<PAGE>
PAGE 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 55 (File No. 2-47430) X
2-29358
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940
Amendment No. 17 (File No. 811-1674) X
IDS Life Variable Annuity Fund B (Individual and Group)
IDS Tower 10, Minneapolis, Minnesota 55440-0010
(612) 671-3678
Mary Ellyn Minenko - IDS Tower 10, Minneapolis 55440-0010
Approximate Date of Proposed Public Offering
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b)
X on April 29, 1994, pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a)
on (date) pursuant to paragraph (a) of rule 486
The Registrant has registered an indefinite number or amount of
securities under the Securities Act of 1933 pursuant to section
24-F of the Investment Company Act of 1940. Registrant's Rule
24f-2 Notice for its most recent fiscal year was filed on or about
February 25, 1994.
<PAGE>
PAGE 2
IDS Life Variable Annuity Fund B Post-Effective Amendment
(Employer and Individual) No. 55
Registration Form N-1
Cross reference sheet showing location in the prospectus of the
information called for by the items enumerated in Part I of Form
N-1.
Negative answers omitted from prospectus are so indicated.
IDS LIFE VARIABLE ANNUITY FUND B (INDIVIDUAL AND GROUP)
<TABLE>
<CAPTION>
Page Number Page Number
Item No. In Prospectus Item No. In Prospectus
<S> <C> <C> <C>
1 3 10 31-35
2 5-7 11 NA
3 7-8 12(a) 36
(b) NA
4(a) 35
(b) NA 13(a) 12,35
(c) NA (b) NA
(c) NA
5(a) 8 (d) NA
(b) 8-12
(c) 8-12 14(a) 31
(d) 7 (b) NA
6(a) 3,25 15(a) 16-19
(b) 25 (b) 15-16,19-23,25-27
(c) NA (c) NA
(d) NA
16(a) 6,13-14,23-25
7(a) 13 (b) 33-35
(b) 13 (c) NA
(c) 13 (d) NA
(d) NA
17 NA
8 NA
18 37-53
9(a) 35
(b) 31
(c) 33
/TABLE
<PAGE>
PAGE 3
IDS Life Variable Annuity Fund B
Individual Variable Annuity Contracts and Group Variable Annuity
Contracts
Prospectus/April 29, 1994
IDS Life Variable Annuity Fund B (the Fund) is a segregated asset
account of IDS Life Insurance Company (IDS Life). The investment
objective of the Fund is long-term capital appreciation. The Fund
invests primarily in common stocks of U.S. corporations. The Fund
also may invest in preferred stocks and in corporate and government
bonds.
This prospectus describes the following types of tax-qualified
variable annuity contracts offered by IDS Life: a) three individual
variable annuity contracts for use with plans qualifying under
Sections 401, 403 or 408 of the Internal Revenue Code (the Code),
and, b) a group variable annuity contract designed to provide
benefits under annuity purchase plans adopted by public school
systems and certain tax-exempt organizations pursuant to Section
403(b) of the Code.
New contracts are not currently being offered. This prospectus
gives you facts about the Fund. You should read it and keep it
with your investment records for future reference.
The Fund is responsible only for statements included in this
prospectus or in authorized sales material.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
IDS Life Variable Annuity Fund B
IDS Tower 10
Minneapolis, Minnesota 55440-0010
General Information (612) 671-3733
Annuity Service (612) 671-4738
<PAGE>
PAGE 4
IDS Life Variable Annuity Fund B
IDS Life Insurance Company
IDS Tower 10
Minneapolis, Minnesota 55440-0010
Prospectus, April 29, 1994
Individual Variable Annuity Contracts and Group Variable Annuity
Contracts
Table of Contents Page
Summary of contents.......................................... 3
Financial highlights......................................... 5
The variable annuity......................................... 5
Investment objective......................................... 6
Investments the Fund will not make........................... 7
Portfolio manager............................................ 8
Investment agreements........................................ 9
Brokerage.................................................... 9
The contracts................................................ 10
The fixed account............................................ 10
Automated transfers and partial surrenders................... 11
Measuring the value of your contract......................... 11
Valuing Fund assets.......................................... 12
The investment factor........................................ 13
Valuing an accumulation unit................................. 13
Valuing an annuity unit...................................... 13
Annuity payment starting date................................ 14
Table of settlement rates.................................... 14
Annuity payment plans........................................ 15
The charges you pay.......................................... 16
Surrendering your contract................................... 18
Special rules if annuitant dies before the annuity payment
starting date................................................ 19
Special features of the group variable annuity contract...... 19
What about your taxes?....................................... 21
Voting rights................................................ 22
Board of managers and officers............................... 23
History...................................................... 25
Assets of the Fund........................................... 25
Headquarters................................................. 25
Ownership of IDS Life and IDS................................ 25
Other affiliations........................................... 25
Custodian.................................................... 26
Insurance regulation......................................... 26
Financial statements......................................... 26
<PAGE>
PAGE 5
Summary of Contents
About the variable annuity - The variable annuities are offered for
sale through the Fund, a diversified open-end management investment
company. Variable annuity contracts guarantee regular payments to
contract purchasers. The amount of these payments is influenced by
the performance of the securities in which the Fund invests (page
5).
Financial highlights - This table shows important financial
information you will need to evaluate the Fund's performance (page
5).
Investment objective - The Fund's investment objective is long-term
capital appreciation in order to build up values and to make
annuity payments. The Fund invests primarily in common stock and
also may invest in preferred stock and in government and corporate
bonds. The Fund may invest in foreign securities, futures
contracts and options on futures contracts. There can be no
guarantee the Fund will achieve its investment objective because
any investment involves risk (page 6).
Portfolio manager - Gordon Fines has managed the Fund since 1989.
He leads the growth team for IDS Financial Corporation (IDS) (page
8).
Investment agreements - The Fund is a segregated asset account of
IDS Life Insurance Company, a stock life insurance company. The
investments of the Fund are managed by IDS Life pursuant to an
Investment Management Agreement. Under this agreement, IDS Life
receives a management fee equal to 0.4 percent of the Fund's
average daily net assets for each year. Pursuant to a Distribution
and Services Agreement, IDS Life also serves as principal
underwriter of the Fund. IDS Life annually pays 0.25 percent of
the Fund's net assets to IDS, for investment advice regarding
management of the Fund's investments (page 9).
Contracts - This prospectus describes the following types of
tax-qualified variable annuity contracts:
o A single payment deferred annuity that can be purchased by making
an initial payment of at least $3,000 (page 10).
o A single payment immediate annuity that can be purchased by
making an initial payment of at least $3,000 (page 10).
o A flexible installment deferred annuity that may be purchased by
making 10 or more annual payments of at least $300 (page 10).
Each of the individual variable annuity contracts described above
are for use with plans qualifying under Sections 401, 403 or 408 of
the Code.
<PAGE>
PAGE 6
The annuitant is the owner for the three individual annuity
contracts described above, unless your application states
otherwise; and
o A group variable annuity contract designed to provide benefits
under annuity plans adopted by public school systems and certain
tax-exempt organizations pursuant to Section 403(b) of the Code.
The contract which is issued to the employer as owner provides
benefits to all group contract participants (participants) in the
underlying annuity plan. Generally, IDS Life will not issue a
contract to an employer unless there are at least five employees
who are plan participants or who already own contracts based on the
Fund. The annual contribution a participant elects must be at
least equal to the larger of (1) an amount which, when multiplied
by the number of contract years between the application date and
the retirement date, equals $3,000 or (2) $300 a year (page 10).
Transfers between accounts - Before the annuity payment starting
date, you may give IDS Life written or telephone instructions to
transfer the contract value of your investment between the fixed
account and the variable account. Transfers must be at least for
$50 (page 11).
Charges you pay - IDS Life will deduct a combined sales and
administrative charge from payments made into the Fund.
For the group variable annuity contract the deduction is 5.75
percent of the first $10,000 contribution, 4 percent of the next
$40,000, and 2 percent of all amounts in excess of $50,000 (page
16).
For the other three individual annuity contracts, the deduction is
15 percent of the first $1,500, 4 percent of the next $48,500, and
2 percent of all amounts in excess of $50,000 (page 16).
Additionally, IDS Life may deduct for premium taxes. Most states
don't have premium taxes but in those that do, IDS Life may make a
deduction of up to 3.5 percent of the gross purchase payments. You
may receive some money in excess of the amount requested if, as a
result of your surrender, the Fund's state premium tax liability is
reduced (page 18).
Surrendering your contract - You can surrender all or part of your
deferred annuity contract any time before the annuity payment
starting date by giving IDS Life written or telephone instructions.
IDS Life will cash in the number of accumulation units or fixed
dollar accumulation value required for the amount of money you
request. The accumulation units will be given the accumulation
unit value determined on the date your request is received.
However, you can't surrender part of your contract if the remaining
accumulation value is less than $20. There can be no surrenders of
any type after annuity payments have started. You will pay income
tax on the taxable part of your surrender and you may have to pay
an IRS penalty tax on early withdrawal if you surrender part or all
of your contract before reaching age 59 1/2. In addition, 20
<PAGE>
PAGE 7
percent income tax withholding may be imposed. The Tax Reform Act
of 1986 restricts your right to receive a distribution from a
Tax-Sheltered Annuity (TSA).
You may lose money if you surrender your contract too soon because
the percentage that is deducted is higher in the earlier years.
A surrender by a participant in a plan or program qualified under
Sections 401, 403, or 408 of the Code may result in adverse tax
consequences. You should consult a tax adviser before making a
surrender request (page 18).
Federal Tax Information - According to current interpretations of
federal income tax law, generally there is no federal income tax on
any increase in your annuity's value until distributions are made.
Under certain circumstances, there may be a 10 percent IRS penalty
tax on early withdrawal and 20 percent income tax withholding
imposed on distributions (page 21).
Additional Information
For information about the Fund's history, organization and
headquarters as well as information about IDS Life and IDS see page
(25).
Financial Highlights From Jan. 1, 1984 to Dec. 31, 1993
<TABLE>
<CAPTION>
Years ended Dec. 31, 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984
___________________________________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Accumulation unit value at
beginning of year $11.60 $10.87 $ 7.29 $7.14 $5.43 $5.08 $3.95 $3.39 $2.76 $2.81
___________________________________________________________________________________________________________________________________
Income from investment operations:
Net investment income (loss) (.02) (.03) .02 .07 .05 .06 .03 .01 .04 .07
Net gains (losses) on securities,
both realized and unrealized 1.11 0.76 3.56 .08 1.66 .29 1.10 .55 .59 (.12)
___________________________________________________________________________________________________________________________________
Total from investment operations 1.09 0.73 3.58 .15 1.71 .35 1.13 .56 .63 (.05)
___________________________________________________________________________________________________________________________________
Accumulation unit value at
end of year $12.69 $11.60 $10.87 $7.29 $7.14 $5.43 $5.08 $3.95 $3.39 $2.76
___________________________________________________________________________________________________________________________________
Total Return* 9.42% 6.72% 49.03% 2.12% 31.46% 6.93% 28.52% 16.75% 22.69% (1.92%)
___________________________________________________________________________________________________________________________________
Ratios/Supplemental Data
___________________________________________________________________________________________________________________________________
Total contract owner's equity
at end of year (000 omitted) $534,556 $506,150 $500,877 $355,049 $376,790 $325,271 $352,809 $312,706 $300,093 $283,138
Ratio of operating expenses to
average net assets 1.40% 1.40% 1.41% 1.41% 1.43% 1.40% 1.40% 1.40% 1.40% 1.40%
Ratio of net investment income
(loss) to average net assets (0.17)% (0.28)% 0.26% 0.93% 0.75% 1.04% 0.48% 0.25% 1.13% 2.69%
Portfolio turnover rate 64% 74% 67% 56% 53% 60% 88% 111% 127% 51%
___________________________________________________________________________________________________________________________________
*Total return does not reflect payment of a sales charge.
This table pertains to accumulation units only. The value of an annuity unit (assuming a 3.5 percent investment rate) was $5.41 as
of Dec. 31, 1993, $5.11 as of Dec. 31, 1992, $4.96 as of Dec. 31, 1991, $3.46 as of Dec. 31, 1990, $3.51 as of Dec. 31, 1989, $2.76
as of Dec. 31, 1988, $2.67 as of Dec. 31, 1987, $2.15 as of Dec. 31, 1986, $1.91 as of Dec. 31, 1985 and $1.61 as of Dec. 31, 1984.
The value of an annuity unit (assuming a 5 percent investment rate) was $3.78 as of Dec. 31, 1993, $3.63 as of Dec. 31, 1992, $3.57
as of Dec. 31, 1991, $2.53 as of Dec. 31, 1990, $2.60 as of Dec. 31, 1989, $2.07 as of Dec. 31, 1988, $2.04 as of Dec. 31, 1987,
$1.67 as of Dec. 31, 1986, $1.50 as of Dec. 31, 1985 and $1.28 as of Dec. 31, 1984. <PAGE>
PAGE 8
The information in this table has been examined by Ernst & Young, independent auditors. The independent auditor's report and
additional information about the performance of the Fund are contained in the Fund's annual report, which if not included with this
prospectus, may be obtained without charge.
</TABLE>
The variable annuity
An annuity is a contract with a life insurance company that
guarantees regular income to the purchaser. Most people buy
annuities to provide income in their retirement years. When most
people think of an annuity, they are thinking of a fixed dollar
annuity. With a fixed dollar annuity, the insurance company bears
the risk of investment gain or loss and guarantees payment of an
exact monthly amount. A variable annuity also guarantees you
regular payments. However, the amount of the payments will
fluctuate with the performance of the securities in which the
annuity fund invests. So if the securities go up in value, you may
receive larger annuity payments. If they go down, the amount of
the annuity payments you receive may be reduced.
Investment objective
The Fund's investment objective is long-term capital appreciation
so that the Fund can build up values and increase the size of
annuity payments. There can be no guarantee the Fund will achieve
its investment objective because any investment involves risk. The
Fund's investment objective can be changed by IDS Life without the
approval of the Fund's contract holders, but IDS Life has no
intention of doing so.
The Fund invests primarily in U.S. common stocks. The Fund also
may invest in preferred stocks and in corporate and government
bonds. Some bonds issued by agencies of the U.S. government are
not supported by the full faith and credit of the United States.
The Fund may invest up to 30 percent of its total assets at the
time of purchase in foreign securities. In selecting foreign
investments, the Fund generally will seek to invest in companies
that it anticipates will experience economic growth at least as
great as that anticipated in the U.S. companies in which it
invests. The securities that the Fund believes offer attractive
opportunities for investment may change from time to time. Foreign
investments may be subject to additional risks, including future
political and economic developments, the possible imposition of
withholding taxes on dividend income, the seizure or
nationalization of companies, the establishment of exchange
controls or the adoption of other restrictions that might adversely
affect an investment.
The Fund may invest in the securities of foreign issuers directly
or in the form of American Depository Receipts (ADRs). ADRs are
receipts typically issued by an American bank or trust company that
evidence ownership of underlying securities issued by a foreign
corporation. Since investments in foreign securities will involve
currencies of foreign countries, the value of the Fund's assets as
measured in U.S. dollars may be affected favorably or unfavorably <PAGE>
PAGE 9
by changes in currency rates and in exchange control regulations.
The Fund also may enter into forward commitments for the purchase
or sale of foreign currencies, but only in connection with the
settlement of foreign securities transactions and not for
speculative purposes.
The Fund may enter into a forward contract to buy or sell foreign
currencies. For example, if the Fund believes the value of the
U.S. dollar will decline in relationship to a foreign currency, the
Fund will buy the foreign currency at today's price in U.S. dollars
agreeing to pay for the currency at a future date. If the U.S.
dollar declines, then the foreign currency can be sold for more
U.S. dollars than it cost and the Fund realizes a profit. The Fund
will not enter into forward contracts in excess of an offsetting
position of cash and investment in U.S. dollars. If the U.S.
dollar does not decline as expected, the Fund will sustain a loss
because of having entered into the forward contract.
The Fund may buy or write (sell) options traded on any U.S. or
foreign exchange or in the over-the-counter market. It may write
covered call options on individual securities. Options in the
over-the-counter market will be purchased only when the investment
manager believes a liquid secondary market exists for the options
and only from dealers and institutions the investment manager
believes present a minimal credit risk. Some options are
exercisable only on a specific date. In that case, or if a liquid
secondary market does not exist, the Fund could be required to buy
or sell securities at disadvantageous prices, thereby incurring
losses. In covered call options, the seller owns the underlying
security required to be sold upon exercise of the option.
Options can be used to produce incremental earnings, protect gains
and facilitate buying and selling securities. The writer of an
option agrees to buy or sell a security at a fixed price and could
forgo a profit or incur a loss from a change in the market price of
the security. The purchaser of an option pays a premium whether or
not the option is exercised. If a liquid secondary market does not
exist at a particular time, it might not be possible to close an
option position when it is desirable to do so. The Fund may buy
put and call options as a trading technique.
For temporary purposes, the Fund may make certain investments. It
may buy short-term U.S. and Canadian government securities. It may
invest in bank obligations including negotiable certificates of
deposit, non-negotiable fixed time deposits, bankers' acceptances
and documented discount notes (letters of credit). The Fund may
buy short-term corporate notes and obligations rated in the top two
classifications by Standard and Poor's, Moody's or the equivalent.
The Fund does not look to buy and sell stocks for the short-term,
but will do so if it is appropriate. The Fund may use repurchase
agreements with broker-dealers registered under the Securities
Exchange Act of 1934 and commercial banks. Repurchase agreements
involve investments in debt securities where the seller agrees to
repurchase the securities at cost plus an agreed-to interest rate <PAGE>
PAGE 10
within a specified time. A risk of a repurchase agreement is that
if the seller seeks the protection of the bankruptcy laws the
Fund's ability to liquidate the security involved could be
impaired, and it might subsequently incur a loss if the value of
the securities declines or if the other party to a repurchase
agreement defaults on its obligation.
The Fund may enter into stock index futures contracts traded on any
U.S. or foreign exchange. The Fund may buy or write put and call
options on these futures and stock indexes. These instruments may
be considered speculative and may expose the Fund to greater risk.
These instruments may be considered speculative and may expose the
Fund to greater risk. Stock index futures contracts, options on
futures contracts and options on stock indexes must be used as a
hedge. This means they must be used to offset changes in value of
some or all the Fund's existing investments in stocks or be offset
by the Fund's cash position. The futures contracts and related
options may help the Fund gain rapid exposure to or protect itself
from changes in the market. Successful hedges depend on the
adviser's ability to predict the future direction of stock prices
or interest rates. If the adviser's prediction is incorrect, the
Fund would have been better off if no hedge had been made. Also,
skills and techniques necessary to arrive at such predictions are
different from those needed for predicting changes in individual
stocks.
No more than 5 percent of the Fund's net assets can be used at any
one time for good faith deposits on futures and premiums for
options on futures that do not offset existing investment
positions.
For 1993, the Fund's portfolio turnover rate was 64 percent, for
1992, the Fund's portfolio turnover rate was 74 percent and for
1991, it was 67 percent. Portfolio turnover results in brokerage
costs and may affect the taxes the Fund must pay.
The prices of the securities in which the Fund invests fluctuate
daily. This means that the value of your contract goes up and
down. If values go down, your contract may be worth less than what
you paid for it.
Investments the Fund will not make
The Fund observes the following fundamental investment
restrictions, that may not be changed without approval by a vote of
the contract holders:
o The Fund will not borrow amounts in excess of 10 percent of the
gross assets of the Fund taken at cost determined in accordance
with generally accepted accounting principles, and no borrowing
shall be undertaken except as a temporary measure for extraordinary
or emergency purposes. The Fund may borrow only from banks. Any
borrowings will require that the Fund maintain the necessary 300
percent asset coverage as set forth under the Investment Company
Act of 1940 (1940 Act).
<PAGE>
PAGE 11
o The Fund shall not underwrite securities of other issuers.
However, this shall not preclude the purchase of securities for
investment, on original issue or otherwise, and shall not preclude
the acquisition of portfolio securities under circumstances where
the Fund would not be free to sell them without being deemed an
underwriter for purposes of the Securities Act of 1933 (1933 Act)
and without registration of these securities or the filing of a
notification under the 1933 Act, or the taking of similar action
under other securities laws relating to the sale of securities.
o The Fund will not invest in securities that are not readily
marketable without registration or the filing of a notification
under the 1933 Act, or the taking of similar action under other
securities laws relating to the sale of securities, if immediately
after the making of any such investment more than 15 percent of the
Fund's net assets (taken at market or other current value) is
invested in these securities. For valuation, see page 12 of this
prospectus. However, investments in securities not having readily
available market quotations in excess of 10 percent of net assets
may be deemed to be imprudent and the Fund does not intend to
exceed this limitation.
o The Fund does not intend to concentrate investments in any
particular industry, but reserves freedom of action to do so
provided that not more than 25 percent of its total assets, taken
at cost, may be so invested at any one time.
o The Fund may invest up to 10 percent of its total assets, taken
at cost, in real properties, but will not do so as a principal
activity.
o Not more than 5 percent of the Fund's total assets taken at cost
will be invested in securities of any one corporation, government
or political subdivision thereof. This limitation does not apply
to investments in obligations of the United States or in
obligations of any corporation organized under a general act of
Congress if the corporation is an instrumentality of the United
States.
o The Fund will not buy securities of any issuer if immediately
after, and as a result of a purchase, the Fund would own more than
10 percent of the outstanding voting securities of the issuer.
o The Fund will not buy securities of any investment trust or
investment company, except by purchase in the open market where no
commission or profit to a sponsor or dealer results from a purchase
other than customary broker's commission. The Fund does not intend
to invest in these securities but may do so to the extent of not
more than 15 percent of the Fund's net assets (taken at market or
other current value). The Fund will not invest in other mutual
funds.
o No securities will be bought on margin, nor will the Fund make
any short sales of securities.
<PAGE>
PAGE 12
o The Fund will not make loans to other persons, except by the
purchase, upon original issuance or otherwise, of a portion of an
issue of bonds, notes, debentures or other securities publicly
distributed or of a type customarily purchased by financial
institutions.
o The Fund will not engage in the purchase and sale of commodities
or commodity contracts.
Portfolio manager
Gordon Fines joined IDS in 1981 and serves as vice president -
Mutual Fund Equity Investments and senior portfolio manager. He
has managed the Fund since 1989. He also leads the growth team for
IDS and manages IDS New Dimensions Fund. From 1985 to 1991, he was
portfolio manager of IDS Managed Retirement Fund.
Investment agreements
IDS Life is the Fund's investment manager. Under the Investment
Management Agreement between IDS Life and the Fund, IDS Life
charges a fee for managing the Fund's investments. This amounts to
0.4 percent of the Fund's average daily net assets for the year.
IDS Life does not keep all of this fee. IDS Life and IDS have an
Investment Advisory Agreement that calls for IDS Life to pay IDS a
fee for serving as investment adviser for the Fund. The fee is
0.25 percent of the Fund's average net assets for the year.
In addition to paying its own management fee, the Fund also pays
all brokerage commissions and charges in the purchase and sale of
assets. Brokerage charges are paid to IDS Life for reimbursement
of charges incurred in the purchase and sale of foreign securities.
An Investment Management Agreement and an Advisory Agreement were
approved by the contract holders on Dec. 30, 1983, as a result of
the IDS/American Express merger. Both agreements will continue
each year as long as they are approved:
o by a majority of the Board of Managers of the Fund or a majority
of the outstanding votes of the Fund, and
o by a majority of the Board of Managers of the Fund who are not
"interested persons" of IDS Life or IDS.
All votes by the Board of Managers must be taken at a meeting
called specifically to approve or disapprove the agreements and all
votes must be cast in person.
IDS Life may cancel either of its agreements without penalty,
provided it gives 60 days' notice in writing. IDS and the Fund may
do the same. If the Fund decides to cancel its management
agreement with IDS Life, it must have the approval of either the
Board of Managers or a majority of the votes of contract holders.
If there is any assignment of either agreement it ends immediately.
<PAGE>
PAGE 13
Brokerage
Under the Investment Management Agreement, IDS Life has
responsibility for making the Fund's investment decisions, for
effecting the execution of trades for the Fund's portfolio and for
negotiating any brokerage commissions. IDS Life intends to direct
IDS to execute trades and negotiate commissions on its behalf.
These services are covered by the Investment Advisory Agreement
between IDS and IDS Life. When IDS acts on IDS Life's behalf for
the Fund, it follows the rules described here for IDS Life. Total
brokerage commissions paid by the Fund for each of the last three
years were as follows: for 1993, $722,276, for 1992, $778,368, and
for 1991, $700,684. IDS Life intends to continue to examine and
consider ways available to reduce brokerage costs.
The Investment Management Agreement generally requires IDS Life to
use its best efforts to obtain the best available price and the
most favorable execution. However, brokerage firms may provide
some extra services, including economic or investment research and
analysis. Sometimes it may be desirable to compensate a broker for
research or brokerage services by paying a commission that might
not otherwise be charged, or a commission in excess of what another
broker might charge. The Board of Managers has adopted a policy
authorizing IDS Life to do so to the extent authorized by law, if
IDS Life determines, in good faith, that the amount of commission
is reasonable in relation to the value of the brokerage or research
services provided by the broker.
In purchases and sales of securities involving transactions not
listed on an exchange or in listed securities which are traded off
of the exchange, the Fund will deal with a market maker as
principal, or a broker as agent, depending upon the method believed
to produce the best available price and most favorable execution as
described above. In transactions with a broker who acts as
principal, commissions are generally not stated separately, but are
included in the price of the securities.
IDS gives investment advice to a number of investment companies and
mutual funds. Where more than one of these companies or funds are
interested in the same securities at the same time, IDS carries out
the sale or purchase in a way that all agree in advance is fair.
Sharing in a large transaction may affect the price or volume of
shares acquired. But by these transactions, the Fund hopes to gain
an advantage in execution.
The Fund may pay brokerage commissions to broker-dealer affiliates
of IDS Life, IDS and American Express.
The contracts
This prospectus describes the following types of tax-qualified
variable annuity contracts:
o Single payment-deferred annuity. You make a single purchase
payment. Annuity payments are deferred until some future date. <PAGE>
PAGE 14
o Single payment-immediate annuity. A participant makes a single
payment. Annuity payments will begin within 60 days after IDS Life
approves your application.
o Flexible installment payment-deferred annuity. A participant
makes purchase payments in installments over one or more years.
Annuity payments will begin at some future date after all
installments have been paid.
o A group variable annuity contract. This contract is designed to
provide benefits under annuity purchase plans adopted by public
school systems and certain tax-exempt organizations pursuant to
Section 403(b) of the Code. The contract is a master contract
issued to the employer as owner and provides benefits for all
annuity plan participants. Generally IDS Life will not issue a
contract to an employer unless there are at least five employees
who are plan participants or who already own contracts based on the
Fund. The annual contribution a participant elects must be at
least equal to the larger of (1) an amount which, when multiplied
by the number of contract years between the application date and
the retirement date, equals $3,000 or (2) $300 a year. A
participant may increase the amount of this annual contribution
within the limits provided by the Code. However, if the annual
contribution is more than twice that of the very first annual
contribution, IDS Life may place some further conditions on
contributions. No contribution will be accepted that is not within
the employee exclusion allowance provided by Section 403(b) of the
Code. The contract provides several optional settlement modes that
each plan participant may elect, except that if at the annuity
starting date the accumulation value of the contract is less than
$2,000, then the accumulation value may be paid in a lump sum.
The fixed account
The fixed account is an additional account to which you may choose
to allocate purchase payments and contract values. It provides
guaranteed values and periodically adjusted interest-crediting
rates.
If you have a deferred annuity contract, you can change your mind
from time to time and apply all or part of your future purchase
payments to the fixed account.
Also, the contract provides that once each contract year, you can
transfer accumulation values of at least $250 from the variable
account to the fixed account or from the fixed account to the
variable account. This right ends 30 days before annuity payments
begin. Presently, IDS Life does not intend to limit the number of
transfers from the variable account to the fixed account; however,
transfers from the fixed account to the variable account are
limited to one per contract year. Just write or telephone IDS Life
and indicate the dollar amount, percentage of, or number of
variable accumulation units to transfer from the Fund or the amount
of fixed dollar accumulation value to transfer to the Fund.
<PAGE>
PAGE 15
Automated transfers and partial surrenders
IDS Life currently allows deferred annuity contract holders to
establish: (1) automated transfers of contract values between the
fixed account and variable account; or (2) automated partial
surrenders of contract values. Both services can be in effect at
the same time and may be established through a one-time written or
telephone request to IDS Life.
