------
Net expenses ........................... 15,136 17,093 1,330 7,079 439 832
--------- -------- -------- -------- -------- -------
NET INVESTMENT INCOME (LOSS) ............... 55,061 28,489 (1,330) 3,763 (55) (384)
--------- -------- -------- -------- -------- -------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS (NOTE 2):
Realized gain (loss) from share
transactions ............................. 71,627 117,038 184,900 251,792 2,375 3,487
Realized gain distribution from Trust ..... 88,436 279,791 22,809 4,889 619 4,713
--------- -------- -------- -------- -------- -------
Net Realized Gain (Loss) ............... 160,063 396,829 207,709 256,681 2,994 8,200
--------- -------- -------- -------- -------- -------
Change in unrealized appreciation/
(depreciation) of investments ............ (22,469) 233,387 173,749 98,680 (4,355) 73,420
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS ............................... 137,594 630,216 381,458 355,361 (1,361) 81,620
--------- -------- -------- -------- -------- -------
NET INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS ................................ $ 192,655 $658,705 $380,128 $359,124 $ (1,416) $81,236
========= ======== ======== ======== ======== =======
</TABLE>
See Notes to Financial Statements.
FSA-4
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT 301
STATEMENTS OF CHANGE IN NET ASSETS
FOR THE PERIOD ENDED DECEMBER 31,
<TABLE>
<CAPTION>
ALLIANCE
INTERMEDIATE
ALLIANCE GOVERNMENT
MONEY MARKET SECURITIES
------------------------------- -----------------------------
1999 1998 1999 1998
--------------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net Investment Income ........................ $ 942,731 $ 878,844 $ 249,048 $ 275,745
Realized gain (loss) on investments .......... 182,138 86,791 85,814 (32,976)
Change in unrealized appreciation/
(depreciation) of investments ............... (120,580) 9,067 (353,170) 164,547
----------- ----------- ------------- ----------
Net increase (decrease) in Net Assets from
Operations .................................. 1,004,289 974,702 (18,308) 407,316
----------- ----------- ------------- ----------
FROM CONTRACTOWNER TRANSACTIONS
(NOTE 3 AND 4):
Contributions and transfers:
Contributions ............................... 4,363,332 4,115,089 167,542 212,370
Transfers from other funds .................. 12,160,364 16,930,606 353,946 1,878,677
Transfers from Guaranteed Rate
Account ................................... 500,851 739,934 14,318 15,660
----------- ----------- ------------- ----------
Total Contributions ....................... 17,024,547 21,785,629 535,806 2,106,707
----------- ----------- ------------- ----------
Withdrawals and Transfers:
Withdrawals ................................. 4,039,854 5,560,917 763,822 470,906
Transfers to other funds .................... 8,346,824 16,999,881 1,093,890 823,160
Transfer to Guaranteed Rate Account ......... 106,533 -- 13,700 13,160
Participant service charge .................. 17,156 18,983 264 1,718
----------- ----------- ------------- ----------
Total withdrawals ......................... 12,510,367 22,579,781 1,871,676 1,308,944
----------- ----------- ------------- ----------
Net increase (decrease) in net assets
from Contract Owner transactions .......... 4,514,180 (794,152) (1,335,870) 797,763
----------- ----------- ------------- ----------
INCREASE (DECREASE) IN NET ASSETS .............. 5,518,469 180,550 (1,354,178) 1,205,079
NET ASSETS -- BEGINNING OF YEAR ................ 20,095,621 19,915,071 6,449,237 5,244,158
----------- ----------- ------------- ----------
NET ASSETS -- END OF YEAR (NOTE 1) ............. $25,614,090 $20,095,621 $ 5,095,059 $6,449,237
=========== =========== ============= ==========
<CAPTION>
ALLIANCE ALLIANCE
HIGH YIELD BALANCED
----------------------------- -------------------------------
1999 1998 1999 1998
--------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net Investment Income ........................ $ 152,861 $ 375,584 $ 1,057,441 $ 887,915
Realized gain (loss) on investments .......... (389,010) 117,549 4,568,623 4,401,654
Change in unrealized appreciation/
(depreciation) of investments ............... 151,455 (727,821) 1,405,187 1,008,639
----------- ---------- ------------ ------------
Net increase (decrease) in Net Assets from
Operations .................................. (84,694) (234,688) 7,031,251 6,298,208
----------- ---------- ------------ ------------
FROM CONTRACTOWNER TRANSACTIONS
(NOTE 3 AND 4):
Contributions and transfers:
Contributions ............................... 89,444 288,584 1,862,075 1,567,580
Transfers from other funds .................. 35,776 1,367,863 1,346,022 3,069,563
Transfers from Guaranteed Rate
Account ................................... 3,258 56,849 65,621 133,795
----------- ---------- ------------ ------------
Total Contributions ....................... 128,478 1,713,296 3,273,718 4,770,938
----------- ---------- ------------ ------------
Withdrawals and Transfers:
Withdrawals ................................. 700,833 390,688 3,418,324 3,496,518
Transfers to other funds .................... 1,164,079 2,050,870 1,800,721 3,543,679
Transfer to Guaranteed Rate Account ......... -- 6,569 2,185 54,523
Participant service charge .................. 756 620 10,852 10,266
----------- ---------- ------------ ------------
Total withdrawals ......................... 1,865,668 2,448,747 5,232,082 7,104,986
----------- ---------- ------------ ------------
Net increase (decrease) in net assets
from Contract Owner transactions .......... (1,737,190) (735,451) (1,958,364) (2,334,048)
----------- ---------- ------------ ------------
INCREASE (DECREASE) IN NET ASSETS .............. (1,821,884) (970,139) 5,072,887 3,964,160
NET ASSETS -- BEGINNING OF YEAR ................ 3,266,345 4,236,484 41,335,481 37,371,321
----------- ---------- ------------ ------------
NET ASSETS -- END OF YEAR (NOTE 1) ............. $ 1,444,461 $3,266,345 $ 46,408,368 $ 41,335,481
=========== ========== ============ ============
</TABLE>
- -------
See Notes to Financial Statements.
FSA-5
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT 301
STATEMENTS OF CHANGE IN NET ASSETS
FOR THE PERIOD ENDED DECEMBER 31,
<TABLE>
<CAPTION>
ALLIANCE ALLIANCE
GROWTH & INCOME COMMON STOCK
--------------------------- -------------------------------
1999 1998 1999 1998
------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net Investment Income ........................ $ (14,951) $ (11,479) $ 292,589 $ 256,084
Realized gain (loss) on investments .......... 1,213,972 930,699 24,139,165 19,493,860
Change in unrealized appreciation/
(depreciation) of investments ............... 158,274 295,676 3,636,285 5,953,990
---------- ---------- ------------ ------------
Net increase (decrease) in Net Assets from
Operations .................................. 1,357,295 1,214,896 28,068,039 25,703,934
---------- ---------- ------------ ------------
FROM CONTRACTOWNER TRANSACTIONS
(NOTE 3 AND 4):
Contributions and transfers:
Contributions ............................... 731,772 1,099,761 2,523,603 4,601,204
Transfers from other funds .................. 1,186,567 1,017,283 6,198,880 12,691,834
Transfers from Guaranteed Rate
Account ................................... 54,049 174,948 269,314 435,008
---------- ---------- ------------ ------------
Total Contributions ....................... 1,972,388 2,291,992 8,991,797 17,728,046
---------- ---------- ------------ ------------
Withdrawals and Transfers:
Withdrawals ................................. 991,318 805,103 6,829,038 6,288,426
Transfers to other funds .................... 931,078 1,051,082 7,913,495 12,834,510
Transfer to Guaranteed Rate Account ......... -- 10,289 130,850 219,886
Participant service charge .................. (12,713) (263) 13,952 (202)
---------- ---------- ------------ ------------
Total withdrawals ......................... 1,909,683 1,866,211 14,887,335 19,342,620
---------- ---------- ------------ ------------
Net increase (decrease) in net assets
from Contract Owner transactions .......... 62,705 425,781 (5,895,538) (1,614,574)
---------- ---------- ------------ ------------
INCREASE (DECREASE) IN NET ASSETS .............. 1,420,000 1,640,677 22,172,501 24,089,360
NET ASSETS -- BEGINNING OF YEAR ................ 7,597,089 5,956,412 115,660,054 91,570,694
---------- ---------- ------------ ------------
NET ASSETS -- END OF YEAR (NOTE 1) ............. $9,017,089 $7,597,089 $137,832,555 $115,660,054
========== ========== ============ ============
<CAPTION>
ALLIANCE ALLIANCE
AGGRESSIVE STOCK GLOBAL
----------------------------- ----------------------------
1999 1998 1999 1998
--------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net Investment Income ..................... $ (13,477) $ (2,164) $ (25,876) $ 44,737
Realized gain (loss) on investments ....... (308,003) 402,443 852,445 666,580
Change in unrealized appreciation/
(depreciation) of investments ............ 1,563,627 (530,062) 1,682,085 494,628
---------- ---------- ---------- ----------
Net increase (decrease) in Net Assets from
Operations ............................... 1,242,147 (129,783) 2,508,654 1,205,945
---------- ---------- ---------- ----------
FROM CONTRACTOWNER TRANSACTIONS
(NOTE 3 AND 4):
Contributions and transfers:
Contributions ............................ 462,313 546,826 448,450 358,695
Transfers from other funds ............... 3,091,125 6,500,343 426,112 479,694
Transfers from Guaranteed Rate
Account ................................. 53,008 116,019 195,130 68,162
---------- ---------- ---------- ----------
Total Contributions ..................... 3,606,446 7,163,188 1,069,692 906,551
---------- ---------- ---------- ----------
Withdrawals and Transfers:
Withdrawals .............................. 1,867,761 649,169 701,561 498,283
Transfers to other funds ................. 4,378,898 6,458,343 696,340 654,870
Transfers to Guaranteed Rate Account ..... -- 11,645 500 47,615
Participant service charge ............... (542) 4,033 1,083 3,600
---------- ---------- ---------- ----------
Total withdrawals ....................... 6,246,117 7,123,190 1,399,484 1,204,368
---------- ---------- ---------- ----------
Net increase (decrease) in net assets
from Contract Owner transactions ........ (2,639,671) 39,998 (329,792) (297,817)
---------- ---------- ---------- ----------
INCREASE (DECREASE) IN NET ASSETS .......... (1,397,524) (89,785) 2,178,862 908,128
NET ASSETS -- BEGINNING OF YEAR ............ 8,714,437 8,804,222 6,832,431 5,924,303
---------- ---------- ---------- ----------
NET ASSETS -- END OF YEAR (NOTE 1) ......... $7,316,913 $8,714,437 $9,011,293 $6,832,431
========== ========== ========== ==========
</TABLE>
- -------
See Notes to Financial Statements.
FSA-6
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT 301
STATEMENTS OF CHANGE IN NET ASSETS
FOR THE PERIOD ENDED DECEMBER 31,
<TABLE>
<CAPTION>
ALLIANCE MFS EMERGING
CONSERVATIVE ALLIANCE GROWTH
INVESTORS GROWTH INVESTORS COMPANIES*
----------------------------- ------------------------- ---------------------------
1999 1998 1999 1998 1999 1998
-------------- -------------- ------------ ------------ -------------- ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net Investment Income ................... 55,061 $ 58,630 $ 28,489 $ 29,713 $ (1,330) $ (27)
Realized gain (loss) on investments ..... 160,063 130,552 396,829 298,377 207,709 (746)
Change in unrealized appreciation/
(depreciation) of investments .......... (22,469) 25,407 233,387 50,086 173,749 4,523
------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) in Net
Assets from Operations ................. 192,655 214,589 658,705 378,176 380,128 3,750
------- ---------- ---------- ---------- ---------- --------
FROM CONTRACTOWNER TRANSACTIONS
(NOTE 3 AND 4):
Contributions and transfers:
Contributions .......................... 125,773 842,039 307,240 481,314 201,740 26,964
Transfers from other funds ............. 203,224 501,717 315,315 433,135 1,571,552 19,178
Transfers from Guaranteed Rate
Account ............................... 7,033 10,985 39,395 53,878 38 (3)
------- ---------- ---------- ---------- ---------- --------
Total Contributions ................... 336,030 1,354,741 661,950 968,327 1,773,330 46,139
------- ---------- ---------- ---------- ---------- --------
Withdrawals and Transfers:
Withdrawals ............................ 268,365 44,170 340,601 391,158 10,691 --
Transfers to other funds ............... 387,934 190,487 214,110 439,828 1,027,934 6,287
Transfer to Guaranteed Rate Account .... -- -- 20,000 24,217 -- --
Participant service charge ............. 268 (292) 227 257 68 --
------- ---------- ---------- ---------- ---------- --------
Total withdrawals ..................... 656,567 234,365 574,938 855,460 1,038,693 6,287
------- ---------- ---------- ---------- ---------- --------
Net increase (decrease) in net assets
from Contract Owner transactions ...... (320,537) 1,120,376 87,012 112,867 734,637 39,852
-------- ---------- ---------- ---------- ---------- --------
INCREASE (DECREASE) IN NET ASSETS ........ (127,882) 1,334,965 745,717 491,043 1,114,765 43,602
NET ASSETS -- BEGINNING OF YEAR .......... 2,253,357 918,392 2,480,295 1,989,252 43,602 --
--------- ---------- ---------- ---------- ---------- --------
NET ASSETS -- END OF YEAR (NOTE 1) ....... $2,125,475 $2,253,357 $3,226,012 $2,480,295 $1,158,367 $43,602
========== ========== ========== ========== ========== ========
<CAPTION>
BT LAZARD T. ROWE PRICE
EQUITY 500 SMALL CAP INTERNATIONAL
INDEX* VALUE* STOCK*
-------------------------- ------------------------- ------------------------
1999 1998 1999 1998 1999 1998
-------------- ----------- ------------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net Investment Income ................... $ 3,763 $ 2,408 $ (55) $ 117 $ (384) $ 290
Realized gain (loss) on investments ..... 256,681 4,416 2,994 (276) 8,200 (508)
Change in unrealized appreciation/
(depreciation) of investments .......... 98,680 54,572 (4,355) 3,923 73,420 1,325
---------- -------- -------- ------- -------- -------
Net increase (decrease) in Net
Assets from Operations ................. 359,124 61,396 (1,416) 3,764 81,236 1,107
---------- -------- -------- ------- -------- -------
FROM CONTRACTOWNER TRANSACTIONS
(NOTE 3 AND 4):
Contributions and transfers:
Contributions .......................... 2,392,519 407,459 43,526 24,583 66,129 26,622
Transfers from other funds ............. 1,545,309 286,817 66,944 44,697 295,404 14,002
Transfers from Guaranteed Rate
Account ............................... 1,255 565 306 178 -- --
---------- -------- -------- ------- -------- -------
Total Contributions ................... 3,939,083 694,841 110,776 69,458 361,533 40,624
---------- -------- -------- ------- -------- -------
Withdrawals and Transfers:
Withdrawals ............................ 1,868,571 355 17,570 -- 18,368 --
Transfers to other funds ............... 1,040,947 165,543 27,913 13,437 55,215 4,000
Transfer to Guaranteed Rate Account .... -- -- -- -- -- --
Participant service charge ............. (10,119) 65 (6) 2 41 --
---------- -------- ---------- ------- -------- -------
Total withdrawals ..................... 2,899,399 165,963 45,477 13,439 73,624 4,000
---------- -------- --------- ------- -------- -------
Net increase (decrease) in net assets
from Contract Owner transactions ...... 1,039,684 528,878 65,299 56,019 287,909 36,624
---------- -------- --------- ------- -------- -------
INCREASE (DECREASE) IN NET ASSETS ........ 1,398,808 590,274 63,883 59,783 369,145 37,731
NET ASSETS -- BEGINNING OF YEAR .......... 590,274 -- 59,783 -- 37,731 --
---------- -------- --------- ------- -------- -------
NET ASSETS -- END OF YEAR (NOTE 1) ....... $1,989,082 $590,274 $123,666 $59,783 $406,876 $37,731
========== ======== ========= ======= ======== =======
</TABLE>
- -------
* Commencement of Operations on July 1, 1998
See Notes to Financial Statements.
FSA-7
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. General
The Equitable Life Assurance Society of the United States (Equitable Life)
Separate Account No. 301 (the Account) is organized as a unit investment
trust, a type of investment company, and is registered with the Securities
and Exchange Commission under the Investment Company Act of 1940. EQ
Advisors Trust ("EQAT" or "Trust") commenced operations on May 1, 1997.
EQAT is an open-ended, diversified, management investment company that
sells shares of a portfolio ("Portfolio") of a mutual fund to separate
accounts of insurance companies. Each Portfolio has separate investment
objectives.
For periods prior to October 18, 1999 the Alliance portfolios were part of
The Hudson River Trust ("HRT"). On October 18, 1999 a Substitution of new
portfolios of EQAT for the portfolios of HRT was performed. At that time
assets of each of the HRT Portfolios were transferred to the corresponding
new Portfolios of EQAT. Class 1A shares and Class 1B shares of the HRT
became Class 1A shares and Class 1B shares of EQAT.
Prior to the Substitution, Alliance Capital Management L.P., an indirect,
majority-owned subsidiary of Equitable Life, managed HRT and was investment
advisor for all HRT Portfolios. Subsequent to the Substitution Alliance
continues as investment adviser for the Alliance Portfolios.
Effective September 1999, Equitable Life serves as investment manager of
EQAT. As such Equitable Life oversees the activities of the investment
advisors with respect to EQAT and is responsible for retaining or
discontinuing the services of those advisors. Prior to September, 1999 AXA
Advisors LLC (formerly EQ Financial Consultants Inc.), a subsidiary of
Equitable Life, served as investment manager to EQAT.
Effective September 1999, AXA Advisors was sold by Equitable Life to an
affiliated company. AXA Advisors, LLC earns fees from the Trust under
distribution agreements held with the Trust. Equitable Life also earns fees
under the investment management agreement with the EQAT. Alliance earns
fees under an investment advisory agreement with Equitable Life.
The Account has fourteen variable investment funds ("Funds"):
o Alliance Money Market
o Alliance Intermediate Government Securities
o Alliance High Yield
o Alliance Balanced
o Alliance Growth & Income
o Alliance Common Stock
o Alliance Aggressive Stock
o Alliance Global
o Alliance Conservative Investors
o Alliance Growth Investors
o MFS Emerging Growth Companies
o BT Equity 500 Index
o Lazard Small Cap Value
o T. Rowe Price International Stock
The assets in each Fund are invested in Class IA or IB shares of a
corresponding mutual fund portfolio (Portfolio) of EQAT. Class IA and IB
shares are offered by EQAT at net asset value. Both classes of shares are
subject to fees for investment management and advisory services and other
Trust expenses. Class IA shares are not subject to distribution fees
imposed pursuant to a distribution plan. Class IB shares are subject to
distribution fees imposed under a distribution plan adopted pursuant to
Rule 12b-1 under the 1940 act as amended. The Rule 12b-1 Plans provide that
EQAT, on behalf of each Fund, may charge annually up to 0.25% of the
average daily net assets of a Fund attributable to its Class B shares in
respect of activities primarily intended to result in the sale of Class 1B
shares. These fees are reflected in the net asset value of the shares.
FSA-8
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
The Account is used to fund benefits under certain group annuity contracts
and certificates (Contracts) in connection with individual retirement
annuities and tax-sheltered annuity arrangements.
The net assets of the Account are not chargeable with liabilities arising
out of any other business Equitable Life may conduct. The excess of assets
over reserves and other contract liabilities, if any, in the Account may be
transferred to Equitable Life's General Account. Equitable Life's General
Account is subject to creditor rights.
2. Significant Accounting Policies
The accompanying financial statements are prepared in conformity with
generally accepted accounting principles (GAAP). The preparation of
financial statements in conformity with GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
Investments are made in shares of the Trust and are valued at the net asset
values per share of the respective Portfolios. The net asset value is
determined by the Trust using the market or fair value of the underlying
assets of the Portfolio, less liabilities.
Investment transactions in EQAT are recorded on the trade date. Dividends
and capital gain are distributed by the Trust at the end of the year and
are automatically reinvested on the ex-dividend date. Realized gains and
losses include (1) gains and losses on redemptions of Trust shares
(determined on the identified cost basis) and (2) Trust distributions
representing the net realized gains on Trust investment transactions
distributed by the Trust at the end of each year.
No Federal income tax based on net income or realized and unrealized
capital gains is currently applicable to Contracts participating in the
Account by reason of applicable provisions of the Internal Revenue Code and
no Federal income tax payable by Equitable Life is expected to affect the
unit value of Contracts participating in the Account. Accordingly, no
provision for income taxes is required. However, Equitable Life retains the
right to charge for any Federal income tax incurred which is attributable
to the Account if the law is changed.
3. Asset Charges
The following charges are made directly against the assets of the Account
and are reflected daily in the computation of the unit values of the
Contracts:
o Administrative fees are charged at an effective annual rate of
0.25% of the net assets of each Fund.
o Direct operating expenses are paid to cover expenses attributable
to the operations of each Fund.
Under the Contracts, Equitable Life reimburses the Alliance Money Market
Fund, the Alliance Common Stock Fund, the Alliance Intermediate Government
Securities Fund and the Alliance Balanced Fund for the excess of the
aggregate expense charges of each Fund (including investment advisory fees
and certain other Trust expenses attributable to assets of such Fund
invested in a Portfolio of the Trust and the asset-based charges of the
Fund, as described above) which during any calendar year exceed 1.5% of the
average daily net assets of the Alliance Common Stock Fund, the Alliance
Intermediate Government Securities Fund and the Alliance Balanced Fund and
1.0% of the
FSA-9
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
Alliance Money Market Fund. In addition, Equitable life voluntarily
reimburses the Alliance High Yield Fund, the Alliance Aggressive Stock Fund
and the Alliance Global Fund for aggregate expenses in excess of 1.5% of
each Fund's average daily net assets. The above expense reimbursement is
disclosed in the statements of operation as Reimbursement for excess
expense limitation. This voluntary expense limitation may be discontinued
by Equitable Life at its discretion.
Also, if the annual amount of management fees applicable to the Alliance
Money Market Portfolio and the Alliance Intermediate Government Securities
Portfolio exceeds 0.35% of the average daily net asset value of either
Portfolio, Equitable Life will reimburse the related Fund for such excess.
This expense limitation is a contractual right for Participants who
enrolled prior to May 1, 1987 and cannot be changed without the consent of
those Participants. Equitable Life has voluntarily agreed to impose this
expense limitation for Participants who enrolled after May 1, 1987 and
reserves the right to discontinue this at any time.
A quarterly Participant Service Charge is made for each participant at the
end of each calendar quarter before retirement benefits begin.
Participant's unit balances are reduced and proceeds are credited to
Equitable Life in payment of the participant's service charge which will
not exceed $30 per year.
FSA-10
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
4. Contributions and Withdrawals:
Contributions allocated to the Account are not subject to sales expense.
Participants may transfer all or part of the cash value under the Contracts
from one Fund to another subject to certain limitations. Transfers to and
from the Guaranteed Interest Account of Equitable Life's General Account
and the Account may be made subject to certain limitations.
Full or partial withdrawals, including withdrawals of excess contributions,
may be made by participants.