The minimum transfer amount from any account or partial surrender
amount from the contract is $50 and such transfer or surrender can
be made on a monthly, quarterly, semi-annual or annual basis. You
may start or stop this service at any time but you must give IDS
Life 30 days' notice to change any automated transfer or surrender
instructions that are currently in place. Automated transfers or
partial surrenders are subject to all of the other contract
provisions and terms including provisions relating to the transfer
of money between accounts. They are not available for 1969 Series
Contracts which were issued prior to May 1971.
Automated transfers from the fixed account may not exceed an amount
that will deplete the fixed account within 24 months. If you have
made any type of transfer from the fixed account, you may not
transfer contract values from the variable account back to the
fixed account until the next contract anniversary.
Automated partial surrenders may be restricted by applicable law in
some contracts. In addition, the payment of additional purchase
payments, if allowed under the contract, while automated partial
surrenders are in effect, may not be appropriate and therefore, is
not permitted.
IDS Life has the authority to honor any telephone requests believed
to be authentic and will use reasonable procedures to confirm that
they are. This includes asking identifying questions and tape
recording calls. As long as the procedures are followed, neither
IDS Life nor its affiliates will be liable for any loss resulting
from fraudulent requests. If IDS Life receives your transfer
and/or variable surrender request before its close of business
(normally 3 p.m. Central time), it will be processed that day.
Calls received after its close of business will be processed the
next business day. At times when the volume of telephone requests
is unusually high, IDS Life will take special measures to ensure
that your call is answered as promptly as possible. A telephone
surrender request will not be allowed within 30 days of a phoned-in
address change.
You may request that telephone withdrawals not be authorized from
your account by writing IDS Life.
Automated partial surrenders may result in income taxes and IRS
penalty taxes being applied to all or a portion of the amount
surrendered. See the sections on Tax charges and Surrendering your
contract (page 18).
<PAGE>
PAGE 16
Consult your tax adviser if you have any questions about the
taxation of your annuity.
Measuring the value of your contract
Because values are always changing with the performance of the
Fund's investments, it is not easy to measure value with a variable
annuity contract. For this reason we use a technique that involves
"units." The performance of the Fund is measured by changes in the
value of a single unit, rather than the total value of the Fund.
There are two kinds of units. As long as you are paying into the
Fund they are called "accumulation units." When you begin to
receive your annuity payments, they change to "annuity units."
o Accumulation units are used to measure the value of deferred
annuity contracts during the period before annuity payments are
made.
number of your value of one total
accumulation x accumulation = accumulation
units unit value
When you buy a deferred annuity contract, your purchase payments
will be credited as accumulation units to your contract.
o Annuity units determine the value of each annuity payment. When
you buy an immediate annuity contract, your purchase payment will
be credited as annuity units to your account.
Under a deferred annuity contract, when annuity payments are to
start, your accumulation value will be converted into annuity
units. From then on, your annuity payments are based on the
current annuity unit value.
number of your annuity value of one
annuity units x unit value = annuity payment
Dates we revalue units - Valuation date
Your units are valued at least once every seven days. At the
present time, your units are revalued each business day at the
close of trading on the New York Stock Exchange (NYSE). The Fund's
securities also will be valued on any business day there is a
sufficient degree of trading in the Fund's portfolio securities
such that the current net asset value of units might be materially
affected (if on that day the Fund is required to sell or redeem
securities). The net asset value per share generally changes each
day. During an emergency the Fund can suspend redemption. Such
emergency situations would occur if:
o The NYSE closes for reasons other than the usual weekend and
holiday closings, or trading on the NYSE is restricted,
o Disposal of the Fund's securities is not reasonably practicable,
or it is not reasonably practicable for the Fund to determine the
fair value of its net assets, or
<PAGE>
PAGE 17
o The Securities and Exchange Commission under the provisions of
the 1940 Act declares a period of emergency to exist.
Splitting units
IDS Life can split accumulation or annuity units. It will only do
so if it is in the best interests of the contract holders, the
annuitants and IDS Life.
The valuation period
The valuation period starts after the close of business on one
valuation date and ends with the close of business on the next
valuation date.
Valuing Fund assets
The net value of the Fund's assets is determined at the start of
each valuation period by taking the total value of the Fund's
assets and subtracting liabilities. The Fund's portfolio
securities are valued as follows:
o Securities traded on national securities exchanges are valued at
the last quoted sales price on that day. If a particular security
hasn't been traded on a certain day, we take the average price
between the last bid (offer to buy) and the last asked (offer to
sell) price.
o Securities with readily available market quotations but without a
listing on an exchange also are valued at the average between the
last bid and the last asked price.
o Short-term securities maturing more than 60 days from the
valuation date are valued at the market price or approximate market
value based on current interest rates. Short-term securities
maturing in 60 days or less but that originally had maturities of
more than 60 days at the acquisition date are valued on an
amortized cost basis using the market value on the 61st day before
maturity. Short-term securities maturing in 60 days or less at the
acquisition date are valued at amortized cost. (Amortized cost is
an approximation of market value determined by systematically
increasing the carrying value of a security if acquired at a
discount, or systematically reducing the carrying value if acquired
at a premium, so that the carrying value is equal to maturity value
on the maturity date.)
o Securities and other assets without a ready market price are
valued at fair value. The Board of Managers is responsible for
using valuation methods which they believe give fair value. In
cases like this, they may use an outside organization to value
these securities. These organizations may use methods that take
into consideration yields, trading characteristics and other market
data.
<PAGE>
PAGE 18
When we credit your purchase payments
IDS Life credits each purchase payment at the end of the valuation
period during which it received the payment at its corporate
office.
The investment factor
On each valuation date, an investment factor is calculated for the
valuation period. This factor measures the Fund's investment
performance during the period. Here is how the investment factor
is determined:
First, the investment income for the period is determined by
combining the Fund's income (interest and any dividends), net
realized and unrealized capital gains or losses on investments and
expenses. Then, the net investment rate is determined by dividing
the Fund's net investment income by the net value of the Fund's
assets at the beginning of the valuation period.
Finally, the investment factor for any valuation period is the sum
of 1 plus the net investment rate. If the Fund has a negative
investment rate for a period, the investment factor will be less
than 1.
Valuing an accumulation unit
Accumulation units are used to measure the value of your contract
during the period before annuity payments begin. The value of an
accumulation unit is determined by multiplying the accumulation
unit value for the last valuation period by the investment factor
for the current period.
Here is an example: Assume the Fund's assets at the start of the
day were $1 million and the investment income for the day was
$2,000. The total expenses were $398.35 and the value of an
accumulation unit the day before was $1.101000.
Step 1. First, the net investment income is determined. This is
income minus expenses or $1,601.65 ($2,000 - $398.35).
Step 2. Next the investment rate is determined. This is the net
investment income divided by the assets at the start of the day or
0.001602 (1,601.65 divided by 1,000,000).
Step 3. The investment factor is one plus the investment rate, or
1.001602.
Step 4. Finally, the value of an accumulation unit is determined
by multiplying yesterday's accumulation unit by the investment
factor. The current value of an accumulation unit comes out to
$1.102764 (1.101000 X 1.001602).
<PAGE>
PAGE 19
Valuing an annuity unit
When you are ready to receive annuity payments, your accumulation
units are exchanged for annuity units. Annuity units measure each
variable annuity payment. To determine the value of an annuity
unit, the annuity unit value on the last valuation date is
multiplied by the product of (1) the investment factor for the
current period, and (2) the neutralizing factor.
The neutralizing factor removes the assumed investment rate that is
built into the variable annuity tables in your contract. The
neutralizing factor for a one-day valuation period is 0.999866,
when the usual 5 percent assumed investment rate is used.
Here is a shortcut for calculating the value of an annuity unit:
Substitute the term "annuity unit" for the term "accumulation unit"
each time it appears in the example used for calculating
accumulation unit values.
Then take the answer in Step 4 ($1.102764) and multiply it by the
neutralizing factor (0.999866). The answer is the current value of
an annuity unit, or $1.102616.
The assumed investment rate is not always 5 percent. For example,
contracts subject to Texas law cannot use more than a 3.5 percent
investment rate. You can request a 3.5 percent investment rate by
sending a written request to IDS Life at its home office. The
current policy of IDS Life is to grant a request received no later
than 30 days before settlement.
Why would you want a lower assumed investment rate? The value of
an annuity unit will rise or fall to the extent that the actual
investment rate for the period is more or less than the assumed
investment rate. A lower assumed rate produces a lower initial
annuity payment, but later payments will rise faster if unit values
are going up. Later payments will fall more slowly if unit values
are dropping.
Annuity payment starting date
Individual contracts. For deferred contracts paid for in annual
installments or with a single payment, the annuity payment starting
date is selected in your application. You may change the payment
date at any time not less than 30 days before annuity payments are
to start.
For single payment deferred contracts, the annuity payment starting
date must be at least 60 days after the application date.
For immediate contracts, the annuity payment starting date must be
no later than 60 days after the application date.
You can only wait so long before annuity payments begin. The
annuity payment starting date must come before the annuitant's 75th
birthday. However, the plan under which you bought the annuity may
require an earlier starting date.
<PAGE>
PAGE 20
Group contracts. For group contracts, the annuity starting date and
the annuity payment plan are elected by the participant in the
Statement of Participation. The participant may change either
election anytime not less than 30 days before annuity payments
start. The annuity starting date must be at least so many years
after the application date that the number of years multiplied by
the annual purchase payment equals or exceeds $3,000.
Additionally, the annuity payment starting date must be no later
than the certificate anniversary nearest the annuitant's 75th
birthday.
Effective Jan. 1, 1989, for annuities purchased under a section
403(b) plan, retirement payments generally must not begin earlier
than the date the annuitant turns 59 1/2 or later than April 1 of
the year following the calendar year in which he or she reaches age
70 1/2.
Table of settlement rates
Settlement rates are based on the Progressive Annuity Table
assuming all births in 1900. To determine the rate applicable at
settlement, we look at the annuitant's birthday nearest the
settlement date and subtract an adjustment according to the
following chart.
Calendar year of Adjustment for
annuitant's birth Male Female
_______________________________________________________
Prior to 1920....................... 0 4
1920 through 1939................... 1 5
1940 through 1954................... 2 6
1955 through 1969................... 3 7
After 1969.......................... 4 8
_______________________________________________________
In Arizona Governing Committee for Tax Deferred Annuity and
Deferred Compensation Plans, etc. et al. v. Nathalie Norris, etc.,
the United States Supreme Court decided that Title VII of the Civil
Rights Act of 1964 prohibits an employer from offering its
employees the option of receiving retirement benefits from one of
several companies selected by the employer, all of which pay a
woman lower monthly retirement benefits than a similarly situated
man. The Court ordered that all retirement benefits derived from
contributions made on and after Aug. 1, 1983, must be calculated
without regard to the sex of the annuitant.
IDS Life has been administering contributions received since Aug.
1, 1983, on the company's in-force annuity contracts to provide
retirement benefits without regard to the sex of the annuitant in
those markets which are affected by the Norris decision. Annuity
contract amendments also have been developed for new contracts in
order to assure continued compliance by employers with the
obligations imposed on them by the Norris decision.
<PAGE>
PAGE 21
Annuity payment plans
You may select on the application how you want annuity payments
made and when the payments are to begin. If you have a deferred
annuity contract you may change your payment plan at any time at
least 30 days before the annuity payment starting date.
Here are the plans available for all annuity contracts as described
in this prospectus:
Plan A - An annuity is paid each month during the lifetime of the
annuitant or payee (group contract). No payments are made after
the annuitant's or payee's death, therefore, it is possible to
receive only one annuity payment if the annuitant dies shortly
after annuity payments begin.
Plan B - An annuity is paid each month during the lifetime of the
annuitant or payee with the additional guarantee that payments will
be made for at least five, 10, or 15 years as you select.
Plan C - An annuity is paid each month during the lifetime of the
annuitant or payee with the additional guarantee that payments will
be made for a period not less than the number of months determined
by dividing the amount applied to Plan C by the amount of the first
monthly annuity payment.
Plan D - An annuity is paid each month during the lifetimes of two
named annuitants or payees. When the first annuitant or payee
dies, payments continue for the lifetime of the survivor. No
payments are made after the survivor's death unless you ask for the
Plan D option. This provides payments for a guaranteed period as
in Plan B or Plan C.
Restrictions for qualified plans - If your annuity was purchased
under a Section 401(k) plan, Section 403(b) plan (TSA), or as an
IRA, you must select a payment plan that provides for payments:
o over the life of the annuitant;
o over the joint lives of the annuitant and beneficiary;
o for a period not exceeding the life expectancy of the annuitant;
or
o for a period not exceeding the joint life expectancies of the
annuitant and beneficiary.
A beneficiary of a variable annuity contract may ask for one
lump-sum payment under Plan B or Plan C. This payment may be
subject to 20 percent income tax withholding if made directly to a
surviving spouse. IDS Life will not grant the request if you asked
us not to.
<PAGE>
PAGE 22
If no plan has been selected by the annuity payment starting date,
Plan B with 120 guaranteed monthly payments will be used.
If the value of the contract is less than $2,000 on the annuity
payment starting date, the accumulation value may be paid in a
lump-sum.
Determination of monthly annuity payments for deferred contracts
When annuity payments are to begin, the first monthly variable
annuity payment is computed on the valuation date on or right
before the seventh day before the annuity payment starting date.
The computations are made using the table of settlement rates in
your contract unless an optional table is agreed upon. A different
table is used if you have elected a 3.5 percent assumed investment
rate. The amount of the first payment is divided by the annuity
unit value to give the number of annuity units for your contract.
Each monthly payment after the first one will be determined by
multiplying the number of annuity units by the current annuity unit
value. Payouts made by check will be computed on the valuation
date on or right before the fifth day before the annuity payment
date. Payouts made by a transfer to another IDS account will be
computed on the valuation date on or right before the annuity
payment date.
Here is an example: Assume the variable accumulation value on the
valuation date seven days before the annuity payment starting date
was $30,000. And the plan you selected produces an initial payment
of $6 for each $1,000 of accumulation value.
Ignoring premium taxes, if any, the first payment would be $180 (30
X $6 = $180).
Now assume the annuity unit value on the valuation date seven days
before the annuity payment starting date is $1.800000. The number
of annuity units for your contract is 100 ($180 divided by
$1.800000 = 100). Ordinarily, the value of the same number of
annuity units will be paid each month.
Determination of monthly annuity payments for immediate contracts
The number of your annuity units is multiplied by the value of one
unit. The value of one unit is determined on the valuation date on
or right before the seventh day before the annuity payment is due.
The following example shows how the number of your annuity units is
determined:
Assume the net purchase payment is $30,000. And the conversion
factor, based on actuarial tables and the contract you selected, is
$5.50.
<PAGE>
PAGE 23
Assume the value of one annuity unit on the valuation date is
$1.500000.
First divide the net purchase payments by $1,000: $30,000 divided
by $1,000 = $30. Next multiply the answer by the conversion
factor: $30 X $5.50 = $165.
Divide the answer by the value of one unit. This gives the number
of annuity units paid out each month: $165 divided by $1.500000 =
110 units.
The charges you pay
1) Sales and administrative charges
The tables below show the deductions from your purchase payments
for sales and administrative charges for single payment contracts
and flexible installment payment contracts. The net amount
invested is the total purchase payments minus the deduction for
sales and administrative charges.
<TABLE><CAPTION>
Single payment contracts
Total charge Total deduction
Part of the Deduction Deduction for as percentage of as percentage of
total purchase for sales administrative total purchase net amount
payment charge charge payment invested
<S> <C> <C> <C> <C>
First $1,500 13% 2% 15% 17.65%
Next $48,500 3 1 4 4.17
Over $50,000 1.5 0.5 2 2.04
Flexible installment payment contracts
Total charge Total deduction
Part of the Deduction Deduction for as percentage of as percentage of
total purchase for sales administrative total purchase net amount
payment charge charge payment invested
First $1,500 13% 2% 15% 17.65%
Next $48,500 2 2 4 4.17
Over $50,000 0.5 1.5 2 2.04
The effect of the deductions shown above is illustrated in the following table:
Sales and admin. Sales and admin.
Deductions charge as a charge as a
$25 Monthly Total for the sales percentage of percentage of
purchase purchase and admin. total purchase aggregate net
payments payments charge payments amount invested
1 Year $ 300 $ 45 15.00% 17.65%
5 Years 1,500 225 15.00 17.65
10 Years 3,000 285 9.50 10.50
15 Years 4,500 345 7.67 8.30
20 Years 6,000 405 6.75 7.24
$100 Monthly
purchase payments
1 Year $ 1,200 $ 180 15.00% 17.65%
5 Years 6,000 405 6.75 7.24
10 Years 12,000 645 5.38 5.68
15 Years 18,000 885 4.92 5.17
20 Years 24,000 1,125 4.69 4.92
/TABLE
<PAGE>
PAGE 24
The table below shows the deduction from your purchase payments for
sales and administrative charges for group contracts. The net
amount invested is the total purchase payments minus the deduction
for sales and administrative charges.
<TABLE><CAPTION>
Group contract -- Employer plan
Part of Deduction Deduction Total Total
the total for for charge as deduction as
purchase sales administrative percentage of total percentage of net
payment charge charge purchase payment amount invested
<S> <C> <C> <C> <C>
First $10,000 3.75% 2% 5.75% 6.10%
Next $40,000 2 2 4 4.17
Excess over $50,000 0.5 1.5 2 2.04
</TABLE>
Pursuant to a Distribution and Services Agreement with the Fund,
IDS Life is the principal underwriter and performs all sales and
administrative duties. It pays salaries, sales commissions, legal,
accounting, auditing or actuarial fees, and death benefits under
deferred variable annuity contracts. The deductions for sales and
administrative charges came to $234,942 for 1993, $256,654 for
1992, and $267,461 for 1991.
The sales and administrative charge may be reduced or eliminated,
but only to the extent IDS Life anticipates that it will incur
lower sales and administrative expenses or perform fewer services
due to economies arising from the size of the particular group, the
average contribution per participant and the utilization of mass
enrollment procedures. Generally, this will occur with programs
established by an employer for all employees or for all employees
in a class, wherein employees do not individually elect to
participate in the program.
2) Premium taxes
Some states may charge a premium tax in an amount of up to 3.5
percent. If a state requires payment of a premium tax on your
contract, a deduction will be made from your purchase payments or
from your contract's accumulation value.
3) Increases in life expectancy and administrative expenses
IDS Life will bear any expenses that occur because of an increase
in administrative expenses, or because of an increase in the life
expectancy of people receiving variable annuity payments. But it
is not responsible for increases in brokers' fees and transfer
taxes on the purchase and sale of assets.
For bearing this risk, IDS Life charges the Fund a fee equal to 1
percent of the Fund's average daily net assets for the year. This
came to $5,163,853 for 1993, $4,693,884 for 1992 and $4,201,390 for
1991.
If the fee is more than enough to cover the increases, IDS Life
will keep the difference. If the fee is not enough, IDS Life bears
the loss.
<PAGE>
PAGE 25
4) Charge for investment management
For acting as investment manager, IDS Life charges the Fund a fee
equal to 0.4 percent of the Fund's average net assets for the year,
less any brokerage credits.
This came to $2,065,651 for 1993, $1,877,800 for 1992 and
$1,680,648 for 1991.
5) Tax charges
IDS Life is taxed as a life insurance company under Subchapter L of
the Code. The Fund is treated as part of IDS Life for federal
income tax purposes. IDS Life must pay all taxes which come about
because of the Fund. For this reason, IDS Life can charge the Fund
for tax charges.
Under current federal income tax law, no taxes are payable with
respect to any income of the Fund.
Investment results credited to a contract are not taxed until
annuity benefits are received.
Surrendering your contract
You can surrender all or part of your deferred annuity contract any
time before the annuity payment starting date. Under certain
contracts issued in connection with optional retirement programs
for employers of certain state supported educational institutions,
the contract holder must join in the request. There can be no
surrender in whole or in part after annuity payments have started
unless the remaining payments are not dependent on life
contingencies.
Immediate annuity contracts can be surrendered at any time as long
as the remaining payments are not dependent on life contingencies.
See annuity payment plans on page 15.
For a discussion of automated partial surrenders, see page 11.
There are special rules for a participant in the Texas Optional
Retirement Program (Texas ORP). The Texas ORP restricts the
payment of program benefits to participating employees prior to
termination of employment. Accordingly, no contract offered by this
prospectus will be issued to fund participation in the Texas ORP
unless the purchaser instructs the company not to accept surrender
of the contract prior to termination of employment, retirement,
death, or total disability of the participating employee.
Make your request to IDS Life in writing. IDS Life will cash in
the number of accumulation units for the amount you request. The
units are valued on the day your request is received in our
Minneapolis home office. You cannot surrender part of your
contract if the remaining accumulation value will be less than $20,
and you cannot repay any amount you surrender. A check usually <PAGE>
PAGE 26
will be mailed to you within seven days after we process your
request. However, IDS Life can delay sending your check until we
are sure we have received good payment for the accumulation units
you want to surrender.
You may receive extra money if the Fund's state premium tax
liability is reduced as a result of your surrender. If it is, you
will receive either the amount of the reduction or the amount
already deducted from your purchase payments for premium taxes,
whichever is less.
A surrender by a participant in a plan or program qualified under
Section 401, 403 or 408 of the Code may result in adverse tax
consequences. Consult a qualified tax adviser before requesting a
surrender.
Distribution Restrictions. The Code imposes certain restrictions on
an owner's right to receive early distributions attributable to
salary reduction contributions from a contract purchased for a
retirement plan qualified under Section 403(b) of the Code as a
TSA.
Distributions attributable to salary reduction contributions may be
made from the TSA contract only if the owner has attained age
59 1/2, has become disabled as defined in the Code, has separated
from the service of the employer that purchased the contract, or
upon the death of the owner. Additionally, if the Owner should
encounter a financial hardship (within the meaning of the Code), he
or she may receive a distribution of all contract values except
those arising from earnings on them. These restrictions apply to
amounts credited to the contract after Dec. 31, 1988. Even though
a distribution may be permitted under these rules (e.g., for
hardship or after separation from service), it may nonetheless be
subject to a 10 percent tax (in addition to income tax) as a
premature distribution and 20 percent income tax withholding may be
imposed (see page 21).
This restriction on the right to receive a distribution does not
affect the availability of the amount credited to the contract as
of Dec. 31, 1988, and if the contract has a loan provision, the
right to receive a loan continues to exist. The restrictions do
not apply to transfers or exchanges of contract value within the
annuity or to another registered variable annuity contract or
investment vehicle available through the employer.
Special rules if the annuitant dies before the annuity payment
starting date
Under a single payment or flexible installment deferred annuity
contract, if the annuitant dies before annuity payments begin, the
beneficiary will receive either:
o the sum of all purchase payments minus surrenders and unrepaid
withdrawals; or
o the accumulation value of the contract, whichever is more.
<PAGE>
PAGE 27
Under the group variable contract, if the participant dies before
annuity payments begin, the beneficiary will receive the greater
of:
o the sum of all contributions made by the participant less his
surrenders; or
o the accumulation value of the participant's account.
IDS Life will pay this death benefit in a lump sum at the end of
the valuation period during which its death claim requirements are
fulfilled, unless an election has been made to provide an annuity
payable to the participant's beneficiary. Payments made directly
to a surviving spouse (instead of being rolled over into an IRA)
may be subject to 20 percent income tax withholding.
Special Features of the Group Variable Annuity Contract
Modifications. From time to time, IDS Life may modify the group
variable annuity contract in order to conform the contract or give
participants the benefit of any federal or state law or any
regulation of the U.S. Treasury Department. Without the consent of
the affected participant, no modification will affect the amount or
terms of an annuity purchased prior to the effective date of the
modification. Without the contract holder's approval, no
modification can be made prior to the fifth contract anniversary.
On or after this anniversary, IDS Life may make modifications to
the contract without the contract holder's consent. The effect of
these modifications may include the deductions from contributions
for sales and administrative expense, periodic deductions for
mortality and expense assurances and investment management, and the
annuity settlement date. At least 90 days' notice of this type of
modification will be given to the contract holder. No modification
made after the fifth contract year will affect the rights of any
participant who was a participant prior to the effective date of
the modification except for that portion of the participant's
contributions which exceeds twice the amount of his first annual
contribution. The amount in excess of twice the first annual
contribution will receive the benefit of the assurances given new
entrants into the plan in the year the excess is first received by
IDS Life. These assurances will continue so long as the
participant continues to make excess contributions.
Experience Rating. The group variable annuity contract provides for
experience rating at the discretion of IDS Life. If the charges
made by IDS Life for mortality and expense assurances exceed the
expenses incurred, IDS Life may allocate all, a portion, or none of
the excess as an experience rating credit. No experience rating
credits have been paid to date. The experience rating credit, if
any, which accrues to any group variable annuity contract will be
determined annually upon each contract anniversary by IDS Life.
Application of the credit accruing to any group variable annuity <PAGE>
PAGE 28
contract will be applied in one of two ways, as determined by IDS
Life:
o by a reduction in the amount deducted from subsequent
contributions; or
o by the crediting of a number of additional accumulation units or
annuity units, as applicable, equal in value to the amount of the
credit due (such additional units shall be credited without the
deduction imposed on contributions).
Assignment Prohibited. No benefit or privilege under the contract
may be sold, assigned, transferred, discounted or pledged as
collateral for a loan or as security for the performance of an
obligation or for any other purpose to any person other than IDS
Life.
Suspension. IDS Life may suspend a group variable annuity contract
upon at least 90 days' written notice to the contract holder if the
contract holder has failed to make any contributions during the
contract year immediately preceding such notice. A contract holder
may suspend a contract upon written notice to IDS Life at least 90
days in advance of the effective date of the suspension. Upon
suspension, IDS Life may refuse to accept further contributions.
Suspension will in no way affect the accumulation units or annuity
units previously credited to any participant.
Termination of Contributions. Upon termination of contributions on
behalf of a participant for any reason prior to the retirement
date, the participant may elect to withdraw the value of, or leave
his total account in force under the contract until its value is
withdrawn as a surrender, paid upon the death of the participant,
or used to provide an annuity for the participant. When a
participant's variable account is left in force under the contract,
the account will continue to reflect the net investment experience
of the Fund except that if the value of the participant's total
account is less then $1,000, IDS Life may fulfill its obligations
with respect to a participant by payment of such value in a lump
sum.
Your right to cancel installment contracts
You will receive a Statement of Charges and a Notice of
Cancellation Rights within 60 days after the contract is sent to
you. You will have 45 days from the time this notice was sent to
you to cancel your installment contract. You will receive the
current accumulation value of your account plus any amounts
deducted for taxes and charges.
If you bought this annuity under an Individual Retirement Annuity
program and cancel the contract within seven days after the date of
issuance, IDS Life will refund the greater of the total amount of
purchase payments, or the value of the net amount invested, without
reduction in either case for sales and contract administrative
charges and taxes.
<PAGE>
PAGE 29
What about your taxes?
Group contract. If your plan is sponsored by a public school system
or an organization that is tax exempt pursuant to 501(c)(3) of the
Code, then contributions made for the purchase of an annuity
contract under Section 403(b) are excludable from your gross
income. Any annual contributions that exceed the limits on
contributions to a 403(b) contract are not excluded from your gross
income.
Once you begin to receive annuity payments, your payments are taxed
as provided in Section 72 of the Code. Ordinarily, this means that
your total annual annuity payments are taxed as ordinary income.
If you elect to receive a lump sum payment rather than annuity
payments, the entire amount received may be taxed as ordinary
income.
Individual contract. Under present law, any increase in the value
of the units credited to your individual annuity contract is not
taxed until received. When payments from a retirement plan or
contract begin, they are taxed under Section 72 of the Code.
Ordinarily, this means that your total annual annuity payments are
taxed as ordinary income. The recipient, however, may be in a
lower tax bracket after retirement due to lower income and larger
deductions. If you elect to receive a lump sum payment rather than
annuity payments, the entire amount received may be taxed as
ordinary income.
For all variable annuity contracts, if you surrender part or all of
your annuity, you will be taxed on the payment you receive to the
extent that the value of your contract exceeds your investment in
the contract and 20 percent income tax withholding may apply to
your surrender. In addition, your regular tax will be increased by
10 percent of the portion of the distribution includable in income
unless the distribution is:
o after you reach age 59 1/2;
o because of your death;
o because you are disabled;
o part of a series of substantially equal periodic payments over
the life expectancy of the owner (or joint life expectancies of the
owner and beneficiary); or
o because you separate from service on account of early retirement
after reaching age 55.
These are the major exceptions to the 10 percent additional tax.
Consult your tax adviser before taking any action.
<PAGE>
PAGE 30
In general, if you receive all or part of the contract value from a
qualified annuity (but not an IRA), mandatory 20 percent income tax
withholding will be imposed at the time the payment is made. In
addition, federal income tax and the 10 percent IRS penalty tax for
early withdrawals may apply to amounts properly includable in
income. This mandatory 20 percent income tax withholding will not
be imposed if:
o instead of receiving the payment, you elect to have the payment
rolled over directly to an IRA or another eligible plan;
o the payment is one of a series of substantially equal periodic
payments made at least annually, over your life or life expectancy
(or joint lives or life expectancies of you and your designated
beneficiary) or made over a period of 10 years or more; or
o the payment is a minimum distribution required under the Code.
These are the major exceptions to the mandatory 20 percent income
tax withholding. Payments made to a surviving spouse instead of
being directly rolled over into an IRA also may be subject to 20
percent income tax withholding. For taxable distributions that are
not subject to the mandatory 20 percent withholding, federal income
tax and possibly state income tax will be withheld from the taxable
part of your distribution unless you elect otherwise.
Unlike life insurance proceeds, the death benefit under an annuity
contract is not tax exempt. The gain, if any, is taxable as
ordinary income to the beneficiary in the year(s) he or she
receives the payments.
This information is based upon IDS Life's understanding of federal
income tax laws as they are currently interpreted. NO
REPRESENTATION IS MADE REGARDING THE LIKELIHOOD OF CONTINUATION OF
CURRENT FEDERAL INCOME TAX LAWS OR THE CURRENT INTERPRETATIONS OF
THE INTERNAL REVENUE SERVICE.
The contract is intended to qualify as an annuity for federal
income tax purposes. To that end, the provisions of the contract
are to be interpreted to ensure or maintain such tax qualification,
notwithstanding any other provisions of the contract. We reserve
the right to amend the contract to reflect any clarifications that
may be needed or are appropriate to maintain such qualification or
to conform the contract to any applicable changes in the tax
qualification requirements. We will send you a copy of any such
amendments.
Since federal tax consequences cannot be anticipated as to all
situations, you should consult a qualified tax adviser regarding
your own circumstances.
<PAGE>
PAGE 31
Voting rights
Voting rights of contract holders and group plan participants are
granted and defined by the regulations of the Fund. To the extent
permitted under the 1940 Act, these voting rights may be modified
by IDS Life without submission to a vote of a majority of the
outstanding voting units. Variable contract holders and group plan
participants can vote on:
o any change in investments the Fund will not make;
o the approval of and any changes to the investment management and
advisory agreements;
o the election of the Board of Managers; and
o the acceptance of the Fund's independent auditors.
A variable contract holder or group plan participant with
accumulation units has a number of votes equal to the number of
accumulation units owned. Under a contract where annuity payments
have started, the number of votes is determined by dividing the
present value of all future annuity payments by the value of one
accumulation unit on the record date. So there may be a gradual
decline in the number of votes to which a contract holder or group
plan participant is entitled as annuity payments continue to be
made under the contract. The record date will be set by the Board
of Managers not more than 60 days before the regular meeting or any
special meeting of variable contract holders or group plan
participants. Cumulative voting is not authorized.
First Bank National Association (First Bank) of St. Paul, MN, as
custodian for Keogh Act plans and for the IDS Incentive and Thrift
Plan, was owner of record of 3,452,793 units of the Fund on Dec.
31, 1993, constituting 8.3 percent of the voting units. First Bank
votes these units in accordance with instructions from the
beneficial owners. If First Bank fails to receive timely
instructions from a beneficial owner, it will vote these units in
the same proportion as units voted according to received
instructions.
Management
Members of the Board of Managers and officers of the Fund
Richard W. Kling*
Chairman of the Board of Managers
IDS Tower
Minneapolis, MN
Director since February 1984; President since March 1994.
Executive Vice President, Marketing and Products from January 1988
to March 1994. Vice President, IDS, since January 1988; Director
of IDS Life Series Fund, Inc. and member of the Board of Managers
of IDS Life Variable Annuity Funds A & B.
<PAGE>
PAGE 32
Edward Landes
Member of the Board of Managers
30 South 9th Street
Minneapolis, MN
Retired, Former Development Consultant.
Janis E. Miller*
Member of the Board of Managers
IDS Tower
Minneapolis, MN
Director and Executive Vice President - Variable Assets, IDS Life,
since March 1994; Vice President, IDS, since June 1990. Director,
Mutual Funds Product Development and Marketing, IDS, from May 1987
to May 1990. Director of IDS Life Series Fund, Inc. since March
1994.
Carl N. Platou
Member of the Board of Managers
312 South 6th Street
Minneapolis, MN
President Emeritus and Chief Executive Officer, Fairview Hospital
and Healthcare Services.
Gordon H. Ritz
Member of the Board of Managers
404 WCCO Radio Building
Minneapolis, MN
President, Con Rad Broadcasting Corp. (radio broadcasting);
Director, Sunstar Foods and Mid-America Publishing.
Morris Goodwin, Jr.*
Vice President and Treasurer
IDS Tower
Minneapolis, MN
Vice President and Corporate Treasurer, IDS, since July 1989; Chief
Financial Officer and Treasurer, IDS Bank & Trust, from January
1988 to July 1989.
Louis C. Fornetti*
Vice President
IDS Tower
Minneapolis, MN
Director, IDS Life. since March 1994; Senior Vice President and
Director, IDS, since February 1985.
<PAGE>
PAGE 33
Colleen Curran*
Secretary
IDS Tower
Minneapolis, MN
Senior Counsel and Secretary, IDS, since 1990; Assistant Vice
President, IDS, since 1987.
William A. Stoltzmann*
General Counsel and Assistant Secretary
IDS Tower
Minneapolis, MN
Vice President and Assistant General Counsel, IDS Life, since
November 1985.
Robert O. Schneider*
Controller
IDS Tower
Minneapolis, MN
Assistant Controller-Corporate Reports and Equity Administration,
IDS Life. Controller of IDS Life Capital Resource Fund, IDS Life
Aggressive Growth Fund, IDS Life International Equity Fund, IDS
Life Special Income Fund, Inc., IDS Life Managed Fund, Inc. and IDS
Life Moneyshare Fund, Inc.
*Interested person of the Fund by reason of being an employee of
IDS Life or IDS.
You vote at each regular meeting for the Fund's Board of Managers.
Members who are not salaried employees of IDS Life or one of its
affiliates receive up to $4,000 annually for serving on the Board.
All officers of the Fund are salaried employees of IDS Life or IDS
and receive no remuneration from the Fund. The officers and
managers of the Fund aggregately hold less than 1 percent of the
outstanding voting units.
Directors and officers of IDS Life Insurance Company*
The Directors:
Louis C. Fornetti, 44
Director since March 1994; Senior Vice President and Director, IDS,
since February 1985.
David R. Hubers, 51
Director since September 1989; President and Chief Executive
Officer, IDS, since August 1993 and Director, IDS, since January
1984. Senior Vice President, Finance and Chief Financial Officer,
IDS, from January 1984 to August 1993.
<PAGE>
PAGE 34
Richard W. Kling, 53
Director since February 1984; President since March 1994, Executive
Vice President, Marketing and Products from January 1988 to March
1994. Vice President, IDS, since January 1988; Director of IDS
Life Series Fund, Inc. and member of the Board of Managers of IDS
Life Variable Annuity Funds A & B.
Paul F. Kolkman, 47
Director since May 1984; Executive Vice President since March 1994;
Vice President, Finance from May 1984 to March 1994; Vice
President, IDS, since January 1987.
Peter A. Lefferts, 52
Director and Executive Vice President, Marketing since March 1994;
Senior Vice President and Director, IDS, since February 1986.
Janis E. Miller, 42
Director and Executive Vice President, Variable Assets since March
1994; Vice President, IDS, since June 1990. Director, Mutual Funds
Product Development and Marketing, IDS, from May 1987 to May 1990.
Director of IDS Life Series Fund, Inc. and Manager of IDS Life
Variable Annuity Funds A & B.
James A. Mitchell, 52
Chairman of the Board since March 1994; Director since July 1984;
Chief Executive Officer since November 1986; President from July
1984 to March 1994; Executive Vice President, IDS, since March
1994; Director, IDS, since July 1984. Senior Vice President, IDS,
from July 1984 to March 1994.
Barry J. Murphy, 43
Director and Executive Vice President, Client Service since March
1994; Senior Vice President, Operations, Travel Related Services
(TRS), a subsidiary of American Express Company, since July 1992;
Vice President, TRS, from November 1989 to July 1992; Chief
Operating Officer, TRS, from March 1988 to November 1989.
Stuart A. Sedlacek, 36
Director and Executive Vice President, Assured Assets since March
1994; Vice President, IDS, since September 1988.
Melinda S. Urion, 40
Director and Controller since September 1991; Executive Vice
President since March 1994; Vice President and Treasurer from
September 1991 to March 1994; Vice President, IDS, since September
1991; Chief Accounting Officer, IDS, from July 1988 to September
1991.
Officers Other Than Directors
Morris Goodwin Jr., 42
Vice President and Treasurer since March 1994; Vice President and
Corporate Treasurer, IDS, since July 1989; Chief Financial Officer
and Treasurer, IDS Bank & Trust, from January 1988 to July 1989.
<PAGE>
PAGE 35
William A. Stoltzmann, 45
Vice President, General Counsel and Secretary since 1985.
*The address for all of the directors and principal officers is:
IDS Tower 10, Minneapolis, MN 55440-0010.
Other Information
History
The Fund is an open-end diversified investment company as defined
under the 1940 Act. It was organized as a segregated asset account
by IDS Life under Minnesota law on May 10, 1968.
IDS Life is a stock life insurance company organized under
Minnesota law on Aug. 7, 1957. It conducts a conventional life
insurance business in addition to its variable annuity business.
IDS Life Insurance Company is not a bank and the securities it
offers are not backed or guaranteed by any bank nor are they
insured by the FDIC.
Assets of the Fund
On Dec. 31, 1993, there were 18,225 outstanding contracts. The
assets were $538,212,074.
The assets of the Fund are held solely for the variable contract
holders. The assets are not used to pay liabilities of any other
business of IDS Life.
Headquarters
The corporate office of IDS Life is located in the IDS Tower in
Minneapolis, Minnesota.
Ownership of IDS Life and IDS
All of the capital stock of IDS Life is owned by IDS Financial
Corporation. On Jan. 12, 1984, Investors Diversified Services,
Inc., of which IDS Life was a wholly owned subsidiary, was merged
into a wholly owned subsidiary of American Express Company to form
IDS Financial Services Inc. On Jan. 1, 1987, IDS Financial
Services Inc. changed its name to IDS Financial Corporation. IDS
serves as investment adviser for the Fund. IDS is an investment
adviser for a number of open-end investment companies and for its
subsidiaries. The headquarters of IDS is IDS Tower, Minneapolis,
Minnesota.
Other affiliations
IDS Life also distributes different variable annuity contracts
including: IDS Life Variable Annuity Fund A (Fund A), IDS Life
Variable Retirement Annuity, IDS Life Combination Retirement <PAGE>
PAGE 36
Annuity, IDS Life Flexible Annuity, IDS Life Real Estate Variable
Annuity, IDS Life Group Variable Annuity Contract and IDS Life
Employee Benefit Annuity.
The members of the Fund's Board of Managers also serve on the Board
of Managers of Fund A and on the Board of Directors of IDS Life
Series Fund, Inc.
IDS Life manages Fund B, Fund A and six mutual funds existing
within the IDS MUTUAL FUND GROUP advised by IDS. These six mutual
funds are available for purchase only through a Variable Retirement
Annuity Contract, a Combination Retirement Annuity Contract or a
Flexible Annuity Contract which are distributed by IDS Life and its
subsidiary, IDS Life Insurance Company of New York, plus a Group
Variable Annuity Contract and an Employee Benefit Annuity Contract
which are distributed by IDS Life. The names of these funds are:
IDS Life Capital Resource Fund, IDS Life Aggressive Growth Fund,
IDS Life International Equity Fund, IDS Life Special Income Fund,
Inc., IDS Life Managed Fund, Inc. and IDS Life Moneyshare Fund,
Inc. IDS Life also manages IDS Life Series Fund, Inc., which is
available for purchase only through policies distributed by IDS
Life and IDS Life Insurance Company of New York.
Custodian
Pursuant to a custodian agreement, the Fund's securities and cash
are held by IDS Trust Company, 1200 Norstar Center West, 625
Marquette Avenue, Minneapolis, MN 55402-2307.
The custodian has entered into a sub-custodian arrangement with
First Bank, 180 E. Fifth St., St. Paul, MN 55101-1631.
As part of this arrangement, portfolio securities purchased outside
the United States are maintained in the custody of various foreign
branches of First Bank or in such other financial institutions as
may be permitted by law and by the Fund's sub-custodian agreement.
Insurance regulation
IDS Life is regulated by the Department of Commerce of the State of
Minnesota. From time to time, the department examines the
company's liabilities and reserves and certifies their correctness.
IDS Life also is subject to insurance laws and regulations of other
states where it is licensed to do business.
Financial statements
The Report of Independent Auditors and the Financial Statements,
including Notes to Financial Statements and the schedule of
investments in securities, contained in the 1993 Annual Report to
IDS Life Variable Annuity Fund B contract holders, pursuant to
Section 30(d) of the 1940 Act, are hereby incorporated in this
Prospectus by reference. No other portion of the Annual Report,
however, is incorporated by reference.
<PAGE>
PAGE 37
IDS Life Financial Information
The financial statements shown below are those of the insurance
company and not those of the Fund. They are included in the
prospectus for the purpose of informing investors as to the
financial condition of the insurance company and its ability to
carry out its obligations under the variable annuity contracts.
IDS Life Insurance Company
<TABLE><CAPTION>
Consolidated Balance Sheets Dec. 31, 1993 Dec. 31, 1992
Assets (Thousands)
______________________________________________________________________________________________________________________________
<S> <C> <C>
Investments
Fixed maturities (Fair value: 1993, $20,425,979; 1992, $17,896,374) $19,392,424 $17,185,879
Mortgage loans on real estate (Fair value: 1993, $2,125,686; 1992, $1,785,970) 2,055,450 1,688,490
Policy loans 350,501 320,016
Other investments 56,307 51,955
______________________________________________________________________________________________________________________________
Total investments 21,854,682 19,246,340
______________________________________________________________________________________________________________________________
Cash and cash equivalents 146,281 73,563
Receivables:
Reinsurance 55,298 -
Amounts due from brokers 5,719 20,202
Other accounts receivable 21,459 20,095
Premiums due 1,329 1,361
______________________________________________________________________________________________________________________________
Total receivables 83,805 41,658
______________________________________________________________________________________________________________________________
Accrued investment income 307,177 285,120
Deferred policy acquisition costs 1,652,384 1,440,875
Other assets 21,730 18,672
Assets held in segregated asset accounts, primarily common stocks at market 8,991,694 6,189,545
______________________________________________________________________________________________________________________________
Total assets $33,057,753 $27,295,773
______________________________________________________________________________________________________________________________
Liabilities and Stockholder's Equity
______________________________________________________________________________________________________________________________
Liabilities:
Fixed annuities - future policy benefits $18,492,135 $16,342,419
Universal life-type insurance - future policy benefits 2,753,455 2,567,687
Traditional life-type insurance - future policy benefits 210,205 210,886
Disability income, health and long-term care insurance - future policy benefits 185,272 104,896
Policy claims and other policyholders' funds 44,516 49,899
Deferred federal income taxes 43,620 87,913
Amounts due to brokers 351,486 258,654
Other liabilities 292,024 235,509
Liabilities related to segregated asset accounts 8,991,694 6,189,545
______________________________________________________________________________________________________________________________
Total liabilities 31,364,407 26,047,408
______________________________________________________________________________________________________________________________
Stockholder's equity:
Capital stock, $30 per value per share; 100,000 shares authorized, issued and outstanding 3,000 3,000
Additional paid-in capital 222,000 22,000
Net unrealized appreciation on equity securities 114 214
Retained earnings 1,468,232 1,223,151
______________________________________________________________________________________________________________________________
Total stockholder's equity 1,693,346 1,248,365
______________________________________________________________________________________________________________________________
Total liabilities and stockholder's equity $33,057,753 $27,295,773
Commitments and contingencies (Note 6)
______________________________________________________________________________________________________________________________
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
PAGE 38 <TABLE><CAPTION>
Consolidated Statements of Income Years ended Dec. 31,
1993 1992 1991
(Thousands)
__________________________________________________________________________________________________________________________________
<S> <C> <C> <C>
Revenues:
Premiums
Traditional life insurance $ 48,137 $ 49,719 $ 49,706
Disability income and long-term care insurance 79,108 64,660 52,632
__________________________________________________________________________________________________________________________________
127,245 114,379 102,338
Policyholder and contractholder charges 184,205 156,368 137,202
Management and other fees 120,139 84,591 61,142
Net investment income 1,783,219 1,616,821 1,422,866
Net loss on investments (6,737) (3,710) (5,837)
__________________________________________________________________________________________________________________________________
Total revenues 2,208,071 1,968,449 1,717,711
__________________________________________________________________________________________________________________________________
Benefits and expenses:
Death and other benefits - traditional life insurance 32,136 34,139 30,170
Death and other benefits - universal life-type insurance
and investment contracts 49,692 42,174 38,529
Death and other benefits - disability income, health and
long-term care insurance 13,148 10,701 8,242
Decrease in liabilities for future policy benefits -
traditional life insurance (4,513) (5,788) (6,425)
Increase in liabilities for future policy benefits -
disability income, health and long-term care insurance 32,528 27,172 19,700
Interest credited on universal life-type insurance and investment contracts 1,218,647 1,188,379 1,098,281
Amortization of deferred policy acquisition costs 211,733 140,159 116,078
Other insurance and operating expenses 241,974 215,692 153,669
__________________________________________________________________________________________________________________________________
Total benefits and expenses 1,795,345 1,652,628 1,458,244
__________________________________________________________________________________________________________________________________
Income before income taxes 412,726 315,821 259,467
Income taxes 142,647 104,651 77,430
__________________________________________________________________________________________________________________________________
Net income $ 270,079 $ 211,170 $ 182,037
__________________________________________________________________________________________________________________________________
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
PAGE 39 <TABLE><CAPTION>
Consolidated Statements of Cash Flows Years ended Dec. 31,
1993 1992 1991
(Thousands)
__________________________________________________________________________________________________________________________________
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $ 270,079 $ 211,170 $ 182,037
Adjustments to reconcile net income to net cash provided by operating activities:
Issuance - policy loans, excluding universal life-type insurance (35,886) (32,881) (29,309)
Repayment - policy loans, excluding universal life-type insurance 29,557 26,750 19,928
Change in reinsurance receivable (55,298) - -
Change in other accounts receivable (1,364) (4,772) (1,558)
Change in accrued investment income (22,057) (15,853) (26,022)
Change in deferred policy acquisition costs, net (211,509) (229,252) (175,442)
Change in liabilities for future policy benefits for traditional life, disability
income, health and long-term care insurance 79,695 21,384 13,275
Change in policy claims and other policyholders' funds (5,383) (1,347) 11,801
Change in deferred federal income taxes (44,237) (30,385) (29,207)
Change in other liabilities 56,515 88,997 45,323
Amortization of premium (accretion of discount), net (27,438) (4,289) 19,726
Net loss on investments 6,737 3,710 5,837
Premiums related to universal life-type insurance 397,883 312,621 264,504
Surrenders and death benefits related to universal life-type insurance (255,133) (166,162) (109,307)
Interest credited to account balances related to universal life-type insurance 156,885 161,873 160,585
Policyholder and contractholder charges, non-cash (115,140) (100,975) (96,211)
Other, net (1,907) (10,647) 2,258
__________________________________________________________________________________________________________________________________
Net cash provided by operating activities $ 221,999 $ 229,942 $ 258,218
__________________________________________________________________________________________________________________________________
Cash flows from investing activities:
Acquisition of investments, excluding policy loans $(7,102,546) $(7,001,348) $(5,518,481)
Maturities, sinking fund payments and calls of investments, excluding policy loans 3,931,819 2,700,479 838,589
Sale of investments, excluding policy loans 613,571 1,073,950 2,274,401
Change in amounts due from brokers 14,483 289,335 (134,312)
Change in amounts due to brokers 92,832 42,182 72,382
__________________________________________________________________________________________________________________________________
Net cash used in investing activities (2,449,841) (2,895,402) (2,467,421)
__________________________________________________________________________________________________________________________________
Cash flows from financing activities:
Considerations received related to investment contracts 2,843,668 2,821,069 2,316,333
Surrenders and death benefits related to investment contracts (1,765,869) (1,168,633) (871,808)
Interest credited to account balances related to investment contracts 1,071,917 1,026,506 937,696
Issuance - universal life-type insurance policy loans (70,304) (72,007) (76,010)
Repayment - universal life-type insurance policy loans 46,148 40,351 31,860
Capital contribution from parent 200,000 - -
Cash dividend to parent (25,000) (20,000) (20,000)
__________________________________________________________________________________________________________________________________
Net cash provided by financing activities 2,300,560 2,627,286 2,318,071
__________________________________________________________________________________________________________________________________
Net increase (decrease) in cash and cash equivalents 72,718 (38,174) 108,868
Cash and cash equivalents at beginning of year 73,563 111,737 2,869
__________________________________________________________________________________________________________________________________
Cash and cash equivalents at end of year $ 146,281 $ 73,563 $ 111,737
__________________________________________________________________________________________________________________________________
See accompanying notes to consolidated financial statements.
</TABLE> <PAGE>
PAGE 40
Notes to Consolidated Financial Statements ($ Thousands)
Dec. 31, 1993, 1992, 1991
1. Summary of significant accounting policies
Nature of business
IDS Life Insurance Company (the Company) is engaged in the
insurance and annuity business. The Company sells various forms of
fixed and variable individual life insurance, group life insurance,
individual and group disability income insurance, long-term care
insurance, and single and installment premium fixed and variable
annuities.
Basis of presentation
The Company is a wholly owned subsidiary of IDS Financial
Corporation (IDS), which is a wholly owned subsidiary of American
Express Company. The accompanying consolidated financial
statements include the accounts of the Company and its wholly owned
subsidiaries, IDS Life Insurance Company of New York and American
Enterprise Life Insurance Company. All material intercompany
accounts and transactions have been eliminated in consolidation.
The accompanying consolidated financial statements have been
prepared in conformity with generally accepted accounting
principles which vary in certain respects from reporting practices
prescribed or permitted by state insurance regulatory authorities.
Also, the consolidated financial statements are presented on a
historical cost basis without adjustment of the net assets
attributable to the 1984 acquisition of IDS by American Express
Company.
Investments
Investments in fixed maturities are carried at cost, adjusted where
appropriate for amortization of premiums and accretion of
discounts. Mortgage loans on real estate are carried principally
at the unpaid principal balances of the related loans. Policy
loans are carried at the aggregate of the unpaid loan balances
which do not exceed the cash surrender values of the related
policies. Other investments include interest rate caps, real
estate and equity securities. When evidence indicates a decline,
which is other than temporary, in the underlying value or earning
power of individual investments, such investments are written down
to the estimated realizable value by a charge to income. Equity
securities are carried at market value and the related net
unrealized appreciation or depreciation is reported as a credit or
charge to stockholder's equity.
The Company has the ability and the intent to recover the costs of
these investments by holding them for the foreseeable future. The
ability to hold investments to scheduled maturity dates is
dependent on, among other things, annuity contract owners
maintaining their annuity contracts in force.
The Company will implement, effective January 1, 1994, Statement of
Financial Accounting Standards No. 115, "Accounting for Certain
Investments in Debt and Equity Securities." Under the new rules,
debt securities that the Company has both the positive intent and
ability to hold to maturity will be carried at amortized cost.
Debt securities that the Company does not have the positive intent <PAGE>
PAGE 41
1. Summary of significant accounting policies (continued)
and ability to hold to maturity and all marketable equity
securities will be classified as available-for-sale and carried at
fair value. Unrealized gains and losses on securities classified
as available-for-sale will be carried as a separate component of
stockholder's equity. The effect of the new rules will be to
increase stockholder's equity by approximately $181 million, net of
taxes, as of January 1, 1994, but the new rules will have no
material impact on the Company's results of operations.
Realized investment gain or loss is determined on an identified
cost basis.
Interest rate cap contracts are purchased to reduce the Company's
exposure to rising interest rates which would increase the cost of
future policy benefits for interest sensitive products. Costs
are amortized over the lives of the agreements and benefits are
recognized when realized.
Prepayments are anticipated on certain investments in
mortgage-backed securities in determining the constant effective
yield used to recognize interest income. Prepayment estimates
are based on information received from brokers who deal in
mortgage-backed securities.
Statement of cash flows
The Company considers investments with a maturity at the date of
their acquisition of three months or less to be cash equivalents.
These securities are carried principally at amortized cost which
approximates fair value.
Supplementary information to the consolidated statement of cash
flows for the years ended Dec. 31 is summarized as follows:
1993 1992 1991
___________________________________________________________________
Cash paid during the year for:
Income taxes $188,204 $140,445 $111,809
Interest on borrowings 2,661 1,265 108
___________________________________________________________________
Recognition of profits on annuity contracts and insurance policies
The Company issues single premium deferred annuity contracts that
provide for a service fee (surrender charge) at annually decreasing
rates upon withdrawal of the annuity accumulation value by the
contract owner. No sales fee is deducted from the contract
considerations received on these contracts ("no load" annuities).
Single premium deferred annuities issued prior to 1980 had a sales
fee and no surrender charge. All of the Company's single premium
deferred annuity contracts provide for crediting the contract
owners' accumulations at specified rates of interest. Such rates
are revised by the Company from time to time based on changes in
the market investment yield rates for fixed-income securities.
<PAGE>
PAGE 42
1. Summary of significant accounting policies (continued)
Profits on single premium deferred annuities and installment
annuities are recognized by the Company over the lives of the
contracts and represent the excess of investment income earned
from investment of contract considerations over interest credited
to contract owners and other expenses.
The retrospective deposit method is used in accounting for
universal life-type insurance. This method recognizes profits over
the lives of the policies in proportion to the estimated gross
profits expected to be realized.
Premiums on traditional life, disability income, health and
long-term care insurance policies are recognized as revenue when
collected or due, and related benefits and expenses are associated
with premium revenue in a manner that results in recognition of
profits over the lives of the insurance policies. This association
is accomplished by means of the provision for future policy
benefits and the deferral and subsequent amortization of policy
acquisition costs.
Deferred policy acquisition costs
The costs of acquiring new business, principally sales
compensation, policy issue costs, underwriting and certain sales
expenses, have been deferred on insurance and annuity contracts.
The deferred acquisition costs for single premium deferred
annuities and installment annuities are amortized based upon
surrender charge revenue and a portion of the excess of investment
income earned from investment of the contract considerations over
the interest credited to contract owners. The costs for universal
life-type insurance are amortized over the lives of the policies as
a percentage of the estimated gross profits expected to be
realized on the policies. For traditional life, disability income,
health and long-term care insurance policies, the costs are
amortized over an appropriate period in proportion to premium
revenue.
Liabilities for future policy benefits
Liabilities for universal life-type insurance, single premium
deferred annuities and installment annuities are accumulation
values.
Liabilities for fixed annuities in a benefit status are based on
the Progressive Annuity Table with interest at 5 percent, the 1971
Individual Annuity Table with interest at 7 percent or 8.25
percent, or the 1983a Table with various interest rates ranging
from 5.5 percent to 9.5 percent, depending on year of issue.
Liabilities for future benefits on traditional life insurance have
been computed principally by the net level premium method, based on
anticipated rates of mortality (approximating the 1965-1970 Select
and Ultimate Basic Table for policies issued after 1980 and the
1955-1960 Select and Ultimate Basic Table for policies issued prior
to 1981), policy persistency derived from Company experience data
(first year rates ranging from approximately 70 percent to 90
percent and increasing rates thereafter), and estimated future
investment yields of 4 percent for policies issued before 1974 and
<PAGE>
PAGE 43
1. Summary of significant accounting policies (continued)
5.25 percent for policies issued from 1974 to 1980. Cash value
plans issued in 1980 and later assume future investment rates that
grade from 9.5 percent to 5 percent over 20 years. Term insurance
issued from 1981 to 1984 assumes an 8 percent level investment rate
and term insurance issued after 1984 assumes investment rates that
grade from 10 percent to 6 percent over 20 years.
Liabilities for future disability income policy benefits have been
computed principally by the net level premium method, based on the
1964 Commissioners Disability Table with the 1958 Commissioners
Standard Ordinary Mortality Table at 3 percent interest for 1980
and prior, 8 percent interest for persons disabled from 1981 to
1991 and 6 percent interest for persons disabled after 1991.