Units of the Account issued and redeemed during the periods indicated were:
<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31,
----------------------
1999 1998
--------- ----------
<S> <C> <C>
ALLIANCE MONEY MARKET
- -------------------------------------------
Issued ................................... 585,833 783,925
Redeemed ................................. 430,869 812,088
------- -------
ALLIANCE INTERMEDIATE GOVERNMENT SECURITIES
- --------------------------------------------
Issued ................................... 11,154 44,628
Redeemed ................................. 38,993 27,762
------- -------
ALLIANCE HIGH YIELD
- --------------------------------------------
Issued ................................... 4,401 53,382
Redeemed ................................. 64,346 78,168
------- -------
ALLIANCE BALANCED
- --------------------------------------------
Issued ................................... 37,767 62,524
Redeemed ................................. 59,106 93,597
------- -------
ALLIANCE GROWTH & INCOME
- --------------------------------------------
Issued ................................... 83,914 115,154
Redeemed ................................. 82,346 95,134
------- -------
ALLIANCE COMMON STOCK
- --------------------------------------------
Issued ................................... 52,033 117,261
Redeemed ................................. 81,479 129,787
------- -------
ALLIANCE AGGRESSIVE STOCK
- --------------------------------------------
Issued ................................... 79,596 158,864
Redeemed ................................. 137,512 160,322
------- -------
ALLIANCE GLOBAL
- --------------------------------------------
Issued ................................... 27,331 28,913
Redeemed ................................. 35,852 38,659
------- -------
ALLIANCE CONSERVATIVE INVESTORS
- --------------------------------------------
Issued ................................... 21,183 94,737
Redeemed ................................. 41,340 16,247
------- -------
ALLIANCE GROWTH INVESTORS
- --------------------------------------------
Issued ................................... 32,700 56,476
Redeemed ................................. 27,842 49,546
------- -------
MFS EMERGING GROWTH COMPANIES
- --------------------------------------------
Issued ................................... 113,211 3,719
Redeemed ................................. 60,598 --
------- -------
BT EQUITY 500 INDEX
- --------------------------------------------
Issued ................................... 329,028 51,505
Redeemed ................................. 234,375 --
------- -------
LAZARD SMALL CAP VALUE
- --------------------------------------------
Issued ................................... 12,295 6,644
Redeemed ................................. 5,228 --
------- -------
T. ROWE PRICE INTERNATIONAL STOCK
- --------------------------------------------
Issued ................................... 34,207 3,731
Redeemed ................................. 7,062 --
------- -------
</TABLE>
FSA-11
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
5. Accumulation Unit Values
Shown below is unit value information for the periods shown.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992 1991 1990
--------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ALLIANCE MONEY MARKET
- ------------------------------
Unit value, beginning of year $ 28.38 $ 27.05 $ 25.77 $ 24.55 $ 23.32 $ 22.48 $ 21.93 $ 21.29 $ 20.17 $ 18.73
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Unit value, end of year ...... $ 29.68 $ 28.38 $ 27.05 $ 25.77 $ 24.55 $ 23.32 $ 22.48 $ 21.93 $ 21.29 $ 20.17
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) ......... 863 708 736 804 850 1,028 1,035 1,301 1,528 1,919
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
ALLIANCE INTERMEDIATE
GOVERNMENT SECURITIES
- -------------------------------
Unit value, beginning of year $ 48.43 $ 45.11 $ 42.20 $ 40.82 $ 36.13 $ 37.77 $ 34.34 $ 32.73 $ 28.79 $ 27.19
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Unit value, end of year ...... $ 48.32 $ 48.43 $ 45.11 $ 42.20 $ 40.82 $ 36.13 $ 37.77 $ 34.34 $ 32.73 $ 28.79
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) ......... 105 133 116 130 153 166 188 184 177 242
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
ALLIANCE HIGH YIELD
- -------------------------------
Unit value, beginning of year $ 29.39 $ 31.16 $ 26.45 $ 21.67 $ 18.18 $ 18.84 $ 15.40 $ 13.84 $ 11.11 $ 11.67
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Unit value, end of year ...... $ 28.17 $ 29.39 $ 31.16 $ 26.45 $ 21.67 $ 18.18 $ 18.84 $ 15.40 $ 13.84 $ 11.11
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) ......... 51 111 136 107 87 80 78 53 27 16
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
ALLIANCE BALANCED
- -------------------------------
Unit value, beginning of year $ 84.01 $ 71.42 $ 62.36 $ 56.07 $ 47.03 $ 51.38 $ 45.92 $ 47.50 $ 33.76 $ 33.91
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Unit value, end of year ...... $ 98.61 $ 84.01 $ 71.42 $ 62.36 $ 56.07 $ 47.03 $ 51.38 $ 45.92 $ 47.50 $ 33.76
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) ......... 471 492 523 559 617 681 756 827 949 1,217
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
</TABLE>
- ----------
* Date on which participant contributions were first allocated to the Fund.
FSA-12
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
5. Accumulation Unit Values (Continued)
Shown below is unit value information for the periods shown.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, MAY 2, 1994* TO
---------------------------------------------------------- DECEMBER 31,
1999 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ---------- ----
<S> <C> <C> <C> <C> <C> <C>
ALLIANCE GROWTH & INCOME
- ------------------------
Unit value, beginning of year ......... $ 22.06 $ 18.35 $ 14.55 $ 12.21 $ 9.92 $ 10.00
======= ======= ======= ======= ======= =======
Unit value, end of year ............... $ 26.06 $ 22.06 $ 18.35 $ 14.55 $ 12.21 $ 9.92
======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) .................. 346 344 324 231 134 105
======= ======= ======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992 1991 1990
--------- --------- --------- ------- --------- --------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ALLIANCE COMMON STOCK
- ---------------------
Unit value, beginning of year .. $ 173.65 $ 134.77 $ 104.68 $ 84.56 $ 64.13 $ 65.89 $ 52.97 $ 51.55 $ 35.87 $ 40.94
======== ======== ======== ======== ======= ======= ======= ======= ======= =======
Unit value, end of year ........ $ 216.64 $ 173.65 $ 134.77 $ 104.68 $ 84.56 $ 64.13 $ 65.89 $ 52.97 $ 51.55 $ 35.87
======== ======== ======== ======== ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) ........... 637 666 678 692 673 694 715 736 790 930
======== ======== ======== ======== ======= ======= ======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
------- -------- -------- -------- -------- --------- ------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ALLIANCE AGGRESSIVE STOCK
- -------------------------
Unit value, beginning of year .. $ 43.73 $ 43.83 $ 39.73 $ 32.67 $ 24.95 $ 26.14 $ 22.54 $ 23.43 $ 13.34 $ 12.47 $ 8.70
======= ======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Unit value, end of year ....... $ 51.79 $ 43.73 $ 43.83 $ 39.73 $ 32.67 $ 24.95 $ 26.14 $ 22.54 $ 23.43 $ 13.34 $ 12.47
======= ======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) .......... 141 199 201 187 190 141 125 156 125 48 27
======= ======= ======= ======= ======= ======= ======= ======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992
----------- ----------- ----------- ----------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ALLIANCE GLOBAL
- ---------------
Unit value, beginning of year ..... $ 34.89 $ 28.80 $ 25.95 $ 22.76 $ 19.25 $ 18.40 $ 14.01 $ 14.20
======= ======= ======= ======= ======= ======= ======= =======
Unit value, end of year ........... $ 48.12 $ 34.89 $ 28.80 $ 25.95 $ 22.76 $ 19.25 $ 18.40 $ 14.01
======= ======= ======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) .............. 187 196 206 214 201 195 153 55
======= ======= ======= ======= ======= ======= ======= =======
<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------
1991 1990
----------- -----------
<S> <C> <C>
ALLIANCE GLOBAL
- ---------------
Unit value, beginning of year ..... $ 11.23 $ 11.97
======= =======
Unit value, end of year ........... $ 14.20 $ 11.23
======= =======
Number of units outstanding,
end of year (000's) .............. 42 32
======= =======
</TABLE>
- ----------
* Date on which participant contributions were first allocated to the Fund.
FSA-13
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
5. Accumulation Unit Values (Continued)
Shown below is unit value information for the periods shown.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, MAY 2, 1994* TO
------------------------------------------------------------------ DECEMBER 31,
1999 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C>
ALLIANCE CONSERVATIVE INVESTORS
- -------------------------------
Unit value, beginning of year ......... $ 15.49 $ 13.71 $ 12.25 $ 11.79 $ 9.92 $ 10.00
======= ======= ======= ======= ======= =======
Unit value, end of year ............... $ 16.94 $ 15.49 $ 13.71 $ 12.25 $ 11.79 $ 9.92
======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) .................. 125 145 67 71 75 50
======= ======= ======= ======= ======= =======
ALLIANCE GROWTH INVESTORS
- -------------------------
Unit value, beginning of year ......... $ 18.69 $ 15.80 $ 13.64 $ 12.23 $ 9.79 $ 10.00
======= ======= ======= ======= ======= =======
Unit value, end of year ............... $ 23.52 $ 18.69 $ 15.80 $ 13.64 $ 12.23 $ 9.79
======= ======= ======= ======= ======= =======
Number of units outstanding,
end of year (000's) .................. 137 133 126 105 93 37
======= ======= ======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED JULY 1, 1998* TO
DECEMBER 31 DECEMBER 31, 1998
------------- -------------------
<S> <C> <C>
MFS EMERGING GROWTH COMPANIES
- -----------------------------
Unit value, beginning of year ............................ $ 11.76 $ 10.00
======= =======
Unit value, end of year .................................. $ 20.33 $ 11.76
======= =======
Number of units outstanding, end of year (000's) ......... 56 4
======= =======
</TABLE>
- ----------
* Date on which participant contributions were first allocated to the Fund.
FSA-14
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
SEPARATE ACCOUNT NO. 301
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
DECEMBER 31, 1999
5. Accumulation Unit Values (Continued)
Shown below is unit value information for the period shown.
<TABLE>
<CAPTION>
YEAR ENDED JULY 1, 1998* TO
DECEMBER 31 DECEMBER 31, 1998
------------- -------------------
<S> <C> <C>
BT EQUITY 500 INDEX
- -------------------
Unit value, beginning of year ............................ $ 11.31 $ 10.00
======= =======
Unit value, end of year .................................. $ 13.55 $ 11.31
======= =======
Number of units outstanding, end of year (000's) ......... 147 52
======= =======
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED JULY 1, 1998* TO
DECEMBER 31 DECEMBER 31, 1998
------------- -------------------
<S> <C> <C>
LAZARD SMALL CAP VALUE
- ----------------------
Unit value, beginning of year ............................ $ 8.94 $ 10.00
====== =======
Unit value, end of year .................................. $ 9.05 $ 8.94
====== =======
Number of units outstanding, end of year (000's) ......... 14 7
====== =======
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED JULY 1, 1998* TO
DECEMBER 31 DECEMBER 31, 1998
------------- -------------------
<S> <C> <C>
T. ROWE PRICE INTERNATIONAL STOCK
- ---------------------------------
Unit value, beginning of year ............................ $ 10.05 $ 10.00
======= =======
Unit value, end of year .................................. $ 13.19 $ 10.05
======= =======
Number of units outstanding, end of year (000's) ......... 31 4
======= =======
</TABLE>
- ----------
* Date on which participant contributions were first allocated to the Fund.
FSA-15
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholder of
The Equitable Life Assurance Society of the United States
In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of earnings, of shareholder's equity and comprehensive
income and of cash flows present fairly, in all material respects, the financial
position of The Equitable Life Assurance Society of the United States and its
subsidiaries ("Equitable Life") at December 31, 1999 and 1998, and the results
of their operations and their cash flows for each of the three years in the
period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
are the responsibility of Equitable Life's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
New York, New York
February 1, 2000
F-1
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
------------- --------------
(IN MILLIONS)
<S> <C> <C>
ASSETS
Investments:
Fixed maturities:
Available for sale, at estimated fair value............................. $ 18,599.7 $ 18,993.7
Held to maturity, at amortized cost..................................... 133.2 125.0
Mortgage loans on real estate............................................. 3,270.0 2,809.9
Equity real estate........................................................ 1,160.2 1,676.9
Policy loans.............................................................. 2,257.3 2,086.7
Other equity investments.................................................. 671.2 713.3
Investment in and loans to affiliates..................................... 1,201.8 928.5
Other invested assets..................................................... 911.6 808.2
------------- -------------
Total investments..................................................... 28,205.0 28,142.2
Cash and cash equivalents................................................... 628.0 1,245.5
Deferred policy acquisition costs........................................... 4,033.0 3,563.8
Other assets................................................................ 3,868.3 3,054.6
Closed Block assets......................................................... 8,607.3 8,632.4
Separate Accounts assets.................................................... 54,453.9 43,302.3
------------- -------------
TOTAL ASSETS................................................................ $ 99,795.5 $ 87,940.8
============= =============
LIABILITIES
Policyholders' account balances............................................. $ 21,351.4 $ 20,857.5
Future policy benefits and other policyholders' liabilities................. 4,777.6 4,726.4
Short-term and long-term debt............................................... 1,407.9 1,181.7
Other liabilities........................................................... 3,133.6 3,474.3
Closed Block liabilities.................................................... 9,025.0 9,077.0
Separate Accounts liabilities............................................... 54,332.5 43,211.3
------------- -------------
Total liabilities..................................................... 94,028.0 82,528.2
------------- -------------
Commitments and contingencies (Notes 11, 13, 14, 15 and 16)
SHAREHOLDER'S EQUITY
Common stock, $1.25 par value 2.0 million shares authorized, issued
and outstanding........................................................... 2.5 2.5
Capital in excess of par value.............................................. 3,557.2 3,110.2
Retained earnings........................................................... 2,600.7 1,944.1
Accumulated other comprehensive (loss) income............................... (392.9) 355.8
------------- -------------
Total shareholder's equity............................................ 5,767.5 5,412.6
------------- -------------
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY.................................. $ 99,795.5 $ 87,940.8
============= =============
</TABLE>
See Notes to Consolidated Financial Statements.
F-2
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
CONSOLIDATED STATEMENTS OF EARNINGS
YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<TABLE>
<CAPTION>
1999 1998 1997
------------ ------------- -------------
(IN MILLIONS)
<S> <C> <C> <C>
REVENUES
Universal life and investment-type product policy fee
income...................................................... $ 1,257.5 $ 1,056.2 $ 950.6
Premiums...................................................... 558.2 588.1 601.5
Net investment income......................................... 2,240.9 2,228.1 2,282.8
Investment (losses) gains, net................................ (96.9) 100.2 (45.2)
Commissions, fees and other income............................ 2,177.9 1,503.0 1,227.2
Contribution from the Closed Block............................ 86.4 87.1 102.5
------------ ------------- -------------
Total revenues.......................................... 6,224.0 5,562.7 5,119.4
------------ ------------- -------------
BENEFITS AND OTHER DEDUCTIONS
Interest credited to policyholders' account balances.......... 1,078.2 1,153.0 1,266.2
Policyholders' benefits....................................... 1,038.6 1,024.7 978.6
Other operating costs and expenses............................ 2,797.3 2,201.2 2,203.9
------------ ------------- -------------
Total benefits and other deductions..................... 4,914.1 4,378.9 4,448.7
------------ ------------- -------------
Earnings from continuing operations before Federal
income taxes and minority interest.......................... 1,309.9 1,183.8 670.7
Federal income taxes.......................................... 332.0 353.1 91.5
Minority interest in net income of consolidated subsidiaries.. 199.4 125.2 54.8
------------ ------------- -------------
Earnings from continuing operations........................... 778.5 705.5 524.4
Discontinued operations, net of Federal income taxes.......... 28.1 2.7 (87.2)
------------ ------------- -------------
Net Earnings.................................................. $ 806.6 $ 708.2 $ 437.2
============ ============= =============
</TABLE>
See Notes to Consolidated Financial Statements.
F-3
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY AND COMPREHENSIVE INCOME
YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<TABLE>
<CAPTION>
1999 1998 1997
------------ ------------- -------------
(IN MILLIONS)
<S> <C> <C> <C>
Common stock, at par value, beginning and end of year......... $ 2.5 $ 2.5 $ 2.5
------------ ------------- -------------
Capital in excess of par value, beginning of year............. 3,110.2 3,105.8 3,105.8
Additional capital in excess of par value..................... 447.0 4.4 -
------------ ------------- -------------
Capital in excess of par value, end of year................... 3,557.2 3,110.2 3,105.8
------------ ------------- -------------
Retained earnings, beginning of year.......................... 1,944.1 1,235.9 798.7
Net earnings.................................................. 806.6 708.2 437.2
Dividend paid to the Holding Company.......................... (150.0) - -
------------ ------------- -------------
Retained earnings, end of year................................ 2,600.7 1,944.1 1,235.9
------------ ------------- -------------
Accumulated other comprehensive income,
beginning of year........................................... 355.8 516.3 177.0
Other comprehensive (loss) income............................. (748.7) (160.5) 339.3
------------ ------------- -------------
Accumulated other comprehensive (loss) income, end of year.... (392.9) 355.8 516.3
------------ ------------- -------------
TOTAL SHAREHOLDER'S EQUITY, END OF YEAR....................... $ 5,767.5 $ 5,412.6 $ 4,860.5
============ ============= ============
COMPREHENSIVE INCOME
Net earnings.................................................. $ 806.6 $ 708.2 $ 437.2
------------ ------------- -------------
Change in unrealized (losses) gains, net of reclassification
adjustment.................................................. (776.9) (149.5) 343.7
Minimum pension liability adjustment.......................... 28.2 (11.0) (4.4)
------------ ------------- -------------
Other comprehensive (loss) income............................. (748.7) (160.5) 339.3
------------ ------------- -------------
COMPREHENSIVE INCOME.......................................... $ 57.9 $ 547.7 $ 776.5
============ ============= ============
</TABLE>
See Notes to Consolidated Financial Statements.
F-4
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<TABLE>
<CAPTION>
1999 1998 1997
------------ ------------- -------------
(IN MILLIONS)
<S> <C> <C> <C>
Net earnings.................................................. $ 806.6 $ 708.2 $ 437.2
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Interest credited to policyholders' account balances........ 1,078.2 1,153.0 1,266.2
Universal life and investment-type product
policy fee income......................................... (1,257.5) (1,056.2) (950.6)
Investment losses (gains)................................... 96.9 (100.2) 45.2
Change in Federal income tax payable........................ 157.4 123.1 (74.4)
Change in property and equipment............................ (256.3) (81.8) (9.6)
Change in deferred acquisition costs........................ (260.7) (314.0) (220.7)
Other, net.................................................. (168.8) 70.9 399.7
------------ ------------- -------------
Net cash provided by operating activities..................... 195.8 503.0 893.0
------------ ------------- -------------
Cash flows from investing activities:
Maturities and repayments................................... 2,019.0 2,289.0 2,702.9
Sales....................................................... 7,572.9 16,972.1 10,385.9
Purchases................................................... (10,737.3) (18,578.5) (13,205.4)
(Increase) decrease in short-term investments............... (178.3) 102.4 (555.0)
Decrease in loans to discontinued operations................ - 660.0 420.1
Sale of subsidiaries........................................ - - 261.0
Other, net.................................................. (134.8) (341.8) (612.6)
------------ ------------- -------------
Net cash (used) provided by investing activities.............. (1,458.5) 1,103.2 (603.1)
------------ ------------- -------------
Cash flows from financing activities: Policyholders'
account balances:
Deposits.................................................. 2,366.2 1,508.1 1,281.7
Withdrawals............................................... (1,765.8) (1,724.6) (1,886.8)
Net increase (decrease) in short-term financings............ 378.2 (243.5) 419.9
Repayments of long-term debt................................ (41.3) (24.5) (196.4)
Payment of obligation to fund accumulated deficit of
discontinued operations................................... - (87.2) (83.9)
Dividend paid to the Holding Company........................ (150.0) - -
Other, net.................................................. (142.1) (89.5) (62.7)
------------ ------------- -------------
Net cash provided (used) by financing activities.............. 645.2 (661.2) (528.2)
------------ ------------- -------------
Change in cash and cash equivalents........................... (617.5) 945.0 (238.3)
Cash and cash equivalents, beginning of year.................. 1,245.5 300.5 538.8
------------ ------------- -------------
Cash and Cash Equivalents, End of Year........................ $ 628.0 $ 1,245.5 $ 300.5
============ ============= =============
Supplemental cash flow information
Interest Paid............................................... $ 92.2 $ 130.7 $ 217.1
============ ============= =============
Income Taxes Paid........................................... $ 116.5 $ 254.3 $ 170.0
============ ============= =============
</TABLE>
See Notes to Consolidated Financial Statements.
F-5
<PAGE>
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1) ORGANIZATION
The Equitable Life Assurance Society of the United States ("Equitable
Life") is an indirect, wholly owned subsidiary of AXA Financial, Inc. (the
"Holding Company," and collectively with its consolidated subsidiaries,
"AXA Financial"). Equitable Life's insurance business is conducted
principally by Equitable Life and its wholly owned life insurance
subsidiaries, Equitable of Colorado ("EOC"), and, prior to December 31,
1996, Equitable Variable Life Insurance Company ("EVLICO"). Effective
January 1, 1997, EVLICO was merged into Equitable Life. Equitable Life's
investment management business, which comprises the Investment Services
segment, is conducted principally by Alliance Capital Management L.P.
("Alliance"), and Donaldson, Lufkin & Jenrette, Inc. ("DLJ"), an investment
banking and brokerage affiliate. AXA, a French holding company for an
international group of insurance and related financial services companies,
is the Holding Company's largest shareholder, owning approximately 58.0% at
December 31, 1999 (53.0% if all securities convertible into, and options
on, common stock were to be converted or exercised).
On September 20, 1999, as part of AXA Financial's "branding" strategic
initiative, EQ Financial Consultants, Inc., a broker-dealer subsidiary of
Equitable Life, was merged into a new company, AXA Advisors, LLC ("AXA
Advisors"). Also, on September 21, 1999, AXA Advisors was transferred by
Equitable Life to AXA Distribution Holding Corporation ("AXA
Distribution"), a wholly owned indirect subsidiary of the Holding Company,
for $15.3 million. The excess of the sales price over AXA Advisors' book
value has been recorded in Equitable Life's books as a capital
contribution. Equitable Life will continue to develop and market the
"Equitable" brand of life and annuity products, while AXA Distribution and
its subsidiaries begin to assume responsibility for providing financial
advisory services, product distribution and customer relationship
management.
The Insurance segment offers a variety of traditional, variable and
interest-sensitive life insurance products, disability income, annuity
products, mutual fund and other investment products to individuals and
small groups. It also administers traditional participating group annuity
contracts with conversion features, generally for corporate qualified
pension plans, and association plans which provide full service retirement
programs for individuals affiliated with professional and trade
associations. This segment includes Separate Accounts for individual
insurance and annuity products.
The Investment Services segment includes Alliance and the results of DLJ
which are accounted for on an equity basis. In 1999, Alliance reorganized
into Alliance Capital Management Holding L.P. ("Alliance Holding") and
Alliance (the "Reorganization"). Alliance Holding's principal asset is its
interest in Alliance and it functions as a holding entity through which
holders of its publicly traded units own an indirect interest in the
operating partnership. The Company exchanged substantially all of its
Alliance Holding units for units in Alliance ("Alliance Units"). As a
result of the reorganization, the Company was the beneficial owner of
approximately 2% of Alliance Holding and 56% of Alliance. Alliance provides
diversified investment fund management services to a variety of
institutional clients, including pension funds, endowments, and foreign
financial institutions, as well as to individual investors, principally
through a broad line of mutual funds. This segment includes institutional
Separate Accounts which provide various investment options for large group
pension clients, primarily deferred benefit contribution plans, through
pooled or single group accounts. At December 31, 1999, Equitable Life has a
31.7% ownership interest in DLJ. DLJ's businesses include securities
underwriting, sales and trading, merchant banking, financial advisory
services, investment research, venture capital, correspondent brokerage
services, online interactive brokerage services and asset management. DLJ
serves institutional, corporate, governmental and individual clients both
domestically and internationally. Through June 10, 1997, this segment also
includes Equitable Real Estate Investment Management Inc. ("EREIM") which
was sold. EREIM provided real estate investment management services,
property management services, mortgage servicing and loan asset management,
and agricultural investment management.
F-6
<PAGE>
2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation
-----------------------------------------------------
The accompanying consolidated financial statements are prepared in
conformity with generally accepted accounting principles ("GAAP") which
require management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
The accompanying consolidated financial statements include the accounts of
Equitable Life and certain of its subsidiaries engaged in insurance related
business (collectively, the "Insurance Group"); other subsidiaries,
principally Alliance and through June 10, 1997, EREIM (see Note 5); and
those partnerships and joint ventures in which Equitable Life or its
subsidiaries has control and a majority economic interest (collectively,
including its consolidated subsidiaries, the "Company"). The Company's
investment in DLJ is reported on the equity basis of accounting. Closed
Block assets, liabilities and results of operations are presented in the
consolidated financial statements as single line items (see Note 7). Unless
specifically stated, all other footnote disclosures contained herein
exclude the Closed Block related amounts.
All significant intercompany transactions and balances except those with
the Closed Block, DLJ and discontinued operations (see Note 8) have been
eliminated in consolidation. The years "1999," "1998" and "1997" refer to
the years ended December 31, 1999, 1998 and 1997, respectively. Certain
reclassifications have been made in the amounts presented for prior periods
to conform these periods with the 1999 presentation.
Closed Block
------------
On July 22, 1992, Equitable Life established the Closed Block for the
benefit of certain individual participating policies which were in force on
that date. The assets allocated to the Closed Block, together with
anticipated revenues from policies included in the Closed Block, were
reasonably expected to be sufficient to support such business, including
provision for payment of claims, certain expenses and taxes, and for
continuation of dividend scales payable in 1991, assuming the experience
underlying such scales continues.
Assets allocated to the Closed Block inure solely to the benefit of the
Closed Block policyholders and will not revert to the benefit of the
Holding Company. No reallocation, transfer, borrowing or lending of assets
can be made between the Closed Block and other portions of Equitable Life's
General Account, any of its Separate Accounts or any affiliate of Equitable
Life without the approval of the New York Superintendent of Insurance (the
"Superintendent"). Closed Block assets and liabilities are carried on the
same basis as similar assets and liabilities held in the General Account.