Liabilities for future benefits on long-term care insurance have
been computed principally by the net level premium method, using
morbidity rates based on the 1985 National Nursing Home Survey and
mortality rates based on the 1983a Table. The interest rate basis
is 9.5 percent grading to 7 percent over ten years for policies
issued from 1989 to 1992, 7.75 percent grading to 7 percent over
four years for policies issued after 1992, 8 percent for claims
incurred in 1989 to 1991 and 6 percent for claims incurred after
1991.
At Dec. 31, 1993 and 1992, the carrying amount and fair value of
fixed annuities future policy benefits, after excluding life
insurance-related contracts carried at $913,127 and $834,909, were
$17,579,008 and $15,507,510, and $16,881,747 and $14,867,066,
respectively. The fair value is net of policy loans of $59,132 and
$51,394 at Dec. 31, 1993 and 1992, respectively. The fair value of
these benefits is based on the status of the annuities at Dec. 31,
1993 and 1992. The fair value of deferred annuities is estimated
as the carrying amount less any surrender charges and related
loans. The fair value for annuities in non-life contingent payout
status is estimated as the present value of projected benefit
payments at the rate appropriate for contracts issued in 1993 and
1992.
Reinsurance
The maximum amount of life insurance risk retained by the Company
on any one life is $750 of life and waiver of premium benefits plus
$50 of accidental death benefits. The maximum amount of disability
income risk retained by the Company on any one life is $6 of
monthly benefit for benefit periods longer than three years. The
excesses are reinsured with other life insurance companies on a
yearly renewable term basis. Graded premium whole life policies
and long term care are primarily reinsured on a coinsurance basis.
In 1993 the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 113, "Accounting and Reporting for Reinsurance
of Short-Duration and Long-Duration Contracts." Under SFAS No.
113, amounts paid or deemed to have been paid for reinsurance
contracts are recorded as reinsurance receivables. Prior to 1993,
these amounts were recorded as a reduction of the liability for
future insurance policy benefits. The cost of reinsurance is
accounted for over the period covered by the reinsurance contract.
<PAGE>
PAGE 44
1. Summary of significant accounting policies (continued)
Federal income taxes
The Company's taxable income is included in the consolidated
federal income tax return of American Express Company. The Company
provides for income taxes on a separate return basis, except that,
under an agreement between IDS and American Express Company, tax
benefit is recognized for losses to the extent they can be used on
the consolidated tax return. It is the policy of IDS and its
subsidiaries that IDS will reimburse a subsidiary for any tax
benefit.
Included in other liabilities at Dec. 31, 1993 and 1992 are $14,709
and $18,181, respectively, payable to IDS for federal income taxes.
Segregated asset account business
The segregated asset account assets and liabilities represent funds
held for the exclusive benefit of the variable annuity and variable
life insurance contract owners. The Company receives investment
management and mortality and expense assurance fees from the
variable annuity and variable life insurance mutual funds and
segregated asset accounts. The Company also deducts a monthly cost
of insurance charge and receives a minimum death benefit guarantee
fee and issue and administrative fee from the variable life
insurance segregated asset accounts.
The Company makes contractual mortality assurances to the variable
annuity contract owners that the net assets of the segregated asset
accounts will not be affected by future variations in the actual
life expectancy experience of the annuitants and the beneficiaries
from the mortality assumptions implicit in the annuity contracts.
The Company makes periodic fund transfers to, or withdrawals from,
the segregated asset accounts for such actuarial adjustments for
variable annuities that are in the benefit payment period. The
Company guarantees, for the variable life insurance policyholders,
the cost of the contractual insurance rate and that the death
benefit will never be less than the death benefit at the date of
issuance.
At Dec. 31, 1993 and 1992 the fair value of liabilities related to
segregated asset accounts was $8,305,209 and $5,727,402,
respectively. The fair value of these liabilities at Dec. 31, 1993
and 1992 is estimated as the carrying amount less variable
insurance contracts carried at $346,276 and $226,946, respectively,
and surrender charges, if applicable.
Reclassification
Certain 1992 and 1991 amounts have been reclassified to conform to
the 1993 presentation.
2. Investments
Market values of investments in fixed maturities represent quoted
market prices and estimated fair values when quoted prices are not
available. Estimated fair values are determined by established
procedures involving, among other things, review of market indices,
price levels of current offerings of comparable issues, price
estimates and market data from independent brokers and financial
files. <PAGE>
PAGE 45
2. Investments (continued)
Net gain (loss) on investments for the years ended Dec. 31 is
summarized as follows:
<TABLE><CAPTION>
1993 1992 1991
________________________________________________________________________________________________
<S> <C> <C> <C>
Fixed maturities $ 5,460 $ 14,474 $ 22,750
Mortgage loans (11,422) (5,004) (1,064)
Other investments (6,606) (8,265) (5,695)
(12,568) 1,205 15,991
Net (increase) decrease in allowance for losses 5,831 (4,915) (21,828)
$ (6,737) $ (3,710) $ (5,837)
________________________________________________________________________________________________
Changes in net unrealized appreciation
(depreciation) of investments for the years
ended Dec. 31 are summarized as follows:
1993 1992 1991
________________________________________________________________________________________________
Fixed maturities $323,060 $(128,683) $861,355
Equity securities (156) 300 418
________________________________________________________________________________________________
Fair values of and gross unrealized gains
and losses on investments in fixed maturities
carried at amortized cost at Dec. 31 are as follows:
Gross Gross
Amortized Unrealized Unrealized Fair
1993 Cost Gains Losses Value
________________________________________________________________________________________________
U.S. Government agency obligations $ 63,532 $ 3,546 $ 1,377 $ 65,701
State and municipal obligations 11,072 2,380 - 13,452
Corporate bonds and obligations 9,362,074 768,747 45,706 10,085,115
Mortgage-backed securities 9,978,523 341,067 57,879 10,261,711
19,415,201 1,115,740 104,962 20,425,979
Less allowance for losses 22,777 - 22,777 -
$19,392,424 $1,115,740 $ 82,185 $20,425,979
________________________________________________________________________________________________
Gross Gross
Amortized Unrealized Unrealized Fair
1992 Cost Gains Losses Value
________________________________________________________________________________________________
U.S. Government agency obligations $ 36,753 $ 3,658 $ 4 $ 40,407
State and municipal obligations 11,234 1,542 - 12,776
Corporate bonds and obligations 7,688,190 431,781 104,707 8,015,264
Mortgage-backed securities 9,487,601 377,539 37,213 9,827,927
17,223,778 814,520 141,924 17,896,374
Less allowance for losses 37,899 - 37,899 -
$17,185,879 $ 814,520 $104,025 $17,896,374
________________________________________________________________________________________________
The amortized cost and fair value of investments in fixed maturities at Dec. 31, 1993 by
contractual maturity are shown below. Expected maturities will differ from contractual
maturities because borrowers may have the right to call or prepay obligations with or without
call or prepayment penalties.
Amortized Fair
Cost Value
________________________________________________________________________________________________
Due in one year or less $ 89,160 $ 90,928
Due from one to five years 1,430,756 1,532,298
Due from five to ten years 5,488,955 5,924,580
Due in more than ten years 2,427,807 2,616,462
Mortgage-backed securities 9,978,523 10,261,711
$19,415,201 $20,425,979
________________________________________________________________________________________________
</TABLE>
<PAGE>
PAGE 46
2. Investments (continued)
Proceeds from sales of investments in fixed maturities during 1993
and 1992 were $482,523 and $996,619, respectively. During 1993 and
1992, gross gains of $48,499 and $94,915, respectively, and gross
losses of $43,039 and $80,441, respectively, were realized on those
sales.
At Dec. 31, 1993, the amount of net unrealized appreciation on
equity securities included $160 of gross unrealized appreciation,
$nil of gross unrealized depreciation and deferred tax credits of
$46. At Dec. 31, 1992, the amount of net unrealized appreciation
on equity securities included $328 of gross unrealized
appreciation, $12 of gross unrealized depreciation and deferred tax
credits of $102. The fair value of equity securities was $1,900
and $2,005 at Dec. 31, 1993 and 1992, respectively.
Included in other investments at Dec. 31, 1993 are interest rate
caps at amortized cost of $26,923 with a fair value of $14,201.
These interest rate caps carry a notional amount of $4,400,000 and
expire on various dates from 1994 to 1998.
At Dec. 31, 1993, bonds carried at $4,184 were on deposit with
various states as required by law.
Net investment income for the years ended Dec. 31 is summarized as
follows:
<TABLE><CAPTION>
1993 1992 1991
______________________________________________________________________________________
<S> <C> <C> <C>
Interest on fixed maturities $1,589,802 $1,449,234 $1,279,317
Interest on mortgage loans 175,063 148,693 122,723
Other investment income 29,345 24,281 20,005
Interest on cash equivalents 2,137 5,363 8,729
1,796,347 1,627,571 1,430,774
Less investment expenses 13,128 10,750 7,908
______________________________________________________________________________________
$1,783,219 $1,616,821 $1,422,866
______________________________________________________________________________________
</TABLE>
At Dec. 31, 1993, investments in fixed maturities comprised 89
percent of the Company's total invested assets. These securities
are rated by Moody's and Standard & Poor's (S&P), except for
approximately $2.1 billion which is rated by IDS internal analysts
using criteria similar to Moody's and S&P. A summary of
investments in fixed maturities by rating on Dec. 31 is as follows:
<TABLE><CAPTION>
Dec. 31, Dec. 31,
Rating 1993 1992
________________________________________________________________________
<S> <C> <C>
Aaa/AAA $ 9,959,884 $ 9,480,345
Aa/AA 258,659 219,370
Aa/A 160,638 109,806
A/A 2,021,177 1,735,750
A/BBB 654,949 447,592
Baa/BBB 3,936,366 3,352,192
Baa/BB 717,606 392,361
Below investment grade 1,705,922 1,486,362
________________________________________________________________________
$19,415,201 $17,223,778
________________________________________________________________________
/TABLE
<PAGE>
PAGE 47
2. Investments (continued)
At Dec. 31, 1993, 99 percent of the securities rated Aaa/AAA are
GNMA, FNMA and FHLMC mortgage-backed securities. No holdings of
any other issuer are greater than 1 percent of the Company's total
investments in fixed maturities.
At Dec. 31, 1993, approximately 9.4 percent of the Company's
invested assets were mortgage loans on real estate. Summaries of
mortgage loans by region of the United States and by type of real
estate at Dec. 31, 1993 and 1992 are as follows:
<TABLE><CAPTION>
Dec. 31, 1993 Dec. 31, 1992
On Balance Commitments On Balance Commitments
Region Sheet to Purchase Sheet to Purchase
______________________________________________________________________________________
<S> <C> <C> <C> <C>
East North Central $ 552,150 $ 20,933 $ 484,808 $ 21,728
West North Central 361,704 16,746 357,388 14,327
South Atlantic 452,679 52,440 320,593 32,022
Middle Atlantic 260,239 41,090 188,294 56,816
New England 155,214 17,620 114,170 24,677
Pacific 120,378 15,492 89,636 5,148
West South Central 43,948 525 46,296 716
East South Central 73,748 - 83,994 10,085
Mountain 70,410 14,594 26,906 8,882
______________________________________________________________________________________
2,090,470 179,440 1,712,085 174,401
Less allowance for losses 35,020 - 23,595 -
______________________________________________________________________________________
$2,055,450 $179,440 $1,688,490 $174,401
______________________________________________________________________________________
Dec. 31, 1993 Dec. 31, 1992
On Balance Commitments On Balance Commitments
Property type Sheet to Purchase Sheet to Purchase
______________________________________________________________________________________
Apartments $ 744,788 $ 79,153 $ 541,855 $ 70,198
Department/retail stores 624,651 65,402 504,331 74,671
Office buildings 234,042 15,583 327,216 12,950
Industrial buildings 217,648 9,279 203,361 15,150
Nursing/retirement homes 83,768 917 56,431 716
Hotels/motels 33,138 - 34,631 716
Medical buildings 30,429 5,954 23,006 -
Residential 78 - 6,618 -
Other 121,928 3,152 14,636 -
______________________________________________________________________________________
2,090,470 179,440 1,712,085 174,401
Less allowance for losses 35,020 - 23,595 -
______________________________________________________________________________________
$2,055,450 $179,440 $1,688,490 $174,401
______________________________________________________________________________________
</TABLE>
Mortgage loan fundings are restricted by state insurance regulatory
authorities to 80 percent or less of the market value of the real
estate at the time of origination of the loan. The Company holds
the mortgage document, which gives the right to take possession of
the property if the borrower fails to perform according to the
terms of the agreement. The fair value of the mortgage loans is
determined by a discounted cash flow analysis using mortgage
interest rates currently offered for mortgages of similar
maturities. Commitments to purchase mortgages are made in the
ordinary course of business. The fair value of the mortgage
commitments is $nil.
<PAGE>
PAGE 48
3. Income taxes
The Company qualifies as a life insurance company for federal
income tax purposes. As such, the Company is subject to the
Internal Revenue Code provisions applicable to life insurance
companies.
Income tax expense consists of the following:
<TABLE><CAPTION>
1993 1992 1991
_______________________________________________________________________________
<S> <C> <C> <C>
Federal income taxes:
Current $180,558 $130,998 $104,292
Deferred (44,237) (30,385) (29,207)
_______________________________________________________________________________
136,321 100,613 75,085
State income taxes-Current 6,326 4,038 2,345
_______________________________________________________________________________
Income tax expense $142,647 $104,651 $ 77,430
_______________________________________________________________________________
</TABLE>
Increases (decreases) to the federal tax provision applicable to
pre-tax income based on the statutory rate are attributable to:
<TABLE><CAPTION>
1993 1992 1991
_________________________________________________________________________________________________________
Provision Rate Provision Rate Provision Rate
_________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C>
Federal income taxes based on
the statutory rate $144,454 35.0% $107,379 34.0% $88,219 34.0%
Increases (decreases) are attributable to:
Tax-excluded interest and dividend income (11,002) (2.7) (8,209) (2.6) (9,496) (3.7)
Other, net 2,869 0.7 1,443 0.4 (3,638) (1.4)
_________________________________________________________________________________________________________
Federal income taxes $136,321 33.0% $100,613 31.8% $75,085 28.9%
_________________________________________________________________________________________________________
</TABLE>
A portion of life insurance company income earned prior to 1984 was
not subject to current taxation but was accumulated, for tax
purposes, in a "policyholders' surplus account." At Dec. 31, 1993,
the Company had a policyholders' surplus account balance of
$19,032. The policyholders' surplus account is only taxable if
dividends to the stockholder exceed the stockholder's surplus
account or if the Company is liquidated. Deferred income taxes of
$6,661 have not been established because no distributions of such
amounts are contemplated.
Significant components of the Company's deferred tax assets and
liabilities as of Dec. 31 are as follows:
<TABLE><CAPTION>
Deferred tax assets: 1993 1992
______________________________________________________________________________________
<S> <C> <C>
Policy reserves $453,436 $356,712
Life insurance guarantee fund assessment reserve 35,000 21,794
______________________________________________________________________________________
Total deferred tax assets 488,436 378,506
______________________________________________________________________________________
Deferred tax liabilities:
______________________________________________________________________________________
Deferred policy acquisition costs 509,868 446,579
Investments 10,105 2,435
Other 12,083 17,405
______________________________________________________________________________________
Total deferred tax liabilities 532,056 466,419
______________________________________________________________________________________
Net deferred tax liabilities $ 43,620 $ 87,913
______________________________________________________________________________________
/TABLE
<PAGE>
PAGE 49
4. Stockholder's equity
Retained earnings available for distribution as dividends to parent
are limited to the Company's surplus as determined in accordance
with accounting practices prescribed by state insurance regulatory
authorities. Statutory unassigned surplus aggregated $922,246 as
of Dec. 31, 1993 and $685,103 as of Dec. 31, 1992 (see Note 3 with
respect to the income tax effect of certain distributions). In
addition, any dividend distributions in 1994 in excess of
approximately $259,063 would require approval of the Department of
Commerce of the State of Minnesota.
Statutory net income for 1993, 1992 and 1991 and stockholder's
equity as of Dec. 31, 1993, 1992 and 1991 are summarized as
follows:
<TABLE><CAPTION>
1993 1992 1991
___________________________________________________________________________________
<S> <C> <C> <C>
Statutory net income $ 275,015 $180,296 $200,704
Statutory stockholder's equity 1,157,022 714,942 551,939
___________________________________________________________________________________
</TABLE>
Dividends paid to IDS were $25,000 in 1993, $20,000 in 1992 and
$20,000 in 1991.
5. Related party transactions
The Company has loaned funds or agreed to loan funds to IDS under
two separate loan agreements. The balance of the first loan was
$75,000 and $nil at Dec. 31, 1993 and 1992, respectively. This
loan can be increased to a maximum of $100,000 and pays interest at
a rate equal to the preceding month's effective new money rate for
the Company's permanent investments. It is collateralized by
equities valued at $96,790 at Dec. 31, 1993. The second loan was
used to fund the construction of the IDS Operations Center. This
loan had an outstanding balance of $84,588 and $85,278 at Dec. 31,
1993 and 1992, respectively. The loan is secured by a first lien
on the IDS Operations Center property and has an interest rate of
9.89 percent. The Company also has a loan to an affiliate which
was used to fund construction of the IDS Learning Center. At Dec.
31, 1993 and 1992, the balance outstanding was $22,573 and $22,755,
respectively. The loan is secured by a first lien on the IDS
Learning Center property and has an interest rate of 9.82 percent.
Interest income on the above loans totaled $11,116, $10,711 and
$14,783 in 1993, 1992 and 1991, respectively.
The Company purchased a five year secured note from an affiliated
company which had an outstanding balance of $27,222 and $31,111 at
Dec. 31, 1993 and 1992, respectively. The note bears a market
interest rate, revised semi-annually, which at Dec. 31, 1993 was
8.42 percent.
The Company has a reinsurance agreement whereby it assumed 100
percent of a block of single premium life insurance business from
an affiliated company. The accompanying consolidated balance sheet
at Dec. 31, 1993 and 1992 includes $759,714 and $746,060,
respectively, of future policy benefits related to this agreement.
<PAGE>
PAGE 50
5. Related party transactions (continued)
The accompanying consolidated statement of income includes revenue
from policyholder charges of $21, $109 and $243, and expenses of
$4,931, $5,897 and $6,445 related to this agreement for 1993, 1992
and 1991, respectively.
The Company has a reinsurance agreement to cede 50 percent of its
long-term care insurance business to an affiliated company. The
accompanying consolidated balance sheet at Dec. 31, 1993 includes
$44,086 of reinsurance receivables related to this agreement.
Liabilities for future policy benefits were reduced by $27,028 at
Dec. 31, 1992 for the effect of this agreement. Premiums ceded
amounted to $16,230, $12,499 and $6,365 and reinsurance recovered
from reinsurers amounted to $404, $250 and $187 for the years ended
Dec. 31, 1993, 1992 and 1991, respectively.
The Company participates in the retirement plan of IDS which covers
all permanent employees age 21 and over who have met certain
employment requirements. The benefits are based on the number of
years the employee participates in the plan, their final average
monthly salary, the level of social security benefits the employee
is eligible for and the level of vesting the employee has earned in
the plan. IDS' policy is to fund retirement plan costs accrued
subject to ERISA and federal income tax considerations. The
Company's share of the total net periodic pension cost was $nil in
1993, 1992 and 1991.
The Company also participates in defined contribution pension plans
of IDS which cover all employees who have met certain employment
requirements. Company contributions to the plans are a percent of
either each employee's eligible compensation or basic
contributions. Costs of these plans charged to operations in 1993,
1992 and 1991 were $2,008, $1,826 and $1,682, respectively.
The Company participates in defined benefit health care plans of
IDS that provide health care and life insurance benefits to retired
employees and retired financial planners. The plans include
participant contributions and service-related eligibility
requirements. Upon retirement, such employees are considered to
have been employees of IDS. IDS expenses these benefits and
allocates the expenses to its subsidiaries. Accordingly, costs of
such benefits to the Company are included in employee compensation
and benefits and cannot be identified on a separate company basis.
Charges by IDS for use of joint facilities and other services
aggregated $243,346, $204,675 and $174,500 for 1993, 1992 and 1991,
respectively. Certain of these costs are included in deferred
policy acquisition costs. In addition, the Company rents its home
office space from IDS on an annual renewable basis. Such rentals
aggregated $4,513, $4,074 and $3,469 for 1993, 1992 and 1991,
respectively.
Certain commission and marketing services expenses are allocated to
the Company by its affiliates. The expenses for 1993, 1992 and
1991 were $127,000, $110,064 and $95,367, respectively. Certain of
the costs assessed to the Company are included in deferred policy
acquisition costs.
<PAGE>
PAGE 51
6. Commitments and contingencies
At Dec. 31, 1993 and 1992, traditional life insurance and universal
life-type insurance in force aggregated $46,125,515 and
$40,904,345, respectively, of which $3,038,426 and $2,937,590 were
reinsured at the respective year ends. The Company also reinsures
a portion of the risks assumed under disability income policies.
Under the agreements, premiums ceded to reinsurers amounted to
$28,276, $24,222 and $16,908 and reinsurance recovered from
reinsurers amounted to $3,345, $6,766 and $6,447 for the years
ended Dec. 31, 1993, 1992 and 1991.
Reinsurance contracts do not relieve the Company from its primary
obligation to policyholders.
The Company is a defendant in various lawsuits, none of which, in
the opinion of the Company counsel, will result in a material
liability.
The Company received the revenue agent's report for the tax years
1984 through 1986 in February 1992, and has settled on all agreed
audit issues. The Company will protest the remaining open issues
and, while the outcome of the appeal is not known at this time,
management does not believe there will be any material impact as a
result of this audit.
7. Lines of credit
The Company has available lines of credit with two banks
aggregating $75,000 at 45 to 80 basis points over the banks' cost
of funds or equal to the prime rate, depending on which line of
credit agreement is used. Borrowings outstanding under these
agreements were $1,519 and $nil at Dec. 31, 1993 and 1992,
respectively.
8. Segment information
The Company's operations consist of two business segments; first,
individual and group life insurance, disability income, health and
long-term care insurance, and second, annuity products designed for
individuals, pension plans, small businesses and employer-sponsored
groups. The consolidated statement of income for the years ended
Dec. 31, 1993, 1992 and 1991 and total assets at Dec. 31, 1993,
1992 and 1991 by segment are summarized as follows:
<PAGE>
PAGE 52
<TABLE><CAPTION>
8. Segment information (continued)
1993 1992 1991
___________________________________________________________________________________________________________
<S> <C> <C> <C>
Net investment income:
Life, disability income, health and long-term care insurance $ 250,224 $ 246,676 $ 233,828
Annuities 1,532,995 1,370,145 1,189,038
___________________________________________________________________________________________________________
$ 1,783,219 $ 1,616,821 $ 1,422,866
___________________________________________________________________________________________________________
Premiums and other considerations:
Life, disability income and long-term care insurance $ 281,284 $ 250,386 $ 220,754
Annuities 143,876 104,952 79,928
___________________________________________________________________________________________________________
$ 425,160 $ 355,338 $ 300,682
___________________________________________________________________________________________________________
Income before income taxes:
Life, disability income, health and long-term care insurance $ 104,127 $ 96,215 $ 90,050
Annuities 315,336 223,316 175,254
Net loss on investments (6,737) (3,710) (5,837)
___________________________________________________________________________________________________________
$ 412,726 $ 315,821 $ 259,467
___________________________________________________________________________________________________________
Total assets:
Life, disability income, health and long-term care insurance $ 4,810,145 $ 4,093,778 $ 3,670,197
Annuities 28,247,608 23,201,995 18,888,612
___________________________________________________________________________________________________________
$33,057,753 $27,295,773 $22,558,809
___________________________________________________________________________________________________________
</TABLE>
Allocations of net investment income and certain general expenses
are based on various assumptions and estimates.
Assets are not individually identifiable by segment and have been
allocated principally based on the amount of future policy benefits
by segment.
Capital expenditures and depreciation expense are not material, and
consequently, are not reported.
<PAGE>
PAGE 53
Annual Financial Information
Report of Independent Auditors
The Board of Directors
IDS Life Insurance Company
We have audited the accompanying consolidated balance sheets of IDS
Life Insurance Company (a wholly owned subsidiary of IDS Financial
Corporation) as of December 31, 1993 and 1992, and the related
consolidated statements of income and cash flows for each of the
three years in the period ended December 31, 1993. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards 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. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial
position of IDS Life Insurance Company at December 31, 1993 and
1992, and the consolidated results of its operations and its cash
flows for each of the three years in the period ended December 31,
1993, in conformity with generally accepted accounting principles.
ERNST & YOUNG
February 3, 1994
Minneapolis, Minnesota
<PAGE>
PAGE 54
Report of Independent Auditors
The Board of Directors
IDS Life Insurance Company
We have audited the consolidated financial statements of IDS Life
Insurance Company as of December 31, 1993 and 1992, and for each of
the three years in the period ended December 31, 1993, and have
issued our report thereon dated February 3, 1994 (included
elsewhere in this Registration Statement).
Our audits also included the financial statement schedules I, V,
VI, VIII and IX included elsewhere in this Registration Statement.
These schedules are the responsibility of the Company's management.
Our responsibility is to express an opinion based on our audits.
In our opinion, the financial statement schedules referred to
above, when considered in relation to the basic financial
statements taken as a whole, present fairly, in all material
respects, the information set forth therein.
Ernst & Young
Minneapolis, Minnesota
February 3, 1994
<PAGE>
PAGE 55
IDS LIFE INSURANCE COMPANY
SCHEDULE I - CONSOLIDATED SUMMARY OF INVESTMENTS
OTHER THAN INVESTMENTS IN RELATED PARTIES ($ thousands)
AS OF DECEMBER 31, 1993
<TABLE>
<CAPTION>
________________________________________________________________________________________
Column A Column B Column C Column D
Type of Investment Cost Value Amount at which
shown in the
balance sheet
________________________________________________________________________________________
<S> <C> <C> <C>
Fixed maturities:
Bonds:
United States Government and
government agencies and
authorities (a) $ 5,591,309 $ 5,737,439 $ 5,591,309
States, municipalities and
polictical subdivisions 11,072 13,452 11,072
All other corporate bonds 13,790,043 14,675,088 13,790,043
____________ _____________ ______________
Total fixed maturities 19,392,424 20,425,979 19,392,424
Mortgage loans on real estate 2,055,450 XXXXXXXXX 2,055,450
Policy loans 350,501 XXXXXXXXX 350,501
Other investments 56,307 XXXXXXXXX 56,307
____________ ______________ ______________
Total investment $ 21,854,682 $ XXXXXXXXX $ 21,854,682
____________ ______________ ______________
(a) - Includes mortgage-backed securities with a cost and market value of $5,527,777 and $5,671,783 respectively.
</TABLE>
<PAGE>
PAGE 56
IDS LIFE INSURANCE COMPANY
SCHEDULE V - SUPPLEMENTARY INSURANCE INFORMATION ($ thousands)
FOR THE YEAR ENDED DECEMBER 31, 1991
<TABLE>
<CAPTION>
Column A Column B Column C Column D Column E Column F
Segment Deferred Future Unearned Other policy Premium
policy policy premiums claims and revenue
acquisition benefits benefits
cost losses, payable
claims and
loss expenses
<S> <C> <C> <C> <C> <C>
Annuities $ 693,184 $13,663,477 $ - $ 30,041 $ -
Life, DI,
Long-Term Care and
Health Insurance 518,439 2,654,915 - 21,205 102,338
Total $1,211,623 $16,318,392 $ - $ 51,246 $102,338
</TABLE>
<TABLE>
<CAPTION>
Column A Column G Column H Column I Column J Column K
Segment Net Benefits, Amortization Other Premiums
investment claims, of deferred operating written
income losses and policy expenses
settlement acquisition
expenses costs
<S> <C> <C> <C> <C> <C>
Annuities $1,189,038 $ 1,639 $ 63,821 $ 66,068 $ N/A
Life, DI,
Long-Term Care and
Health Insurance 233,828 88,577 52,257 87,601 N/A
Total $1,422,866 $90,216 $116,078 $ 153,669 N/A
</TABLE>
IDS LIFE INSURANCE COMPANY
SCHEDULE V - SUPPLEMENTARY INSURANCE INFORMATION ($ thousands)
FOR THE YEAR ENDED DECEMBER 31, 1992
<TABLE>
<CAPTION>
Column A Column B Column C Column D Column E Column F
Segment Deferred Future Unearned Other policy Premium
policy policy premiums claims and revenue
acquisition benefits benefits
cost losses, payable
claims and
loss expenses
<S> <C> <C> <C> <C> <C>
Annuities $ 860,027 $16,342,419 $ - $ 28,705 $ -
Life, DI,
Long-Term Care and
Health Insurance 580,848 2,883,469 - 21,194 114,379
Total $1,440,875 $19,225,888 $ - $ 49,899 $114,379
</TABLE>
<TABLE>
<CAPTION>
Column A Column G Column H Column I Column J Column K
Segment Net Benefits, Amortization Other Premiums
investment claims, of deferred operating written
income losses and policy expenses
settlement acquisition
expenses costs
<S> <C> <C> <C> <C> <C>
Annuities $1,370,145 $ 1,870 $ 81,706 $ 100,928 $ N/A
Life, DI,
Long-Term Care and
Health Insurance 246,676 106,528 58,453 114,764 N/A
Total $1,616,821 $108.398 $140,159 $ 215,692 N/A
</TABLE>
<PAGE>
PAGE 57
IDS LIFE INSURANCE COMPANY
SCHEDULE V - SUPPLEMENTARY INSURANCE INFORMATION ($ thousands)
FOR THE YEAR ENDED DECEMBER 31, 1993
<TABLE>
<CAPTION>
Column A Column B Column C Column D Column E Column F
Segment Deferred Future Unearned Other policy Premium
policy policy premiums claims and revenue
acquisition benefits benefits
cost losses, payable
claims and
loss expenses
<S> <C> <C> <C> <C> <C>
Annuities $1,008,378 $18,492,135 $ - $ 21,508 $ -
Life, DI,
Long-Term Care and
Health Insurance 644,006 3,148,932 - 23,008 127,245
Total $1,652,384 $21,641,067 $ - $ 44,516 $127,245
</TABLE>
<TABLE>
<CAPTION>
Column A Column G Column H Column I Column J Column K
Segment Net Benefits, Amortization Other Premiums
investment claims, of deferred operating written
income losses and policy expenses
settlement acquisition
expenses costs
<S> <C> <C> <C> <C> <C>
Annuities $1,532,995 $ 3,656 $139,602 $ 122,999 $ N/A
Life, DI,
Long-Term Care and
Health Insurance 250,224 119,335 72,131 118,975 N/A
Total $1,783,219 $122,991 $211,733 $ 241,974 N/A
</TABLE>
<PAGE>
PAGE 58
IDS LIFE INSURANCE COMPANY
SCHEDULE VI - REINSURANCE ($ thousands)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991
<TABLE>
<CAPTION>
____________________________________________________________________________________________________________________
Column A Column B Column C Column D Column E Column F
Gross amount Ceded to other Assumed from Net % of amount
companies other companies Amount assumed to net
____________________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C>
For the year ended
December 31, 1993
Life insurance in force $ 44,188,493 $ 3,038,426 $ 2,015,382 $ 43,165,449 4.67%
____________________________________________________________________________________________________________________
Premiums:
Life insurance $ 51,764 $ 3,627 $ -- $ 48,137 0.00%
DI & health insurance 96,250 17,142 -- 79,108 0.00%
____________________________________________________________________________________________________________________
Total premiums $ 148,014 $ 20,769 $ -- $ 127,245 0.00%
____________________________________________________________________________________________________________________
For the year ended
December 31, 1992
Life insurance in force $ 38,888,963 $ 2,937,590 $ 2,015,382 $ 37,966,755 5.31%
____________________________________________________________________________________________________________________
Premiums:
Life insurance $ 53,238 $ 3,849 $ 330 $ 49,719 0.66%
DI & health insurance 78,347 13,687 -- 64,660 0.00%
____________________________________________________________________________________________________________________
Total premiums $ 131,585 $ 17,536 $ 330 $ 114,379 0.29%
____________________________________________________________________________________________________________________
For the year ended
December 31, 1991
Life insurance in force $ 34,596,113 $ 2,902,381 $ 2,020,900 $ 33,714,632 5.99%
_____________________________________________________________________________________________________________________
Premiums:
Life insurance $ 53,223 $ 3,902 $ 385 $ 49,706 0.77%
DI & health insurance 59,844 7,212 -- 52,632 0.00%
____________________________________________________________________________________________________________________
Total premiums $ 113,067 $ 11,114 $ 385 $ 102,338 0.38%
____________________________________________________________________________________________________________________
</TABLE>
<PAGE>
PAGE 59
IDS LIFE INSURANCE COMPANY
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS ($ thousands)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991
<TABLE>
<CAPTION>
____________________________________________________________________________________________________________________
Column A Column B Column C Column D Column E
Additions
--------------
Balance at Charged to
Description Beginning Charged to Other Accounts- Deductions- Balance at End
of Period Costs & Expenses Describe * Describe ** of Period
____________________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C>
For the year ended
December 31, 1993
- ------------------------------
Reserve for Mortgage Loans $23,595 $13,635 $0 $2,210 $35,020
Reserve for Fixed Maturities $37,899 ($15,122) $0 $22,777
Reserve for Other Investments $12,834 ($4,344) $0 ($2,210) $10,700
For the year ended
December 31, 1992
- -------------------------------
Reserve for Mortgage Loans $16,131 $8,440 $0 $976 $23,595
Reserve for Fixed Maturities $45,100 ($7,601) $400 $0 $37,899
Reserve for Other Investments $7,782 $4,076 $0 ($976) $12,834
For the year ended
December 31, 1991
- ------------------------------
Reserve for Mortgage Loans $12,655 $6,860 $0 $3,384 $16,131
Reserve for Fixed Maturities $26,096 $19,004 $0 $0 $45,100
Reserve for Other Investments $8,434 ($4,036) $0 ($3,384) $7,782
____________________________________________________________________________________________________________________
* Cash received on bond previously written down
** Transfer between reserve accounts
</TABLE>
<PAGE>
PAGE 60
IDS LIFE INSURANCE COMPANY
SCHEDULE IX - SHORT-TERM BORROWINGS ($ thousands)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991
<TABLE>
<CAPTION>
_______________________________________________________________________________________________________
Column A Column B Column C Column D Column E Column F
Maximum Average Weighted
Weighted amount amount average
Category of aggregate Balance average outstanding outstanding interest rate
short-term borrowing at end interest during the during the during the
of period rate period period period
_______________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C>
1993
Line of Credit $1,519 N/A $22,700 $1,297 3.70%
1992
Line of Credit $ 0 N/A $20,000 $ 825 5.45%
1991
Line of Credit $ 0 N/A $32,725 $1,483 7.28%
_______________________________________________________________________________________________________
</TABLE>
<PAGE>
PAGE 61
PART II. OTHER INFORMATION
Item 1. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
List of financial statements filed as part of this Post-Effective
Amendment to the Registration Statement:
Financial statements included in the prospectus:
IDS Life Insurance Company
Consolidated Balance Sheets as of December 31, 1993, and
December 31, 1992.
Consolidated Statements of Income for the years ended
December 31, 1993, 1992 and 1991.
Consolidated Statements of Cash Flows for the years ended
December 31, 1993, 1992 and 1991.
Notes to Consolidated Financial Statements.
Report of Independent Auditors dated Feb. 3, 1994.
Exhibits to Financial Statements:
Schedules I, V, VI, VIII and IX as required by Regulation
S-X.
(b) Exhibits
(1) Resolution of the Executive Committee of the Board of
Directors of Investors Syndicate Life Insurance and Annuity
Company, dated May 10, 1968, is filed electronically herewith.
(2) Regulations of IDS Life Variable Annuity Fund B as amended and
restated, dated June 22, 1979, is filed electronically
herewith.
(3) Not applicable.
(4) Contracts filed as Exhibit 4 to Registrant's Post-Effective
Amendment No. 32 to Registration Statement No. 2-29358 filed
on December 27, 1979, are incorporated herein by reference.
(5) (a) Investment Advisory Agreement between IDS Life Insurance
Company and IDS/American Express dated January 12, 1984,
is filed electronically herewith.
<PAGE>
PAGE 62
(b) Investment Management Agreement between IDS Life
Insurance Company and IDS Life Variable Annuity Fund B,
dated January 12, 1984, is filed electronically herewith.
(6) Distribution and Services Agreement between Registrant and IDS
Life Insurance Company, dated January 12, 1984, is filed
electronically herewith.
(7) None.
(8) (a) Custodian Agreement between Registrant, IDS Life
Insurance Company and IDS Bank & Trust dated July 12,
1990, is filed electronically herewith.
(b) Foreign Custody and Subcustodian Agreement filed as
Exhibit 8(b) to Registrant's Post-Effective Amendment No.
51 to this Registration Statement, filed April 24, 1990,
is incorporated herein by reference.
(9) Not applicable.
(10) Opinion and Consent of Counsel as to the legality of the
securities registered was filed with Registrant's 24f-2 Notice
on or about February 25, 1994.
(11) Consent of Independent Auditors is filed electronically
herewith.
(12) through (15) not applicable.
(16) Powers of Attorney to sign Amendments to this Registration
Statement, dated March 31, 1994, are filed electronically
herewith.
Item 2. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH
REGISTRANT
Both the Registrant and IDS Life Variable Annuity Fund A are
separate accounts of IDS Life. Consequently, the securities and
funds of the Registrant and Fund A are technically those of IDS
Life, even though the securities and Funds of the two Funds are
maintained as separate accounts under Minnesota Law pursuant to a
safekeeping agreement with IDS Bank & Trust. As separate Accounts,
Minnesota Law provides that the assets of the Funds are not
chargeable with liabilities arising out of any other business of
IDS Life and are held for the exclusive benefit of owners of
variable annuity contracts based on the Funds.
<PAGE>
PAGE 63
Item 3. NUMBER OF HOLDERS OF SECURITIES
Number of Record Holders
Title of Class as of March 31, 1994
Variable Annuities 18,188
Item 4. INDEMNIFICATION
The Regulations of the Registrant provide that each member of
the Board of Managers and each Officer of the Fund shall be
indemnified by IDS Life, of which the Fund is a separate account,
for reasonable costs and expenses actually and necessarily incurred
in defense of any action, suit or proceedings where the defendant
is a party by reason of being a Manager or Officer. No
indemnification will be forthcoming in the event of an adjudication
of willful misfeasance, bad faith, gross negligence or reckless
disregard by the Officer or Manager of the duties of his office.
In the absence of an adjudication expressly absolving the Office or
Manager of the afore-detailed wrongful conduct, indemnification may
still be advanced should 2/3 of the members of the Board of
Directors of IDS Life who were not involved in the processing
resolve there was no instance of such wrongful conduct. In the
instance of such a resolution, the indemnification claim still must
be found to be reasonable in amount and proper in presentation by
independent counsel of IDS Life. Should any proceeding be settled,
indemnification shall not exceed the costs, fees and expenses which
would have been incurred had the proceeding been litigated. The
payment of indemnification by IDS Life will not prevent a variable
contract holder from challenging the payment by appropriate legal
action on the basis that the payment was improper because of
willful misfeasance, bad faith, gross negligence or reckless
disregard by an Officer or Manager of his duties.
The By-Laws of the Registrant's investment management
underwriter, IDS Life, also contains an indemnification clause.
The clause provides that IDS Life shall indemnify any person who
was or is a party or is threatened to be made a party, by reason of
the fact that he is or was a Manager of Variable Annuity Funds A
and B, director, officer, employee or agent of IDS Life, or is or
was serving at the direction of IDS Life as a Manager of Variable
Annuity Funds A and B, Director, Officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, to any threatened, pending or completed action, suit or
proceeding, wherever brought, to the fullest extent permitted by
the laws of the State of Minnesota, as now existing or hereafter
amended, provided that this Article shall not indemnify or protect
any such Manager of Variable Annuity Funds A and B,Director,
Officer, employee or agent against any liability to IDS Life or its
security holders to which he would otherwise be subject by reason
of willful misfeasance, bad faith, or gross negligence, in the
performance of his duties or by reason of his reckless disregard of
his obligations and duties.
At the time of the filing of the Registration Statement of the
Registrant, IDS Life included the following undertaking with regard
to the foregoing indemnification procedures:
<PAGE>
PAGE 64
"Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provision, or otherwise ISL [si__. IDS Life] 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 of ISL
[si__. IDS Life] 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, ISL [si__.
IDS Life] 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."
<TABLE>
<CAPTION>
Item 5. Business and Other Connections of Investment Adviser (IDS Financial Corporation)
Directors and officers of IDS Financial Corporation who are directors and/or officers of one
or more other companies:
Ronald G. Abrahamson, Vice President--Field Administration
<S> <C> <C>
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-Field
Administration
Douglas A. Alger, Vice President--Total Compensation
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Total Compensation
Jerome R. Amundson, Vice President and Controller--Mutual Funds Operations
IDS Financial Services Inc. IDS Tower 10 Vice President and
Minneapolis, MN 55440 Controller-Mutual Funds
Operations
Peter J. Anderson, Director and Senior Vice President--Investments
IDS Advisory Group Inc. IDS Tower 10 Director and Chairman
Minneapolis, MN 55440 of the Board
IDS Capital Holdings Inc. Director and President
IDS Financial Services Inc. Senior Vice President-
Advisory Group and Equity
Management
IDS Fund Management Limited Director
IDS International, Inc. Director, Chairman of the
Board and Executive Vice
President<PAGE>
PAGE 65
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
IDS Securities Corporation Executive Vice President-
Investments
NCM Capital Management Group, Inc. 2 Mutual Plaza Director
501 Willard Street
Durham, NC 27701
Ward D. Armstrong, Vice President--Sales and Marketing, IDS Institutional Retirement Services
IDS Financial Services Inc. IDS Tower 10 Vice President-Sales and
Minneapolis, MN 55440 Marketing, IDS
Institutional Retirement
Services
Alvan D. Arthur, Region Vice President--Pacific Northwest Region
American Express Service Corporation IDS Tower 10 Vice President
IDS Financial Services Inc. Minneapolis, MN 55440 Region Vice President-
Pacific Northwest Region
Kent L. Ashton, Vice President--Group Management Office, Banking and Certificates Group
IDS Financial Services Inc. IDS Tower 10 Vice President-Group
Minneapolis, MN 55440 Management Office, Banking
and Certificates Group
Joseph M. Barsky III, Vice President--Senior Portfolio Manager
IDS Advisory Group Inc. IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-Senior
Portfolio Manager
Robert Baston, Vice President--Tax and Business Services
IDS Financial Services Inc. IDS Tower 10 Vice President-Tax
Minneapolis, MN 55440 and Business Services
Timothy V. Bechtold, Vice President--Insurance Product Development
IDS Financial Services Inc. IDS Tower 10 Vice President-Insurance
Minneapolis, MN 55440 Product Development
IDS Life Insurance Company Vice President-Insurance
Product Development
John D. Begley, Region Vice President--Mid-Central Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Mid-Central Region
IDS Insurance Agency of Alabama Inc. Vice President-Mid-Central
Region<PAGE>
PAGE 66
Item 5. Business and Other Connections of Investment Adviser (IDS Financial
Corporation)(cont'd)
IDS Insurance Agency of Arkansas Inc. Vice President-Mid-Central
Region
IDS Insurance Agency of Massachusetts Inc. Vice President-Mid-Central
Region
IDS Insurance Agency of Nevada Inc. Vice President-Mid-Central
Region
IDS Insurance Agency of New Mexico Inc. Vice President-Mid-Central
Region
IDS Insurance Agency of North Carolina Inc. Vice President-Mid-Central
Region
IDS Insurance Agency of Ohio Inc. Vice President-Mid-Central
Region
IDS Insurance Agency of Wyoming Inc. Vice President-Mid-Central
Region
Carl E. Beihl, Vice President--Strategic Technology Planning
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Strategic Technology
Planning
Alan F. Bignall, Vice President--Financial Planning Systems
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-
Financial Planning
Systems
Brent L. Bisson, Region Vice President--Northwest Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Northwest Region
IDS Insurance Agency of Alabama Inc. Vice President-
Northwest Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Northwest Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Northwest Region
IDS Insurance Agency of Nevada, Inc. Vice President-
Northwest Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Northwest Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Northwest Region
IDS Insurance Agency of Ohio Inc. Vice President-
Northwest Region
IDS Insurance Agency of Wyoming Inc. Vice President-
Northwest Region
<PAGE>
PAGE 67
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Karl J. Breyer, Director, Senior Vice President and General Counsel
American Express Minnesota Foundation IDS Tower 10 Director
Minneapolis, MN 55440
IDS Aircraft Services Corporation Director and President
IDS Financial Services Inc. Senior Vice President
Harold E. Burke, Vice President and Assistant General Counsel
American Express Service Corporation IDS Tower 10 Vice President
IDS Financial Services Inc. Minneapolis, MN 55440 Vice President and
Assistant General Counsel
Daniel J. Candura, Vice President--Marketing Support
IDS Financial Services Inc. IDS Tower 10 Vice President-Marketing
Minneapolis, MN 55440 Support
Cynthia M. Carlson, Vice President--IDS Securities Services
American Enterprise Investment IDS Tower 10 Director, President and
Services Inc. Minneapolis, MN 55440 Chief Executive Officer
IDS Financial Services Inc. Vice President-IDS
Securities Services
Orison Y. Chaffee III, Vice President--Field Real Estate
IDS Financial Services Inc. IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Real Estate
James E. Choat, Director and Senior Vice President--Field Management
American Express Minnesota Foundation IDS Tower 10 Director
American Express Service Corporation Minneapolis, MN 55440 Vice President
IDS Financial Services Inc. Senior Vice President-
Field Management
IDS Insurance Agency of Alabama Inc. Vice President--North
Central Region
IDS Insurance Agency of Arkansas Inc. Vice President--North
Central Region
IDS Insurance Agency of Massachusetts Inc. Vice President--North
Central Region
IDS Insurance Agency of Nevada Inc. Vice President--North
Central Region
IDS Insurance Agency of New Mexico Inc. Vice President--North
Central Region
IDS Insurance Agency of North Carolina Inc. Vice President--North
Central Region
IDS Insurance Agency of Ohio Inc. Vice President--North
Central Region
IDS Insurance Agency of Wyoming Inc. Vice President-- North
Central Region
IDS Property Casualty Insurance Co. Director
<PAGE>
PAGE 68
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Kenneth J. Ciak, Vice President and General Manager--IDS Property Casualty
IDS Financial Services Inc. IDS Tower 10 Vice President and General
Minneapolis, MN 55440 Manager-IDS Property
Casualty
IDS Property Casualty Insurance Co. I WEG Blvd. Director and President
DePere, Wisconsin 54115
Roger C. Corea, Region Vice President--Northeast Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Northeast Region
IDS Insurance Agency of Alabama Inc. Vice President -
Northeast Region
IDS Insurance Agency of Arkansas Inc. Vice President -
Northeast Region
IDS Insurance Agency of Massachusetts Inc. Vice President -
Northeast Region
IDS Insurance Agency of Nevada Inc. Vice President -
Northeast Region
IDS Insurance Agency of New Mexico Inc. Vice President -
Northeast Region
IDS Insurance Agency of North Carolina Inc. Vice President -
Northeast Region
IDS Insurance Agency of Ohio, Inc. Vice President -
Northeast Region
IDS Insurance Agency of Wyoming Inc. Vice President -
Northeast Region
IDS Life Insurance Co. of New York Box 5144 Director
Albany, NY 12205
Kevin F. Crowe, Region Vice President--Atlantic Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President -
Atlantic Region
Alan R. Dakay, Vice President--Institutional Insurance Marketing
American Enterprise Life Insurance Co. IDS Tower 10 Director and President
Minneapolis, MN 55440
American Partners Life Insurance Co. Director and President
IDS Financial Services Inc. Vice President -
Institutional Insurance
Marketing
IDS Life Insurance Company Vice President -
Institutional Insurance
Marketing
<PAGE>
PAGE 69
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
William F. Darland, Region Vice President--South Central Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
South Central Region
IDS Insurance Agency of Alabama Inc. Vice President-
South Central Region
IDS Insurance Agency of Arkansas Inc. Vice President -
South Central Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
South Central Region
IDS Insurance Agency of Nevada Inc. Vice President-
South Central Region
IDS Insurance Agency of New Mexico Inc. Vice President-
South Central Region
IDS Insurance Agency of North Carolina Inc. Vice President-
South Central Region
IDS Insurance Agency of Ohio Inc. Vice President-
South Central Region
IDS Insurance Agency of Wyoming Inc. Vice President-
South Central Region
William H. Dudley, Director, Executive Vice President--Investment and Brokerage Operations
IDS Advisory Group Inc. IDS Tower 10 Director
Minneapolis, MN 55440
IDS Capital Holdings Inc. Director
IDS Financial Services Inc. Director, Executive Vice
President-Investment and
Brokerage Operations
IDS Futures Corporation Director
IDS Futures III Corporation Director
IDS International, Inc. Director
IDS Securities Corporation Director, Chairman of the
Board, President and
Chief Executive Officer
Roger S. Edgar, Director and Senior Vice President--Information Systems
IDS Financial Services Inc. IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Information Systems
Gordon L. Eid, Director, Senior Vice President and Deputy General Counsel
IDS Financial Services Inc. IDS Tower 10 Senior Vice President and
General Counsel
IDS Insurance Agency of Alabama Inc. Director and Vice President
IDS Insurance Agency of Arkansas Inc. Director and Vice President
IDS Insurance Agency of Massachusetts Inc. Director and Vice President
IDS Insurance Agency of Nevada Inc. Director and Vice President<PAGE>
PAGE 70
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
IDS Insurance Agency of New Mexico Inc. Director and Vice President
IDS Insurance Agency of North Carolina Inc. Director and Vice President
IDS Insurance Agency of Ohio Inc. Director and Vice President
IDS Insurance Agency of Wyoming Inc. Director and Vice President
IDS Real Estate Services, Inc. Vice President
Investors Syndicate Development Corp. Director
Mark A. Ernst, Vice President
American Enterprise Investment IDS Tower 10 Director
Services Inc. Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-Tax and
Business Services
Gordon M. Fines, Vice President--Mutual Fund Equity Investments
IDS Advisory Group Inc. IDS Tower 10 Executive Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-
Mutual Fund Equity
Investments
IDS International Inc. Vice President and
Portfolio Manager
Louis C. Fornetti, Director and Senior Vice President--Corporate Controller
American Enterprise Investment IDS Tower 10 Vice President
Services Inc. Minneapolis, MN 55440
IDS Capital Holdings Inc. Senior Vice President
IDS Certificate Company Vice President
IDS Financial Services Inc. Senior Vice President-
Corporate Controller
IDS Insurance Agency of Alabama Inc. Vice President
IDS Insurance Agency of Arkansas Inc. Vice President
IDS Insurance Agency of Massachusetts Inc. Vice President
IDS Insurance Agency of Nevada Inc. Vice President
IDS Insurance Agency of New Mexico Inc. Vice President
IDS Insurance Agency of North Carolina Inc. Vice President
IDS Insurance Agency of Ohio Inc. Vice President
IDS Insurance Agency of Wyoming Inc. Vice President
IDS Life Insurance Company Director
IDS Life Series Fund, Inc. Vice President
IDS Life Variable Annuity Funds A&B Vice President
IDS Property Casualty Insurance Co. Director and Vice President
IDS Real Estate Services, Inc. Vice President
IDS Sales Support Inc. Director
IDS Securities Corporation Vice President
IDS Trust Company Director
Investors Syndicate Development Corp. Vice President
<PAGE>
PAGE 71
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Douglas L. Forsberg, Vice President--Securities Services
IDS Financial Services Inc. Vice President-
Securities Services
Carl W. Gans, Region Vice President--North Central Region
IDS Financial Services Inc. Region Vice President-
North Central Region
Robert G. Gilbert, Vice President--Real Estate
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Real Estate
John J. Golden, Vice President--Field Compensation Development
IDS Financial Services Inc. IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Compensation Development
Harvey Golub, Director
American Express Company American Express Tower Director and President
World Financial Center
New York, New York 10285
American Express Travel Chairman and Chief
Related Services Company, Inc. Executive Officer
National Computer Systems, Inc. 11000 Prairie Lakes Drive Director
Minneapolis, MN 55440
Morris Goodwin Jr., Vice President and Corporate Treasurer
American Enterprise Investment IDS Tower 10 Vice President and
Services Inc. Minneapolis, MN 55440 Treasurer
American Enterprise Life Insurance Co. Vice President and
Treasurer
American Express Minnesota Foundation Director, Vice President
and Treasurer
American Express Service Corporation Vice President and
Treasurer
IDS Advisory Group Inc. Vice President and
Treasurer
IDS Aircraft Services Corporation Vice President and
Treasurer
IDS Cable Corporation Vice President and
Treasurer
IDS Cable II Corporation Vice President and
Treasurer
IDS Capital Holdings Inc. Vice President and
Treasurer
IDS Certificate Company Vice President and
Treasurer<PAGE>
PAGE 72
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
IDS Deposit Corp. Director, President
and Treasurer
IDS Financial Services Inc. Vice President and
Corporate Treasurer
IDS Insurance Agency of Alabama Inc. Vice President and
Treasurer
IDS Insurance Agency of Arkansas Inc. Vice President and
Treasurer
IDS Insurance Agency of Massachusetts Inc. Vice President and
Treasurer
IDS Insurance Agency of Nevada Inc. Vice President and
Treasurer
IDS Insurance Agency of New Mexico Inc. Vice President and
Treasurer
IDS Insurance Agency of North Carolina Inc. Vice President and
Treasurer
IDS Insurance Agency of Ohio Inc. Vice President and
Treasurer
IDS Insurance Agency of Wyoming Inc. Vice President and
Treasurer
IDS International, Inc. Vice President and
Treasurer
IDS Life Insurance Company Vice President and
Treasurer
IDS Life Series Fund, Inc. Vice President and
Treasurer
IDS Life Variable Annuity Funds A&B Vice President and
Treasurer
IDS Management Corporation Vice President and
Treasurer
IDS Partnership Services Corporation Vice President and
Treasurer
IDS Plan Services of California, Inc. Vice President and
Treasurer
IDS Property Casualty Insurance Co. Vice President and
Treasurer
IDS Real Estate Services, Inc Vice President and
Treasurer
IDS Realty Corporation Vice President and
Treasurer
IDS Sales Support Inc. Director, Vice President
and Treasurer
IDS Securities Corporation Vice President and
Treasurer
Investors Syndicate Development Corp. Vice President and
Treasurer
NCM Capital Management Group, Inc. 2 Mutual Plaza Director
501 Willard Street
Durham, NC 27701
Sloan Financial Group, Inc. Director
<PAGE>
PAGE 73
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Suzanne Graf, Vice President--Systems Services
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Systems Services
David A. Hammer, Vice President and Marketing Controller
IDS Financial Services Inc. IDS Tower 10 Vice President and
Minneapolis, MN 55440 Marketing Controller
IDS Plan Services of California, Inc. Director and Vice President
Robert L. Harden, Region Vice President--Mid-Atlantic Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Mid Atlantic Region
IDS Insurance Agency of Alabama Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of Nevada Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of Ohio Inc. Vice President-
Mid Atlantic Region
IDS Insurance Agency of Wyoming Inc. Vice President-
Mid Atlantic Region
Lorraine R. Hart, Vice President--Insurance Investments
American Enterprise Life IDS Tower 10 Vice President-Investments
Insurance Company Minneapolis, MN 55440
American Partners Life Insurance Co. Director and Vice
President-Investments
IDS Certificate Company Vice President-Investments
IDS Financial Services Inc. Vice President-Insurance
Investments
IDS Life Insurance Company Vice President-Investments
Mark S. Hays, Vice President--Senior Portfolio Manager, IDS International
IDS Financial Services Inc. IDS Tower 10 Vice President-Senior
Minneapolis, MN 55440 Portfolio Manager, IDS
International
IDS Fund Management Limited Director
IDS International, Inc. Senior Vice President
<PAGE>
PAGE 74
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Brian M. Heath, Region Vice President--Southwest Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Southwest Region
IDS Insurance Agency of Alabama Inc. Vice President-
Southwest Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Southwest Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Southwest Region
IDS Insurance Agency of Nevada Inc. Vice President-
Southwest Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Southwest Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Southwest Region
IDS Insurance Agency of Ohio Inc. Vice President-
Southwest Region
IDS Insurance Agency of Texas Inc. Director and President
IDS Insurance Agency of Wyoming Inc. Vice President-
Southwest Region
Raymond E. Hirsch, Vice President--Senior Portfolio Manager
IDS Advisory Group Inc. IDS Tower 10 Vice President
IDS Financial Services Inc. Minneapolis, MN 55440 Vice President-Senior
Portfolio Manager
James G. Hirsh, Vice President and Assistant General Counsel
IDS Financial Services Inc. IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
IDS Insurance Agency of Alabama Inc. Vice President
IDS Insurance Agency of Arkansas Inc. Vice President
IDS Insurance Agency of Massachusetts Inc. Vice President
IDS Insurance Agency of Nevada Inc. Vice President
IDS Insurance Agency of New Mexico Inc. Vice President
IDS Insurance Agency of North Carolina Inc. Vice President
IDS Insurance Agency of Ohio Inc. Vice President
IDS Insurance Agency of Wyoming Inc. Vice President
IDS Securities Corporation Director, Vice President
and General Counsel
Kevin P. Howe, Vice President--Government and Customer Relations and Chief Compliance Officer
American Enterprise Investment IDS Tower 10 Vice President and
Services Inc. Minneapolis, MN 55440 Compliance Officer
American Express Service Corporation Vice President
IDS Financial Services Inc. Vice President-
Government and
Customer Relations
<PAGE>
PAGE 75
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
David R. Hubers, Director, President and Chief Executive Officer
American Express Service Corporation IDS Tower 10 Director and President
Minneapolis, MN 55440
IDS Aircraft Services Corporation Director
IDS Certificate Company Director
IDS Financial Services Inc. Chairman, Chief Executive
Officer and President
IDS Life Insurance Company Director
IDS Plan Services of California, Inc. Director and President
IDS Property Casualty Insurance Co. Director
Marietta Johns, Director and Senior Vice President--Field Management
IDS Financial Services Inc. IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 ACUMA Ltd.