The excess of Closed Block liabilities over Closed Block assets represents
the expected future post-tax contribution from the Closed Block which would
be recognized in income over the period the policies and contracts in the
Closed Block remain in force.
Discontinued Operations
-----------------------
Discontinued operations at December 31, 1999, principally consists of the
Group Non-Participating Wind-Up Annuities ("Wind-Up Annuities"), for which
a premium deficiency reserve has been established. Management reviews the
adequacy of the allowance each quarter and believes the allowance for
future losses at December 31, 1999 is adequate to provide for all future
losses; however, the quarterly allowance review continues to involve
numerous estimates and subjective judgments regarding the expected
performance of Discontinued Operations Investment Assets. There can be no
assurance the losses provided for will not differ from the losses
ultimately realized. To the extent actual results or future projections of
the discontinued operations differ from management's current best estimates
and assumptions underlying the allowance for future losses, the difference
would be reflected in the consolidated statements of earnings in
discontinued operations. In particular, to the extent income, sales
proceeds and holding periods for equity real estate differ from
management's previous assumptions, periodic adjustments to the allowance
are likely to result (see Note 8).
F-7
<PAGE>
Accounting Changes
------------------
In March 1998, the American Institute of Certified Public Accountants
("AICPA") issued Statement of Position ("SOP") 98-1, "Accounting for the
Costs of Computer Software Developed or Obtained for Internal Use," which
requires capitalization of external and certain internal costs incurred to
obtain or develop internal-use computer software during the application
development stage. The Company applied the provisions of SOP 98-1
prospectively effective January 1, 1998. The adoption of SOP 98-1 did not
have a material impact on the Company's consolidated financial statements.
Capitalized internal-use software is amortized on a straight-line basis
over the estimated useful life of the software.
New Accounting Pronouncements
-----------------------------
In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard ("SFAS") No. 133, "Accounting
for Derivative Instruments and Hedging Activities," which establishes
accounting and reporting standards for derivative instruments, including
certain derivatives embedded in other contracts, and for hedging
activities. It requires all derivatives to be recognized on the balance
sheet at fair value. The accounting for changes in the fair value of a
derivative depends on its intended use. Derivatives not used in hedging
activities must be adjusted to fair value through earnings. Changes in the
fair value of derivatives used in hedging activities will, depending on the
nature of the hedge, either be offset in earnings against the change in
fair value of the hedged item attributable to the risk being hedged or
recognized in other comprehensive income until the hedged item affects
earnings. For all hedging activities, the ineffective portion of a
derivative's change in fair value will be immediately recognized in
earnings. In June 1999, the FASB issued SFAS No. 137, "Accounting for
Derivative Instruments and Hedging Activities - Deferral of the Effective
Date of FASB Statement No. 133," which defers the effective date of SFAS
No. 133 to all fiscal quarters of all fiscal years beginning after June 15,
2000. The Company expects to adopt SFAS No. 133 effective January 1, 2001.
Adjustments resulting from initial adoption of the new requirements will be
reported in a manner similar to the cumulative effect of a change in
accounting principle and will be reflected in net income or accumulated
other comprehensive income based upon existing hedging relationships, if
any. Management currently is assessing the impact of adoption. However,
Alliance's adoption of the new requirements is not expected to have a
significant impact on the Company's consolidated balance sheet or statement
of earnings. Also, since most of DLJ's derivatives are carried at fair
values, the Company's consolidated earnings and financial position are not
expected to be significantly affected by DLJ's adoption of the new
requirements.
Valuation of Investments
------------------------
Fixed maturities identified as available for sale are reported at estimated
fair value. Fixed maturities, which the Company has both the ability and
the intent to hold to maturity, are stated principally at amortized cost.
The amortized cost of fixed maturities is adjusted for impairments in value
deemed to be other than temporary.
Valuation allowances are netted against the asset categories to which they
apply.
Mortgage loans on real estate are stated at unpaid principal balances, net
of unamortized discounts and valuation allowances. Valuation allowances are
based on the present value of expected future cash flows discounted at the
loan's original effective interest rate or the collateral value if the loan
is collateral dependent. However, if foreclosure is or becomes probable,
the measurement method used is collateral value.
Real estate, including real estate acquired in satisfaction of debt, is
stated at depreciated cost less valuation allowances. At the date of
foreclosure (including in-substance foreclosure), real estate acquired in
satisfaction of debt is valued at estimated fair value. Impaired real
estate is written down to fair value with the impairment loss being
included in investment gains (losses), net. Valuation allowances on real
estate held for sale are computed using the lower of depreciated cost or
current estimated fair value, net of disposition costs. Depreciation is
discontinued on real estate held for sale.
F-8
<PAGE>
Policy loans are stated at unpaid principal balances.
Partnerships and joint venture interests in which the Company does not have
control or a majority economic interest are reported on the equity basis of
accounting and are included either with equity real estate or other equity
investments, as appropriate.
Equity securities, comprised of common stock classified as both trading and
available for sale securities, are carried at estimated fair value and are
included in other equity investments.
Short-term investments are stated at amortized cost which approximates fair
value and are included with other invested assets.
Cash and cash equivalents includes cash on hand, amounts due from banks and
highly liquid debt instruments purchased with an original maturity of three
months or less.
All securities are recorded in the consolidated financial statements on a
trade date basis.
Net Investment Income, Investment Gains, Net and Unrealized Investment
----------------------------------------------------------------------
Gains (Losses)
--------------
Net investment income and realized investment gains (losses) (collectively,
"investment results") related to certain participating group annuity
contracts which are passed through to the contractholders are reflected as
interest credited to policyholders' account balances.
Realized investment gains (losses) are determined by specific
identification and are presented as a component of revenue. Changes in
valuation allowances are included in investment gains (losses).
Unrealized gains (losses) on publicly-traded common equity securities
classified as trading securities are reflected in net investment income.
Unrealized investment gains (losses) on fixed maturities and equity
securities available for sale held by the Company are accounted for as a
separate component of accumulated comprehensive income, net of related
deferred Federal income taxes, amounts attributable to discontinued
operations, participating group annuity contracts and deferred policy
acquisition costs ("DAC") related to universal life and investment-type
products and participating traditional life contracts.
Recognition of Insurance Income and Related Expenses
----------------------------------------------------
Premiums from universal life and investment-type contracts are reported as
deposits to policyholders' account balances. Revenues from these contracts
consist of amounts assessed during the period against policyholders'
account balances for mortality charges, policy administration charges and
surrender charges. Policy benefits and claims that are charged to expense
include benefit claims incurred in the period in excess of related
policyholders' account balances.
Premiums from participating and non-participating traditional life and
annuity policies with life contingencies generally are recognized as income
when due. Benefits and expenses are matched with such income so as to
result in the recognition of profits over the life of the contracts. This
match is accomplished by means of the provision for liabilities for future
policy benefits and the deferral and subsequent amortization of policy
acquisition costs.
For contracts with a single premium or a limited number of premium payments
due over a significantly shorter period than the total period over which
benefits are provided, premiums are recorded as income when due with any
excess profit deferred and recognized in income in a constant relationship
to insurance in force or, for annuities, the amount of expected future
benefit payments.
Premiums from individual health contracts are recognized as income over the
period to which the premiums relate in proportion to the amount of
insurance protection provided.
F-9
<PAGE>
Deferred Policy Acquisition Costs
---------------------------------
The costs of acquiring new business, principally commissions, underwriting,
agency and policy issue expenses, all of which vary with and are primarily
related to the production of new business, are deferred. DAC is subject to
recoverability testing at the time of policy issue and loss recognition
testing at the end of each accounting period.
For universal life products and investment-type products, DAC is amortized
over the expected total life of the contract group (periods ranging from 25
to 35 years and 5 to 17 years, respectively) as a constant percentage of
estimated gross profits arising principally from investment results,
mortality and expense margins and surrender charges based on historical and
anticipated future experience, updated at the end of each accounting
period. The effect on the amortization of DAC of revisions to estimated
gross profits is reflected in earnings in the period such estimated gross
profits are revised. The effect on the DAC asset that would result from
realization of unrealized gains (losses) is recognized with an offset to
accumulated other comprehensive income in consolidated shareholder's equity
as of the balance sheet date.
As part of its asset/liability management process, in second quarter 1999,
management initiated a review of the matching of invested assets to
Insurance product lines given their different liability characteristics and
liquidity requirements. As a result of this review, management reallocated
the current and prospective interests of the various product lines in the
invested assets. These asset reallocations and the related changes in
investment yields by product line, in turn, triggered a review of and
revisions to the estimated future gross profits used to determine the
amortization of DAC for universal life and investment-type products. The
revisions to estimated future gross profits resulted in an after-tax
writedown of DAC of $85.6 million (net of a Federal income tax benefit of
$46.1 million).
For participating traditional life policies (substantially all of which are
in the Closed Block), DAC is amortized over the expected total life of the
contract group (40 years) as a constant percentage based on the present
value of the estimated gross margin amounts expected to be realized over
the life of the contracts using the expected investment yield. At December
31, 1999, the expected investment yield, excluding policy loans, generally
ranged from 7.75% grading to 7.5% over a 20 year period. Estimated gross
margin includes anticipated premiums and investment results less claims and
administrative expenses, changes in the net level premium reserve and
expected annual policyholder dividends. The effect on the amortization of
DAC of revisions to estimated gross margins is reflected in earnings in the
period such estimated gross margins are revised. The effect on the DAC
asset that would result from realization of unrealized gains (losses) is
recognized with an offset to accumulated comprehensive income in
consolidated shareholder's equity as of the balance sheet date.
For non-participating traditional life DAC is amortized in proportion to
anticipated premiums. Assumptions as to anticipated premiums are estimated
at the date of policy issue and are consistently applied during the life of
the contracts. Deviations from estimated experience are reflected in
earnings in the period such deviations occur. For these contracts, the
amortization periods generally are for the total life of the policy.
Policyholders' Account Balances and Future Policy Benefits
----------------------------------------------------------
Policyholders' account balances for universal life and investment-type
contracts are equal to the policy account values. The policy account values
represents an accumulation of gross premium payments plus credited interest
less expense and mortality charges and withdrawals.
For participating traditional life policies, future policy benefit
liabilities are calculated using a net level premium method on the basis of
actuarial assumptions equal to guaranteed mortality and dividend fund
interest rates. The liability for annual dividends represents the accrual
of annual dividends earned. Terminal dividends are accrued in proportion to
gross margins over the life of the contract.
For non-participating traditional life insurance policies, future policy
benefit liabilities are estimated using a net level premium method on the
basis of actuarial assumptions as to mortality, persistency and interest
established at policy issue. Assumptions established at policy issue as to
mortality and persistency are based on the Insurance Group's experience
which, together with interest and expense assumptions, includes a margin
for adverse deviation. When the liabilities for future policy benefits plus
the present value of expected future gross premiums for a product are
insufficient to provide for expected future policy benefits
F-10
<PAGE>
and expenses for that product, DAC is written off and thereafter, if
required, a premium deficiency reserve is established by a charge to
earnings. Benefit liabilities for traditional annuities during the
accumulation period are equal to accumulated contractholders' fund balances
and after annuitization are equal to the present value of expected future
payments. Interest rates used in establishing such liabilities range from
2.25% to 11.5% for life insurance liabilities and from 2.25% to 8.35% for
annuity liabilities.
Individual health benefit liabilities for active lives are estimated using
the net level premium method and assumptions as to future morbidity,
withdrawals and interest. Benefit liabilities for disabled lives are
estimated using the present value of benefits method and experience
assumptions as to claim terminations, expenses and interest. While
management believes its disability income ("DI") reserves have been
calculated on a reasonable basis and are adequate, there can be no
assurance reserves will be sufficient to provide for future liabilities.
Claim reserves and associated liabilities for individual DI and major
medical policies were $948.4 million and $951.7 million at December 31,
1999 and 1998, respectively. Incurred benefits (benefits paid plus changes
in claim reserves) and benefits paid for individual DI and major medical
are summarized as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Incurred benefits related to current year.......... $ 150.7 $ 140.1 $ 132.3
Incurred benefits related to prior years........... 64.7 84.2 60.0
------------- ------------ ------------
Total Incurred Benefits............................ $ 215.4 $ 224.3 $ 192.3
============= ============ ============
Benefits paid related to current year.............. $ 28.9 $ 17.0 $ 28.8
Benefits paid related to prior years............... 189.8 155.4 146.2
------------- ------------ ------------
Total Benefits Paid................................ $ 218.7 $ 172.4 $ 175.0
============= ============ ============
</TABLE>
Policyholders' Dividends
------------------------
The amount of policyholders' dividends to be paid (including those on
policies included in the Closed Block) is determined annually by Equitable
Life's board of directors. The aggregate amount of policyholders' dividends
is related to actual interest, mortality, morbidity and expense experience
for the year and judgment as to the appropriate level of statutory surplus
to be retained by Equitable Life.
At December 31, 1999, participating policies, including those in the Closed
Block, represent approximately 23.0% ($47.0 billion) of directly written
life insurance in force, net of amounts ceded.
Federal Income Taxes
--------------------
The Company files a consolidated Federal income tax return with the Holding
Company and its consolidated subsidiaries. Current Federal income taxes are
charged or credited to operations based upon amounts estimated to be
payable or recoverable as a result of taxable operations for the current
year. Deferred income tax assets and liabilities are recognized based on
the difference between financial statement carrying amounts and income tax
bases of assets and liabilities using enacted income tax rates and laws.
Separate Accounts
-----------------
Separate Accounts are established in conformity with the New York State
Insurance Law and generally are not chargeable with liabilities that arise
from any other business of the Insurance Group. Separate Accounts assets
are subject to General Account claims only to the extent the value of such
assets exceeds Separate Accounts liabilities.
F-11
<PAGE>
Assets and liabilities of the Separate Accounts, representing net deposits
and accumulated net investment earnings less fees, held primarily for the
benefit of contractholders, and for which the Insurance Group does not bear
the investment risk, are shown as separate captions in the consolidated
balance sheets. The Insurance Group bears the investment risk on assets
held in one Separate Account; therefore, such assets are carried on the
same basis as similar assets held in the General Account portfolio. Assets
held in the other Separate Accounts are carried at quoted market values or,
where quoted values are not available, at estimated fair values as
determined by the Insurance Group.
The investment results of Separate Accounts on which the Insurance Group
does not bear the investment risk are reflected directly in Separate
Accounts liabilities. For 1999, 1998 and 1997, investment results of such
Separate Accounts were $6,045.5 million, $4,591.0 million and $3,411.1
million, respectively.
Deposits to Separate Accounts are reported as increases in Separate
Accounts liabilities and are not reported in revenues. Mortality, policy
administration and surrender charges on all Separate Accounts are included
in revenues.
Employee Stock Option Plan
--------------------------
The Company accounts for stock option plans sponsored by the Holding
Company, DLJ and Alliance in accordance with the provisions of Accounting
Principles Board Opinion ("APB") No. 25, "Accounting for Stock Issued to
Employees," and related interpretations. In accordance with the opinion,
compensation expense is recorded on the date of grant only if the current
market price of the underlying stock exceeds the option strike price at the
grant date. See Note 22 for the pro forma disclosures for the Holding
Company, DLJ and Alliance required by SFAS No. 123, "Accounting for
Stock-Based Compensation".
F-12
<PAGE>
3) INVESTMENTS
The following tables provide additional information relating to fixed
maturities and equity securities:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED ESTIMATED
COST GAINS LOSSES FAIR VALUE
------------- ------------- ------------ -------------
(IN MILLIONS)
<S> <C> <C> <C> <C>
DECEMBER 31, 1999
-----------------
Fixed Maturities:
Available for Sale:
Corporate.......................... $ 14,866.8 $ 139.5 $ 787.0 $ 14,219.3
Mortgage-backed.................... 2,554.5 2.3 87.8 2,469.0
U.S. Treasury, government and
agency securities................ 1,194.1 18.9 23.4 1,189.6
States and political subdivisions.. 110.0 1.4 4.9 106.5
Foreign governments................ 361.8 16.2 14.8 363.2
Redeemable preferred stock......... 286.4 1.7 36.0 252.1
------------- ------------- ------------ -------------
Total Available for Sale............... $ 19,373.6 $ 180.0 $ 953.9 $ 18,599.7
============= ============= ============ =============
Held to Maturity: Corporate......... $ 133.2 $ - $ - $ 133.2
============= ============= ============ =============
Equity Securities:
Common stock available for sale...... 25.5 1.5 17.8 9.2
Common stock trading securities...... 7.2 9.1 2.2 14.1
------------- ------------- ------------ -------------
Total Equity Securities................ $ 32.7 $ 10.6 $ 20.0 $ 23.3
============= ============= ============ =============
December 31, 1998
-----------------
Fixed Maturities:
Available for Sale:
Corporate.......................... $ 14,520.8 $ 793.6 $ 379.6 $ 14,934.8
Mortgage-backed.................... 1,807.9 23.3 .9 1,830.3
U.S. Treasury, government and
agency securities................ 1,464.1 107.6 .7 1,571.0
States and political subdivisions.. 55.0 9.9 - 64.9
Foreign governments................ 363.3 20.9 30.0 354.2
Redeemable preferred stock......... 242.7 7.0 11.2 238.5
------------- ------------- ------------ -------------
Total Available for Sale............... $ 18,453.8 $ 962.3 $ 422.4 $ 18,993.7
============= ============= ============ =============
Held to Maturity: Corporate......... $ 125.0 $ - $ - $ 125.0
============= ============= ============ =============
Equity Securities:
Common stock available for sale...... $ 58.3 $ 114.9 $ 22.5 $ 150.7
============= ============= ============ =============
</TABLE>
For publicly traded fixed maturities and equity securities, estimated fair
value is determined using quoted market prices. For fixed maturities
without a readily ascertainable market value, the Company determines an
estimated fair value using a discounted cash flow approach, including
provisions for credit risk, generally based on the assumption such
securities will be held to maturity. Estimated fair values for equity
securities, substantially all of which do not have a readily ascertainable
market value, have been determined by the Company. Such estimated fair
values do not necessarily represent the values for which these securities
could have been sold at the dates of the consolidated balance sheets. At
December 31, 1999 and 1998, securities without a readily ascertainable
market value having an amortized cost of $3,322.2 million and $3,539.9
million, respectively, had estimated fair values of $3,177.7 million and
$3,748.5 million, respectively.
F-13
<PAGE>
The contractual maturity of bonds at December 31, 1999 is shown below:
<TABLE>
<CAPTION>
AVAILABLE FOR SALE
-------------------------------
AMORTIZED ESTIMATED
COST FAIR VALUE
------------ ------------
(IN MILLIONS)
<S> <C> <C>
Due in one year or less................................................ $ 479.1 $ 477.8
Due in years two through five.......................................... 2,991.8 2,921.2
Due in years six through ten........................................... 7,197.9 6,813.0
Due after ten years.................................................... 5,864.0 5,666.5
Mortgage-backed securities............................................. 2,554.4 2,469.1
------------ ------------
Total.................................................................. $ 19,087.2 $ 18,347.6
============ ============
</TABLE>
Corporate bonds held to maturity with an amortized cost and estimated fair
value of $133.2 million are due in one year or less.
Bonds not due at a single maturity date have been included in the above
table in the year of final maturity. Actual maturities will differ from
contractual maturities because borrowers may have the right to call or
prepay obligations with or without call or prepayment penalties.
The Insurance Group's fixed maturity investment portfolio includes
corporate high yield securities consisting of public high yield bonds,
redeemable preferred stocks and directly negotiated debt in leveraged
buyout transactions. The Insurance Group seeks to minimize the higher than
normal credit risks associated with such securities by monitoring
concentrations in any single issuer or a particular industry group. Certain
of these corporate high yield securities are classified as other than
investment grade by the various rating agencies, i.e., a rating below Baa
or National Association of Insurance Commissioners ("NAIC") designation of
3 (medium grade), 4 or 5 (below investment grade) or 6 (in or near
default). At December 31, 1999, approximately 14.9% of the $18,344.3
million aggregate amortized cost of bonds held by the Company was
considered to be other than investment grade.
In addition, the Insurance Group is an equity investor in limited
partnership interests which primarily invest in securities considered to be
other than investment grade. The carrying values at December 31, 1999 and
1998 were $647.9 million and $562.6 million, respectively.
Investment valuation allowances and changes thereto are shown below:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Balances, beginning of year........................ $ 230.6 $ 384.5 $ 137.1
Additions charged to income........................ 68.2 86.2 334.6
Deductions for writedowns and
asset dispositions............................... (150.2) (240.1) (87.2)
------------- ------------ ------------
Balances, End of Year.............................. $ 148.6 $ 230.6 $ 384.5
============= ============ ============
Balances, end of year comprise:
Mortgage loans on real estate.................... $ 27.5 $ 34.3 $ 55.8
Equity real estate............................... 121.1 196.3 328.7
------------- ------------ ------------
Total.............................................. $ 148.6 $ 230.6 $ 384.5
============= ============ ============
</TABLE>
F-14
<PAGE>
At December 31, 1999, the carrying value of fixed maturities which are
non-income producing for the twelve months preceding the consolidated
balance sheet date was $152.1 million.
The payment terms of mortgage loans on real estate may from time to time be
restructured or modified. The investment in restructured mortgage loans on
real estate, based on amortized cost, amounted to $106.0 million and $115.1
million at December 31, 1999 and 1998, respectively. Gross interest income
on restructured mortgage loans on real estate that would have been recorded
in accordance with the original terms of such loans amounted to $9.5
million, $10.3 million and $17.2 million in 1999, 1998 and 1997,
respectively. Gross interest income on these loans included in net
investment income aggregated $8.2 million, $8.3 million and $12.7 million
in 1999, 1998 and 1997, respectively.
Impaired mortgage loans along with the related provision for losses were as
follows:
<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------------------
1999 1998
-------------- --------------
(IN MILLIONS)
<S> <C> <C>
Impaired mortgage loans with provision for losses.................. $ 142.4 $ 125.4
Impaired mortgage loans without provision for losses............... 2.2 8.6
-------------- --------------
Recorded investment in impaired mortgage loans..................... 144.6 134.0
Provision for losses............................................... (23.0) (29.0)
-------------- --------------
Net Impaired Mortgage Loans........................................ $ 121.6 $ 105.0
============== ==============
</TABLE>
Impaired mortgage loans without provision for losses are loans where the
fair value of the collateral or the net present value of the expected
future cash flows related to the loan equals or exceeds the recorded
investment. Interest income earned on loans where the collateral value is
used to measure impairment is recorded on a cash basis. Interest income on
loans where the present value method is used to measure impairment is
accrued on the net carrying value amount of the loan at the interest rate
used to discount the cash flows. Changes in the present value attributable
to changes in the amount or timing of expected cash flows are reported as
investment gains or losses.
During 1999, 1998 and 1997, respectively, the Company's average recorded
investment in impaired mortgage loans was $141.7 million, $161.3 million
and $246.9 million. Interest income recognized on these impaired mortgage
loans totaled $12.0 million, $12.3 million and $15.2 million ($0.0 million,
$.9 million and $2.3 million recognized on a cash basis) for 1999, 1998 and
1997, respectively.
The Insurance Group's investment in equity real estate is through direct
ownership and through investments in real estate joint ventures. At
December 31, 1999 and 1998, the carrying value of equity real estate held
for sale amounted to $382.2 million and $836.2 million, respectively. For
1999, 1998 and 1997, respectively, real estate of $20.5 million, $7.1
million and $152.0 million was acquired in satisfaction of debt. At
December 31, 1999 and 1998, the Company owned $443.9 million and $552.3
million, respectively, of real estate acquired in satisfaction of debt.
Depreciation of real estate held for production of income is computed using
the straight-line method over the estimated useful lives of the properties,
which generally range from 40 to 50 years. Accumulated depreciation on real
estate was $251.6 million and $374.8 million at December 31, 1999 and 1998,
respectively. Depreciation expense on real estate totaled $21.8 million,
$30.5 million and $74.9 million for 1999, 1998 and 1997, respectively.