Douglas R. Jordal, Vice President--Taxes
IDS Aircraft Services Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-Taxes
Craig A. Junkins, Vice President--IDS 1994 Implementation Planning and Financial Planning
Development
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-IDS 1994
Implementation Planning
and Financial Planning
Development
James E. Kaarre, Vice President--Marketing Information
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Marketing Information
G. Michael Kennedy, Vice President--Investment Services and Investment Research
IDS Financial Services Inc. IDS Tower 10 Vice President-Investment
Minneapolis, MN 55440 Services and Investment
Research
Susan D. Kinder, Director and Senior Vice President--Human Resources
American Express Minnesota Foundation IDS Tower 10 Director
Minneapolis, MN 55440
American Express Service Corporation Vice President
IDS Financial Services Inc. Senior Vice President-
Human Resources
<PAGE>
PAGE 76
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Richard W. Kling, Vice President--Insurance Marketing and Products
American Enterprise Life Insurance Co. IDS Tower 10 Director
Minneapolis, MN 55440
American Partners Life Insurance Co. Director and Chairman of
the Board
IDS Financial Services Inc. Vice President-
Insurance Marketing and
Products
IDS Insurance Agency of Alabama Inc. Director and Executive Vice
President
IDS Insurance Agency of Arkansas Inc. Director and Executive Vice
President
IDS Insurance Agency of Massachusetts Inc. Director and Executive Vice
President
IDS Insurance Agency of Nevada Inc. Director and Executive Vice
President
IDS Insurance Agency of New Mexico Inc. Director and Executive Vice
President
IDS Insurance Agency of North Carolina Inc. Director and Executive Vice
President
IDS Insurance Agency of Ohio Inc. Director and Executive Vice
President
IDS Insurance Agency of Wyoming Inc. Director and Executive Vice
President
IDS Life Insurance Company Director and President
IDS Life Series Fund, Inc. Director and President
IDS Life Variable Annuity Funds A&B Member of Board of
Managers, Chairman of the
Board and President
IDS Property Casualty Insurance Co. Director and Chairman of
the Board
IDS Life Insurance Company P.O. Box 5144 Director
of New York Albany, NY 12205
Harold D. Knutson, Vice President--System Services
IDS Financial Services Inc. IDS Tower 10 Vice President--
Minneapolis, MN 55440 System Services
Paul F. Kolkman, Vice President--Corporate Actuary
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Corporate Actuary
IDS Life Insurance Company Director and Executive
Vice President
IDS Life Series Fund, Inc. Vice President and Chief
Actuary
Claire Kolmodin, Vice President--Service Quality
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Service Quality
<PAGE>
PAGE 77
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
David S. Kreager, Vice President--Field Management Development
IDS Financial Services Inc. IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Management Development
Christopher R. Kudrna, Vice President--Systems and Technology Development
IDS Financial Services Inc. IDS Tower 10 Vice President-Systems and
Minneapolis, MN 55440 Technology Development
Steven C. Kumagai, Director, Senior Vice President and Associate General Sales Manager
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Director; Senior Vice
President and Associate
General Sales Manager
Mitre Kutanovski, Region Vice President--Midwest Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Midwest Region
Edward Labenski, Vice President--Senior Portfolio Manager
IDS Advisory Group Inc. IDS Tower 10 Senior Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-
Senior Portfolio
Manager
Peter L. Lamaison, Vice President--IDS International Division
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 IDS International
Division
IDS Fund Management Limited Director and Chairman of
the Board
IDS International, Inc. Director, President and
Chief Executive Officer
Kurt A. Larson, Vice President--Senior Portfolio Manager
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Senior Portfolio Manager
<PAGE>
PAGE 78
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Ryan R. Larson, Vice President--Annuity Product Development
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Annuity Product
Development
IDS Life Insurance Company Vice President-
Annuity Product
Development
Daniel E. Laufenberg, Vice President and Chief U.S. Economist
IDS Financial Services Inc. IDS Tower 10 Vice President and
Minneapolis, MN 55440 Chief U.S. Economist
Peter A. Lefferts, Director and Senior Vice President--Banking and Certificates
IDS Life Insurance Company IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-Marketing
IDS Plan Services of California, Inc. Director
IDS Trust Company Director and Chairman of
the Board
Investors Syndicate Development Corp. Director, Chairman of the
Board and President
Douglas A. Lennick, Director, Senior Vice President and General Sales Manager
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Director, Senior Vice
President and General
Sales Manager
Mary J. Malevich, Vice President--Senior Portfolio Manager
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Senior Portfolio
Manager
IDS International Inc. Vice President and
Portfolio Manager
Fred A. Mandell, Vice President--Certificate Operations
IDS Financial Services Inc. IDS Tower 10 Vice President-Certificate
Minneapolis, MN 55440 Operations
William J. McKinney, Vice President--Field Management Support
IDS Financial Services Inc. IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Management Support
<PAGE>
PAGE 79
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Thomas W. Medcalf, Vice President--Senior Portfolio Manager
IDS Financial Services Inc. IDS Tower 10 Vice President-Senior
Minneapolis, MN 55440 Portfolio Manager
William C. Melton, Vice President-International Research and Chief International Economist
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 International Research
and Chief International
Economist
Janis E. Miller, Vice President--Mutual Funds Products and Marketing
IDS Financial Services Inc. IDS Tower 10 Vice President-Mutual Funds
Minneapolis, MN 55440 Products and Marketing
IDS Life Insurance Company Director and Executive
Vice President-Variable
Assets
IDS Life Variable Annuity Funds A&B Director
IDS Life Series Fund, Inc. Director
IDS Management Corporation Director and President
IDS Partnership Services Corporation Director and President
IDS Realty Corporation Director and President
James A. Mitchell, Director and Senior Vice President--Insurance Operations
American Enterprise Investment IDS Tower 10 Director
Services Inc. Minneapolis, MN 55440
IDS Certificate Company Director and Chairman of
the Board
IDS Financial Services Inc. Senior Vice President-
Insurance Operations
IDS Insurance Agency of Alabama Inc. Director and President
IDS Insurance Agency of Arkansas Inc. Director and President
IDS Insurance Agency of Massachusetts Inc. Director and President
IDS Insurance Agency of Nevada Inc. Director and President
IDS Insurance Agency of New Mexico Inc. Director and President
IDS Insurance Agency of North Carolina Inc. Director and President
IDS Insurance Agency of Ohio Inc. Director and President
IDS Insurance Agency of Wyoming Inc. Director and President
IDS Life Insurance Company Director, Chairman of
the Board and Chief
Executive Officer
IDS Plan Services of California, Inc. Director
IDS Property Casualty Insurance Co. Director
American Enterprise Life Insurance P.O. Box 534 Chairman of the Board
Company Minneapolis, MN 55440
IDS Life Insurance Company P.O. Box 5144 Director, Chairman
of New York Albany, NY 12205 of the Board and Chief
Executive Officer
<PAGE>
PAGE 80
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Pamela J. Moret, Vice President--Corporate Communications
American Express Minnesota Foundation IDS Tower 10 Director and President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-
Corporate Communications
Robert J. Neis, Vice President--Information Systems Operations
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Information Systems
Operations
Vernon F. Palen, Region Vice President--Rocky Mountain Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Rocky Mountain Region
IDS Insurance Agency of Alabama Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of Nevada Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of Ohio Inc. Vice President-
Rocky Mountain Region
IDS Insurance Agency of Wyoming Inc. Vice President-
Rocky Mountain Region
James R. Palmer, Vice President--Insurance Operations
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Insurance Operations
IDS Life Insurance Company Vice President-Taxes
Judith A. Pennington, Vice President--Field Technology
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Field Technology
<PAGE>
PAGE 81
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
George M. Perry, Vice President--Corporate Strategy and Development
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Corporate Strategy
and Development
IDS Insurance Agency of Alabama Inc. Director and Executive
Vice President
IDS Insurance Agency of Arkansas Inc. Director and Executive
Vice President
IDS Insurance Agency of Massachusetts Inc. Director and Executive
Vice President
IDS Insurance Agency of Nevada Inc. Director and Executive
Vice President
IDS Insurance Agency of New Mexico Inc. Director and Executive
Vice President
IDS Insurance Agency of North Carolina Inc. Director and Executive
Vice President
IDS Insurance Agency of Ohio Inc. Director and Executive
Vice President
IDS Insurance Agency of Wyoming Inc. Director and Executive
Vice President
IDS Property Casualty Insurance Co. Director
Susan B. Plimpton, Vice President -- American Express Marketing
IDS Financial Services Inc. IDS Tower 10 Vice President--
Minneapolis, MN 55440 American Express
Marketing
Ronald W. Powell, Vice President and Assistant General Counsel
IDS Cable Corporation IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant Secretary
IDS Cable II Corporation Vice President and
Assistant Secretary
IDS Financial Services Inc. Vice President and
Assistant General Counsel
IDS Management Corporation Vice President and
Assistant Secretary
IDS Partnership Services Corporation Vice President and
Assistant Secretary
IDS Plan Services of California, Inc. Vice President and
Assistant Secretary
IDS Realty Corporation Vice President and
Assistant Secretary
James M. Punch, Vice President--TransAction Services
IDS Financial Services Inc. Vice President-Trans
Action Services
<PAGE>
PAGE 82
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Frederick C. Quirsfeld, Vice President--Taxable Mutual Fund Investments
IDS Advisory Group Inc. IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President--
Taxable Mutual Fund
Investments
Roger B. Rogos, Region Vice President--Great Lakes Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Great Lakes Region
IDS Insurance Agency of Alabama Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of Nevada Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of Ohio Inc. Vice President-
Great Lakes Region
IDS Insurance Agency of Wyoming Inc. Vice President-
Great Lakes Region
ReBecca K. Roloff, Vice President--1994 Program Director
IDS Financial Services Inc. IDS Tower 10 Vice President-1994
Minneapolis, MN 55440 Program Director
Stephen W. Roszell, Vice President--Advisory Institutional Marketing
IDS Advisory Group Inc. IDS Tower 10 President and Chief
Minneapolis, MN 55440 Executive Officer
IDS Financial Services Inc. Vice President-Advisory
Institutional Marketing
Robert A. Rudell, Vice President--IDS Institutional Retirement Services
IDS Financial Services Inc. IDS Tower 10 Vice President-IDS
Minneapolis, MN 55440 Institutional Retirement
Services
IDS Sales Support Inc. Director and President
IDS Trust Company Director
<PAGE>
PAGE 83
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
John P. Ryan, Vice President and General Auditor
IDS Financial Services Inc. IDS Tower 10 Vice President and General
Minneapolis, MN 55440 Auditor
Erven A. Samsel, Director and Senior Vice President--Field Management
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Senior Vice President-
Field Management
IDS Insurance Agency of Alabama Inc. Vice President-
New England Region
IDS Insurance Agency of Arkansas Inc. Vice President-
New England Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
New England Region
IDS Insurance Agency of Nevada Inc. Vice President-
New England Region
IDS Insurance Agency of New Mexico Inc. Vice President-
New England Region
IDS Insurance Agency of North Carolina Inc. Vice President-
New England Region
IDS Insurance Agency of Ohio Inc. Vice President-
New England Region
IDS Insurance Agency of Wyoming Inc. Vice President-
New England Region
R. Reed Saunders, Director, Senior Vice President and Chief Marketing Officer
American Express Service Corporation IDS Tower 10 Director and Vice
Minneapolis, MN 55440 President
IDS Financial Services Inc. Director, Senior Vice
President and Chief
Marketing Officer
IDS Property Casualty Insurance Co. Director
Stuart A. Sedlacek, Vice President--Structured Products Group
American Enterprise Life Insurance Co. IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President, Assured
Assets
IDS Certificate Company Director and President
IDS Financial Services Inc. Vice President-
Structured Products
Group
IDS Life Insurance Company Director and Executive
Vice President, Assured
Assets
<PAGE>
PAGE 84
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Donald K. Shanks, Vice President--Property Casualty
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Property Casualty
IDS Property Casualty Insurance Co. Senior Vice President
F. Dale Simmons, Vice President--Senior Portfolio Manager, Insurance Investments
American Enterprise Life Insurance Co. IDS Tower 10 Vice President-Real
Minneapolis, MN 55440 Estate Loan Management
American Partners Life Insurance Co. Vice President-Real
Estate Loan Management
IDS Certificate Company Vice President-Real
Estate Loan Management
IDS Financial Services Inc. Vice President-Senior
Portfolio Manager
Insurance Investments
IDS Life Insurance Company Vice President-Real
Estate Loan Management
IDS Partnership Services Corporation Vice President
IDS Real Estate Services Inc. Director and Vice President
IDS Realty Corporation Vice President
Judy P. Skoglund, Vice President--Human Resources and Organization Development
IDS Financial Services Inc. IDS Tower 10 Vice President-Human
Minneapolis, MN 55440 Resources and
Organization Development
Julian W. Sloter, Region Vice President--Southeast Region
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Region Vice President-
Southeast Region
IDS Insurance Agency of Alabama Inc. Vice President-
Southeast Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Southeast Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Southeast Region
IDS Insurance Agency of Nevada Inc. Vice President-
Southeast Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Southeast Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Southeast Region
IDS Insurance Agency of Ohio Inc. Vice President-
Southeast Region
IDS Insurance Agency of Wyoming Inc. Vice President-
Southeast Region
<PAGE>
PAGE 85
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Ben C. Smith, Vice President--Workplace Marketing
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Workplace Marketing
William A. Smith, Vice President--Finance and CFO/UK
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Finance and CFO/UK
James B. Solberg, Vice President--Advanced Financial Planning
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Advanced Financial
Planning
Bridget Sperl, Vice President--Human Resources Management Services
IDS Financial Services Inc. IDS Tower 10 Vice President-Human
Minneapolis, MN 55440 Resources Management
Jeffrey E. Stiefler, Director
American Express Company American Express Tower Director and President
World Financial Center
New York, NY 10285
Lois A. Stilwell, Vice President--Sales Training and Communications
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Sales Training and
Communications
William A. Stoltzmann, Vice President and Assistant General Counsel
American Partners Life Insurance Co. IDS Tower 10 Director, Vice President,
Minneapolis, MN 55440 General Counsel and
Secretary
IDS Financial Services Inc. Vice President and
Assistant General Counsel
IDS Life Insurance Company Vice President, General
Counsel and Secretary
American Enterprise Life Insurance P.O. Box 534 Director, Vice President,
Company Minneapolis, MN 55440 General Counsel
and Secretary
James J. Strauss, Vice President--Corporate Planning and Analysis
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Corporate Planning and
Analysis
<PAGE>
PAGE 86
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Jeffrey J. Stremcha, Vice President--Information Resource Management/ISD
IDS Financial Services Inc. IDS Tower 10 Vice President-Information
Minneapolis, MN 55440 Resource Management/ISD
Fenton R. Talbott, Director and Senior Vice President--ACUMA Ltd.
ACUMA Ltd. ACUMA House President and Chief
The Glanty, Egham Executive Officer
Surrey TW 20 9 AT
UK
Neil G. Taylor, Vice President--Field Business Systems
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Field Business Systems
John R. Thomas, Director and Senior Vice President--Mutual Funds Operations
IDS Bond Fund, Inc. IDS Tower 10 Director
Minneapolis, MN 55440
IDS California Tax-Exempt Trust Trustee
IDS Discovery Fund, Inc. Director
IDS Equity Plus Fund, Inc. Director
IDS Extra Income Fund, Inc. Director
IDS Federal Income Fund, Inc. Director
IDS Financial Services Inc. Senior Vice President-
Mutual Funds Operations
IDS Futures Corporation Director and President
IDS Futures III Corporation Director and President
IDS Global Series, Inc. Director
IDS Growth Fund, Inc. Director
IDS High Yield Tax-Exempt Fund, Inc. Director
IDS Investment Series, Inc. Director
IDS Managed Retirement Fund, Inc. Director
IDS Market Advantage Series, Inc. Director
IDS Money Market Series, Inc. Director
IDS New Dimensions Fund, Inc. Director
IDS Precious Metals Fund, Inc. Director
IDS Progressive Fund, Inc. Director
IDS Selective Fund, Inc. Director
IDS Special Tax-Exempt Series Trust Trustee
IDS Stock Fund, Inc. Director
IDS Strategy Fund, Inc. Director
IDS Tax-Exempt Bond Fund, Inc. Director
IDS Tax-Free Money Fund, Inc. Director
IDS Utilities Income Fund, Inc. Director
<PAGE>
PAGE 87
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
Melinda S. Urion, Vice President--Insurance Controller
American Enterprise Life IDS Tower 10 Vice President and
Insurance Company Minneapolis, MN 55440 Controller
American Partners Life Insurance Co. Director, Vice President,
Controller and Treasurer
IDS Financial Services Inc. Vice President-Insurance
Controller
IDS Life Insurance Company Director, Executive Vice
President and Controller
IDS Life Series Fund, Inc. Vice President and
Controller
Wesley W. Wadman, Vice President--Senior Portfolio Manager
IDS Advisory Group Inc. IDS Tower 10 Executive Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-
Senior Portfolio Manager
IDS Fund Management Limited Director
IDS International, Inc. Senior Vice President
Norman Weaver, Jr., Director and Senior Vice President--Field Management
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Senior Vice President-
Field Management
IDS Insurance Agency of Alabama Inc. Vice President-
Pacific Region
IDS Insurance Agency of Arkansas Inc. Vice President-
Pacific Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
Pacific Region
IDS Insurance Agency of Nevada Inc. Vice President-
Pacific Region
IDS Insurance Agency of New Mexico Inc. Vice President-
Pacific Region
IDS Insurance Agency of North Carolina Inc. Vice President-
Pacific Region
IDS Insurance Agency of Ohio Inc. Vice President-
Pacific Region
IDS Insurance Agency of Wyoming Inc. Vice President-
Pacific Region
Michael L. Weiner, Vice President--Corporate Tax Operations
IDS Capital Holdings Inc. IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Vice President-Corporate
IDS Futures III Corporation Vice President, Treasurer
and Secretary<PAGE>
PAGE 88
Item 5. Business and Other Connections of Investment Adviser (IDS
Financial Corporation)(cont'd)
IDS Futures Brokerage Group Vice President
IDS Futures Corporation Vice President, Treasurer
and Secretary
Lawrence J. Welte, Vice President--Investment Administration
IDS Financial Services Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Investment Administration
IDS Securities Corporation Director, Executive Vice
President and Chief
Operating Officer
William N. Westhoff, Director and Senior Vice President--Fixed Income Management
American Enterprise Life Insurance IDS Tower 10 Director
Company Minneapolis, MN 55440
IDS Financial Services Inc. Senior Vice President-
Fixed Income Management
IDS Partnership Services Corporation Director and Vice President
IDS Real Estate Services Inc. Director, Chairman of the
Board and President
IDS Realty Corporation Director and Vice President
Investors Syndicate Development Corp. Director
Edwin M. Wistrand, Vice President and Assistant General Counsel
IDS Financial Services Inc. IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
Michael R. Woodward, Director and Senior Vice President--Field Management
American Express Service Corporation IDS Tower 10 Vice President
Minneapolis, MN 55440
IDS Financial Services Inc. Senior Vice President-
Field Management
IDS Insurance Agency of Alabama Inc. Vice President-
North Region
IDS Insurance Agency of Arkansas Inc. Vice President-
North Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
North Region
IDS Insurance Agency of Nevada Inc. Vice President-
North Region
IDS Insurance Agency of New Mexico Inc. Vice President-
North Region
IDS Insurance Agency of North Carolina Inc. Vice President-
North Region
IDS Insurance Agency of Ohio Inc. Vice President-
North Region
IDS Insurance Agency of Wyoming Inc. Vice President-
North Region
IDS Life Insurance Company Box 5144 Director
of New York Albany, NY 12205
/TABLE
<PAGE>
PAGE 89
Item 6. PRINCIPAL UNDERWRITERS
(a) IDS Life is the principal underwriter for IDS Life
Variable Annuity Fund B, IDS Life Variable Annuity
Fund A, IDS Life Accounts F, IZ, JZ, G, H and N, IDS
Life Account RE, IDS Life Account MGA and IDS Life
Account SLB.
(b) Directors and Officers of the Underwriter
<TABLE><CAPTION>
Positions and
Name Principal Business Address Offices with Underwriter
<S> <C> <C>
Timothy V. Bechtold IDS Tower 10 Vice President-Insurance
Minneapolis, MN 55440 Product Development
David J. Berry IDS Tower 10 Vice President
Minneapolis, MN 55440
Alan R. Dakay IDS Tower 10 Vice President-
Minneapolis, MN 55440 Institutional Insurance
Marketing
Louis C. Fornetti IDS Tower 10 Director
Minneapolis, MN 55440
Morris Goodwin Jr. IDS Tower 10 Vice President and Treasurer
Minneapolis, MN 55440
Lorraine R. Hart IDS Tower 10 Vice President-Investments
Minneapolis, MN 55440
David R. Hubers IDS Tower 10 Director
Minneapolis, MN 55440
Roger P. Husemoller IDS Tower 10 Vice President-
Minneapolis, MN 55440 Intercorporate Insurance
Operations
Richard W. Kling IDS Tower 10 Director and President
Minneapolis, MN 55440
Paul F. Kolkman IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President
Ryan R. Larson IDS Tower 10 Vice President-
Minneapolis, MN 55440 Annuity Product
Development
Peter A. Lefferts IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-
Marketing
Janis E. Miller IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-
Variable Assets
<PAGE>
PAGE 90
Item 6.(b) Directors and Officers of the Underwriter (Continued)
Positions and
Name Principal Business Address Offices with Underwriter
James A. Mitchell IDS Tower 10 Director, Chairman of
Minneapolis, MN 55440 the Board and Chief
Executive Officer
Barry J. Murphy IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-
Client Service
Mary O. Neal IDS Tower 10 Vice President-
Minneapolis, MN 55440 Sales Support
James R. Palmer IDS Tower 10 Vice President-Taxes
Minneapolis, MN 55440
F. Dale Simmons IDS Tower 10 Vice President-
Minneapolis, MN 55440 Real Estate
Loan Management
William A. Stoltzmann IDS Tower 10 Vice President, General
Minneapolis, MN 55440 Counsel and Secretary
Melinda S. Urion IDS Tower 10 Director, Executive
Minneapolis, MN 55440 Vice President and
Controller
</TABLE>
Item 7. LOCATION OF ACCOUNTS AND RECORDS
IDS Life Insurance Company
IDS Tower
Minneapolis, Minnesota
Item 8. MANAGEMENT SERVICES
Not Applicable.
Item 9. DISTRIBUTION EXPENSES
Not Applicable.
Item 10. UNDERTAKINGS
(a) and (b) These undertakings were filed in Registrant's
initial Registration Statement.
<PAGE>
PAGE 91
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, IDS Life Insurance Company, on
behalf of the Registrant, certifies that it meets all of the
requirements for effectiveness of this Amendment to its
Registration Statement pursuant to Rule 486(b) under the Securities
Act of 1933 and has duly caused this Amendment to its Registration
Statement to be signed on its behalf by the undersigned thereunto
duly authorized, in the city of Minneapolis, and State of Minnesota
on the 27th day of April, 1994.
IDS LIFE VARIABLE ANNUITY FUND B
By:
Richard W. Kling
President
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by
the following persons in the capacities indicated on the 27th day
of April, 1994.
Signature Title
/s/ Edward Landes* Member, Board of Managers
Edward Landes
/s/ Carl N. Platou* Member, Board of Managers
Carl N. Platou
/s/ Gordon H. Ritz* Member, Board of Managers
Gordon H. Ritz
Member, Board of Managers
Richard W. Kling
Member, Board of Managers
Janis E. Miller
* Signed pursuant to Powers of Attorney filed as Exhibit 16 to
Registrant's Post-Effective Amendment No. 50 to this Registration
Statement No. 2-29358, 2-47430.
by
Mary Ellyn Minenko
<PAGE>
PAGE 92
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, IDS Life Insurance Company, on
behalf of the Registrant, certifies that it meets all of the
requirements for effectiveness of this Amendment to its
Registration Statement pursuant to Rule 486(b) under the Securities
Act of 1933 and has duly caused this Amendment to its Registration
Statement to be signed on its behalf by the undersigned thereunto
duly authorized, in the city of Minneapolis, and State of Minnesota
on the 27th day of April, 1994.
IDS LIFE INSURANCE COMPANY
By: /s/ Richard W. Kling*
Richard W. Kling
President
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by
the following persons in the capacities indicated on the 27th day
of April, 1994.
Signature Title
/s/ James A. Mitchell* Chairman of the Board
James A. Mitchell and Chief Executive
Officer
/s/ Richard W. Kling* Director and President
Richard W. Kling
/s/ Louis C. Fornetti* Director
Louis C. Fornetti
/s/ David R. Hubers* Director
David R. Hubers
/s/ Paul F. Kolkman* Director and Executive Vice
Paul F. Kolkman President
/s/ Peter A. Lefferts* Director and Executive Vice
Peter A. Lefferts President, Marketing
/s/ Janis E. Miller* Director and Executive Vice
Janis E. Miller President, Variable Assets
/s/ Barry J. Murphy* Director and Executive Vice
Barry J. Murphy President, Client Service
/s/ Stuart A. Sedlacek* Director and Executive Vice
Stuart A. Sedlacek President, Assured Assets
/s/ Melinda S. Urion* Director, Exective Vice
Melinda S. Urion President and Controller
<PAGE>
PAGE 93
*Signed pursuant to Powers of Attorney, dated March 31, 1994, filed
electronically herewith.
by
Mary Ellyn Minenko
<PAGE>
PAGE 94
CONTENTS OF THIS
POST-EFFECTIVE AMENDMENT NO. 55
TO REGISTRATION STATEMENT NO. 2-47430; 2-29358
This Post-Effective Amendment comprises the following papers and
documents.
The facing sheet.
Part I.
Cross Reference Sheet.
Prospectus.
Financial Statements.
Part II.
Other Information.
Signatures.
Exhibits.
<PAGE>
EXHIBIT INDEX
Exhibit 1(b)(1) Resolution of the Executive Committee of
the Board of Directors of Investors
Syndicate Life Insurance and Annuity
Company, dated May 10, 1968
Exhibit 1(b)(2) Regulations of IDS Life Variable Annuity
Fund B as amended and restated, dated
June 22, 1979
Exhibit 1(b)(5)(a) Investment Advisory Agreement between IDS
Life Insurance Company and IDS/American
Express, dated January 12, 1984
Exhibit 1(b)(5)(b) Investment Management Agreement between
IDS Life Insurance Company and IDS Life
Variable Annuity Fund B, dated January 12,
1984
Exhibit 1(b)(6) Distribution and Services Agreement
between Registrant and IDS Life Insurance
Company, dated January 12, 1984
Exhibit 1(b)(8)(a) Custodian Agreement between Registrant,
IDS Life Insurance Company and IDS Bank &
Trust, dated July 12, 1990
Exhibit 1(b)(11) Consent of Independent Auditors
Exhibit 1(b)(16) Powers of Attorney to sign Amendments to
this Registrant, dated March 31, 1994
<PAGE>
<PAGE>
PAGE 1
I, the undersigned, Assistant Secretary of Investors Syndicate Life
Insurance and Annuity Company, a Minnesota Corporation, do hereby
certify that the following is a true and correct copy of a
resolution duly adopted by the Executive Committee of the Board of
Directors of this Corporation on the 10th day of June, 1968 and is
in full force and effect and has not been rescinded:
WHEREAS, the Board of Directors of the Corporation, by resolution
passed November 8, 1967, authorized the establishment of a separate
account and the issuance of contracts on a variable basis; and
WHEREAS, such Board further authorized and directed this Executive
Committee to take such further action as may be necessary or
desirable to accomplish such purpose;
NOW, THEREFORE, BE IT RESOLVED, That a separate account be and it
hereby is established in accordance with Section 61A.14 of the
Minnesota Statutes, such separate account to be known as IDS
Variable Annuity Fund B.
Witness my hand and
seal of the Corporation
this date: June 14, 1968 \s\ John E. McTavish
Assistant Secretary
<PAGE>
<PAGE>
PAGE 1
AMENDED AND RESTATED
REGULATIONS OF IDS LIFE VARIABLE ANNUITY FUND B
IDS Life Variable Annuity Fund B (Fund) is a separate account
within IDS Life Insurance Company (the Company) pursuant to
Minnesota Statutes, Section 61A.14, as amended. The Fund's assets
are those allocated to it from time to time under the terms of
variable annuity contracts which expressly provide for such
allocation. Such assets constitute the source of payments which
the company is obligated to make under the terms of such variable
annuity contracts.
ARTICLE I
Purpose
Section 1.1. The company empowered by Minnesota law to delegate
management of the Fund to a Committee (Board of Managers) and to
grant voting rights to holders of variable annuity contracts to the
extent the Company deems necessary under the Investment Company Act
of 1940. The purpose of these regulations is to exercise such
power and to establish the basis for the management and
administration of the Fund.
Section 1.2 The Fund is deemed an investment company of the open-
end diversified management type within the meaning of the
Investment Company Act of 1940. The Company intends to operate the
Fund in such a way as to comply with the Act and amendments
thereof, or pursuant to such exemptions from otherwise applicable
provisions of such Act as may be obtained from time to time. The
Company expressly reserves the power to take such actions as it
deems necessary to obtain and maintain compliance with applicable
laws of all jurisdictions to which it now is or may become subject.
Section 1.3. Interpretation of these regulations shall be
consistent with (a) the basic purpose of the Fund to provide the
investment medium for and the source of payments required by
variable annuity contracts, (b) the legal authority of the Company
as a Minnesota Corporation to establish and operate the Fund, (c)
the status of the Company as a life insurance company licensed to
do business in the several states, and (d) the operation of the
Fund in accordance with requirements of applicable state and
federal securities and insurance laws.
ARTICLE II
Voting Rights of Variable Contract Holders
Section 2.1. A Variable Contract as defined herein, is a variable
annuity or supplementary contract under the terms of which there
are values or benefits based on the Fund. A participant, as
defined herein, is any natural person who has credited to him
accumulation units or annuity units based on the Fund.
<PAGE>
PAGE 2
Section 2.2. The owner of a Variable Contract shall have the right
to vote at meetings of Variable Contract Holders, upon such matters
and in the manner as hereinafter provided, except if, and to the
extent that a Group Variable Contract by its terms grants voting
rights to one or more Participants. A Variable Contract Holder, as
defined herein, is an owner, or a Participant with voting rights
under a Group Variable Contract.
Section 2.3. The number of votes which a Variable Contract Holder
may cast at any meeting of Variable Contract Holders or adjournment
thereof shall be determined as of a reasonable date, fixed by the
Board of Managers or in such manner as they may direct, as follows:
(a) A Variable Contract Holder, who has credited to him
accumulation units based on the Fund, shall be entitled
to a number of votes equal to the number of such
accumulation units credited to him; and
(b) A Variable Contract Holder of a contract, who has
credited to him annuity units based on the Fund, shall
be entitled to a number of votes equal to the number
determined by dividing (1) the present value of all
future variable annuity payments under the contract by
(2) the value as of the record date of one accumulation
unit of the Fund. Such computations shall assume the
mortality and interest bases and settlement mode used
to determine the initial variable annuity payment under
the contract and shall further assume a constant
annuity unit value determined as of the record date.
Section 2.4. Only Variable Contract Holders of record ont he
record date for any meeting shall be entitled to notice of, and to
vote at such meeting of Variable Contract Holders. A Variable
Contract Holder entitled to vote may vote at any such meeting
either in person or by a duly executed proxy. A valid proxy for
any meeting shall be valid for any adjournment of such meeting.
Section 2.5. The appointment of a proxy shall be in writing filed
with the inspectors at or before the meeting. The authority of a
proxy, if not coupled with an interest, may be terminated at will.
The authority of every proxy shall cease within one year after the
appointment. A termination of a proxy's authority by act of the
Variable Contract Holder shall be ineffective until written notice
of the termination has been given to the inspectors. Unless
otherwise provided, therein, the appointment shall have the effect
of revoking all appointments of prior date.
ARTICLE III
Meetings of Variable Contract Holders
Section 3.1. An annual meeting of Variable Contract Holders for
the transaction of such business as may properly come before the
meeting shall be held each year at a date and time to be determined
by the Board of Managers or in such manner as they may direct.
<PAGE>
PAGE 3
Section 3.2. Special meetings of the Variable Contract Holders may
be called by the Chairman of the Board of Managers or any two
members of the Board of Managers.
Section 3.3. Meetings of Variable Contract Holders shall be held
at the principal office of the Company in the City of Minneapolis,
Minnesota.
Section 3.4. A written notice stating the place, date and hour of
the meeting and the purpose or purposes for which the meeting is
called, shall be delivered or mailed to each Variable Contract
Holder. Mailed notice shall be mailed, to the address of the
Variable Contract Holder as it appears on the records, not less
than twenty days prior to the date of such meeting.
Section 3.5. The number of votes present at any meeting of
Variable Contract Holders shall include votes of Variable Contract
Holders who are personally present and those represented by proxy.
If fewer than the required number are present at any meeting in
order to vote on a specific matter as hereinafter provided, the
Chairman of the Board of Managers may nevertheless adjourn the
meeting at the time until the required number of votes are present
at any such adjourned meeting.
Section 3.6. At each meeting of the Variable Contract Holders the
polls shall be opened and closed, the proxies and ballots shall be
received and taken in charge, and all questions touching the
qualification of voters or the validity of proxies and the
acceptance or rejection of votes shall be decided by three
inspectors. Such inspectors, who need to be Variable Contract
Holders, shall be appointed by the chairman of the Board of
Managers.
Section 3.7. Any action, which may be taken at a meeting of the
Variable Contract Holders, may be taken without a meeting if done
in writing signed by all Variable Contract Holders who would be
entitled to a notice of a meeting, for such purpose.
ARTICLE IV
Board of Managers
Section 4.1. The Board of Managers shall consist of not less than
five nor more than nine members, as the Board of Manages may from
time to time determine. The members of the Board of Managers shall
be subject to election at each annual meeting of the Variable
Contract Holders. The term of the office of each member of the
Board of Manages shall be until the next annual meeting of the
Variable Contract Holders and until his successor has been elected
and qualified. members of the Board of Managers need not be
Variable Contract Holders.
<PAGE>
PAGE 4
Section 4.2. If there be a vacancy in the Board of Managers by
reason of death, resignation, removal, or otherwise, such vacancy
shall be filled for the unexpired term by a majority vote of the
remaining Board of Managers, though less than a quorum. Provided,
however, if immediately after filling any such vacancy less than
two-thirds of the directors then holding office would have been
elected to such office by the Variable Contract Holders, such
vacancy shall be filled by the Variable Contract Holders at an
annual or special meeting duly called for that purpose, and such
vacancy shall not be filled by the remaining Board of Managers. In
the event that at any time less than a majority of the Board of
Managers holding office were elected by the Variable Contract
Holders, the Board of Managers shall forthwith cause to be held as
promptly as possible and, in any event within sixty days unless
appropriate regulatory authorities permit an extension of such
period, a meeting of Variable Contract Holders for the purpose of
electing Board of Manages members to fill any existing vacancies in
the Board of Managers.
Section 4.3. At least forty percent (40%) of the outstanding votes
of Variable Contract Holders shall be present to constitute a
quorum for the election of Board of Managers members at any annual
or special meeting of Variable Contract Holders.
Section 4.4. A Variable Contract Holder may in any election of
Board of Managers cast the total number of votes which he holds for
each of the vacancies on the Board of Managers. There shall not be
cumulative voting. Those candidates for election to the Board of
Managers who receive the largest number of votes, whether a
majority of the votes cast or not, shall be declared elected to the
vacancies on the Board of Managers.
Section 4.5. Any Variable Contract Holder, or his duly appointed
proxy, may nominate a candidate or candidates for Board of Managers
membership at any meeting of Variable Contract Holders at which an
election of Board of managers members is duly being held.
Section 4.6. The entire Board of managers of any individual member
thereof may be removed from the Board of managers, with or without
cause, by a vote of Variable Contract Holders holding a majority of
the votes entitled to be cast for election of members of the Board
of Managers.
ARTICLE V
Meetings and Organization of Board of Managers
Section 5.1. A chairman shall be elected by the Board of Managers
from their own number. He shall preside at meetings of the Board
of Managers and at meetings of the Variable Contract Holders and
shall perform such other duties as may be delegated to the Chairman
from time to time.
<PAGE>
PAGE 5
Section 5.2. A Secretary, who may or may not be a member of the
Board of Managers, shall be elected by the Board of Managers. He
shall attend all meetings of the Board of Managers, the Variable
Contract Holders, and such other meetings as may be designated by
the Board of Managers. He shall act as clerk of such meetings and
record all of the proceedings of such meetings in a book or books
to be kept for that purpose and shall have custody of the minute
books of the Board of Managers. He shall perform such additional
duties as are assigned to him by the Board of Managers.
Section 5.3. The Chairman and Secretary of the Board of Managers
shall serve until their successors are chosen and qualify in their
stead and may be removed either with or without cause at any time
by the affirmative vote of a majority of the Board of Managers.
Section 5.4. Regular meetings of the Board of Managers may be held
at such time and place as shall from time to time be fixed by
resolution of the Board of Managers. No notice of regular meetings
shall be required.
Section 5.5. Special meetings of the Board of Managers may be
called by the Chairman or by any two members of the Board of
Managers. Notice of the time and place of special meetings shall
be given to each member of the Board of Managers at least one day
prior thereto by mail, telephone, telegraph, or in person. Special
meetings of the Board of Managers may be held at such place as is
indicated in the notice thereof.
Section 5.6. A majority of the members of the Board of Managers
shall constitute a quorum, but a smaller number may adjourn from
time to time without notice, other than by announcement at the
meeting, until a quorum is secured; and likewise, in case a quorum
be present, the meeting may be adjourned from time to time without
notice other than by announcement at the meeting. At any adjourned
meeting at which a quorum be present, any business may be
transacted which might have been transacted at the meeting as
originally called.
Section 5.7. The affirmative vote of a majority of the members of
the Board of Managers present at any meeting shall pass any
question duly presented, except as may be otherwise provided for
any question by the Investment Company Act of 1940.
Section 5.8. Any action required or permitted to be taken at any
meeting of the Board of Managers may be taken without a meeting if
a written consent thereto is signed by all members of the Board of
Managers.
<PAGE>
PAGE 6
ARTICLE VI
Authority
Section 6.1. The President of the Company shall be the President
of the Fund ex officio. The Company by its duly authorized
officers, shall at all times retain control over the disposition of
all assets of the Company and shall have the authority to draw upon
the Fund to pay fees, make adjustments and payments pursuant to
Variable Annuity Contracts based on the Fund. The Company shall
determine the amount of and liability for such payments and its
decision shall be binding on the Fund.
Section 6.2. Except as may be otherwise provided or limited by the
Investment Company Act of 1940 or agreements entered into by the
Company and the Fund pursuant to such Act, the Company, by its duly
authorized officers, shall at all times have access to the assets
of the fund for any lawful purpose including the making of such
valuations, reports, etc., as deemed necessary by the Company.
Section 6.3. The Company shall, in the amount and manned deemed by
the Company to be necessary, provide and pay for all administrative
services and costs related to the Fund.
Section 6.4. In addition to other rights to withdraw amounts from
the Fund which the Company may have pursuant to contracts between
the Company and the Fund, the Company shall have the authority to
withdraw from the Fund the amounts payable to the Company pursuant
to Variable Annuity Contracts based on the Fund, including but not
limited to amounts: for providing mortality and expense
guarantees, for mortality adjustments, and for capital gains or
other taxes.
Section 6.5. The Board of Managers shall have the following powers
with respect to the Fund provided that such powers shall be
exercised at all times consistent with the status of the Fund as a
separate account of the Company under Minnesota law and as a
registered investment company under the Investment Company Act of
1940 and the status of the Company as a corporation organized under
Minnesota law and as an insurance company under the laws of other
applicable jurisdictions:
a) The Board of Managers may enter into a written
agreement to obtain investment advisory services for
the Fund. Such written contract may allow or provide
that any investment advisor or manager may in turn
contract with others for the performance of all or part
of such investment advisory services. To the extent
required by the Investment Company Act of 1940, any
such contract or contracts shall not be effective until
such time as it is approved by a vote of Variable
Contract Holders of either (1) at least 67% of the
votes present at such meeting if at least 50% of the
outstanding votes are present, or (2) at least 50% of
the outstanding votes of the Fund whichever is less;
provided, however, that such requirement of approval by
Variable Contract Holders shall not be required to make<PAGE>
PAGE 7
the contract effective for any period for which an
exemption from such requirement has been obtained from
the appropriate regulatory authorities. The amount of
the fee paid for such investment advisory services may
not exceed the valuation period equivalent of an annual
rate of .4% of the net value of the Fund assets.
b) The Board of Managers may enter into a written contract
providing for the distribution of variable annuity
contracts with values or benefits based, in whole of in
part, on the Fund.
c) The Board of Managers shall select an independent
public accountant for the Fund at a meeting held within
30 days before or after the beginning of each fiscal
year of the Fund or before the annual meeting of
Variable Contract Holders in that year and such
selection shall be submitted for ratification or
rejection at the next succeeding annual meeting of
Variable Contract Holders provided that at least 40% of
the outstanding votes must be present in person or by
proxy at the meeting of Variable Contract Holders. A
majority of the votes cast on the question of
ratification or rejection of such selection shall
decide the question. In the event that the selection
of such an independent public accountant be rejected or
his employment terminated the vacancy so occurring may
be filled at a meeting of Variable Contract Holders by
a vote of a majority of the outstanding votes for such
meeting.
d) The Board of Managers shall select a Controller of the
Fund who shall serve at the pleasure of the Board of
Managers and who may participate as required by law in
the preparation of any Fund financial statement filed
with the Securities and Exchange Commission.
e) The Board of Managers shall select a Treasurer who
shall be a chief financial officer of the Fund and one
or more Assistant Treasurers as may be deemed necessary
or desirable, who shall serve at the pleasure of the
Board of Managers.
f) The Chairman of the Board of Managers on behalf of the
Board of Managers shall enter into an appropriate
agreement or agreements for the safekeeping of
Securities and other assets of the Fund. The Board of
Managers shall by resolution designate certain persons
who shall have access to the assets of the Fund in a
manner to be defined in the appropriate safekeeping
agreement. The Board of Managers may cause such
persons to be bonded, retain an independent public
accountant, and cause to be kept such records and do
all other things as may be necessary to maintain such
safekeeping agreements in compliance with applicable
provisions of the Investment Company Act of 1940.
<PAGE>
PAGE 8
ARTICLE VII
Policy of the Fund
Section 7.1. The principal investment objective of the Fund is to
invest in securities with an opportunity of long-term capital
appreciation consistent with the Fund's purpose of serving as the
vehicle for accumulating values and providing annuity payments
under variable annuity contracts issued by the Company. The
principal objective does not preclude the making of investments for
the purpose of seeking short-term capital appreciation. It is
anticipated that the Fund's assets will be invested primarily in
common stocks, but investments may be made in senior securities and
debt instruments and government obligations, including short-term
obligations. Any income or realized capital gains on investments
of the fund will be reinvested. The Fund does not intend to invest
in companies for the purpose of exercising control or management.
It intends to select securities which it is believed may be
profitably retained over a period of time, and it is not the policy
of the Fund to engage in trading for short-term profits. However,
notwithstanding the length of time a security has been held,
changes in the portfolio will be made promptly when determined to
be advisable by reason of developments not foreseen at the time of
the investment decision.
Section 7.2. The Company and the Fund shall adhere to the
following fundamental investment policies with respect to the Fund.
a) The Fund shall not borrow amounts in excess of 10% of
the gross assets of the Fund taken at cost determined
in accordance with good accounting practice and no
borrowing shall be undertaken except as a temporary
measure for extraordinary or emergency purposes. The
Fund may borrow only from banks.
b) The Fund shall not underwrite securities of other
issuers. However, this shall not preclude the purchase
of securities for investment on original issue or
otherwise, and shall not preclude the acquisition of
portfolio securities under circumstances where the Fund
would not be free to sell them without being deemed an
underwriter for purposes of the Securities Act of 1933
and without registration of such securities or the
filing of a notification under that Act, or the taking
of similar action under other securities laws relating
to the sale of securities. The Fund will not invest in
securities which are not readily marketable without
registration or the filing of a notification under the
Securities Act of 1933, or the taking of similar action
under other securities laws relating to the sale of
securities, if immediately after the making of any such
investment more than 15% of the Fund's net assets
(taken at market or other current value) is invested in
such securities.
<PAGE>
PAGE 9
c) The Fund does not intend to concentrate its investments
in any particular industry, but reserves freedom of
action to do so provided that not more than 25% of its
assets, taken at cost, may be so invested at any one
time.
d) The Fund will not purchase or sell real estate as a
principal activity. However, the right is reserved to
invest up to 10% of the Fund's assets, taken at cost,
in real properties.
e) Not more than 5% of the gross assets of the Fund taken
at cost will be invested in securities of any one
corporation, government or political subdivision
thereof, but this limitation shall not apply to
investments in obligations of the United States or in
obligations of any corporation organized under general
act of Congress if such corporation be an
instrumentality of the United States.
f) The Fund will not purchase securities of any investment
trust or investment company, except by purchase in the
open market where no commission or profit to a sponsor
or dealer results from such purchase the Fund would own
more than 10% of the outstanding voting securities of
such issuer.
g) The Fund will not purchase securities of any investment
trust or investment company, except by purchase in the
open market where no commission or profit to a sponsor
or dealer results from such purchase other than
customary broker's commission. The Fund does not
intend to invest in such securities but may do so to
the extent of not more than 15% of the Fund's net
assets (taken at market or other current value).
h) No securities will be purchased on margin, nor will the
Fund make any short sales of securities.
i) The Fund shall not make loans to other persons, except
by the purchase, upon original issuance or otherwise,
of a portion of an issue of bonds, notes, debentures,
or other securities publicly distributed or of a type
customarily purchased by financial institutions.
j) The Fund will not engage in the purchase and sale of
commodities or commodity contracts.
ARTICLE VIII
Miscellaneous
Section 8.1. The fiscal year of the Fund shall begin on the first
day of january, in each year and end on the thirty-first day of
December following.
<PAGE>
PAGE 10
Section 8.2. The "close of business" for any valuation date of the
Fund shall coincide with the time of closing of the New York Stock
Exchange. The business of the Fund shall be conducted in
accordance with such closing.
ARTICLE IX
Indemnification
Section 9.1. Subject to the further provisions hereof, each member
of the Board of Managers and each Officer of the Fund shall be
indemnified by the Company against reasonable costs and expenses
actually and necessarily incurred by him in connection with the
defense of any action, suit or proceedings to which he may be made
a party by reason of his being or having been a member of the Board
of Managers or Officer of the Fund, except in relation to any
action, suit, or proceeding to be liable because of willful
misfeasance, bad faith, gross negligence or reckless disregard of
the duties involved in the conduct of his office. In the absence
of an adjudication which expressly absolves the member or office of
liability to the Fund or its Contract Holders for willful
misfeasance, bad faith, gross negligence or reckless disregard of
the duties involved in the conduct of his office or in the event of
a settlement, each member of the Board of Managers and Officer of
the Fund (and his heirs, executors, and administrators) may be
indemnified by the Company against payments made, including
reasonable costs and expenses; provided that such indemnity shall
be conditioned upon the prior determination by a resolution of two-
thirds of the members of the Board of Directors of the Company and
who are not involved in the action, suit, or proceeding, that the
member of the Board of Managers or Officer has not liability by
reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his
office; and provided further, if a majority of the members of the
Board of Directors of the Company are involved in the action, suit,
or proceeding, no sums shall be paid until the Company is further
advised by written opinion of independent counsel that the amount
is reasonable, and that the costs and expenses were actually and
necessarily incurred, and that the claim is proper. In the event
of a settlement, the amounts which the Company may pay by way of
indemnification shall not exceed the costs, fees, and expenses
which would have been reasonably incurred if the action, suit, or
proceeding had been litigated to a conclusion. Such a
determination by the Board of Directors or by independent counsel,
and the payment of amounts by the Company on the basis thereof
shall not prevent a Variable Contract Holder from challenging such
indemnification by appropriate legal proceedings on the grounds
that the person indemnified was liable to the Fund or its Variable
Contract Holders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the
conduct of his office.
<PAGE>
PAGE 11
ARTICLE X
Amendment of Regulations
Section 10.1. These regulations may be amended by the Board of
Directors of the Company subject to approval of the Board of
Managers or Variable Contract Holders as may be required by the
Investment Company Act of 1940.
<PAGE>
<PAGE>
PAGE 1
INVESTMENT ADVISORY AGREEMENT
Agreement effective the 12th day of January, 1984, by and between
IDS Life Insurance Company (IDS Life) and IDS/American Express Inc.
(IDS), superseding the agreement between Investors Diversified
Services, Inc. and IDS Life, dated August 26, 1981.
Whereas IDS Life has heretofore established certain separate
accounts, and may in the future establish one or more additional
separate accounts, as authorized by Minnesota law; and
Whereas IDS has a staff of experienced investment personnel
and facilities for the kind of investment portfolio contemplated
for such separate account or accounts;
NOW THEREFORE it is mutually agreed:
(1) Separate Account or Accounts to Which Applicable. This
agreement shall only be effective as to any separate account in
respect of which:
(a) IDS Life has notified IDS in writing to include such separate
account under the terms of this agreement; and
(b) IDS Life has an existing legal duty to provide investment
management for such separate account; and
(c) To the extent required by the Investment Company Act of 1940,
this agreement has been approved by a vote of the persons
having an interest in such separate account or an exemptive
order from such requirement of approval has been obtained from
the Securities and Exchange Commission; and continuance of its
applicability is approved as required by the Investment
Company Act of 1940; and
(d) The applicability of this agreement has not been terminated as
provided in paragraph 8 hereof.
(2) Investment Advice. IDS will continuously keep under
observation the investment portfolio and investment objectives
of any separate account covered by the terms of this agreement
and will, with respect to each such separate account,
continuously furnish to IDS Life (1) assistance and advice in
investment planning, (2) recommendations as to particular
purchases and sales of securities, and (3) information as to
economic and market factors and other information relating to
the investment plans of and the particular investment held in
any such separate account.
(3) Information Furnished to IDS. IDS Life shall furnish such
information to IDS as to holdings, purchases, and sales of
securities under its management and investment portfolio
requirements as will reasonably enable IDS to furnish the
investment advice under this agreement.
(4) Furnishing Advice, Information and Notices. The advice,
information, reports, etc., furnished under this agreement to
IDS Life and any notice under this agreement shall be
furnished to the President of IDS Life or to the person or
persons designated in writing by him or by a person to whom he
has delegated the authority to so designate. Any information
<PAGE>
PAGE 2
or notice provided to IDS under the terms of this agreement
shall be furnished to the President of IDS or to the person or
persons designated in writing by him or by a person to whom he
has delegated the authority to so designate.
(5) Purchase and Sale of Securities. IDS Life may, in its
discretion, direct purchase or sale orders to IDS which will
then place any such order with a broker or brokers or
negotiate such executions. All transactions will be executed
in a manner and in accordance with the procedures and
standards as set forth in, or as established in accordance
with, the investment management agreement between IDS Life and
such separate account. IDS Life shall furnish IDS with
information concerning such procedures and standards, and any
amendments thereto; and IDS will maintain records to assure
that such transactions have been executed in accordance
therewith. It is understood that IDS Securities Corporation,
a subsidiary of IDS and a member firm of the Pacific Stock
Exchange, may, subject to paragraph 6 of this agreement,
participate in brokerage commissions generated by any security
transactions under this agreement, and that other broker
dealer affiliates of IDS may be used to the extent consistent
with Section 15(f) of the Investment Company Act of 1940 and
other applicable provisions of the Federal securities laws.
(6) Compensation to IDS. The fee for the services provided by
this agreement will be determined as follows:
(a) An amount each valuation period of each separate account to
which this agreement is applicable equal to the equivalent,
for the valuation period of each such account, of .25% on an
annual basis of the net value of the assets of any such
separate account or accounts. The net value of the assets of
any such separate account shall be computed as of the close of
business on the last day of the last preceding valuation
period for each such separate account. The valuation period
of any separate account for this purpose shall be the same
period of time for which values of interest in such separate
account are redetermined.
(b) As soon as practicable after the last business day of each
month, the net profit, if any, of IDS Securities Corporation,
before income taxes payable to the United States and before
investment income, shall be determined in accordance with
generally accepted accounting principles. IDS will then
credit an amount equivalent to the portion of such net profit
attributable to transactions for each separate account of IDS
Life to which this agreement is applicable as a reduction of
the next fee payment due from IDS Life under subparagraph (a)
of this paragraph 6, subject to an adjustment in accordance
with audits of the books of IDS Securities Corporation made
periodically by independent certified public accountants. It
is understood that nothing in this subparagraph shall have the
effect of increasing the fee payment otherwise due were this
subparagraph (b) not in operation.
(c) The foregoing fee shall be paid on a monthly basis in cash by
IDS Life to IDS within five (5) business days after the last
day of each month.
<PAGE>
PAGE 3
(7) Miscellaneous.
(a) IDS Life recognizes that IDS now renders and may continue to
render investment advice and other services to other persons
which may or may not have investment policies and investments
similar to those of separate accounts included herein and that
IDS manages its own investments and those of certain
subsidiaries. IDS shall be free to render such investment
advice and other services, and IDS Life hereby consents
thereto.
(b) It is understood and agreed that in furnishing the investment
advice and other services as herein provided, neither IDS, nor
any officer, director, or agent thereof shall be held liable
to IDS Life or separate accounts included herein or creditors
or Contract Holders for errors of judgment or for anything
except willful misfeasance, bad faith, or gross negligence in
the performance of its duties, or reckless disregard of its
obligations and duties under the terms of this agreement. It
is further understood and agreed that IDS may rely upon
information furnished to it reasonably believed to be accurate
and reliable and that, except as hereinabove provided, IDS
shall not be accountable for any loss suffered by IDS Life or
separate accounts included herein by the reason of the
latter's action or non-action on the basis of any advice or
recommendation of IDS, its officers, director or agents.
(8) Renewal and Termination
(a) As to any separate account which (1) is a registered
investment company under the Investment Company Act of 1940,
and (2) this agreement has become applicable as provided in
Section 1 above, this agreement, unless terminated pursuant to
Paragraph b,c, or d below, shall continue in effect from year
to year, provided its continued applicability is specifically
approved at least annually (i) by the Board of Directors of
said separate account or by a vote of the holders of a
majority of the outstanding votes of the separate account and
(ii) by vote of a majority of the Managers who are not parties
to this agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting
on such approval. As used in this paragraph, the term
"interested person" shall have the same meaning as set forth
in the Investment Company Act of 1940, as amended.
(b) The applicability of this agreement to any separate account
which is a registered investment company within the meaning of
the Investment Company Act of 1940 may be terminated by sixty
days' written notice to either IDS or IDS Life.
(c) IDS or IDS Life may terminate this agreement or the
applicability of this agreement to any separate account by
giving sixty days written notice to the other party.
(d) This agreement shall terminate, as to any separate account
which is a registered investment company under the Investment
Company Act of 1940, in the event of its assignment, the term
"assignment" for this purpose having the same meaning set
forth in the investment Company Act of 1940, as amended.
<PAGE>
PAGE 4
IN WITNESS WHEREOF, the parties hereto have executed the foregoing
agreement on the day and year first above written.
IDS LIFE INSURANCE COMPANY
By \s\ R.W. Kling
Executive Vice President
IDS/AMERICAN EXPRESS INC.
By \s\ Frank L. Skillern, Jr.
Sr. Vice President - Law
<PAGE>
<PAGE>
PAGE 1
INVESTMENT MANAGEMENT AGREEMENT
Agreement effective the 12th day of Jan, 1984, by and between
IDS Life Insurance Company (the "Company") and IDS Life Variable
Annuity Fund A (the "Fund"), superseding the agreement between the
Company and the Fund dated August 26, 1981.
The Fund desires to avail itself of the investment management
facilities available from the Company, and the Company is willing
to furnish such services as set forth in this Agreement.