F-15
<PAGE>
4) JOINT VENTURES AND PARTNERSHIPS
Summarized combined financial information for real estate joint ventures
(25 individual ventures at both December 31, 1999 and 1998) and for limited
partnership interests accounted for under the equity method, in which the
Company has an investment of $10.0 million or greater and an equity
interest of 10% or greater, follows:
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------
1999 1998
------------- -------------
(IN MILLIONS)
<S> <C> <C>
BALANCE SHEETS
Investments in real estate, at depreciated cost........................ $ 861.1 $ 913.7
Investments in securities, generally at estimated fair value........... 678.4 636.9
Cash and cash equivalents.............................................. 68.4 85.9
Other assets........................................................... 239.3 279.8
------------- -------------
Total Assets........................................................... $ 1,847.2 $ 1,916.3
============= =============
Borrowed funds - third party........................................... $ 354.2 $ 367.1
Borrowed funds - AXA Financial......................................... 28.9 30.1
Other liabilities...................................................... 313.9 197.2
------------- -------------
Total liabilities...................................................... 697.0 594.4
------------- -------------
Partners' capital...................................................... 1,150.2 1,321.9
------------- -------------
Total Liabilities and Partners' Capital................................ $ 1,847.2 $ 1,916.3
============= =============
Equity in partners' capital included above............................. $ 316.5 $ 365.6
Equity in limited partnership interests not included above and other... 524.1 390.1
------------- -------------
Carrying Value......................................................... $ 840.6 $ 755.7
============= =============
</TABLE>
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
STATEMENTS OF EARNINGS
Revenues of real estate joint ventures............. $ 180.5 $ 246.1 $ 310.5
Revenues of other limited partnership interests.... 455.1 128.9 506.3
Interest expense - third party..................... (39.8) (33.3) (91.8)
Interest expense - AXA Financial................... (2.5) (2.6) (7.2)
Other expenses..................................... (139.0) (197.0) (263.6)
------------- ------------ ------------
Net Earnings....................................... $ 454.3 $ 142.1 $ 454.2
============= ============ ============
Equity in net earnings included above.............. $ 10.5 $ 44.4 $ 76.7
Equity in net earnings of limited partnership
interests not included above..................... 76.0 37.9 69.5
Other.............................................. - - (.9)
------------- ------------ ------------
Total Equity in Net Earnings....................... $ 86.5 $ 82.3 $ 145.3
============= ============ ============
</TABLE>
F-16
<PAGE>
5) NET INVESTMENT INCOME AND INVESTMENT GAINS (LOSSES)
The sources of net investment income follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Fixed maturities................................... $ 1,499.8 $ 1,489.0 $ 1,459.4
Mortgage loans on real estate...................... 253.4 235.4 260.8
Equity real estate................................. 250.2 356.1 390.4
Other equity investments........................... 165.1 83.8 156.9
Policy loans....................................... 143.8 144.9 177.0
Other investment income............................ 161.3 185.7 181.7
------------- ------------ ------------
Gross investment income.......................... 2,473.6 2,494.9 2,626.2
Investment expenses.............................. (232.7) (266.8) (343.4)
------------- ------------ ------------
Net Investment Income.............................. $ 2,240.9 $ 2,228.1 $ 2,282.8
============= ============ ============
</TABLE>
Investment (losses) gains, net, including changes in the valuation
allowances, follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Fixed maturities................................... $ (290.9) $ (24.3) $ 88.1
Mortgage loans on real estate...................... (3.3) (10.9) (11.2)
Equity real estate................................. (2.4) 74.5 (391.3)
Other equity investments........................... 88.1 29.9 14.1
Sale of subsidiaries............................... - (2.6) 252.1
Issuance and sales of Alliance Units............... 5.5 19.8 -
Issuance and sales of DLJ common stock............. 106.0 18.2 3.0
Other.............................................. .1 (4.4) -
------------- ------------ ------------
Investment (Losses) Gains, Net..................... $ (96.9) $ 100.2 $ (45.2)
============= ============ ============
</TABLE>
Writedowns of fixed maturities amounted to $223.2 million, $101.6 million
and $11.7 million for 1999, 1998 and 1997, respectively, and writedowns of
equity real estate amounted to $136.4 million for 1997. In fourth quarter
1997, the Company reclassified $1,095.4 million depreciated cost of equity
real estate from real estate held for the production of income to real
estate held for sale. Additions to valuation allowances of $227.6 million
were recorded upon these transfers. Additionally, in fourth quarter 1997,
$132.3 million of writedowns on real estate held for production of income
were recorded.
For 1999, 1998 and 1997, respectively, proceeds received on sales of fixed
maturities classified as available for sale amounted to $7,138.6 million,
$15,961.0 million and $9,789.7 million. Gross gains of $74.7 million,
$149.3 million and $166.0 million and gross losses of $214.3 million, $95.1
million and $108.8 million, respectively, were realized on these sales. The
change in unrealized investment (losses) gains related to fixed maturities
classified as available for sale for 1999, 1998 and 1997 amounted to
$(1,313.8) million, $(331.7) million and $513.4 million, respectively.
On January 1, 1999, investments in publicly-traded common equity securities
in the General Account portfolio within other equity investments amounting
to $102.3 million were transferred from available for sale securities to
trading securities. As a result of this transfer, unrealized investment
gains of $83.3 million ($43.2 million net of related DAC and Federal income
taxes) were recognized as realized investment gains in the consolidated
statements of earnings. Net unrealized holding gains of $7.0 million were
included in net investment income in the consolidated statements of
earnings for 1999. These trading securities had a carrying value of $14.1
million and costs of $7.2 million at December 31, 1999.
F-17
<PAGE>
During 1999, DLJ completed its offering of a new class of its Common Stock
to track the financial performance of DLJdirect, its online brokerage
business. As a result of this offering, the Company recorded a non-cash
pre-tax realized gain of $95.8 million.
For 1999, 1998 and 1997, investment results passed through to certain
participating group annuity contracts as interest credited to
policyholders' account balances amounted to $131.5 million, $136.9 million
and $137.5 million, respectively.
In 1997, Equitable Life sold EREIM (other than its interest in Column
Financial, Inc.) ("ERE") to Lend Lease Corporation Limited ("Lend Lease"),
for $400.0 million and recognized an investment gain of $162.4 million, net
of Federal income tax of $87.4 million. Equitable Life entered into
long-term advisory agreements whereby ERE continues to provide
substantially the same services to Equitable Life's General Account and
Separate Accounts, for substantially the same fees, as provided prior to
the sale. Through June 10, 1997, the businesses sold reported combined
revenues of $91.6 million and combined net earnings of $10.7 million.
On June 30, 1997, Alliance reduced the recorded value of goodwill and
contracts associated with Alliance's 1996 acquisition of Cursitor Holdings
L.P. and Cursitor Holdings Limited (collectively, "Cursitor") by $120.9
million since Cursitor's business fundamentals no longer supported the
carrying value of its investment. The Company's earnings from continuing
operations for 1997 included a charge of $59.5 million, net of a Federal
income tax benefit of $10.0 million and minority interest of $51.4 million.
The remaining balance of intangible assets is being amortized over its
estimated useful life of 20 years.
Net unrealized investment gains (losses), included in the consolidated
balance sheets as a component of accumulated comprehensive income and the
changes for the corresponding years, follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Balance, beginning of year......................... $ 384.1 $ 533.6 $ 189.9
Changes in unrealized investment (losses) gains.... (1,486.6) (242.4) 543.3
Changes in unrealized investment losses
(gains) attributable to:
Participating group annuity contracts.......... 24.7 (5.7) 53.2
DAC............................................ 208.6 13.2 (89.0)
Deferred Federal income taxes.................. 476.4 85.4 (163.8)
------------- ------------ ------------
Balance, End of Year............................... $ (392.8) $ 384.1 $ 533.6
============= ============ ============
Balance, end of year comprises:
Unrealized investment (losses) gains on:
Fixed maturities............................... $ (773.9) $ 539.9 $ 871.2
Other equity investments....................... (16.3) 92.4 33.7
Other, principally Closed Block................ 46.8 111.1 80.9
------------- ------------ ------------
Total........................................ (743.4) 743.4 985.8
Amounts of unrealized investment gains
attributable to:
Participating group annuity contracts........ - (24.7) (19.0)
DAC.......................................... 80.8 (127.8) (141.0)
Deferred Federal income taxes................ 269.8 (206.8) (292.2)
------------- ------------ ------------
Total.............................................. $ (392.8) $ 384.1 $ 533.6
============= ============ ============
</TABLE>
Changes in unrealized gains (losses) reflect changes in fair value of only
those fixed maturities and equity securities classified as available for
sale and do not reflect any changes in fair value of policyholders' account
balances and future policy benefits.
F-18
<PAGE>
6) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Accumulated other comprehensive income (loss) represents cumulative gains
and losses on items that are not reflected in earnings. The balances for
the past three years follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Unrealized (losses) gains on investments........... $ (392.8) $ 384.1 $ 533.6
Minimum pension liability.......................... (.1) (28.3) (17.3)
------------- ------------ ------------
Total Accumulated Other
Comprehensive (Loss) Income...................... $ (392.9) $ 355.8 $ 516.3
============= ============ ============
</TABLE>
The components of other comprehensive income (loss) for the past three
years follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Net unrealized (losses) gains on investment
securities:
Net unrealized (losses) gains arising during
the period..................................... $ (1,682.3) $ (186.1) $ 564.0
Adjustment to reclassify losses (gains)
included in net earnings during the period..... 195.7 (56.3) (20.7)
------------- ------------ ------------
Net unrealized (losses) gains on investment
securities..................................... (1,486.6) (242.4) 543.3
Adjustments for policyholder liabilities,
DAC and deferred Federal income taxes.......... 709.7 92.9 (199.6)
------------- ------------ ------------
Change in unrealized losses (gains), net of
adjustments.................................... (776.9) (149.5) 343.7
Change in minimum pension liability................ 28.2 (11.0) (4.4)
------------- ------------ ------------
Total Other Comprehensive (Loss) Income............ $ (748.7) $ (160.5) $ 339.3
============= ============ ============
</TABLE>
F-19
<PAGE>
7) CLOSED BLOCK
Summarized financial information for the Closed Block follows:
<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C
BALANCE SHEETS
Fixed Maturities:
Available for sale, at estimated fair value (amortized cost,
$4,144.8 and $4,149.0)........................................... $ 4,014.0 $ 4,373.2
Mortgage loans on real estate........................................ 1,704.2 1,633.4
Policy loans......................................................... 1,593.9 1,641.2
Cash and other invested assets....................................... 194.4 86.5
DAC.................................................................. 895.5 676.5
Other assets......................................................... 205.3 221.6
------------ ------------
Total Assets......................................................... $ 8,607.3 $ 8,632.4
============ ============
Future policy benefits and policyholders' account balances........... $ 9,011.7 $ 9,013.1
Other liabilities.................................................... 13.3 63.9
------------ ------------
Total Liabilities.................................................... $ 9,025.0 $ 9,077.0
============ ============
</TABLE>
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
STATEMENTS OF EARNINGS
Premiums and other revenue......................... $ 619.1 $ 661.7 $ 687.1
Investment income (net of investment
expenses of $15.8, $15.5 and $27.0).............. 574.2 569.7 574.9
Investment (losses) gains, net..................... (11.3) .5 (42.4)
------------- ------------ ------------
Total revenues............................... 1,182.0 1,231.9 1,219.6
------------- ------------ ------------
Policyholders' benefits and dividends.............. 1,024.7 1,082.0 1,066.7
Other operating costs and expenses................. 70.9 62.8 50.4
------------- ------------ ------------
Total benefits and other deductions.......... 1,095.6 1,144.8 1,117.1
------------- ------------ ------------
Contribution from the Closed Block................. $ 86.4 $ 87.1 $ 102.5
============= ============ ============
</TABLE>
Impaired mortgage loans along with the related provision for losses
follows:
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------
1999 1998
------------- -------------
(IN MILLIONS)
<S> <C> <C>
Impaired mortgage loans with provision for losses...................... $ 26.8 $ 55.5
Impaired mortgage loans without provision for losses................... 4.5 7.6
------------- -------------
Recorded investment in impaired mortgages.............................. 31.3 63.1
Provision for losses................................................... (4.1) (10.1)
------------- -------------
Net Impaired Mortgage Loans............................................ $ 27.2 $ 53.0
============= =============
</TABLE>
During 1999, 1998 and 1997, the Closed Block's average recorded investment
in impaired mortgage loans was $37.0 million, $85.5 million and $110.2
million, respectively. Interest income recognized on these impaired
mortgage loans totaled $3.3 million, $4.7 million and $9.4 million ($.3
million, $1.5 million and $4.1 million recognized on a cash basis) for
1999, 1998 and 1997, respectively.
F-20
<PAGE>
Valuation allowances amounted to $4.6 million and $11.1 million on mortgage
loans on real estate and $24.7 million and $15.4 million on equity real
estate at December 31, 1999 and 1998, respectively. Writedowns of fixed
maturities amounted to $3.5 million for 1997. Writedowns of equity real
estate amounted to $28.8 million for 1997.
In fourth quarter 1997, $72.9 million depreciated cost of equity real
estate held for production of income was reclassified to equity real estate
held for sale. Additions to valuation allowances of $15.4 million were
recorded upon these transfers. Also in fourth quarter 1997, $28.8 million
of writedowns on real estate held for production of income were recorded.
Many expenses related to Closed Block operations are charged to operations
outside of the Closed Block; accordingly, the contribution from the Closed
Block does not represent the actual profitability of the Closed Block
operations. Operating costs and expenses outside of the Closed Block are,
therefore, disproportionate to the business outside of the Closed Block.
F-21
<PAGE>
8) DISCONTINUED OPERATIONS
Summarized financial information for discontinued operations follows:
<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C>
BALANCE SHEETS
Mortgage loans on real estate........................................ $ 454.6 $ 553.9
Equity real estate................................................... 426.6 611.0
Other equity investments............................................. 55.8 115.1
Other invested assets................................................ 87.1 24.9
------------ ------------
Total investments.................................................. 1,024.1 1,304.9
Cash and cash equivalents............................................ 164.5 34.7
Other assets......................................................... 213.0 219.0
------------ ------------
Total Assets......................................................... $ 1,401.6 $ 1,558.6
============ ============
Policyholders' liabilities........................................... $ 993.3 $ 1,021.7
Allowance for future losses.......................................... 242.2 305.1
Other liabilities.................................................... 166.1 231.8
------------ ------------
Total Liabilities.................................................... $ 1,401.6 $ 1,558.6
============ ============
</TABLE>
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
STATEMENTS OF EARNINGS
Investment income (net of investment
expenses of $49.3, $63.3 and $97.3).............. $ 98.7 $ 160.4 $ 188.6
Investment (losses) gains, net..................... (13.4) 35.7 (173.7)
Policy fees, premiums and other income............. .2 (4.3) .2
------------- ------------ ------------
Total revenues..................................... 85.5 191.8 15.1
Benefits and other deductions...................... 104.8 141.5 169.5
(Losses charged) earnings credited to allowance
for future losses................................ (19.3) 50.3 (154.4)
------------- ------------ ------------
Pre-tax loss from operations....................... - - -
Pre-tax earnings from releasing (loss from
strengthening) the allowance for future
losses........................................... 43.3 4.2 (134.1)
Federal income tax (expense) benefit............... (15.2) (1.5) 46.9
------------- ------------ ------------
Earnings (Loss) from Discontinued Operations....... $ 28.1 $ 2.7 $ (87.2)
============= ============ ============
</TABLE>
The Company's quarterly process for evaluating the allowance for future
losses applies the current period's results of the discontinued operations
against the allowance, re-estimates future losses and adjusts the
allowance, if appropriate. Additionally, as part of the Company's annual
planning process which takes place in the fourth quarter of each year,
investment and benefit cash flow projections are prepared. These updated
assumptions and estimates resulted in a release of allowance in 1999 and
1998 and strengthening of allowance in 1997.
In fourth quarter 1997, $329.9 million depreciated cost of equity real
estate was reclassified from equity real estate held for production of
income to real estate held for sale. Additions to valuation allowances of
$79.8 million were recognized upon these transfers. Also in fourth quarter
1997, $92.5 million of writedowns on real estate held for production of
income were recognized.
F-22
<PAGE>
Benefits and other deductions includes $26.6 million and $53.3 million of
interest expense related to amounts borrowed from continuing operations in
1998 and 1997, respectively.
Valuation allowances of $1.9 million and $3.0 million on mortgage loans on
real estate and $54.8 million and $34.8 million on equity real estate were
held at December 31, 1999 and 1998, respectively. Writedowns of equity real
estate were $95.7 million in 1997.
During 1999, 1998 and 1997, discontinued operations' average recorded
investment in impaired mortgage loans was $13.8 million, $73.3 million and
$89.2 million, respectively. Interest income recognized on these impaired
mortgage loans totaled $1.7 million, $4.7 million and $6.6 million ($.0
million, $3.4 million and $5.3 million recognized on a cash basis) for
1999, 1998 and 1997, respectively.
At December 31, 1999 and 1998, discontinued operations had real estate
acquired in satisfaction of debt with carrying values of $24.1 million and
$50.0 million, respectively.
9) SHORT-TERM AND LONG-TERM DEBT
Short-term and long-term debt consists of the following:
<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C>
Short-term debt...................................................... $ 557.0 $ 179.3
------------ ------------
Long-term debt:
Equitable Life:
Surplus notes, 6.95% due 2005...................................... 399.5 399.4
Surplus notes, 7.70% due 2015...................................... 199.7 199.7
Other.............................................................. .4 .3
------------ ------------
Total Equitable Life........................................... 599.6 599.4
------------ ------------
Wholly Owned and Joint Venture Real Estate:
Mortgage notes, 5.43% - 9.5%, due through 2017..................... 251.3 392.2
------------ ------------
Alliance:
Other.............................................................. - 10.8
------------ ------------
Total long-term debt................................................. 850.9 1,002.4
------------ ------------
Total Short-term and Long-term Debt.................................. $ 1,407.9 $ 1,181.7
============ ============
</TABLE>
Short-term Debt
---------------
Equitable Life has a $700.0 million bank credit facility available to fund
short-term working capital needs and to facilitate the securities
settlement process. The credit facility consists of two types of borrowing
options with varying interest rates and expires in September 2000. The
interest rates are based on external indices dependent on the type of
borrowing and at December 31, 1999 range from 5.76% to 8.5%. There were no
borrowings outstanding under this bank credit facility at December 31,
1999.
Equitable Life has a commercial paper program with an issue limit of $1.0
billion. This program is available for general corporate purposes used to
support Equitable Life's liquidity needs and is supported by Equitable
Life's existing $700.0 million bank credit facility. At December 31, 1999,
there were $166.9 million outstanding under this program.
Alliance has a $425.0 million five-year revolving credit facility with a
group of commercial banks. Under the facility, the interest rate, at the
option of Alliance, is a floating rate generally based upon a defined prime
rate, a rate related to the London Interbank Offered Rate ("LIBOR") or the
Federal Funds Rate. A facility fee is payable on the total facility. During
July 1999, Alliance increased the size of its commercial paper program by
$200.0 million from $425.0 million for a total available limit of $625.0
million. Borrowings from the revolving credit facility and the original
commercial paper program may not exceed $425.0 million in the aggregate.
The revolving credit facility provides backup liquidity for commercial
paper issued under
F-23
<PAGE>
Alliance's commercial paper program and can be used as a direct source of
borrowing. The revolving credit facility contains covenants that require
Alliance to, among other things, meet certain financial ratios. At December
31, 1999, Alliance had commercial paper outstanding totaling $384.7 million
at an effective interest rate of 5.9%; there were no borrowings outstanding
under Alliance's revolving credit facility.
In December 1999, Alliance established a $100.0 million extendible
commercial notes ("ECN") program to supplement its commercial paper
program. ECN's are short-term debt instruments that do not require any
back-up liquidity support.
Long-term Debt
--------------
Several of the long-term debt agreements have restrictive covenants related
to the total amount of debt, net tangible assets and other matters. At
December 31, 1999, the Company is in compliance with all debt covenants.
The Company has pledged real estate, mortgage loans, cash and securities
amounting to $323.6 million and $640.2 million at December 31, 1999 and
1998, respectively, as collateral for certain short-term and long-term
debt.
At December 31, 1999, aggregate maturities of the long-term debt based on
required principal payments at maturity was $3.0 million for 2000 and
$848.7 million for 2005 and thereafter.
10) FEDERAL INCOME TAXES
A summary of the Federal income tax expense in the consolidated statements
of earnings follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Federal income tax expense (benefit):
Current.......................................... $ 174.0 $ 283.3 $ 186.5
Deferred......................................... 158.0 69.8 (95.0)
------------- ------------ ------------
Total.............................................. $ 332.0 $ 353.1 $ 91.5
============= ============ ============
</TABLE>
F-24
<PAGE>
The Federal income taxes attributable to consolidated operations are
different from the amounts determined by multiplying the earnings before
Federal income taxes and minority interest by the expected Federal income
tax rate of 35%. The sources of the difference and their tax effects
follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Expected Federal income tax expense................ $ 458.4 $ 414.3 $ 234.7
Non-taxable minority interest...................... (47.8) (33.2) (38.0)
Non-taxable subsidiary gains....................... (37.1) (6.4) -
Adjustment of tax audit reserves................... 27.8 16.0 (81.7)
Equity in unconsolidated subsidiaries.............. (64.0) (39.3) (45.1)
Other.............................................. (5.3) 1.7 21.6
------------- ------------ ------------
Federal Income Tax Expense......................... $ 332.0 $ 353.1 $ 91.5
============= ============ ============
</TABLE>
The components of the net deferred Federal income taxes are as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1999 December 31, 1998
----------------------------- -----------------------------
ASSETS LIABILITIES Assets Liabilities
----------- ------------ ------------ -----------
(IN MILLIONS)
<S> <C> <C> <C> <C>
Compensation and related benefits...... $ - $ 37.7 $ 235.3 $ -
Other.................................. - 20.6 27.8 -
DAC, reserves and reinsurance.......... - 329.7 - 231.4
Investments............................ 115.1 - - 364.4
----------- ------------ ------------ -----------
Total.................................. $ 115.1 $ 388.0 $ 263.1 $ 595.8
=========== ============ ============ ===========
</TABLE>
At December 31, 1999, in conjunction with the non-qualified employee
benefit plans, $236.8 million in deferred tax asset was transferred to the
Holding Company. See Note 12 for discussion of the benefit plans
transferred.
The deferred Federal income taxes impacting operations reflect the net tax
effects of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for
income tax purposes. The sources of these temporary differences and their
tax effects follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
DAC, reserves and reinsurance...................... $ 83.2 $ (7.7) $ 46.2
Investments........................................ 3.2 46.8 (113.8)
Compensation and related benefits.................. 21.0 28.6 3.7
Other.............................................. 50.6 2.1 (31.1)
------------- ------------ ------------
Deferred Federal Income Tax
Expense (Benefit)................................ $ 158.0 $ 69.8 $ (95.0)
============= ============ ============
</TABLE>
The Internal Revenue Service (the "IRS") is in the process of examining the
Holding Company's consolidated Federal income tax returns for the years
1992 through 1996. Management believes these audits will have no material
adverse effect on the Company's results of operations.
F-25
<PAGE>
11) REINSURANCE AGREEMENTS
The Insurance Group assumes and cedes reinsurance with other insurance
companies. The Insurance Group evaluates the financial condition of its
reinsurers to minimize its exposure to significant losses from reinsurer
insolvencies. Ceded reinsurance does not relieve the originating insurer of
liability. The effect of reinsurance (excluding group life and health) is
summarized as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Direct premiums.................................... $ 420.6 $ 438.8 $ 448.6
Reinsurance assumed................................ 206.7 203.6 198.3
Reinsurance ceded.................................. (69.1) (54.3) (45.4)
------------- ------------ ------------
Premiums........................................... $ 558.2 $ 588.1 $ 601.5
============= ============ ============
Universal Life and Investment-type Product
Policy Fee Income Ceded.......................... $ 69.7 $ 75.7 $ 61.0
============= ============ ============
Policyholders' Benefits Ceded...................... $ 99.6 $ 85.9 $ 70.6
============= ============ ============
Interest Credited to Policyholders' Account
Balances Ceded................................... $ 38.5 $ 39.5 $ 36.4
============= ============ ============
</TABLE>
Since 1997, the Company reinsures on a yearly renewal term basis 90% of the
mortality risk on new issues of certain term, universal and variable life
products. The Company's retention limit on joint survivorship policies is
$15.0 million. All in force business above $5.0 million is reinsured. The
Insurance Group also reinsures the entire risk on certain substandard
underwriting risks and in certain other cases.
The Insurance Group cedes 100% of its group life and health business to a
third party insurer. Premiums ceded totaled $.1 million, $1.3 million and
$1.6 million for 1999, 1998 and 1997, respectively. Ceded death and
disability benefits totaled $44.7 million, $15.6 million and $4.3 million
for 1999, 1998 and 1997, respectively. Insurance liabilities ceded totaled
$510.5 million and $560.3 million at December 31, 1999 and 1998,
respectively.
F-26
<PAGE>
12) EMPLOYEE BENEFIT PLANS
The Company sponsors qualified and non-qualified defined benefit plans
covering substantially all employees (including certain qualified part-time
employees), managers and certain agents. The pension plans are
non-contributory. Equitable Life's benefits are based on a cash balance
formula or years of service and final average earnings, if greater, under
certain grandfathering rules in the plans. Alliance's benefits are based on
years of credited service, average final base salary and primary social
security benefits. The Company's funding policy is to make the minimum
contribution required by the Employee Retirement Income Security Act of
1974 ("ERISA").
Effective December 31, 1999, the Holding Company legally assumed primary
liability from Equitable Life for all current and future obligations of its
Excess Retirement Plan, Supplemental Executive Retirement Plan and certain
other employee benefit plans that provide participants with medical, life
insurance, and deferred compensation benefits; Equitable Life remains
secondarily liable. The amount of the liability associated with employee
benefits transferred was $676.5 million, including $183.0 million of
non-qualified pension benefit obligations and $394.1 million of
postretirement benefits obligations at December 31, 1999. This transfer was
recorded as a non-cash capital contribution to Equitable Life.
Components of net periodic pension (credit) cost for the qualified and
non-qualified plans follow:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Service cost....................................... $ 36.7 $ 33.2 $ 32.5
Interest cost on projected benefit obligations..... 131.6 129.2 128.2
Actual return on assets............................ (189.8) (175.6) (307.6)
Net amortization and deferrals..................... 7.5 6.1 166.6
------------- ------------ ------------
Net Periodic Pension Cost (Credit)................. $ (14.0) $ (7.1) $ 19.7
============= ============ ============
</TABLE>
The projected benefit obligations under the qualified and non-qualified
pension plans were comprised of:
<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C>
Benefit obligations, beginning of year................................. $ 1,933.4 $ 1,801.3
Service cost........................................................... 36.7 33.2
Interest cost.......................................................... 131.6 129.2
Actuarial (gains) losses............................................... (53.3) 108.4
Benefits paid.......................................................... (123.1) (138.7)
------------ ------------
Subtotal before transfer............................................... 1,925.3 1,933.4
Transfer of Non-qualified Pension Benefit Obligation
to the Holding Company............................................... (262.5) -
------------ ------------
Benefit Obligation, End of Year........................................ $ 1,662.8 $ 1,933.4
============ ============
</TABLE>
F-27
<PAGE>
The funded status of the qualified and non-qualified pension plans was as
follows:
<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C>
Plan assets at fair value, beginning of year........................... $ 2,083.1 $ 1,867.4
Actual return on plan assets........................................... 369.0 338.9
Contributions.......................................................... .1 -
Benefits paid and fees................................................. (108.5) (123.2)
------------ ------------
Plan assets at fair value, end of year................................. 2,343.7 2,083.1
Projected benefit obligations.......................................... 1,925.3 1,933.4
------------ ------------
Excess of plan assets over projected benefit obligations............... 418.4 149.7
Unrecognized prior service cost........................................ (5.2) (7.5)
Unrecognized net (gain) loss from past experience different
from that assumed.................................................... (197.3) 38.7
Unrecognized net asset at transition................................... (.1) 1.5
------------ ------------
Subtotal before transfer............................................... 215.8 182.4
Transfer of Accrued Non-qualified Pension Benefit Obligation
to the Holding Company............................................... 183.0 -
------------ ------------
Prepaid Pension Cost, Net.............................................. $ 398.8 $ 182.4
============ ============
</TABLE>
The prepaid pension cost for pension plans with assets in excess of
projected benefit obligations was $412.2 million and $363.9 million and the
accrued liability for pension plans with projected benefit obligations in
excess of plan assets was $13.5 million and $181.5 million at December 31,
1999 and 1998, respectively.
The pension plan assets include corporate and government debt securities,
equity securities, equity real estate and shares of group trusts managed by
Alliance. The discount rate and rate of increase in future compensation
levels used in determining the actuarial present value of projected benefit
obligations were 8.0% and 6.38%, respectively, at December 31, 1999 and
7.0% and 3.83%, respectively, at December 31, 1998. As of January 1, 1999
and 1998, the expected long-term rate of return on assets for the
retirement plan was 10.0% and 10.25%, respectively.
The Company recorded, as a reduction of shareholder's equity, an additional
minimum pension liability of $.1 million, $28.3 million and $17.3 million,
net of Federal income taxes, at December 31, 1999, 1998 and 1997,
respectively, primarily representing the excess of the accumulated benefit
obligation of the non-qualified pension plan over the accrued liability.
The aggregate accumulated benefit obligation and fair value of plan assets
for pension plans with accumulated benefit obligations in excess of plan
assets were $325.7 million and $36.3 million, respectively, at December 31,
1999 and $309.7 million and $34.5 million, respectively, at December 31,
1998.
Prior to 1987, the qualified plan funded participants' benefits through the
purchase of non-participating annuity contracts from Equitable Life.
Benefit payments under these contracts were approximately $30.2 million,
$31.8 million and $33.2 million for 1999, 1998 and 1997, respectively.
The Company provides certain medical and life insurance benefits
(collectively, "postretirement benefits") for qualifying employees,
managers and agents retiring from the Company (i) on or after attaining age
55 who have at least 10 years of service or (ii) on or after attaining age
65 or (iii) whose jobs have been abolished and who have attained age 50
with 20 years of service. The life insurance benefits are related to age
and salary at retirement. The costs of postretirement benefits are
recognized in accordance with the provisions of SFAS No. 106. The Company
continues to fund postretirement benefits costs on a pay-as-you-go basis
and, for 1999, 1998 and 1997, the Company made estimated postretirement
benefits payments of $29.5 million, $28.4 million and $18.7 million,
respectively.
F-28
<PAGE>
The following table sets forth the postretirement benefits plan's status,
reconciled to amounts recognized in the Company's consolidated financial
statements:
<TABLE>
<CAPTION>
1999 1998 1997
----------------- ---------------- -----------------
(IN MILLIONS)
<S> <C> <C> <C>
Service cost....................................... $ 4.7 $ 4.6 $ 4.5
Interest cost on accumulated postretirement
benefits obligation.............................. 34.4 33.6 34.7
Unrecognized prior service costs................... (7.0) - -
Net amortization and deferrals..................... 8.4 .5 1.9
----------------- ---------------- -----------------
Net Periodic Postretirement Benefits Costs......... $ 40.5 $ 38.7 $ 41.1
================= ================ =================
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C>
Accumulated postretirement benefits obligation, beginning
of year.............................................................. $ 490.4 $ 490.8
Service cost........................................................... 4.7 4.6
Interest cost.......................................................... 34.4 33.6
Contributions and benefits paid........................................ (29.5) (28.4)
Actuarial gains........................................................ (29.0) (10.2)
------------ ------------
Accumulated postretirement benefits obligation, end of year............ 471.0 490.4
Unrecognized prior service cost........................................ 26.9 31.8
Unrecognized net loss from past experience different
from that assumed and from changes in assumptions.................... (86.0) (121.2)
------------ ------------
Subtotal before transfer............................................... 411.9 401.0
Transfer to the Holding Company........................................ (394.1) -
------------ ------------
Accrued Postretirement Benefits Cost................................... $ 17.8 $ 401.0
============ ============
</TABLE>
Since January 1, 1994, costs to the Company for providing these medical
benefits available to retirees under age 65 are the same as those offered
to active employees and medical benefits will be limited to 200% of 1993
costs for all participants.
The assumed health care cost trend rate used in measuring the accumulated
postretirement benefits obligation was 7.5% in 1999, gradually declining to
4.75% in the year 2010, and in 1998 was 8.0%, gradually declining to 2.5%
in the year 2009. The discount rate used in determining the accumulated
postretirement benefits obligation was 8.0% and 7.0% at December 31, 1999
and 1998, respectively.
If the health care cost trend rate assumptions were increased by 1%, the
accumulated postretirement benefits obligation as of December 31, 1999
would be increased 3.55%. The effect of this change on the sum of the
service cost and interest cost would be an increase of 3.91%. If the health
care cost trend rate assumptions were decreased by 1% the accumulated
postretirement benefits obligation as of December 31, 1999 would be
decreased by 4.38%. The effect of this change on the sum of the service
cost and interest cost would be a decrease of 4.96%.
F-29
<PAGE>
13) DERIVATIVES AND FAIR VALUE OF FINANCIAL INSTRUMENTS
Derivatives
-----------
The Insurance Group primarily uses derivatives for asset/liability risk
management and for hedging individual securities. Derivatives mainly are
utilized to reduce the Insurance Group's exposure to interest rate
fluctuations. Accounting for interest rate swap transactions is on an
accrual basis. Gains and losses related to interest rate swap transactions
are amortized as yield adjustments over the remaining life of the
underlying hedged security. Income and expense resulting from interest rate
swap activities are reflected in net investment income. The notional amount
of matched interest rate swaps outstanding at December 31, 1999 and 1998,
respectively, was $797.3 million and $880.9 million. The average unexpired
terms at December 31, 1999 ranged from two months to 5.0 years. At December
31, 1999, the cost of terminating swaps in a loss position was $1.8
million. Equitable Life maintains an interest rate cap program designed to
hedge crediting rates on interest-sensitive individual annuities contracts.
The outstanding notional amounts at December 31, 1999 of contracts
purchased and sold were $7,575.0 million and $875.0 million, respectively.
The net premium paid by Equitable Life on these contracts was $51.6 million
and is being amortized ratably over the contract periods ranging from 1 to
4 years. Income and expense resulting from this program are reflected as an
adjustment to interest credited to policyholders' account balances.
DLJ enters into certain contractual agreements referred to as derivatives
or off-balance-sheet financial instruments primarily for trading purposes
and to provide products for its clients. DLJ performs the following
activities: writing over-the-counter ("OTC") options to accommodate
customer needs; trading in forward contracts in U.S. government and agency
issued or guaranteed securities; trading in futures contracts on equity
based indices, interest rate instruments, and currencies; and issuing
structured products based on emerging market financial instruments and
indices. DLJ also enters into swap agreements, primarily equity, interest
rate and foreign currency swaps. DLJ is not significantly involved in
commodity derivative instruments.
Fair Value of Financial Instruments
-----------------------------------
The Company defines fair value as the quoted market prices for those
instruments that are actively traded in financial markets. In cases where
quoted market prices are not available, fair values are estimated using
present value or other valuation techniques. The fair value estimates are
made at a specific point in time, based on available market information and
judgments about the financial instrument, including estimates of the timing
and amount of expected future cash flows and the credit standing of
counterparties. Such estimates do not reflect any premium or discount that
could result from offering for sale at one time the Company's entire
holdings of a particular financial instrument, nor do they consider the tax
impact of the realization of unrealized gains or losses. In many cases, the
fair value estimates cannot be substantiated by comparison to independent
markets, nor can the disclosed value be realized in immediate settlement of
the instrument.
Certain financial instruments are excluded, particularly insurance
liabilities other than financial guarantees and investment contracts. Fair
market value of off-balance-sheet financial instruments of the Insurance
Group was not material at December 31, 1999 and 1998.
F-30
<PAGE>
Fair values for mortgage loans on real estate are estimated by discounting
future contractual cash flows using interest rates at which loans with
similar characteristics and credit quality would be made. Fair values for
foreclosed mortgage loans and problem mortgage loans are limited to the
estimated fair value of the underlying collateral if lower.
Fair values of policy loans are estimated by discounting the face value of
the loans from the time of the next interest rate review to the present, at
a rate equal to the excess of the current estimated market rates over the
current interest rate charged on the loan.
The estimated fair values for the Company's association plan contracts,
supplementary contracts not involving life contingencies ("SCNILC") and
annuities certain, which are included in policyholders' account balances,
and guaranteed interest contracts are estimated using projected cash flows
discounted at rates reflecting expected current offering rates.
The estimated fair values for variable deferred annuities and single
premium deferred annuities ("SPDA"), which are included in policyholders'
account balances, are estimated by discounting the account value back from
the time of the next crediting rate review to the present, at a rate equal
to the excess of current estimated market rates offered on new policies
over the current crediting rates.
Fair values for long-term debt are determined using published market
values, where available, or contractual cash flows discounted at market
interest rates. The estimated fair values for non-recourse mortgage debt
are determined by discounting contractual cash flows at a rate which takes
into account the level of current market interest rates and collateral
risk. The estimated fair values for recourse mortgage debt are determined
by discounting contractual cash flows at a rate based upon current interest
rates of other companies with credit ratings similar to the Company. The
Company's carrying value of short-term borrowings approximates their
estimated fair value.
The following table discloses carrying value and estimated fair value for
financial instruments not otherwise disclosed in Notes 3, 7 and 8:
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------------------------------
1999 1998
--------------------------------- ---------------------------------
CARRYING ESTIMATED Carrying Estimated
VALUE FAIR VALUE Value Fair Value
--------------- ---------------- --------------- ---------------
(IN MILLIONS)
<S> <C> <C> <C> <C>
Consolidated Financial Instruments:
-----------------------------------
Mortgage loans on real estate.......... $ 3,270.0 $ 3,239.3 $ 2,809.9 $ 2,961.8
Other limited partnership interests.... 647.9 647.9 562.6 562.6
Policy loans........................... 2,257.3 2,359.5 2,086.7 2,370.7
Policyholders' account balances -
investment contracts................. 12,740.4 12,800.5 12,892.0 13,396.0
Long-term debt......................... 850.9 834.9 1,002.4 1,025.2
Closed Block Financial Instruments:
-----------------------------------
Mortgage loans on real estate.......... $ 1,704.2 $ 1,650.3 $ 1,633.4 $ 1,703.5
Other equity investments............... 36.3 36.3 56.4 56.4
Policy loans........................... 1,593.9 1,712.0 1,641.2 1,929.7
SCNILC liability....................... 22.8 22.5 25.0 25.0
Discontinued Operations Financial
---------------------------------
Instruments:
------------
Mortgage loans on real estate.......... $ 454.6 $ 467.0 $ 553.9 $ 599.9
Fixed maturities....................... 85.5 85.5 24.9 24.9
Other equity investments............... 55.8 55.8 115.1 115.1
Guaranteed interest contracts.......... 33.2 27.5 37.0 34.0
Long-term debt......................... 101.9 101.9 147.1 139.8
</TABLE>
F-31
<PAGE>
14) COMMITMENTS AND CONTINGENT LIABILITIES
The Company has provided, from time to time, certain guarantees or
commitments to affiliates, investors and others. These arrangements include
commitments by the Company, under certain conditions: to make capital
contributions of up to $59.4 million to affiliated real estate joint
ventures; and to provide equity financing to certain limited partnerships
of $373.8 million at December 31, 1999, under existing loan or loan
commitment agreements.
Equitable Life is the obligor under certain structured settlement
agreements which it had entered into with unaffiliated insurance companies
and beneficiaries. To satisfy its obligations under these agreements,
Equitable Life owns single premium annuities issued by previously wholly
owned life insurance subsidiaries. Equitable Life has directed payment
under these annuities to be made directly to the beneficiaries under the
structured settlement agreements. A contingent liability exists with
respect to these agreements should the previously wholly owned subsidiaries
be unable to meet their obligations. Management believes the satisfaction
of those obligations by Equitable Life is remote.
The Insurance Group had $24.9 million of letters of credit outstanding at
December 31, 1999.
15) LITIGATION
The Company
-----------
Life Insurance and Annuity Sales Cases
A number of lawsuits are pending as individual claims and purported class
actions against Equitable Life, its subsidiary insurance company and a
former insurance subsidiary. These actions involve, among other things,
sales of life and annuity products for varying periods from 1980 to the
present, and allege, among other things, sales practice misrepresentation
primarily involving: the number of premium payments required; the propriety
of a product as an investment vehicle; the propriety of a product as a
replacement of an existing policy; and failure to disclose a product as
life insurance. Some actions are in state courts and others are in U.S.
District Courts in different jurisdictions, and are in varying stages of
discovery and motions for class certification.
In general, the plaintiffs request an unspecified amount of damages,
punitive damages, enjoinment from the described practices, prohibition
against cancellation of policies for non-payment of premium or other
remedies, as well as attorneys' fees and expenses. Similar actions have
been filed against other life and health insurers and have resulted in the
award of substantial judgments, including material amounts of punitive
damages, or in substantial settlements. Although the outcome of litigation
cannot be predicted with certainty, particularly in the early stages of an
action, the Company's management believes that the ultimate resolution of
these cases should not have a material adverse effect on the financial
position of the Company. The Company's management cannot make an estimate
of loss, if any, or predict whether or not any such litigation will have a
material adverse effect on the Company's results of operations in any
particular period.
Discrimination Case
Equitable Life is a defendant in an action, certified as a class action in
September 1997, in the United States District Court for the Northern
District of Alabama, Southern Division, involving alleged discrimination on
the basis of race against African-American applicants and potential
applicants in hiring individuals as sales agents. Plaintiffs seek a
declaratory judgment and affirmative and negative injunctive relief,
including the payment of back-pay, pension and other compensation. Although
the outcome of litigation cannot be predicted with certainty, the Company's
management believes that the ultimate resolution of this matter should not
have a material adverse effect on the financial position of the Company.
The Company's management cannot make an estimate of loss, if any, or
predict whether or not such matter will have a material adverse effect on
the Company's results of operations in any particular period.
Agent Health Benefits Case
Equitable Life is a defendant in an action, certified as a class action in
March 1999, in the United States District Court for the Northern District
of California, alleging, among other things, that Equitable Life violated
ERISA by eliminating certain alternatives pursuant to which agents of
Equitable Life could qualify for health care coverage. The class consists
of "[a]ll current, former and retired Equitable agents, who while
F-32
<PAGE>
associated with Equitable satisfied [certain alternatives] to qualify for
health coverage or contributions thereto under applicable plans."
Plaintiffs allege various causes of action under ERISA, including claims
for enforcement of alleged promises contained in plan documents and for
enforcement of agent bulletins, breach of unilateral contract, breach of
fiduciary duty and promissory estoppel. The parties are currently engaged
in discovery. Although the outcome of any litigation cannot be predicted
with certainty, the Company's management believes that the ultimate
resolution of this matter should not have a material adverse effect on the
financial position of the Company. The Company's management cannot make an
estimate of loss, if any, or predict whether or not such matter will have a
material adverse effect on the Company's results of operations in any
particular period.
Prime Property Fund Case
In January 2000, the California Supreme Court denied the Company's petition
for review of an October 1999 decision by the California Superior Court of
Appeal. Such decision reversed the dismissal by the Supreme Court of Orange
County, California of an action which was commenced in 1995 by a real
estate developer in connection with a limited partnership formed in 1991
with the Company on behalf of Prime Property Fund ("PPF"). The Company
serves as investment manager for PPF, an open-end, commingled real estate
separate account of the Company for pension clients. Plaintiff alleges
breach of fiduciary duty and other claims principally in connection with
PPF's 1995 purchase and subsequent foreclosure of the loan which financed
the partnership's property. Plaintiff seeks compensatory and punitive
damages. The case has been remanded to the Superior Court for further
proceedings. Although the outcome of litigation cannot be predicted with
certainty, the Company's management believes that the ultimate resolution
of this matter should not have a material adverse effect on the financial
position of the Company. The Company's management cannot make an estimate
of loss, if any, or predict whether or not this matter will have a material
adverse effect on the Company's results of operations in any particular
period.
Alliance Capital
----------------
In July 1995, a class action complaint was filed against Alliance North
American Government Income Trust, Inc. (the "Fund"), Alliance Holding and
certain other defendants affiliated with Alliance, including the Holding
Company, alleging violations of Federal securities laws, fraud and breach
of fiduciary duty in connection with the Fund's investments in Mexican and
Argentine securities. The original complaint was dismissed in 1996; on
appeal, the dismissal was affirmed. In October 1996, plaintiffs filed a
motion for leave to file an amended complaint, alleging the Fund failed to
hedge against currency risk despite representations that it would do so,
the Fund did not properly disclose that it planned to invest in
mortgage-backed derivative securities and two Fund advertisements
misrepresented the risks of investing in the Fund. In October 1998, the
U.S. Court of Appeals for the Second Circuit issued an order granting
plaintiffs' motion to file an amended complaint alleging that the Fund
misrepresented its ability to hedge against currency risk and denying
plaintiffs' motion to file an amended complaint containing the other
allegations. In December 1999, the United States District Court for the
Southern District of New York granted the defendants' motion for summary
judgment on all claims against all defendants. Later in December 1999, the
plaintiffs filed motions for reconsideration of the Court's ruling. These
motions are currently pending with the Court.
In connection with the Reorganization; Alliance assumed any liabilities
which Alliance Holding may have with respect to this action. Alliance and
Alliance Holding believe that the allegations in the amended complaint are
without merit and intend to vigorously defend against these claims. While
the ultimate outcome of this matter cannot be determined at this time,
management of Alliance Holding and Alliance do not expect that it will have
a material adverse effect on Alliance Holding's or Alliance's results of
operations or financial condition.
DLJSC
-----
Donaldson, Lufkin & Jenrette Securities Corporation ("DLJSC") is a
defendant along with certain other parties in a class action complaint
involving the underwriting of units, consisting of notes and warrants to
purchase common shares, of Rickel Home Centers, Inc. ("Rickel"), which
filed a voluntary petition for reorganization pursuant to Chapter 11 of the
Bankruptcy Code. The complaint seeks unspecified compensatory and punitive
damages from DLJSC, as an underwriter and as an owner of 7.3% of the common
stock, for alleged violation of Federal securities laws and common law
fraud for alleged misstatements and omissions contained in the prospectus
and registration statement used in the offering of the units. In April
1999, the complaint against DLJSC and the other defendants was dismissed.
The plaintiffs have appealed. DLJSC intends to defend itself vigorously
against all the allegations contained in the complaint.
DLJSC is a defendant in a purported class action filed in a Texas State
Court on behalf of the holders of $550 million principal amount of
subordinated redeemable discount debentures of National Gypsum Corporation
("NGC"). The debentures were canceled in connection with a Chapter 11 plan
of reorganization for NGC consummated in July 1993. The litigation seeks
compensatory and punitive damages for DLJSC's activities as financial
advisor to NGC in the course of NGC's Chapter 11 proceedings. In March
1999, the Court granted motions for summary judgment filed by DLJSC and the
other defendants. The plaintiffs have appealed. DLJSC intends to defend
itself vigorously against all the allegations contained in the complaint.
In November 1998, three purported class actions were filed in the U.S.
District Court for the Southern District of New York against more than 25
underwriters of initial public offering securities, including DLJSC. The
complaints allege that defendants conspired to fix the "fee" paid for
underwriting initial public offering securities by setting the
underwriters' discount or "spread" at 7%, in violation of the Federal
antitrust laws. The complaints seek treble damages in an unspecified amount
and injunctive relief as well as attorneys' fees and costs. In March 1999,
the plaintiffs filed a consolidated amended complaint. A motion by all
defendants
F-33
<PAGE>
to dismiss the complaints on several grounds is pending. Separately, the
U.S. Department of Justice has issued a Civil Investigative Demand to
several investment banking firms, including DLJSC, seeking documents and
information relating to "alleged" price-fixing with respect to underwriting
spreads in initial public offerings. The Justice Department has not made
any charges against DLJSC or the other investment banking firms. DLJSC is
cooperating with the Justice Department in providing the requested
information and believes that no violation of law by DLJSC has occurred.
Although there can be no assurance, DLJ's management does not believe that
the ultimate resolution of the litigations described above to which DLJSC
is a party will have a material adverse effect on DLJ's consolidated
financial condition. Based upon the information currently available to it,
DLJ's management cannot predict whether or not such litigations will have a
material adverse effect on DLJ's results of operations in any particular
period.
Other Matters
In addition to the matters described above, the Holding Company and its
subsidiaries are involved in various legal actions and proceedings in
connection with their businesses. Some of the actions and proceedings have
been brought on behalf of various alleged classes of claimants and certain
of these claimants seek damages of unspecified amounts. While the ultimate
outcome of such matters cannot be predicted with certainty, in the opinion
of management no such matter is likely to have a material adverse effect on
the Company's consolidated financial position or results of operations.
16) LEASES
The Company has entered into operating leases for office space and certain
other assets, principally information technology equipment and office
furniture and equipment. Future minimum payments under noncancelable leases
for 2000 and the four successive years are $111.2 million, $93.3 million,
$78.3 million, $71.9 million, $66.5 million and $523.7 million thereafter.
Minimum future sublease rental income on these noncancelable leases for
2000 and the four successive years is $5.2 million, $4.1 million, $2.8
million, $2.8 million, $2.8 million and $23.8 million thereafter.
At December 31, 1999, the minimum future rental income on noncancelable
operating leases for wholly owned investments in real estate for 2000 and
the four successive years is $120.7 million, $113.5 million, $96.0 million,
$79.7 million, $74.1 million and $354.6 million thereafter.
17) OTHER OPERATING COSTS AND EXPENSES
Other operating costs and expenses consisted of the following:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C>
Compensation costs................................. $ 1,010.6 $ 772.0 $ 721.5
Commissions........................................ 549.5 478.1 409.6
Short-term debt interest expense................... 16.7 26.1 31.7
Long-term debt interest expense.................... 76.3 84.6 121.2
Amortization of policy acquisition costs........... 314.5 292.7 287.3
Capitalization of policy acquisition costs......... (709.9) (609.1) (508.0)
Writedown of policy acquisition costs.............. 131.7 - -
Rent expense, net of sublease income............... 113.9 100.0 101.8
Cursitor intangible assets writedown............... - - 120.9
Other.............................................. 1,294.0 1,056.8 917.9
------------- ------------ ------------
Total.............................................. $ 2,797.3 $ 2,201.2 $ 2,203.9
================= ================ =================
</TABLE>
F-34
<PAGE>
During 1997, the Company restructured certain operations in connection with
cost reduction programs and recorded a pre-tax provision of $42.4 million.
The amount paid during 1999 associated with cost reduction programs totaled
$15.6 million. At December 31, 1999, the remaining liabilities associated
with cost reduction programs was $8.8 million. The 1997 cost reduction
program included costs related to employee termination and exit costs.
18) INSURANCE GROUP STATUTORY FINANCIAL INFORMATION
Equitable Life is restricted as to the amounts it may pay as shareholder
dividends. Under the New York Insurance Law, the Superintendent has broad
discretion to determine whether the financial condition of a stock life
insurance company would support the payment of dividends to its
shareholders. For 1999, 1998 and 1997, statutory net income (loss) totaled
$547.0 million, $384.4 million and ($351.7) million, respectively.
Statutory surplus, capital stock and Asset Valuation Reserve ("AVR")
totaled $5,570.6 million and $4,728.0 million at December 31, 1999 and
1998, respectively. In September 1999, $150.0 million in dividends were
paid to the Holding Company by Equitable Life, the first such payment since
Equitable Life's demutualization in 1992.
At December 31, 1999, the Insurance Group, in accordance with various
government and state regulations, had $26.8 million of securities deposited
with such government or state agencies.
The differences between statutory surplus and capital stock determined in
accordance with Statutory Accounting Principles ("SAP") and total
shareholder's equity under GAAP are primarily: (a) the inclusion in SAP of
an AVR intended to stabilize surplus from fluctuations in the value of the
investment portfolio; (b) future policy benefits and policyholders' account
balances under SAP differ from GAAP due to differences between actuarial
assumptions and reserving methodologies; (c) certain policy acquisition
costs are expensed under SAP but deferred under GAAP and amortized over
future periods to achieve a matching of revenues and expenses; (d) external
and certain internal costs incurred to obtain or develop internal use
computer software during the application development stage is capitalized
under GAAP but expensed under SAP; (e) Federal income taxes are generally
accrued under SAP based upon revenues and expenses in the Federal income
tax return while under GAAP deferred taxes provide for timing differences
between recognition of revenues and expenses for financial reporting and
income tax purposes; (f) the valuation of assets under SAP and GAAP differ
due to different investment valuation and depreciation methodologies, as
well as the deferral of interest-related realized capital gains and losses
on fixed income investments; and (g) differences in the accrual
methodologies for post-employment and retirement benefit plans.
F-35
<PAGE>
19) BUSINESS SEGMENT INFORMATION
The Company's operations consist of Insurance and Investment Services. The
Company's management evaluates the performance of each of these segments
independently and allocates resources based on current and future
requirements of each segment. Management evaluates the performance of each
segment based upon operating results adjusted to exclude the effect of
unusual or non-recurring events and transactions and certain revenue and
expense categories not related to the base operations of the particular
business net of minority interest. Information for all periods is presented
on a comparable basis.
Intersegment investment advisory and other fees of approximately $75.6
million, $61.8 million and $84.1 million for 1999, 1998 and 1997,
respectively, are included in total revenues of the Investment Services
segment. These fees, excluding amounts related to discontinued operations
of $.5 million, $.5 million and $4.2 million for 1999, 1998 and 1997,
respectively, are eliminated in consolidation.
The following tables reconcile each segment's revenues and operating
earnings to total revenues and earnings from continuing operations before
Federal income taxes and cumulative effect of accounting change as reported
on the consolidated statements of earnings and the segments' assets to
total assets on the consolidated balance sheets, respectively.
<TABLE>
<CAPTION>
INVESTMENT
INSURANCE SERVICES ELIMINATION TOTAL
------------- ------------ ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C> <C>
1999
----
Segment revenues..................... $ 4,283.0 $ 2,052.7 $ (23.8) $ 6,311.9
Investment (losses) gains............ (199.4) 111.5 - (87.9)
------------- ------------ ------------ ------------
Total Revenues....................... $ 4,083.6 $ 2,164.2 $ (23.8) $ 6,224.0
============= ============ ============ ============
Pre-tax operating earnings........... $ 895.7 $ 427.0 $ - $ 1,322.7
Investment (losses) gains , net of
DAC and other charges.............. (208.4) 110.5 - (97.9)
Non-recurring DAC adjustments........ (131.7) - - (131.7)
Pre-tax minority interest............ - 216.8 - 216.8
------------- ------------ ------------ ------------
Earnings from Continuing
Operations......................... $ 555.6 $ 754.3 $ - $ 1,309.9
============= ============ ============ ============
Total Assets......................... $ 86,842.7 $ 12,961.7 $ (8.9) $ 99,795.5
============= ============ ============ ============
1998
----
Segment revenues..................... $ 4,029.8 $ 1,438.4 $ (5.7) $ 5,462.5
Investment gains..................... 64.8 35.4 - 100.2
------------- ------------ ------------ ------------
Total Revenues....................... $ 4,094.6 $ 1,473.8 $ (5.7) $ 5,562.7
============= ============ ============ ============
Pre-tax operating earnings........... $ 688.6 $ 284.3 $ - $ 972.9
Investment gains, net of
DAC and other charges.............. 41.7 27.7 - 69.4
Pre-tax minority interest............ - 141.5 - 141.5
------------- ------------ ------------ ------------
Earnings from Continuing
Operations......................... 730.3 453.5 - 1,183.8
============= ============ ============ ============
Total Assets......................... $ 75,626.0 $ 12,379.2 $ (64.4) $ 87,940.8
============= ============ ============ ============
</TABLE>
F-36
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT
INSURANCE SERVICES ELIMINATION TOTAL
------------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
1997
----
Segment revenues..................... $ 3,990.8 $ 1,200.0 $ (7.7) $ 5,183.1
Investment (losses) gains............ (318.8) 255.1 - (63.7)
------------- ------------ ------------ ------------
Total Revenues....................... $ 3,672.0 $ 1,455.1 $ (7.7) $ 5,119.4
============= ============ ============ ============
Pre-tax operating earnings........... $ 507.0 $ 258.3 $ - $ 765.3
Investment (losses) gains, net of
DAC and other charges.............. (292.5) 252.7 - (39.8)
Non-recurring costs and expenses..... (41.7) (121.6) - (163.3)
Pre-tax minority interest............ - 108.5 - 108.5
------------- ------------ ------------ ------------
Earnings from Continuing
Operations......................... $ 172.8 $ 497.9 $ - $ 670.7
============= ============ ============ ============
Total Assets......................... $ 67,762.4 $ 13,691.4 $ (96.1) $ 81,357.7
============= ============ ============ ============
</TABLE>
20) QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
The quarterly results of operations for 1999 and 1998 are summarized below:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------------------------------------------------------------
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31
------------- ------------- ------------ ------------
(IN MILLIONS)
<S> <C> <C> <C> <C>
1999
----
Total Revenues................ $ 1,484.3 $ 1,620.3 $ 1,512.1 $ 1,607.3
============= ============= ============ ============
Earnings from Continuing
Operations.................. $ 187.3 $ 222.6 $ 186.5 $ 182.1
============= ============= ============ ============
Net Earnings.................. $ 182.0 $ 221.3 $ 183.1 $ 220.2
============= ============= ============ ============
1998
----
Total Revenues................ $ 1,470.2 $ 1,422.9 $ 1,297.6 $ 1,372.0
============= ============= ============ ============
Earnings from Continuing
Operations.................. $ 212.8 $ 197.0 $ 136.8 $ 158.9
============= ============= ============ ============
Net Earnings.................. $ 213.3 $ 198.3 $ 137.5 $ 159.1
============= ============= ============ ============
</TABLE>
F-37
<PAGE>
21) INVESTMENT IN DLJ
At December 31, 1999, the Company's ownership of DLJ interest was
approximately 31.71%. The Company's ownership interest in DLJ will continue
to be reduced upon the exercise of options granted to certain DLJ employees
and the vesting of forfeitable restricted stock units acquired by DLJ
employees. DLJ restricted stock units represent forfeitable rights to
receive approximately 5.2 million shares of DLJ common stock through
February 2000.
The results of operations of DLJ are accounted for on the equity basis and
are included in commissions, fees and other income in the consolidated
statements of earnings. The Company's carrying value of DLJ is included in
investment in and loans to affiliates in the consolidated balance sheets.
Summarized balance sheets information for DLJ, reconciled to the Company's
carrying value of DLJ, are as follows:
<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------------
1999 1998
------------ ------------
(IN MILLIONS)
<S> <C> <C>
Assets:
Trading account securities, at market value............................ $ 27,982.4 $ 13,195.1
Securities purchased under resale agreements........................... 29,538.1 20,063.3
Broker-dealer related receivables...................................... 44,998.1 34,264.5
Other assets........................................................... 6,493.5 4,759.3
------------ ------------
Total Assets........................................................... $ 109,012.1 $ 72,282.2
============ ============
Liabilities:
Securities sold under repurchase agreements............................ $ 56,474.4 $ 35,775.6
Broker-dealer related payables......................................... 37,207.4 26,161.5
Short-term and long-term debt.......................................... 6,518.6 3,997.6
Other liabilities...................................................... 4,704.5 3,219.8
------------ ------------
Total liabilities...................................................... 104,904.9 69,154.5
DLJ's company-obligated mandatorily redeemed preferred
securities of subsidiary trust holding solely debentures of DLJ...... 200.0 200.0
Total shareholders' equity............................................. 3,907.2 2,927.7
------------ ------------
Total Liabilities, Cumulative Exchangeable Preferred Stock and
Shareholders' Equity................................................. $ 109,012.1 $ 72,282.2
============ ============
DLJ's equity as reported............................................... $ 3,907.2 $ 2,927.7
Unamortized cost in excess of net assets acquired in 1985
and other adjustments................................................ 22.9 23.7
The Holding Company's equity ownership in DLJ.......................... (1,341.4) (1,002.4)
Minority interest in DLJ............................................... (1,479.3) (1,118.2)
------------ ------------
The Company's Carrying Value of DLJ.................................... $ 1,109.4 $ 830.8
============ ============
</TABLE>
F-38
<PAGE>
Summarized statements of earnings information for DLJ reconciled to the
Company's equity in earnings of DLJ is as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------ ------------ -------------
(IN MILLIONS)
<S> <C> <C> <C>
Commission, fees and other income..................... $ 4,145.1 $ 3,150.5 $ 2,430.7
Net investment income................................. 2,175.3 2,189.1 1,652.1
Principal Transactions, net........................... 825.9 67.4 557.7
------------ ------------ -------------
Total revenues........................................ 7,146.3 5,407.0 4,640.5
Total expenses including income taxes................. 6,545.6 5,036.2 4,232.2
------------ ------------ -------------
Net earnings.......................................... 600.7 370.8 408.3
Dividends on preferred stock.......................... 21.2 21.3 12.2
------------ ------------ -------------
Earnings Applicable to Common Shares.................. $ 579.5 $ 349.5 $ 396.1
============ ============ =============
DLJ's earnings applicable to common shares as
reported............................................ $ 579.5 $ 349.5 $ 396.1
Amortization of cost in excess of net assets
acquired in 1985.................................... (.9) (.8) (1.3)
The Holding Company's equity in DLJ's earnings........ (222.7) (136.8) (156.8)
Minority interest in DLJ.............................. (172.9) (99.5) (109.1)
------------ ------------ -------------
The Company's Equity in DLJ's Earnings................ $ 183.0 $ 112.4 $ 128.9
============ ============ =============
</TABLE>
22) ACCOUNTING FOR STOCK-BASED COMPENSATION
The Holding Company sponsors a stock incentive plan for employees of
Equitable Life. DLJ and Alliance each sponsor their own stock option plans
for certain employees. The Company has elected to continue to account for
stock-based compensation using the intrinsic value method prescribed in APB
No. 25. Had compensation expense for the Holding Company, DLJ and Alliance
Stock Option Incentive Plan options been determined based on SFAS No. 123's
fair value based method, the Company's pro forma net earnings for 1999,
1998 and 1997 would have been $757.1 million, $678.4 million and $426.3
million, respectively.
The fair values of options granted after December 31, 1994, used as a basis
for the pro forma disclosures above, were estimated as of the grant dates
using the Black-Scholes option pricing model. The option pricing
assumptions for 1999, 1998 and 1997 follow:
<TABLE>
<CAPTION>
HOLDING COMPANY DLJ ALLIANCE
------------------------------ ------------------------------- ----------------------------------
1999 1998 1997 1999 1998 1997 1999 1998 1997
--------- ---------- --------- ---------- --------- ---------- --------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dividend yield...... 0.31% 0.32% 0.48% 0.56% 0.69% 0.86% 8.70% 6.50% 8.00%
Expected volatility. 28% 28% 20% 36% 40% 33% 29% 29% 26%
Risk-free interest
rate.............. 5.46% 5.48% 5.99% 5.06% 5.53% 5.96% 5.70% 4.40% 5.70%
Expected life
in years.......... 5 5 5 5 5 5 7 7.2 7.2
Weighted average
fair value per
option at
grant-date........ $10.78 $11.32 $6.13 $17.19 $16.27 $10.81 $3.88 $3.86 $2.18
</TABLE>
F-39
<PAGE>
A summary of the Holding Company, DLJ and Alliance's option plans follows:
<TABLE>
<CAPTION>
HOLDING COMPANY DLJ ALLIANCE
----------------------------- ----------------------------- -----------------------------
Weighted Weighted Weighted
Average Average Average
Exercise Exercise Exercise
Price of Price of Price of
Shares Options Shares Options Units Options
(In Millions) Outstanding (In Millions) Outstanding (In Millions) Outstanding
--------------- ------------- --------------- ------------- -----------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance as of
January 1, 1997........ 13.4 $10.40 22.2 $14.03 10.0 $ 9.54
Granted................ 6.4 $20.93 6.4 $30.54 2.2 $18.28
Exercised.............. (3.2) $10.13 (.2) $16.01 (1.2) $ 8.06
Forfeited.............. (.8) $11.72 (.2) $13.79 (.4) $10.64
--------------- ------------- ---------------
Balance as of
December 31, 1997...... 15.8 $14.53 28.2 $17.78 10.6 $11.41
Granted................ 8.6 $33.13 1.5 $38.59 2.8 $26.28
Exercised.............. (2.2) $10.59 (1.4) $14.91 (.9) $ 8.91
Forfeited.............. (.8) $23.51 (.1) $17.31 (.2) $13.14
--------------- ------------- ---------------
Balance as of
December 31, 1998...... 21.4 $22.00 28.2 $19.04 12.3 $14.92
Granted................ 4.3 $31.70 4.8 $45.23 2.0 $30.18
Exercised.............. (2.4) $13.26 (2.2) $34.61 (1.5) $ 9.51
Forfeited.............. (.6) $24.29 (.1) $15.85 (.3) $17.79
--------------- ------------- ---------------
Balance as of
December 31, 1999...... 22.7 $24.60 30.7 $23.30 12.5 $17.95
=============== ============= ===============
</TABLE>
F-40
<PAGE>
Information about options outstanding and exercisable at December 31, 1999
follows:
<TABLE>
<CAPTION>
Options Outstanding Options Exercisable
--------------------------------------------------- -------------------------------------
Weighted
Average Weighted Weighted
Range of Number Remaining Average Number Average
Exercise Outstanding Contractual Exercise Exercisable Exercise
Prices (In Millions) Life (Years) Price (In Millions) Price
- -------------------- ------------------ ---------------- --------------- ------------------ ----------------
Holding
Company
- --------------------
<S> <C> <C> <C> <C> <C> <C>
$ 9.06 -$13.88 5.6 4.2 $10.50 10.9 $18.98
$14.25 -$22.63 5.2 7.7 $20.95 - -
$25.32 -$34.59 8.2 8.7 $29.08 - -
$40.97 -$41.28 3.7 8.6 $41.28 - -
----------------- ------------------
$ 9.06 -$41.28 22.7 7.3 $24.60 10.9 $18.98
================= ================ =============== ================== ================
DLJ
- --------------------
$13.50 -$25.99 20.2 8.4 $14.61 20.6 $16.62
$26.00 -$38.99 4.9 7.8 $33.99 - -
$39.00 -$52.875 4.8 9.0 $43.28 - -
$53.00 -$76.875 .8 9.7 $57.09 - -
----------------- ------------------
$13.50 -$76.875 30.7 8.4 $23.30 20.6 $16.62
================= ================ =============== ================== ================
Alliance
- --------------------
$ 3.66 -$ 9.81 2.6 3.8 $ 8.31 2.2 $ 8.12
$ 9.88 -$12.56 3.3 5.6 $11.16 2.6 $10.92
$13.75 -$18.47 1.8 7.9 $18.34 .7 $18.34
$18.78 -$26.31 2.8 8.9 $26.16 .6 $26.06
$27.31 -$30.94 2.0 9.9 $30.24 - -
----------------- ------------------
$ 3.66 -$30.94 12.5 7.0 $17.95 6.1 $12.12
================= ================ =============== ================== ================
</TABLE>
F-41
<PAGE>
PART C
OTHER INFORMATION
-----------------
Item 24. Financial Statements and Exhibits
(a) Financial Statements included in Part B.
1. Separate Account No. 301:
- Statements of Assets and Liabilities for the Year Ended
December 31, 1999;
- Statements of Operations for the Year Ended December 31, 1999
- Statements of Changes in Net Assets for the Years Ended
December 31, 1999 and 1998
- Notes to Financial Statements
- Report of Independent Accountants - PricewaterhouseCoopers LLP
2. The Equitable Life Assurance Society of the United States:
- Report of Independent Accountants - PricewaterhouseCoopers LLP
- Consolidated Balance Sheets as of December 31, 1999 and 1998
- Consolidated Statements of Earnings for Years Ended December 31,
1999, 1998 and 1997
- Consolidated Statements of Equity for Years Ended December 31,
1999, 1998 and 1997
- Consolidated Statements of Cash Flows for Years Ended December
31, 1999, 1998 and 1997
- Notes to Consolidated Financial Statements
(b) Exhibits.
The following exhibits are filed herewith:
1. (a) Resolutions of the Board of Directors of The Equitable Life
Assurance Society of the United States ("Equitable")
authorizing the establishment of the Registrant, previously
filed with this Registration Statement No. 2-74667 on
September 19, 1986, refiled electronically on
August 3, 1998.
(b) Resolutions of the Board of Directors of Equitable dated
July 17, 1986 authorizing the reorganization of Separate
Account Nos. 301, 302, 303 and 304 into one continuing
separate account, previously filed with this Registration
Statement, File No. 2-74667, on April 21, 1998.
2. Not applicable.
3. (a) Form of Sales Agreement, previously filed with this
Registration Statement No. 2-74667 on September 19, 1986,
refiled electronically on August 3, 1998.
(b) Sales Agreement among Equitable, Separate Account No. 301
and Equitable Variable Life Insurance Company, as principal
underwriter for The Hudson River Trust, previously filed
with this Registration Statement No. 2-74667 on April 29,
1993, refiled electronically on August 3, 1998.
C-1
<PAGE>
(c) Distribution and Servicing Agreement among Equico
Securities, Inc., (now AXA Advisors, LLC) Equitable and
Equitable Variable dated as of May 1, 1994, previously filed
with this Registration Statement No. 2-74667 on April 4,
1995.
(d) Participation Agreement among EQ Advisors Trust, The
Equitable Life Assurance Society of the United States,
Equitable Distributors, Inc. and EQ Financial Consultants,
Inc. (now AXA Advisors, LLC) dated as of the 14th day of
April 1997, incorporated by reference to the Registration
Statement of EQ Advisors Trust (File No. 333-17217) on Form
N-1A, filed August 28, 1997.
(e) Sales Agreement among Equico, (now AXA Advisors, LLC)
Equitable and Equitable's Separate Account A, Separate
Account No. 301 and Separate Account No. 51 dated as of
January 1, 1994, previously filed with this Registration
Statement No. 2-74667 on April 4, 1995.
4. (a) (1) Form of group variable annuity contract, as amended
(TSA), previously filed with this Registration Statement
No. 2-74667 on April 24, 1987, refiled electronically on
August 3, 1998.
(2) Rider No. PF 94,177 to group variable annuity contract,
as amended (TSA), previously filed with this
Registration Statement No. 2-74667 on April 15, 1988,
refiled electronically on August 3, 1998.
(b) (1) Form of group variable annuity certificate, as amended
(TSA), previously filed with this Registration Statement
No. 2-74667 on April 24, 1987, refiled electronically on
August 3, 1998.
(2) Rider No. PF 94,178 to group variable annuity
certificate, as amended (TSA), previously filed with
this Registration Statement No. 2-74667 on April 15,
1988, refiled electronically on August 3, 1998.
(c) (1) Rider No. PF 94,189 to group variable annuity contract,
as amended (TSA), previously filed with this
Registration Statement No. 2-74667 on April 17, 1990,
refiled electronically on August 3, 1998.
(2) Rider No. PF 94,188 to group variable annuity
certificate, as amended (TSA), previously filed with
this Registration Statement. No. 2-74667 on April 17,
1990, refiled electronically on August 3, 1998.
(d) (1) Form of group variable annuity contract, as amended
(IRA), previously filed with this Registration Statement
No. 2-74667 on April 24, 1987, refiled electronically on
August 3, 1998.
(2) Rider No. PF 96,000 to group variable annuity contract,
as amended (IRA), previously filed with this
Registration Statement No. 2-74667 on April 15, 1988,
refiled electronically on August 3, 1998.
(3) Rider No. PF 10,000 to group variable annuity contract,
as amended (IRA), previously filed with this
Registration Statement No. 2-74667 on December 14, 1993,
refiled electronically on August 3, 1998.
(e) (1) Form of group variable annuity certificate, as amended
(IRA), previously filed with this Registration Statement
No. 2-74667 on April 24, 1987, refiled electronically on
August 3, 1998.
(2) Rider No. PF 96,100 to group variable annuity
certificate, as amended (IRA), previously filed with
this Registration Statement No. 2-74667 on April 15,
1988, refiled electronically on August 3, 1998.
C-2
<PAGE>
(3) Rider No. PF 10,001 to group variable annuity
certificate, as amended (IRA), previously filed with
this Registration Statement No. 2-74667 on December 14,
1993, refiled electronically on August 3, 1998.
(f) Plan of Operations, as amended, previously filed with this
Registration Statement No. 2-74667 on April 24, 1987,
refiled electronically on August 3, 1998.
5. (a) Form of application for group variable annuity contract, as
amended (TSA), previously filed with this Registration
Statement No. 2-74667 on April 15, 1988, refiled
electronically on August 3, 1998.
(b) Form of participant enrollment for group variable annuity
contract, as amended (IRA), previously filed with this
Registration Statement No. 2-74667 on April 15, 1988,
refiled electronically on August 3, 1998.
6. (a) Copy of the Restated Charter of The Equitable Life
Assurance Society of the United States, as amended January
1, 1997, previously filed with this Registration Statement
No. 2-74667 on April 24, 1997.
(b) By-Laws of The Equitable Life Assurance Society of the
United States, as amended November 21, 1996, previously
filed with this Registration Statement No. 2-74667 on
April 29, 1997.
C-3
<PAGE>
7. Not applicable.
8. (a) Agreement, dated as of March 15, 1985, between Integrity
Life Insurance Company ("Integrity") and Equitable for
cooperative and joint use of personnel, property and
services, previously filed with this Registration Statement
No. 2-74667 on September 19, 1986, refiled electronically
on August 3, 1998.
(b) Administration and Servicing Agreement, dated as of May 1,
1987, by and between Equitable and Integrity, previously
filed with this Registration Statement No. 2-74667 on May
4, 1987, refiled electronically on August 3, 1998.
(c) Amendment, dated September 30, 1988, to Administration and
Servicing Agreement by and between Equitable and Integrity,
previously filed with this Registration Statement No.
2-74667 on April 19, 1989, refiled electronically on
August 3, 1998.
9. (a) Opinion of Hebert P. Shyer, Executive Vice President and
General Counsel of Equitable, previously filed with this
Registration Statement No. 2-74667 on November 6, 1983,
refiled electronically on August 3, 1998.
(b) Opinion of Hebert P. Shyer, Executive Vice President and
General Counsel of Equitable, as to the legality of the
securities being registered, previously filed with this
Registration Statement No. 2-74667 on April 24, 1987,
refiled electronically on August 3, 1998.
10. (a) Consent of PricewaterhouseCoopers LLP.
(b) Powers of Attorney.
11. Not applicable.
12. Not applicable.
13. Not applicable.
C-4
<PAGE>
Item 25: Directors and Officers of Equitable.
Set forth below is information regarding the directors and principal
officers of Equitable. Equitable's address is 1290 Avenue of Americas,
New York, New York 10104. The business address of the persons whose
names are preceded by an asterisk is that of Equitable.
POSITIONS AND
NAME AND PRINCIPAL OFFICES WITH
BUSINESS ADDRESS EQUITABLE
- ---------------- ---------
DIRECTORS
Francoise Colloc'h Director
AXA
23, Avenue Matignon
75008 Paris, France
Henri de Castries Director
AXA
23, Avenue Matignon
75008 Paris, France
Joseph L. Dionne Director
198 Wieton Road
New Canaan, CT 06840
Denis Duverne Director
AXA
23, Avenue Matignon
75008 Paris, France
Jean-Rene Fourtou Director
Rhone-Poulenc S.A.
25 Quai Paul Doumer
92408 Courbevoie Cedex,
France
Norman C. Francis Director
Xavier University of Louisiana
7325 Palmetto Street
New Orleans, LA 70125
C-5
<PAGE>
POSITIONS AND
NAME AND PRINCIPAL OFFICES WITH
BUSINESS ADDRESS EQUITABLE
- ---------------- ---------
Donald J. Greene Director
LeBouef, Lamb, Greene & MacRae
125 West 55th Street
New York, NY 10019-4513
John T. Hartley Director
Harris Corporation
1025 NASA Boulevard
Melbourne, FL 32919
John H.F. Haskell Jr. Director
SBC Warburg Dillion Read LLC
535 Madison Avenue
New York, NY 10028
Mary R. (Nina) Henderson Director
Bestfoods
International Plaza
700 Sylvan Avenue
Englewood Cliffs, NJ 07632-9976
W. Edwin Jarmain Director
Jarmain Group Inc.
121 King Street West
Suite 2525
Toronto, Ontario M5H 3T9,
Canada
George T. Lowy Director
Cravath, Swaine & Moore
825 Eighth Avenue
New York, NY 10019
C-6
<PAGE>
POSITIONS AND
NAME AND PRINCIPAL OFFICES WITH
BUSINESS ADDRESS EQUITABLE
- ---------------- ---------
Didier Pineau-Valencienne Director
Credit Suisse First Boston 64,
rue de Miromesmil 75008
Paris, France
George J. Sella, Jr. Director
P.O. Box 397
Newton, NJ 07860
Peter J. Tobin Director
St. John's University
8,000 Utopia Parkway
Jamaica, NY 11439
Dave H. Williams Director
Alliance Capital Management Corporation
1345 Avenue of the Americas
New York, NY 10105
OFFICER-DIRECTORS
- -----------------
*Michael Hegarty President, Chief Operating
Officer and Director
*Edward D. Miller Chairman of the Board,
Chief Executive Officer
and Director
* Stanley B. Tulin Vice Chairman of the Board,
Chief Financial Officer and Director
OTHER OFFICERS
- --------------
*Leon Billis Executive Vice President
and Chief Information Officer
*Derry Bishop Executive Vice President and
Chief Agency Officer
*Harvey Blitz Senior Vice President
*Robert T. Brockbank Executive Vice President
and AXA Group Deputy Chief
Information Officer
*Kevin R. Byrne Senior Vice President and Treasurer
*John A. Caroselli Executive Vice President
Selig Ehrlich Senior Vice President and
Chief Actuary
*Alvin H. Fenichel Senior Vice President and
Controller
C-7
<PAGE>
POSITIONS AND
NAME AND PRINCIPAL OFFICES WITH
BUSINESS ADDRESS EQUITABLE
- ---------------- ---------
*Paul J. Flora Senior Vice President and Auditor
*Robert E. Garber Executive Vice President and
Chief Legal Officer
*James D. Goodwin Vice President
*Edward J. Hayes Senior Vice President
*Craig Junkins Senior Vice President
*Donald R. Kaplan Senior Vice President and Chief
Compliance Officer and Associate
General Counsel
*Michael S. Martin Executive Vice President and Chief
Marketing Officer
*Richard J. Matteis Executive Vice President
*Peter D. Noris Executive Vice President and Chief
Investment Officer
*Brian S. O'Neil Executive Vice President
*Anthony C. Pasquale Senior Vice President
*Pauline Sherman Senior Vice President, Secretary and
Associate General Counsel
*Samuel B. Shlesinger Senior Vice President
*Richard V. Silver Senior Vice President and
General Counsel
*Jose Suquet Senior Executive Vice President and
Chief Distribution Officer
*Naomi J. Weinstein Vice President
*Gregory Wilcox Executive Vice President
*R. Lee Wilson Executive Vice President
*Maureen K. Wolfson Vice President
C-8
<PAGE>
Item 26. Persons Controlled by or Under Common Control with the Insurance
Company or Registrant.
Separate Account No. 301 of The Equitable Life Assurance Society of the
United States (the "Separate Account") is a separate account of Equitable.
Equitable, a New York stock life insurance company, is a wholly owned subsidiary
of AXA Financial, Inc. (the "Holding Company") (formerly the Equitable Companies
Incorporated), a publicly traded company.
The largest stockholder of the Holding Company is AXA which as of
December 31, 1999 beneficially owned 58.0% of the Holding Company's outstanding
common stock. AXA is able to exercise significant influence over the operations
and capital structure of the Holding Company and its subsidiaries, including
Equitable. AXA, a French company, is the holding company for an international
group of insurance and related financial services companies.
C-9
<PAGE>
ORGANIZATION CHART OF EQUITABLE'S AFFILIATES
AXA Financial, Inc. (formerly the Equitable Companies, Incorporated) (1991)
(Delaware)
Donaldson Lufkin & Jenrette, Inc. (1933) (Delaware) (38.31%)
(See Addendum B(1) for subsidiaries)
AXA Client Solutions, LLC (1999) (Delaware)
AXA Distribution Holding Corporation (1999) (Delaware)
AXA Advisors, LLC (formerly EQ Financial Consultants, Inc. (1971)
Delaware)(a)(b)
The Equitable Life Assurance Society of the United States (1989)
(New York)(a)(b)
The Equitable of Colorado, Inc. (l983) (Colorado)
EVLICO East Ridge, Inc. (1995) (California)
GP/EQ Southwest, Inc. (1995) (Texas)
Franconom, Inc. (1985) (Pennsylvania) (50.00%)
Frontier Trust Company (1987) (North Dakota)
Gateway Center Buildings, Garage, and Apartment Hotel, Inc.
(inactive) (pre-l970) (Pennsylvania)
Equitable Deal Flow Fund, L.P.
Equitable Managed Assets (Delaware)
Real Estate Partnership Equities (various)
EREIM LP Associates (99%)
EML Associates, L.P. (19.8%)
Alliance Capital Management L.P. (2.7% limited partnership
interest)
ACMC, Inc. (1991) (Delaware)(s) (Note 5)
Alliance Capital Management L.P. (1988) (Delaware)
(38.6% limited partnership interest)
EVSA, Inc. (1992) (Pennsylvania)
Prime Property Funding, Inc. (1993) (Delaware)
Wil Gro, Inc. (1992) (Pennsylvania)
Equitable Underwriting and Sales Agency (Bahamas) Limited (1993)
(Bahamas)
(a) Registered Broker/Dealer (b) Registered Investment Advisor
i
<PAGE>
AXA Financial, Inc. (cont.)
Donaldson Lufkin & Jenrette, Inc. (cont.)
AXA Client Solutions, LLC (cont.)
AXA Distribution Holding Corp. (cont.)
Equitable Life Assurance Society of the United States (cont.)
Fox Run, Inc. (1994) (Massachusetts)
STCS, Inc. (1992) (Delaware)
CCMI Corporation (1994) (Maryland)
HVM Corporation (199 ) (Maryland)
EVSA Incorporated ( ) (Delaware)
FTM Corporation (1994) (Maryland)
Equitable BJVS, Inc. (1992) (California)
Equitable Rowes Wharf, Inc. (1995) (Massachusetts)
ELAS Realty, Inc. (1996) (Delaware)
ELAS Realty, Inc. (Georgia)
Equitable Structured Settlement Corporation (1996) (Delaware)
Prime Property Funding II, Inc. (1997) (Delaware)
Sarasota Prime Hotels, Inc. (1997) (Florida)
ECLL, Inc. (1997) (Michigan)
Equitable Holdings LLC (1997) (New York) (into which Equitable
Holding Corporation was merged in 1997)
ELAS Securities Acquisition Corp. (l980) (Delaware)
100 Federal Street Realty Corporation ( ) (Massachusetts)
100 Federal Street Funding Corporation (Massachusetts)
EquiSource of New York, Inc. (1986) (New York) (See
Addendum A for subsidiaries)
Equitable Casualty Insurance Company (l986) (Vermont)
EREIM LP Corp. (1986) (Delaware)
EREIM LP Associates (L.P.) (1%)
EML Associates (L.P.) (.02%)
(a) Registered Broker/Dealer (b) Registered Investment Advisor
ii
<PAGE>
AXA Financial, Inc. (cont.)
Donaldson Lufkin & Jenrette, Inc. (cont.)
AXA Client Solutions, LLC (cont.)
AXA Distribution Holding Corp. (cont.)
The Equitable Life Assurance Society of the United States (cont.)
Equitable Holdings, LLC (cont.)
Equitable JVS, Inc. (1988) (Delaware)
Astor/Broadway Acquisition Corp. (1990) (New York)
Astor Times Square Corp. (1990) (New York)
PC Landmark, Inc. (1990) (Texas)
Equitable JVS II, Inc. (1994) (Maryland)
EJSVS, Inc. (1995) (New Jersey)
Donaldson, Lufkin & Jenrette, Inc. (1985 by EIC; 1993 by EQ and
EHC) (Delaware) (31.47%) (See Addendum B(1) for
subsidiaries)
JMR Realty Services, Inc. (1994) (Delaware)
Equitable Investment Corporation (l97l) (New York)
Stelas North Carolina Limited Partnership (50% limited
partnership interest) (l984)
Equitable JV Holding Corporation (1989) (Delaware)
Alliance Capital Management Corporation (l991) (Delaware) (b)
(See Addendum B(2) for subsidiaries)
Equitable Capital Management Corporation (l985)
(Delaware) (b)
Equitable Capital Private Income and Equity
Partnership II, L.P. (Delaware)
EQ Services, Inc. (1992) (Delaware)
EREIM Managers Corp. (1986) (Delaware)
ML/EQ Real Estate Portfolio, L.P. (Delaware)
EML Associates, L.P. (New York)
(a) Registered Broker/Dealer (b) Registered Investment
Advisor
iii
<PAGE>
ORGANIZATION CHART OF EQUITABLE'S AFFILIATES
ADDENDUM A - SUBSIDIARY
OF EQUITABLE HOLDINGS, LLC
HAVING MORE THAN FIVE SUBSIDIARIES
-------------------------------------------------------
EquiSource of New York, Inc. (formerly Traditional Equinet Business Corporation
of New York) has the following subsidiaries that are brokerage companies to
make available to Equitable Agents within each state traditional (non-equity)
products and services not manufactured by Equitable:
EquiSource of Alabama, Inc. (1986) (Alabama)
EquiSource of Arizona, Inc. (1986) (Arizona)
EquiSource of Arkansas, Inc. (1987) (Arkansas)
EquiSource Insurance Agency of California, Inc. (1987) (California)
EquiSource of Colorado, Inc. (1986) (Colorado)
EquiSource of Delaware, Inc. (1986) (Delaware)
EquiSource of Hawaii, Inc. (1987) (Hawaii)
EquiSource of Maine, Inc. (1987) (Maine)
EquiSource Insurance Agency of Massachusetts, Inc. (1988)
(Massachusetts)
EquiSource of Montana, Inc. (1986) (Montana)
EquiSource of Nevada, Inc. (1986) (Nevada)
EquiSource of New Mexico, Inc. (1987) (New Mexico)
EquiSource of Pennsylvania, Inc. (1986) (Pennsylvania)
EquiSource of Puerto Rico, Inc. (1997) (Puerto Rico)
EquiSource Insurance Agency of Utah, Inc. (1986) (Utah)
EquiSource of Washington, Inc. (1987) (Washington)
EquiSource of Wyoming, Inc. (1986) (Wyoming)
iv
<PAGE>
ORGANIZATION CHART OF EQUITABLE'S AFFILIATES
ADDENDUM B - INVESTMENT SUBSIDIARIES
HAVING MORE THAN FIVE SUBSIDIARIES
------------------------------------
Donaldson, Lufkin & Jenrette, Inc. has the following subsidiaries, and
approximately 150 other subsidiaries, most of which are special
purpose\subsidiaries (the number fluctuates according to business needs):
Donaldson, Lufkin & Jenrette, Securities Corporation (1985)
(Delaware) (a) (b)
Wood, Struthers & Winthrop Management Corp. (1985)
(Delaware) (b)
Autranet, Inc. (1985) (Delaware) (a)
DLJ Real Estate, Inc.
DLJ Capital Corporation (b)
DLJ Mortgage Capital, Inc. (1988) (Delaware)
Alliance Capital Management Corporation (as general partner) (b) has the
following subsidiaries:
Alliance Capital Management L.P. (1988) (Delaware) (b)
Albion Alliance LLC (Delaware) (37.6%)
Cursitor Alliance LLC (Delaware) (93%)
Cursitor Alliance Holdings Ltd. (U.K.)
Draycott Partners, Ltd (MA)
Cursitor Alliance Services Ltd. (U.K.)
Cursitor Management Co. S.A. (Lux.)
Alliance Asset Allocation Ltd. (U.K.)
Cursitor Eaton Asset Allocation Management Co. (NY) (50%)
Alliance Cecogest S.A. (France) (75%)
Cursitor Courtage SARL (France)
Cursitor Gestion S.A. (France)
Alliance Capital Management Corporation of Delaware (Delaware) (100%)
Alliance Fund Services, Inc. (Delaware) (a)
Alliance Fund Distributors, Inc. (Delaware) (a)
Alliance Capital Oceanic Corp. (Delaware)
Alliance Capital Management (Brazil) Ltd. (Brazil) (99%)
Alliance Capital Management Australia Limited (Australia)
Meiji - Alliance Capital Corp. (Delaware) (50%)
Alliance Capital (Luxembourg) S.A. (Lux.) (99%)
Alliance Barra Research Institute, Inc. (Delaware)
Alliance Capital Management Canada, Inc. (Delaware)
Alliance Capital Global Derivatives Corp. (Delaware)
ACM Fund Services, S.A. (Lux.) (99%)
ACM Fund Services (Espana) S.L. (Spain)
Alliance Capital Management (Singapore) Ltd. (Singapore)
ACM CIIC Investment Management Ltd. (Cayman Islands) (54%)
ACM Software Services Ltd. (Delaware)
East Fund Managementberatung GmbH. (Australia) (51%)
Albion Alliance EFM (Czech) (49%)
East Fund Management (Cyprus) Ltd. (Cyprus) (99%)
EFM Consultanta Financiara Bucuresti SRL (Romania)
Alliance Capital (Mauritius) Private Ltd. (Mauritius)
Alliance Capital Asset Management (India) Private Ltd.
(India) (75%)
ACSYS Software India Private Ltd. (India) (51%)
ACAM Trust Company Private Ltd. (India)
Alliance Eastern Europe, Inc. (Delaware)
Alliance Capital Management (Asia) Ltd. (Delware)
Alliance Capital Management (Turkey) Ltd. (Turkey)
Alliance Capital Mangement (Japan) Inc. 1261 (Delaware)
Alliance Capital Invest Tr. Mgmt. K.K. (Japan)
Alliance Capital Limited (U.K)
Alliance Capital Services Ltd. (U.K.)
Dimentional Trust Management Ltd. (U.K)
Alliance Corporate Finance Group Inc. (Delaware)
BCN Alliance Capital Management SA (Brazil) (50%)
Przymierze Trust Fund Co. (Poland) (49%)
Alliance SBS-AGRO Captial Management Co. (Russia) (49%)
Pekao/Alliance PTE S.A. (Poland) (49%)
Whittingdale Holdings Ltd. (U.K.)
Alliance Capital Whittingdale Ltd. (U.K)
ACM Investments Ltd. (U.K.)
Whittingdale Nominees Ltd. (U.K.)
Hanwha Investment Trust Mgmt. Co., Ltd. (South Korea) (20%)
New Alliance Asset Mangement (Asia) Ltd. (H.K.) (50%)
ACM New-Alliance (Luxemborg) S.A. (Lux.)
Alliance Odyssey Capital Mgmt. (Porprietary) Ltd. (South Africa) (80%)
Alliance-MBCA Capital (Private) Ltd. (Zimbabwe) (50%)
Alliance Odyssey Capital Mgmt. (Nambia) (Proprietary) Ltd. (Nambia)
(a) Registered Broker/Dealer (b) Registered Investment Advisor
v
<PAGE>
AXA GROUP CHART
The information listed below is dated as of January 1, 2000; percentages
shown represent voting power. The name of the owner is noted when AXA
indirectly controls the company.
AXA INSURANCE AND REINSURANCE
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
AXA Assurances IARD France 100% by AXA France Assurance
AXA Assurances Vie France 6.48% by AXA Assurances IARD,
82.40% by AXA France Assurance
and 11.13% by AXA Collectives
AXA Courtage IARD France 99.77% by AXA France Assurance
AXA Conseil Vie France 100% by AXA France Assurance
AXA Conseil IARD France 100% by AXA France Assurance
Direct Assurances Vie France 100% by AXA Direct
Juridica France 7.81% by AXA Assurance IARD,
89.27% by AXA France Assurance
1.44% by AXA Courtage IARD
AXA Assistance France 100% by AXA
AXA Collectives France 94.47% by AXA France Assurance,
3.69% by AXA Assurances IARD
and 1.25% by AXA Courtage IARD
NSM Vie France 40.64% by AXA France Assurance
AXA Global Risks France 98.49% by AXA France
Assurance
Argovie France 94.03% by AXA Collectives
S.P.S. Re France 69.03% by AXA Reassurance
vi
<PAGE>
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
Direct Assurance France 100% by AXA Direct
Natio Assurances France 50% by AXA Assurances IARD
AXA Assistance France 100% by AXA
AXA Reassurance France 86.33% by AXA, 8.25% by AXA
Assurances IARD, 5.07% by
AXA Global Risks, 0.13% by
AXA France Assurances and
0.02% by AXA Collectives
AXA Re Finance France 79% owned by AXA Reassurance
AXA Cessions France 100% by AXA
UAB Belgium 100% by AXA Holdings Belgium
Ardenne Prevoyante Belgium 99.99% by AXA Holdings Belgium
and 0.01% by AXA Royale Belge
Assurance Courtraisienne Belgium 100% by AXA Holdings Belgium
AXA Royale Belge Belgium 99.57% by AXA Holdings Belgium
and 0.43% by UAB
Assurances de la Poste Belgium 50% by AXA Holdings Belgium
Assurances de la Poste Vie Belgium 50% by AXA Holdings Belgium
C.G.R.M. Monte Carlo France 99.99% by AXA Reassurance
AXA Assurance Vie Luxembourg Luxembourg 100% by AXA Luxembourg S.A.
Paneurore Luxembourg 5% by AXA Portugal Companhia de
Seguros, 20% by AXA Colonia
Versicherungs, 5% by AXA
Assicurazioni, 10% by Aurora
Iberica SA de Seguros y Reas,
20% by AXA Insurance IK,
20% by Royale Belge
Investissement and
20% by Saint George Re
Crealux Luxembourg 100% by AXA Holdings Belgium
Futur Re Luxembourg 100% by AXA Global Risks
AXA Assurances Luxembourg Luxembourg 100% by AXA Luxembourg SA
Hilo Direct Seguros y Reaseguros Spain 71.43% by AXA Aurora
Ayuda Legal SA de Seguros y Spain 88% by AXA Aurora Iberica SA de
Reaseguros Seguros y Reaseguros and 12% by
AXA Seguros de Seguros
Reaseguros
Aurora Iberica SA de Spain 99.82% by AXA Aurora
Seguros y Reaseguros
AXA Seguros de Seguros y Spain 1.45% by AXA and 97.06% by
Reasegiros Aurora Iberica SA de Seguros y
Reas
Eurovita Italy 30% owned by AXA Assicurazioni
UAP Vita Italy 62.21% by AXA, 18.70% by AXA
Conseil Vie, and 19.08% by AXA
Collectives
AXA Interlife Italy 100% by AXA
AXA Assicurazioni Italy 84.10% by AXA, 11.70% by
Grupo UAP Italiana, 2.11% by
AXA Conseil Vie and 2.07%%
by AXA Collectives
AXA Equity & Law Plc U.K. 100% by AXA Sun Life
Assurance Society
AXA Global Risks (U.K) Ltd U.K. 100% by AXA Global Risks
(France)
English & Scottish U.K. 100% by AXA UK
AXA UK U.K. 100% by AXA
AXA Sun Life U.K. 100% by Sun Life and Provincial
Holdings Plc
AXA UK Holding Ltd. U.K. 100% by AXA Reassurance
Guardian Insurance Ltd. U.K. 100% by Guardian Royal Exchange
Plc
GREA Assurance U.K. 100% by Guardian Royal
Exchange Plc
PPP Group Plc. U.K. 100% by Guardian Royal
Exchange Plc
PPP Healthcare Ltd. U.K. 100% by Guardian Royal
Exchange Plc
PPP Lifetimecare U.K. 100% by Guardian Royal
Exchange Plc
AXA Insurance UK U.K. 100% by Guardian Royal
Exxchange Plc
AXA Reinsurance UK Plc. U.K. 100% by AXA UK Holding Ltd.
AXA Sun Life Holdings Plc. U.K. 100% by SLPH
AXA Nederland BV The Nether- 51.31% AXA Royal Belge, 38.94%
lands by Gelderland and 4.11% by
AXA Holdings Belgium
AXA Schade The Nether- 100% by AXA Verzekeringen
lands
AXA Zorg NV The Nether- 100% by UAP Verzekeringen
lands
Vinci BV The Nether- 100% by AXA
lands
AXA Leven NV The Nether- 100% by AXA Verzekeringen
lands
UAP Niew Rotterdam Beheer The Nether- 100% by AXA Nederland BV
lands
AXA Zorg NV The Nether- 100% by AXA Verzekeringen
lands
AXA Portugal Companhia de Portugal 9.63% by AXA Global Risk, 2.28%
Serguros by AXA Portugal Seguros
Vida, 5.71% by AXA Conseil Vie
and 81.93% by AXA
Participations
AXA Portugal Seguros Vida Portugal 87.63% by AXA Conseil Vie and
7.46% by AXA Participations
AXA Compagnie d' Assurances Switzerland 99.95% AXA Participations
AXA Compagnie d' Assurances Switzerland 94.99% by AXA Participations
sur la Vie and 5.01% by AXA Compagnie
d'Assurance.
AXA Al Amane Assurances Morocco 99.99% by AXA Ona
Epargne Croissance Morocco 99.59% by AXA Al Amane
Assurances
Compagnie Africaine Morocco 100% by AXA Al Almane
d'Assurance Assurances
AXA Canada Canada 100% by AXA
AXA Canada ADP Canada 100% by AXA Canada
AXA Colonia Krankenversicherung Germany 51% by AXA Colonia Konzern AG
and 48.36% by AXA Colonia Leben
Colonia Nordstern Versicherungs Germany 100% by AXA Colonia Konzern AG
Sicher Direct Germany 50% by AXA Colonia Konzern AG
and 50% by AXA Direct
Albingia Versicherung Germany 98.98% by GRE Continental
Europe Holding Gmbh
Albingia Lebenversicherung Germany 100% by Albingia Versicherung
AXA Colonia Leben Germany 50% by AXA Colonia Konzern AG
and 50% by AXA Colonia
Versicherung
AXA Colonia Versicherung Germany 100% by AXA Colonia Konzern AG
AXA Norstern Art Germany 100% by AXA Colonia Konzern AG
Tellit Vie Germany 100% by AXA-Colonia Konzern
AG
National Mutual Financial Australia 100% by National Mutual
Services Holdings
AXA Oyak Hayat Sigorta Turkey 100% by AXA Oyak Holding AS
AXA Oyak Sigorta Turkey 0.70% by AXA Oyak Hayat
Sigorta and 70.32% by AXA
Oyak Holding AS
AXA Minmerals Assurance Co. Ltd. China 51% by AXA China
vii
<PAGE>
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
AXA Non Life Insurance Co. Ltd. Japan 100% by AXA Direct
AXA Life Insurance Japan 100% by AXA
Dongbu AXA Life South Korea 100% by AXA
AXA Insurance Investment Singapore 100% by AXA
Holdings
AXA Insurance Singapore Singapore 100% by AXA Insurance
Investment Holding
AXA Life Singapore Singapore 100% by National Mutual
International
GRE Singapore Branch Singapore 100% by AXA
AXA Life Hong Kong Singapore 100% by AXA
AXA Insurance Hong Kong Hong Kong 82.5% by AXA Insurance
Investment Holdings Pte Ltd
and 17.5% by AXA
National Mutual Asia Ltd. Hong Kong 53.8% by National Mutual
Holdings, Ltd and 20% by Detura
AXA China Region Ltd. Hong Kong 73.55% by National Mutual
Holdings
Guardian Insurance Ltd. Hong Kong 100% by AXA
Hong Kong
The Equitable Life Assurance U.S.A. 100% by AXA Financial Inc.
Society of the United States
(ELAS)
AXA Reinsurance U.S.A. 100% by AXA America
AXA America U.S.A. 100% by AXA Reassurance
AXA Global Risks US U.S.A. 96.39% by AXA Global Risks and
3.61% by Colonia Nordstern
Versicherungs AG
AXA Re Life Insurance Company U.S.A. 100% by AXA America
National Mutual Holdings Australia 42.1% by AXA and 8.9% by
AXA Equity & Law Life
Assurance Society
National Mutual International Australia 100% by National Mutual
Holdings Ltd
Australian Casualty Insurance Australia 100% by National Mutual
Property Ltd Holdings
National Mutual Health Australia 100% by National Mutual
Insurance Pty Ltd Holdings Ltd
Guardian Dublin Docks Ireland 100% by Guardian PMPA Group
Ltd.
Guardian PMPA Group Ltd. Ireland 100 by Guardian Royal
Exchange Plc
Detura Hong Kong 75% by National Mutual Holdings
AXA Insurance Singapore Singapore 100% by AXA Insurance
Investment Holdings
AXA Reinsurance Asia Singapore 100% by AXA Reassurance
viii
<PAGE>
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
AXA Reinsurance U.K. Plc. U.K. 100% owned by AXA U.K.
Holding Ltd.
Nordstern Colonia Versicherung Austria 89.95% by AXA Colonia
Versicherungs
and 10.05% by Colonia Leben
ix
<PAGE>
FINANCIAL SERVICES AND REAL ESTATE
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
Compagnie Financiere de Paris France 96.89% by AXa 0.27% by AXA
(C.F.P.) Assurance IARD and 0.01% by
Societe Beaujon
AXA Banque France 98.7% by Compagnie
Financiere de Paris
AXA Credit France 65% by Compagnie
Financiere de Paris
Sofapi France 100% by Compagnie
Financiere de Paris
Holding Soffim France 100% by Compagnie
Financiere de Paris
Sofinad France 100% by Compagnie
Financiere de Paris
Banque des Tuileries France 100% by Compagnie
Financiere de Paris
Banque de Marches et d'Arbitrage France 19.51% by AXA and 8.2% by AXA
Courtage IARD
AXA Investment Managers France 5.28% by AXA Royale Belge,
56.48 BY AXA, 1.02% by AXA
Reassurance, 19.46% by AXA
Assurance IARD, 5.12% by AXA
Colonia Konzern and 0.25% By
Direct Assurances, 2.63% by
AXA Leven NV, 5.10% by National
Fund Management, 2.03% by AXA
Courtege IARD
Banque Worms France 1.91% by AXA France Assurance,
5.32% by AXA Collectives, 6.30%
by AXA Courtage IARD, 3.06% by
AXA Conseil Vie, 10.72% by AXA
Assurances IARD, 21.63% by AXA
Assurance Vie, 49.56% by
Compagnie Financiere de Paris
Investment Managers Paris France 100% by AXA Investment Managers
Transaxim France 100% by Compagnie Financiere
de Participations
AXA Millesimes 10.10% by AXA Reassurance,
11.95% by AXA Reassurance,
7.26% by Societe Beaujon,
6.87% by Jour Finance
AXA Colonia Asset Management Germany 51% by AXA Investment
Managers and 49% by AXA
Colonia Konzern AG
AXA Colonia KAG Germany 51% by AXA Investment
Managers and 26.50% by AXA
Colonia Konzern AG
AXA Colonia Bausparkasse AG Germany 66.67% by AXA Colonia
Konzern AG and 32.99% by
AXA Colonia Leben
Banque IPPA Belgium 100% by AXA Holdings Belgium
Royal Belge Investissement Belgium 100% by AXA Royale Belge
AXA IM Bruxelles Belgium 100% by AXA Investment
Managers
AXA Banque Belgium Belgium 100% by AXA Holdings Belgium
Royale Belge Investissement Belgium 100% by AXA Royale Belge
Sun Life Asset Management U.K. 66.67% by Sun Life and
Provincial Holdings Plc and
33.33% by AXA Asset Management
Ltd.
x
<PAGE>
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
Alliance Capital Management Corp. U.S.A. 100% held by The Equitable
Life Assurance Society
Donaldson Lufkin & Jenrette U.S.A. 0.13% by AXA, 31.44% by
the ELAS, 38.27% by AXA
Financial Inc. and 1.31%
by AXA Participations Belgium
AXA IM Holdings Inc. U.S.A. 100% by AXA Investment
Managers
AXA IM Rose U.S.A. 90% by AXA Investment
Managers and 10% by AXA IM
Holdings Inc.
AXA Rosenberg LLC U.S.A. 50% by AXA IM Rose
National Mutual Funds Australia 100% owned by National
Management Mutual Holdings
AXA Investment Managers Japan 100% by AXA Investment
Tokyo Managers
AXA Investment Managers The Nether- 100% by AXA Investment
Den Haag lands Managers
AXA IM HK SAR Hong Kong 100% by AXA Investment
Managers
AXA Investment Managers Hong Kong 100% by AXA Investment
Hong Kong Managers
xi
<PAGE>
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
S.G.C.I. France 100% by AXA
Compagnie Parisienne de France 100% by Sofinad
Participations (C.P.P.)
Monte Scopeto France 99.99% by Compagnie
Parisienne de Participations
Colisee Jeuneurs France 99.82% by Colisee Suresnes and
0.17% by Compagnie Parislenne
de Participation
Colisee Delcasse France 99.98% by Colisee Suresnes
Colisee Victoire France 99.74% by S.G.C.I.
Colisee Suresnes France 21.19% by AXA Assurance IARD,
0.92% by Societe Beaujon,
51.07% by Compagnie Financiere
de Paris, 20.63% by Jour
Finance and 2.53% by AXA
Courtage IARD
Colisee 21 Matignon France 99.44% by S.G.C.I. and 0.55% by
AXA
xii
<PAGE>
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
Colisee Saint Georges SA France 100% by SGCI
xiii
<PAGE>
HOLDINGS AND MISCELLANEOUS BUSINESS
COMPANY COUNTRY VOTING POWER
- ------- ------- ------------
AXA Direct France 100% by AXA
Societe Beaujon France 100% by AXA
Lor Finance France 99.87% by AXA
Jour Finance France 60.47% by AXA Conseil Vie,
39.53% by AXA Assurance IARD
Financiere 45 France 100% by AXA
Mofipar France 99.92% by AXA
AXA Participations France 53.15% by AXA, 21.90% by AXA
Global Risks and 24.95% by AXA
Courtage IARD
Colisee Excellence France 100% by Financiere Mermoz
Financiere Mermoz France 100% by AXA
AXA France Assurance France 100% by AXA
AXA China France 49% by AXA Region Limited
and 51% by AXA
AXA Participations Belgium Belgium 17.65% by AXA Global Risks,
75% by AXA, 1.82% by AXA
Conseil IARD and 5.53% by AXA
Courtage IARD
Finaxa Belgium Belgium 99.99% by AXA
AXA Holdings Belgium Belgium 43.75% by AXA, 3.02% by AXA
Global Risks, 49.10% by AXA
Participations Belgium and
4.11% by Vinci BV
GRE Continental Europe Germany 100% by AXA Cononia Konzern AG
Holding Gmbh
AXA-Colonia Konzern AG Germany 39.73% by Vinci BV, 25.63% by
Kolnische Verwaltungs and
21.62% by AXA
Kolnische Verwaltungs Germany 67.72% by Vinci BV, 22.99% by
AXA Colonia Konzern AG and
8.83% by AXA
AXA Luxembourg SA Luxembourg 100% by AXA Holdings Belgium
AXA Ona Morocco 51% by AXA Participations
Gelderland The Nether- 100% by AXA Holdings Belgium
lands
AXA Oyak Holdings AS Turkey 50% by AXA
AXA Financial Inc. U.S.A. 4.12% by AXA Equity & Law
Life Assurance Society, 43.01
by AXA, 2.97% by AXA
Reassurance, 0.03% by AXA
America, 0.44% by Societe
Beaujon, 3.21% by Fianciere 45
and 6.46% by LOR Finance
AXA Aurora Spain 30% owned by AXA and 40% by
AXA Participations
AXA Equity & Law Plc U.K. 99.94 by AXA Life
Sun Life and Provincial U.K. 34.52% by AXA and 21.81% by
Holdings (SLPH) AXA Equity & Law Plc
xiv
<PAGE>
ORGANIZATION CHART OF EQUITABLE'S AFFILIATES
NOTES
-----
1. The year of formation or acquisition and state or country of incorporation
of each affiliate is shown.
2. The chart omits certain relatively inactive special purpose real estate
subsidiaries, partnerships, and joint ventures formed to operate or
develop a single real estate property or a group of related properties,
and certain inactive name-holding corporations.
3. All ownership interests on the chart are 100% common stock ownership
except: (a) AXA Financial, Inc.'s 38.6% interest in Donaldson, Lufkin &
Jenrette, Inc., and Equitable Holdings, LLC's 31.7% interest in same; (b)
as noted for certain partnership interests; (c) Equitable Life's ACMC,
Inc.'s and Equitable Capital Management Corporation's limited partnership
interests in Alliance Capital Management L.P.; and (d) as noted for certain
subsidiaries of Alliance Capital Management Corp. of Delaware, Inc.
4. The following entities are not included in this chart because, while they
have an affiliation with The Equitable, their relationship is not the
ongoing equity-based form of control and ownership that is characteristic
of the affiliations on the chart, and, in the case of the first entity, it
is under the direction of at least a majority of "outside" trustees:
EQ Advisors Trust
Separate Accounts
5. This chart was last revised on January 1, 2000.
xv
C-10
<PAGE>
Item 27. Number of Contractowners
As of March 31, 1999 qualified annuity contracts covering 5,495
participants had been issued by the registrant.
Item 28. Indemnification
(a) Indemnification of Directors and Officers
The by-laws of The Equitable Life Assurance Society of the
United States ("Equitable Life") provide, in Article VII, as
follows:
7.4 Indemnification of Directors, Officer and Employees. (a) To the
extent permitted by law of the State of New York and subject to
all applicable requirements thereof:
(i) Any person made or threatened to be made a party to any action or
proceeding, whether civil or criminal, by reason of the fact that
he or she, or his or her testator or intestate is or was a
director, officer or employee of the Company shall be indemnified
by the Company;
(ii) any person made or threatened to be made a party to any action
or proceeding, whether civil or criminal, by reason of the fact
that he or she, or his or her testator or intestate serves or
served any other organization in any capacity at the request of
the Company may be indemnified by the Company; and
(iii) the related expenses of any such person in any of said
categories may be advanced by the Company.
(b) To the extent permitted by the law of the State or New York,
the Company may provide for further indemnification or
advancement of expenses by resolution of shareholders of the
Company or Board of Directors, by amendment of these By-Laws, or
by agreement. (Business Corporation Law ss.ss.721-726; Insurance
Law ss.1216)
The directors and officers of Equitable Life are insured under policies
issued by Lloyd's of London, X.L. Insurance Company and ACE Insurance Company.
The annual limit of such policies is $100 million, and the policies insure the
officers and directors against certain liabilities arising out of their conduct
in such capacities.
(b) Indemnification of Principal Underwriter
To the extent permitted by law of the State of New York and
subject to all applicable requirements thereof, AXA Advisors, LLC
(formerly EQ Financial Consultants, Inc.) undertook to indemnify
each of its directors and officers who is made or threatened to
be made a party to any action or proceeding, whether civil or
criminal, by reason of the fact that he or she is or was a
director or officer of AXA Advisors, LLC.
(c) Undertaking
Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
Item 29. Principal Underwriters
(a) AXA Advisors, LLC (formerly EQ Financial Consultants, Inc.), an
affiliate of Equitable, is the principal underwriter and
depositor for its Separate Account No. 301, Separate Account
No. 45, Separate Account A, Separate Account I, Separate
Account FP ans EQ Advisors Trust. AXA Advisors, LLC's principal
business address is 1290 Avenue of the Americas, NY, NY 10104.
(b) Set forth below is certain information regarding the directors and
principal officers of AXA Advisors, LLC. The business address of
the persons whose names are preceded by an asterisk is that of AXA
Advisors, LLC.
C-11
<PAGE>
NAME AND PRINCIPAL POSITIONS AND OFFICES
BUSINESS ADDRESS WITH UNDERWRITER (AXA ADVISORS, LLC)
- ------------------ -------------------------------------
*Michael S. Martin Chairman of the Board, Chief Executive
Officer and Director
*Martin J. Telles Executive Vice President and Chief
Marketing Officer
*Derry E. Bishop Executive Vice President and Director
*Harvey E. Blitz Executive Vice President and Director
*S. Patrick McGunagle Executive Vice President and Director
*Richard V. Silver Director
*Mark R. Wutt Director
Edward J. Hayes Executive Vice President
200 Plaza Drive
Secaucus, NJ 07096
*Craig A. Junkins Executive Vice President
*Peter D. Noris Executive Vice President
*Mark A. Silberman Senior Vice President and Chief
Financial Officer
*James Bodowitz Senior Vice President and
General Counsel
Stephen T. Burnthall Senior Vice President
6435 Shiloh Road
Suite A
Alpharetta, GA 30005
*Catherine P. Earl Senior Vice President
Richard Magaldi Senior Vice President
6435 Shiloh Road
Suite A
Alpharetta, GA 30005
*Robert Schmedt Senior Vice President
*Cindy Schreiner Senior Vice President
*Donna M. Dazzo First Vice President
*Robin K. Murray First Vice President
*James Bodowitz Vice President and Counsel
*Michael Brzozowski Vice President and Compliance Director
*Amy Francesscheni First Vice President
*Anne Nusbaum First Vice President
*Philomena Scamardella First Vice President
*Mark D. Godolsky Vice President and Controller
*Linda J. Galasso Secretary
*Francesca Divone Assistant Secretary
(c) Not applicable.
C-12
<PAGE>
Item 30. Location of Accounts and Records
The records required to be maintained by Section 31(a) of the Company
Act of 1940 and Rules 31a-1 to 31a-3 promulgated thereunder, are maintained by
Equitable at: 200 Plaza Drive, Secaucus, New Jersey 07094; 1290 Avenue of the
Americas, New York, New York 10104; and 135 West 50th Street, New York, New
York 10020.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
The Registrant hereby undertakes:
(a) to file a post-effective amendment to this registration statement
as frequently as is necessary to ensure that the audited
financial statements in the registration statement are never more
than 16 months old for so long as payments under the variable
annuity contracts may be accepted;
(b) to include either (1) as part of any application to purchase a
contract offered by the prospectus, a space that an applicant can
check to request a Statement of Additional Information, or (2) a
postcard or similar written communication affixed to or included
in the prospectus that the applicant can remove to send for a
Statement of Additional Information;
(c) to deliver any Statement of Additional Information and any
financial statements required to be made available under this
Form promptly upon written or oral request; and
(d) Equitable represents that the fees and charges deducted under
the Contract described in this Registration Statement, in the
aggregate, are reasonable in relation to the services rendered,
the expenses to be incurred, and the risks assumed by Equitable
under the Contract. Equitable bases its representation on its
assessment of all of the facts and circumstances, including such
relevant factors as: the nature and extent of such services,
expenses and risks, the need for Equitable to earn a profit, the
degree to which the Contract includes innovative features, and
regulatory standards for the grant of exemptive relief under the
Investment Company Act of 1940 used prior to October 1996,
including the range of industry practice. This representation
applies to all Contracts sold pursuant to this Registration
Statement, including those sold on the terms specifically
described in the prospectuses contained herein, or any
variations therein, based on supplements, endorsements, data
pages or riders to any Contract or prospectus, or otherwise.
The Registrant hereby represents that it is relying on the November
28, 1988 no-action letter (Ref. No. IP-6-88) relating to variable annuity
contracts offered as funding vehicles for retirement plans meeting the
requirements of Section 403(b) of the Internal Revenue Code. Registrant further
represents that it complies with the provisions of paragraphs (1) - (4) of that
letter.
C-13
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company
Act of 1940, the Registrant certifies that it meets the requirements of
Securities Act Rule 485(b) for effectiveness of this amendment to the
Registration Statement and has caused this amendment to the Registration
Statement to be signed on its behalf in the City and State of New York, on this
24th day of April, 2000.
SEPARATE ACCOUNT NO. 301 OF
THE EQUITABLE LIFE ASSURANCE
SOCIETY OF THE UNITED STATES
(Registrant)
By: The Equitable Life Assurance
Society of the United States
By: /s/ Maureen K. Wolfson
---------------------------
Maureen K. Wolfson
Vice President
C-14
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company
Act of 1940, the Depositor has duly caused this amendment to the Registration
Statement to be signed on its behalf, in the City and State of New York, on
this 24th day of April, 2000.
THE EQUITABLE LIFE ASSURANCE
SOCIETY OF THE UNITED STATES
(Depositor)
By: /s/ Maureen K. Wolfson
--------------------------
Maureen K. Wolfson
Vice President
The Equitable Life Assurance
Society of The United States
As required by the Securities Act of 1933 and the Investment Company
Act of 1940, this amendment to the Registration Statement has been signed by the
following persons in the capacities and on the date indicated:
PRINCIPAL EXECUTIVE OFFICERS:
*Edward D. Miller Chairman of the Board, Chief Executive
Officer and Director
*Michael Hegarty President, Chief Operating Officer
and Director
PRINCIPAL FINANCIAL OFFICER:
*Stanley B. Tulin Vice Chairman of the Board, Chief
Financial Officer and Director
PRINCIPAL ACCOUNTING OFFICER:
*Alvin H. Fenichel Senior Vice President and
Controller
*DIRECTORS:
Francoise Colloc'h John T. Hartley Didier Pineau-Valencienne
Henri de Castries John H.F. Haskell, Jr. George J. Sella, Jr.
Joseph L. Dionne Michael Hegarty Peter J. Tobin
Denis Duverne Mary R. (Nina) Henderson Stanley B. Tulin
Jean-Rene Fourtou W. Edwin Jarmain Dave H. Williams
Norman C. Francis George T. Lowy
Donald J. Greene Edward D. Miller
*By: /s/ Maureen K. Wolfson
----------------------
Maureen K. Wolfson
Attorney-in-Fact
April 24, 2000
C-15
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. PAGE NO.
- ----------- --------
10.(a) Consent of PricewaterhouseCoopers LLP
10.(b) Powers of Attorney.
C-16
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in the Statement of Additional Information
constituting part of this Post-Effective Amendment No. 32 to the Registration
Statement No. 2-74667 on Form N-4 (the "Registration Statement") of (1) our
report dated February 1, 2000 relating to the financial statements of
Separate Account No. 301 of The Equitable Life Assurance Society of the United
States for the year ended December 31, 1999, and (2) our report dated
February 1, 2000 relating to the consolidated financial statements of The
Equitable Life Assurance Society of the United States for the year ended
December 31, 1999, which reports appear in such Statement of Additional
Information, and to the incorporation by reference of our reports into the
Prospectus which constitutes part of this Registration Statement. We also
consent to the reference to us under the headings "Condensed Financial
Information" and "About our independent accountants" in the Prospectus.
/s/ PricewaterhouseCoopers LLP
- ------------------------------
PricewaterhouseCoopers LLP
New York, New York
April 24, 2000
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Francoise Colloc'h
----------------------------------
Francoise Colloc'h
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Norman C. Francis
------------------------------------
Norman C. Francis
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Michael Hegarty
------------------------------------
Michael Hegarty
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Edward Miller
------------------------------------
Edward Miller
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred
Oliver, Robin Wagner and each of them (with full power to each of them to act
alone), his or her true and lawful attorney-in-fact and agent, with full power
of substitution to each, for him or her and on his or her behalf and in his or
her name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the
Securities Exchange Act of 1934 and the Investment Company Act of 1940 with
respect to any insurance or annuity contracts or other agreements providing for
allocation of amounts to Separate Accounts of the Company, and related units or
interests in Separate Accounts: registration statements on any form or forms
under the Securities Act of 1933 and the Investment Company Act of 1940 and
annual reports on any form or forms under the Securities Exchange Act of 1934,
and any and all amendments and supplements thereto, with all exhibits and all
instruments necessary or appropriate in connection therewith, each of said
attorneys-in-fact and agents and his, her or their substitutes being empowered
to act with or without the others, and to have full power and authority to do
or cause to be done in the name and on behalf of the undersigned each and every
act and thing requisite and necessary or appropriate with respect thereto to be
done in and about the premises in order to effectuate the same, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Denis Duverne
------------------------------------
Denis Duverne
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Donald J. Greene
------------------------------------
Donald J. Greene
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ George T. Lowy
------------------------------------
George T. Lowy
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Peter J. Tobin
------------------------------------
Peter J. Tobin
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Joseph L. Dionne
------------------------------------
Joseph L. Dionne
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ John T. Hartley
------------------------------------
John T. Hartley
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ John H. F. Haskell, Jr.
------------------------------------
John H. F. Haskell, Jr.
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
5th day of April, 2000.
/s/ Dave H. Williams
------------------------------------
Dave H. Williams
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Mary B. (Nina) Henderson
------------------------------------
Mary B. (Nina) Henderson
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
4th day of April, 2000.
/s/ George J. Sella, Jr.
------------------------------------
George J. Sella, Jr.
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ W. Edwin Jarmain
------------------------------------
W. Edwin Jarmain
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
13th day of April, 2000.
/s/ Alvin H. Fenichel
------------------------------------
Alvin H. Fenichel
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
13th day of April, 2000.
/s/ Jean-Rene Fourtou
------------------------------------
Jean-Rene Fourtou
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
23rd day of March, 2000.
/s/ Stanley B. Tulin
------------------------------------
Stanley B. Tulin
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
4th day of April, 2000.
/s/ Henri de Castries
------------------------------------
Henri de Castries
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned officer or
Director of The Equitable Life Assurance Society of the United States (the
"Company"), a New York stock life insurance company, hereby constitutes and
appoints R. Lee Wilson, Anne M. Katcher, Stuart L. Faust, Nik Malvania, Pauline
Sherman, Naomi J. Weinstein, Mary A. Hyland, Maureen K. Wolfson, Mildred Oliver,
Robin Wagner and each of them (with full power to each of them to act alone),
his or her true and lawful attorney-in-fact and agent, with full power of
substitution to each, for him or her and on his or her behalf and in his or her
name, place and stead, to execute and file any of the documents referred to
below relating to registrations under the Securities Act of 1933, the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 with respect to any
insurance or annuity contracts or other agreements providing for allocation of
amounts to Separate Accounts of the Company, and related units or interests in
Separate Accounts: registration statements on any form or forms under the
Securities Act of 1933 and the Investment Company Act of 1940 and annual reports
on any form or forms under the Securities Exchange Act of 1934, and any and all
amendments and supplements thereto, with all exhibits and all instruments
necessary or appropriate in connection therewith, each of said attorneys-in-fact
and agents and his, her or their substitutes being empowered to act with or
without the others, and to have full power and authority to do or cause to be
done in the name and on behalf of the undersigned each and every act and thing
requisite and necessary or appropriate with respect thereto to be done in and
about the premises in order to effectuate the same, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this
10th day of April, 2000.
/s/ Didier Pineau Valencienne
------------------------------------
Didier Pineau Valencienne