Therefore, it is mutually agreed:
ARTICLE I: INVESTMENT MANAGEMENT SERVICES
Section 1.1: The Company shall manage the assets of the Fund by
furnishing continuously an investment program, by determining what
securities shall be purchased or sold, by directing the execution
of the purchase and sell orders, and by determining what portion of
the Fund shall be held uninvested. So long as this contract
remains in effect, determinations so made by the Company shall be
binding on the Fund, if in compliance with the restrictions set
forth in Section 1.3. The Company will report to the Board of
Managers at such times and in such detail as members of the Board
may from time to time determine to be appropriate in order to
permit the Board to determine the adherence of the Company to the
investment policies of the Fund.
Section 1.2: The Company is authorized to select the brokers or
dealers that will execute the purchases and sales of portfolio
securities for the Fund and is directed to use its best efforts to
obtain the best available price and most favorable execution,
except as prescribed herein.Subject to prior authorization by the
Fund's Board of Managers of appropriate policies and procedures,
and subject to termination at any time by the Board of Managers,
the Company may also be authorized to effect individual securities
transactions at commission rates in excess of the minimum
commission rates available, to the extent authorized by law, if the
Company determines in good faith that such amount of commission was
reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of
either that particular transaction or the Company's overall
responsibilities with respect to the Fund and other accounts as to
which the Company exercises investment discretion. The Fund shall
pay all brokerage commissions and charges in the purchase and sale
of assets. It is specifically understood and agreed that IDS
Securities Corporation may, subject to section 3.1 hereof,
participate in brokerage commissions generated by a security
transaction for the Fund, and that other broker dealer affiliates
of IDS may be used to the extent consistent with Section 15(f) of
the Investment Company Act of 1940 and other applicable provisions
of the Federal securities laws.
Section 1.3: The investment management furnished by the Company
will be in accordance with general investment policies and the
provisions of the Regulations of the Fund, as may from time to time
be amended, and the provisions of applicable federal and state
laws.
<PAGE>
PAGE 2
ARTICLE II: INVESTMENT ADVISORY AGREEMENT BETWEEN THE COMPANY AND
INVESTORS DIVERSIFIED SERVICES, INC.
Section 2.1: The existence of an investment advisory agreement
between the Company and IDS/American Express Inc. (a copy of which
is attached hereto as Exhibit A) is specifically acknowledged and
approved.
ARTICLE III: COMPENSATION TO COMPANY
Section 3.1: The fee for the investment management services shall
be an amount for each valuation period of the Fund equal to the
equivalent for each such valuation period of .4%on an annual basis
of the net value of the assets of the Fund. Valuation periods
shall be determined in accordance with the annuity contracts
outstanding which have values or benefits based on the Fund. The
foregoing fee shall be reduced to the extent the fee payable by the
Company to Investors Diversified Services, Inc., under the
Investment Advisory Agreement referred to in Section 2.1 hereof is
reduced by an amount equal to net profits, if any, of IDS
Securities Corporation (determined as provided in said agreement)
attributable to transactions for the Fund. Any such reduction has
been reflected in the fee payable by the Company to Investors
Diversified Services, Inc. under the aforesaid Investment Advisory
Agreement.
Section 3.2: The fee shall be deducted on a monthly basis in cash
from the Fund by the Company within five (5) business days after
the last day of the month.
ARTICLE IV: MISCELLANEOUS
Section 4.1: The Company may render investment management and
other services to other separate accounts or companies, which may
or may not have investment policies and investments similar to
those of the Fund, and the Company also manages its own
investments. The Company shall be free to render such investment
advice and other services.
Section 4.2: This contract shall not be invalidated or in anywise
affected by the fact that members of the Board of Managers or
contract holders are or may be interested in the Company as
directors, officers, employees, agents, stockholders or otherwise
or that the Company is or may be interested in the Fund as a
contract holder or otherwise.
Section 4.3: Neither the Company, nor any officer, director or
agent thereof shall be held liable to the Board of Managers, the
Fund or its creditors or contract holders for errors of judgment or
for anything except willful misfeasance, bad faith, or gross
negligence in the performance of its duties, or reckless disregard
of its obligations and duties under the terms of this agreement.
The Company may rely upon information furnished to it reasonably
believed to be accurate and reliable.
<PAGE>
PAGE 3
ARTICLE V: RENEWAL AND TERMINATION
Section 5.1: Unless sooner terminated pursuant to Section 5.1 or
5.4 below, this agreement shall continue in effect from year to
year except that such continuance shall be specifically approved at
least annually (1) by the Board of Managers of the Fund or by a
vote of the holders of a majority of the outstanding votes of the
Fund and (2) by the vote of a majority of the Managers who are not
parties to this agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting on
such approval. As used in this paragraph, the term "interested
person" shall have the same meaning as set forth in the Investment
Company Act of 1940, as amended.
Section 5.2: This agreement may be terminated by the Fund at any
time without penalty by giving the Company at least sixty days
notice of the intention to terminate. Such termination may be
effected either by the Board of Managers or by a vote of the
holders of a majority of votes in the Fund.
Section 5.3: Any notice under this contract shall be given in
writing, addressed and delivered, or mailed postpaid, to the party
to this agreement entitled to receive such, at the IDS Tower,
Minneapolis, Minnesota, or to such other address as either party
may designate in writing mailed to the other.
Section 5.4: This agreement shall terminate in the event of its
assignment by the Company, the term "assignment" for this purpose
having the same meaning as set forth in the Investment Company Act
of 1940, as amended.
IN WITNESS WHEREOF, the parties hereto have executed the foregoing
agreement on the day and year first above written.
IDS LIFE INSURANCE COMPANY
By /s/ R. W. Kling
Executive Vice President
IDS LIFE VARIABLE ANNUITY FUND A
By \s\ E. L. Milbrath
Executive Vice President<PAGE>
PAGE 4
EXHIBIT A: INVESTMENT ADVISORY AGREEMENT
Agreement effective the day of , 1984, by and between IDS
Life Insurance Company (IDS Life) and IDS/American Express Inc.
(IDS), superseding the agreement between Investors Diversified
Services, Inc. and IDS Life, dated August 26, 1981.
Whereas IDS Life has heretofore established certain separate
accounts, and may in the future establish one or more additional
separate accounts, as authorized by Minnesota law; and
Whereas IDS has a staff of experienced investment personnel
and facilities for the kind of investment portfolio contemplated
for such separate account or accounts;
NOW THEREFORE it is mutually agreed:
(1) Separate Account or Accounts to Which Applicable. This
agreement shall only be effective as to any separate account in
respect of which:
(a) IDS Life has notified IDS in writing to include such separate
account under the terms of this agreement; and
(b) IDS Life has an existing legal duty to provide investment
management for such separate account; and
(c) To the extent required by the Investment Company Act of 1940,
this agreement has been approved by a vote of the persons
having an interest in such separate account or an exemptive
order from such requirement of approval has been obtained from
the Securities and Exchange Commission; and continuance of its
applicability is approved as required by the Investment
Company Act of 1940; and
(d) The applicability of this agreement has not been terminated as
provided in paragraph 8 hereof.
(2) Investment Advice. IDS will continuously keep under
observation the investment portfolio and investment objectives
of any separate account covered by the terms of this agreement
and will, with respect to each such separate account,
continuously furnish to IDS Life (1) assistance and advice in
investment planning, (2) recommendations as to particular
purchases and sales of securities, and (3) information as to
economic and market factors and other information relating to
the investment plans of and the particular investment held in
any such separate account.
(3) Information Furnished to IDS. IDS Life shall furnish such
information to IDS as to holdings, purchases, and sales of
securities under its management and investment portfolio
requirements as will reasonably enable IDS to furnish the
investment advice under this agreement.
(4) Furnishing Advice, Information and Notices. The advice,
information, reports, etc., furnished under this agreement to
IDS Life and any notice under this agreement shall be
furnished to the President of IDS Life or to the person or
persons designated in writing by him or by a person to whom he
has delegated the authority to so designate. Any information
or notice provided to IDS under the terms of this agreement
shall be furnished to the President of IDS or to the person or
persons designated in writing by him or by a person to whom he
has delegated the authority to so designate.<PAGE>
PAGE 5
(5) Purchase and Sale of Securities. IDS Life may, in its
discretion, direct purchase or sale orders to IDS which will
then place any such order with a broker or brokers or
negotiate such executions. All transactions will be executed
in a manner and in accordance with the procedures and
standards as set forth in, or as established in accordance
with, the investment management agreement between IDS Life and
such separate account. IDS Life shall furnish IDS with
information concerning such procedures and standards, and any
amendments thereto; and IDS will maintain records to assure
that such transactions have been executed in accordance
therewith. It is understood that IDS Securities Corporation,
a subsidiary of IDS and a member firm of the Pacific Stock
Exchange, may, subject to paragraph 6 of this agreement,
participate in brokerage commissions generated by any security
transactions under this agreement, and that other broker
dealer affiliates of IDS may be used to the extent consistent
with Section 15(f) of the Investment Company Act of 1940 and
other applicable provisions of the Federal securities laws.
(6) Compensation to IDS. The fee for the services provided by
this agreement will be determined as follows:
(a) An amount each valuation period of each separate account to
which this agreement is applicable equal to the equivalent,
for the valuation period of each such account, of .25% on an
annual basis of the net value of the assets of any such
separate account or accounts. The net value of the assets of
any such separate account shall be computed as of the close of
business on the last day of the last preceding valuation
period for each such separate account. The valuation period
of any separate account for this purpose shall be the same
period of time for which values of interest in such separate
account are redetermined.
(b) As soon as practicable after the last business day of each
month, the net profit, if any, of IDS Securities Corporation,
before income taxes payable to the United States and before
investment income, shall be determined in accordance with
generally accepted accounting principles. IDS will then
credit an amount equivalent to the portion of such net profit
attributable to transactions for each separate account of IDS
Life to which this agreement is applicable as a reduction of
the next fee payment due from IDS Life under subparagraph (a)
of this paragraph 6, subject to an adjustment in accordance
with audits of the books of IDS Securities Corporation made
periodically by independent certified public accountants. It
is understood that nothing in this subparagraph shall have the
effect of increasing the fee payment otherwise due were this
subparagraph (b) not in operation.
(c) The foregoing fee shall be paid on a monthly basis in cash by
IDS Life to IDS within five (5) business days after the last
day of each month.
<PAGE>
PAGE 6
(7) Miscellaneous.
(a) IDS Life recognizes that IDS now renders and may continue to
render investment advice and other services to other persons
which may or may not have investment policies and investments
similar to those of separate accounts included herein and that
IDS manages its own investments and those of certain
subsidiaries. IDS shall be free to render such investment
advice and other services, and IDS Life hereby consents
thereto.
(b) It is understood and agreed that in furnishing the investment
advice and other services as herein provided, neither IDS, nor
any officer, director, or agent thereof shall be held liable
to IDS Life or separate accounts included herein or creditors
or Contract Holders for errors of judgment or for anything
except willful misfeasance, bad faith, or gross negligence in
the performance of its duties, or reckless disregard of its
obligations and duties under the terms of this agreement. It
is further understood and agreed that IDS may rely upon
information furnished to it reasonably believed to be accurate
and reliable and that, except as hereinabove provided, IDS
shall not be accountable for any loss suffered by IDS Life or
separate accounts included herein by the reason of the
latter's action or non-action on the basis of any advice or
recommendation of IDS, its officers, director or agents.
(8) Renewal and Termination
(a) As to any separate account which (1) is a registered
investment company under the Investment Company Act of 1940,
and (2) this agreement has become applicable as provided in
Section 1 above, this agreement, unless terminated pursuant to
Paragraph b,c, or d below, shall continue in effect from year
to year, provided its continued applicability is specifically
approved at least annually (i) by the Board of Directors of
said separate account or by a vote of the holders of a
majority of the outstanding votes of the separate account and
(ii) by vote of a majority of the Managers who are not parties
to this agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting
on such approval. As used in this paragraph, the term
"interested person" shall have the same meaning as set forth
in the Investment Company Act of 1940, as amended.
(b) The applicability of this agreement to any separate account
which is a registered investment company within the meaning of
the Investment Company Act of 1940 may be terminated by sixty
days' written notice to either IDS or IDS Life.
(c) IDS or IDS Life may terminate this agreement or the
applicability of this agreement to any separate account by
giving sixty days written notice to the other party.
(d) This agreement shall terminate, as to any separate account
which is a registered investment company under the Investment
Company Act of 1940, in the event of its assignment, the term
"assignment" for this purpose having the same meaning set
forth in the investment Company Act of 1940, as amended.
<PAGE>
PAGE 7
IN WITNESS WHEREOF, the parties hereto have executed the foregoing
agreement on the day and year first above written.
IDS LIFE INSURANCE COMPANY
By \s\ R.W. Kling
Executive Vice President
IDS/AMERICAN EXPRESS INC.
By \s\ Frank L. Skillern, Jr.
Sr. Vice President - Law
<PAGE>
<PAGE>
PAGE 1
DISTRIBUTION AND SERVICES AGREEMENT
This agreement made the 12th day of January, 1984, by and
between IDS Life Insurance Company (IDS Life) and IDS Life Variable
Annuity Fund A (the Fund) supersedes and replaces the Distribution
and Services Agreement between IDS Life and the Fund executed
December 8, 1981.
The Fund which has been established pursuant to Minnesota
Statutes Section 61A.14, as amended, desires to engage IDS Life as
its principal underwriter and distributor and IDS Life agrees to
provide any and all sales and administrative services incident to
the sale and administration of all contracts on a variable basis
which the Fund is now or may be authorized to issue or sell and
which provide for values or benefits based on the investment
results of the Fund (Variable Contracts), in accordance with the
further terms and provisions of this agreement.
ARTICLE I: DISTRIBUTION
Section 1.1: IDS Life shall be the exclusive distributor of all
such Variable Contracts based upon the Fund which
are issued and outstanding during the period of this
agreement. During such period IDS Life agrees to
continue to offer contracts to new entrants to
existing non-qualified employer plans, as described
in the Fund's Registration No. 2-47430, unless IDS
Life is unable legally to make such offer for sale
or sales as a result of any federal, state, or
quasi-governmental law or regulation.
Section 1.2: IDS Life shall allocate and place into the Fund
portions of purchase payments received on Variable
Contracts promptly upon receipt of such payments,
pursuant to the provisions and requirements of such
Variable Contracts. IDS Life shall deduct a
distribution fee and an amount for any applicable
premium or similar tax on such purchase payment
before such allocation to the Fund.
ARTICLE II: SERVICES
Section 2.1: IDS Life shall take all steps necessary including,
but not limited to registrations, filing, licensing,
etc. with State and Federal authorities to permit
the offer or sale or continuance of the offer or
sale of Variable Contracts in such jurisdiction.
Section 2.2: IDS Life shall prepare and make available necessary
prospectuses, applications, Variable Contracts and
any other forms or materials required for the
distribution of Variable Contracts.
Section 2.3: IDS Life shall mail such notices as required by law
and by Variable Contracts and shall deliver the
Variable Contracts to appropriate Contract Holders.
<PAGE>
PAGE 2
Section 2.4: In addition to the Services specifically provided
for above, IDS Life shall provide and pay for all
services required for the operation of the Fund
(except brokerage fees and transfer taxes incurred
in investment transactions), including but not
limited to the following services:
Occupancy and office rental
Clerical and bookkeeping
Accounting services
Auditing services
Legal fees
Registration and filing fees
Stationery, supplies and printing
Salaries and compensation of directors of the
registrant
Reports to stockholders (Variable Contract
Holders)
Determination of offering and redemption prices
ARTICLE III: COMPENSATION
Section 3.1: IDS Life shall receive distribution and service fees
as provided in said Variable Contracts, in
consideration of the distribution and other services
performed in the sale and administration of Variable
Contract business.
ARTICLE IV: MISCELLANEOUS
Section 4.1: IDS Life may conduct any aspect of the business of
an insurance company, including the performance of
other distribution and service agreements as it may
enter into from time to time.
Section 4.2: This Agreement shall be binding upon the respective
successors of the parties hereto, and any person,
trust, association or corporation acquiring all or
substantially all of the assets and business of
either party.
Section 4.3: Neither IDS Life, nor any officer, director or agent
thereof shall be held liable to the Fund or its
creditors or Contract Holders for errors of judgment
or for anything except willful misfeasance, bad
faith, or gross negligence in the performance of its
duties, or reckless disregard of its obligations and
duties under the terms of this agreement.
Section 4.4: IDS Life shall do any and all things reasonably
necessary in connection with or incidental to the
carrying out of the purpose and provisions of this
agreement.
<PAGE>
PAGE 3
ARTICLE V: TERMINATION
Section 5.1: This agreement shall continue in effect from year to
year, subject to approval at least annually by the
Board of Managers of the Fund or until terminated as
hereinafter provided.
Section 5.2: This contract shall be automatically terminated in
the event of the assigning of this contract.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed.
IDS LIFE VARIABLE ANNUITY FUND B
by \s\ Earlon L. Milbrath
Treasurer
IDS LIFE INSURANCE COMPANY
by \s\ R. W. Kling
Executive Vice President
<PAGE>
<PAGE>
PAGE 1
CUSTODIAN AGREEMENT
THIS CUSTODIAN AGREEMENT dated July 12, 1990, between IDS Life
Variable Annuity Funds A and B (individually, the "Fund"),
segregated asset accounts of IDS Life Insurance Company, organized
under Minnesota law; and IDS Bank & Trust, a corporation organized
under the laws of the State of Minnesota with its principal place
of business at Minneapolis, Minnesota (hereinafter also called the
"Custodian").
WHEREAS, the Fund desires that its securities and cash be hereafter
held and administered by Custodian pursuant to the terms of this
Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein
made, the Fund and the Custodian agree as follows:
Section 1. Definitions
The word "securities" as used herein shall be construed to include,
without being limited to, shares, stocks, treasury stocks, notes,
bonds, debentures, evidences of indebtedness, options to buy or
sell stocks or stock indexes, certificates of interest or
participation in any profit-sharing agreements, collateral trust
certificates, preorganization certificates or subscriptions,
transferable shares, investment contracts, voting trust
certificates, certificates of deposit for a security, fractional or
undivided interests in oil, gas or other mineral rights, or any
certificates of interest or participation in, temporary or interim
certificates for, receipts for, guarantees of, or warrants or
rights to subscribe to or purchase any of the foregoing,
acceptances and other obligations and any evidence of any right or
interest in or to any cash, property or assets and any interest or
instrument commonly known as a security. In addition, for the
purpose of this Agreement, the word "securities" also shall include
other instruments in which the Fund may invest including currency
forward contracts and commodities such as interest rate or index
futures contracts, margin deposits on such contracts or options on
such contracts.
The words "custodian order" shall mean a request or direction,
including a computer printout, directed to the Custodian and signed
in the name of the Fund by any two individuals designated in the
current certified list referred to in Section 2.
The word "facsimile" shall mean an exact copy or likeness which is
electronically transmitted for instant reproduction.
Section 2. Names, Titles and Signatures of Authorized Persons
The Fund will certify to the Custodian the names and signatures of
its present officers and other designated persons authorized on
behalf of the Fund to direct the Custodian by custodian order as
hereinbefore defined. The Fund agrees that whenever any change
occurs in this list it will file with the Custodian a copy of a
resolution certified by the Secretary or an Assistant Secretary of
the Fund as having been duly adopted by the Board of Managers of
<PAGE>
PAGE 2
the Fund designating those persons currently authorized on behalf
of the Fund to direct the Custodian by custodian order, as
hereinbefore defined, and upon such filing (to be accompanied by
the filing of specimen signatures of the designated persons) the
persons so designated in said resolution shall constitute the
current certified list. The Custodian is authorized to rely and
act upon the names and signatures of the individuals as they appear
in the most recent certified list from the Fund which as been
delivered to the Custodian as hereinabove provided.
Section 3. Use of Subcustodians
The Custodian may make arrangements, where appropriate, with other
banks having not less than two million dollars aggregate capital,
surplus and undivided profits for the custody of securities and
cash.
The Custodian also may enter into arrangements for the custody of
securities entrusted to its care through foreign branches of United
States banks; through foreign banks, banking institutions or trust
companies; through foreign subsidiaries of United States banks or
bank holding companies; or through foreign securities depositories
or clearing agencies (hereinafter also called, collectively, the
"Foreign Subcustodian") or indirectly through an agent, established
under the first paragraph of this section, if and to the extent
permitted by Section 17(f) of the Investment Company Act of 1940
and the rules promulgated by the Securities and Exchange Commission
thereunder, any order issued by the Securities and Exchange
Commission, or any "no-action" letter received from the staff of
the Securities and Exchange Commission. To the extent the existing
provisions of the Custodian Agreement are consistent with the
requirements of such Section, rules, order or no-action letter,
they shall apply to all such foreign custodianships. To the extent
such provisions are inconsistent with or additional requirements
are established by such Section, rules, order or no-action letter
will prevail and the parties will adhere to such requirements;
provided, however, in the absence of notification from the Fund of
any changes or additions to such requirements, the Custodian shall
have no duty or responsibility to inquire as to any such changes or
additions.
All Subcustodians of the Custodian (such Subcustodians,
collectively, the "Subcustodians"), including all Foreign Custodial
Agents, shall be subject to the instructions of the Custodian and
not to those of the Corporation and shall act solely as agent of
the Custodian.
Section 4. Receipt and Disbursement of Money
(1) The Custodian shall open and maintain a separate account or
accounts in the name of the Fund or cause its agent to open and
maintain such account or accounts subject only to checks, drafts or
directives by the Custodian pursuant to the terms of this
Agreement. The Custodian or its agent shall hold in such account
or accounts, subject to the provisions hereof, all cash received by
it from or for the account of the Fund. The Custodian or its agent
shall make payments of cash to or for the account of the Fund from
such cash only:
<PAGE>
PAGE 3
(a) for the purchase of securities for the portfolio of the
Fund upon the receipt of such securities by the Custodian
or its agent;
(b) for the purchase or redemption of shares of capital stock
of the Fund;
(c) for the payment of interest, dividends, taxes, management
fees, or operating expenses (including, without
limitation thereto, fees for legal, accounting and
auditing services);
(d) for payment of distribution fees, commissions, or
redemption fees, if any;
(e) for payments in connection with the conversion, exchange
or surrender of securities owned or subscribed to by the
Fund held by or to be delivered to the Custodian;
(f) for payments in connection with the return of securities
loaned by the Fund upon receipt of such securities or the
reduction of collateral upon receipt of proper notice;
(g) for payments for other proper corporate purposes; or
(h) upon the termination of this Agreement.
Before making any such payment for the purposes permitted under the
terms of items (a), (b), (c), (d), (e), (f) or (g) of paragraph (1)
of this section, the Custodian shall receive and may rely upon a
custodian order directing such payment and stating that the payment
is for such a purpose permitted under these items (a), (b), (c),
(d), (e), (f) or (g) and that in respect to item (g), a copy of a
resolution of the Board of Managers of the Fund signed by an
officer of the Fund and certified by its Secretary or an Assistant
Secretary, specifying the amount of such payment, setting forth the
purpose to be a proper corporate purpose, and naming the person or
persons to whom such payment is made. Notwithstanding the above,
for the purposes permitted under items (a) or (f) of paragraph (1)
of this section, the Custodian may rely upon a facsimile order.
(2) The Custodian is hereby appointed the attorney-in-fact of the
Fund to endorse and collect all checks, drafts or other orders for
the payment of money received by the Custodian for the account of
the Fund and drawn on or to the order of the Fund and to deposit
same to the account of the Fund pursuant to this Agreement.
Section 5. Receipt of Securities
Except as permitted by the second paragraph of this section, the
Custodian or its agent shall hold in a separate account or
accounts, and physically segregated at all times from those of any
other persons, firms or corporations, pursuant to the provisions
hereof, all securities received by it for the account of the Fund.
The Custodian shall record and maintain a record of all certificate
numbers. Securities so received shall be held in the name of the
Fund, in the name of an exclusive nominee duly appointed by the
Custodian or in bearer form, as appropriate.
<PAGE>
PAGE 4
Subject to such rules, regulations or guidelines as the Securities
and Exchange Commission may adopt, the Custodian may deposit all or
any part of the securities owned by the Fund in a securities
depository which includes any system for the central handling of
securities established by a national securities exchange or a
national securities association registered with the Securities and
Exchange Commission under the Securities Exchange Act of 1934, or
such other person as may be permitted by the Commission, pursuant
to which system all securities of any particular class or series of
any issuer deposited within the system are treated as fungible and
may be transferred or pledged by bookkeeping entry without physical
delivery of such securities.
All securities are to be held or disposed of by the Custodian for,
and subject at all times to the instructions of, the Fund pursuant
to the terms of this Agreement. The Custodian shall have no power
or authority to assign, hypothecate, pledge or otherwise dispose of
any such securities, except pursuant to the directive of the Fund
and only for the account of the Fund as set forth in Section 6 of
this Agreement
Section 6. Transfer Exchange, Delivery, etc. of Securities
The Custodian shall have sole power to release or deliver any
securities of the Fund held by it pursuant to this Agreement. The
Custodian agrees to transfer, exchange or deliver securities held
by it or its agent hereunder only:
(a) for sales of such securities for the account of the Fund,
upon receipt of payment therefor;
(b) when such securities are called, redeemed, retired or
otherwise become payable;
(c) for examination upon the sale of any such securities in
accordance with "street delivery" custom which would
include delivery against interim receipts or other proper
delivery receipts;
(d) in exchange for or upon conversion into other securities
alone or other securities and cash whether pursuant to
any plan of merger, consolidation, reorganization,
recapitalization or readjustment, or otherwise;
(e) for the purpose of exchanging interim receipts or
temporary certificates for permanent certificates;
(f) upon conversion of such securities pursuant to their
terms into other securities;
(g) upon exercise of subscription, purchase or other similar
rights represented by such securities;
(h) for loans of such securities by the Fund upon receipt of
collateral; or
(i) for other proper corporate purposes.
<PAGE>
PAGE 5
As to any deliveries made by the Custodian pursuant to items (a),
(b), (c), (d), (e), (f), (g) and (h), securities or cash received
in exchange therefore shall be delivered to the Custodian, its
agent, or to a securities depository. Before making any such
transfer, exchange or delivery, the Custodian shall receive a
custodian order or a facsimile from the Fund requesting such
transfer, exchange or delivery and stating that it is for a purpose
permitted under Section 6 (whenever a facsimile is utilized, the
Fund also will deliver an original signed custodian order) and, in
respect to item (i), a copy of a resolution of the Board of
Managers of the Fund signed by an officer of the Fund and certified
by its Secretary of an Assistant Secretary, specifying the
securities, setting forth the purpose for which such payment,
transfer, exchange or delivery is to be made, declaring such
purpose to be a proper corporate purpose, and naming the person or
persons to whom such transfer, exchange or delivery of such
securities shall be made.
Section 7. Custodian's Acts Without Instructions
Unless and until the Custodian receives a contrary custodian order
from the Fund, the Custodian shall or shall cause its agent to:
(a) present for payment all coupons and other income items
held by the Custodian or its agent for the account of the
Fund which call for payment upon presentation and hold
all cash received upon such payment for the account of
the Fund;
(b) present for payment all securities held by it or its
agent which mature or when called, redeemed, retired or
otherwise become payable;
(c) ascertain all stock dividends, rights and similar
securities to be issued with respect to any securities
held by the Custodian or its agent hereunder, and to
collect and hold for the account of the Fund all such
securities; and
(d) ascertain all interest and cash dividends to be paid to
security holders with respect to any securities held by
the Custodian or its agent, and to collect and hold such
interest and cash dividends for the account of the Fund.
(e) present for exchange securities converted pursuant to
their terms into other securities; and
(f) exchange interim receipts or temporary securities for
definitive securities; and
(g) execute in the name of the Corporation such ownership and
other certificates as may be required to obtain payments
in respect thereto, provided that the Corporation shall
have furnished to the Custodian or such agent any
information necessary in connection with such
certificates.
<PAGE>
PAGE 6
Section 8. Transfer Taxes
The Fund shall pay or reimburse the Custodian for any transfer
taxes payable upon transfers of securities made hereunder,
including transfers resulting from the termination of this
Agreement. The Custodian shall execute such certificates in
connection with securities delivered to it under this Agreement as
may be required, under any applicable law or regulation, to exempt
from taxation any transfers and/or deliveries of any such
securities which may be entitled to such exemption.
Section 9. Voting and Other Action
Neither the Custodian nor any nominee of the Custodian shall vote
any of the securities held hereunder by or for the account of the
Fund. The Custodian shall promptly deliver to the Fund all
notices, proxies and proxy soliciting materials with relation to
such securities, such proxies to be executed by the registered
holder of such securities (if registered otherwise than in the name
of the Fund), but without indicating the manner in which such
proxies are to be voted.
Custodian shall transmit promptly to the Fund all written
information (including, without limitation, pendency of calls and
maturities of securities and expirations of rights in connection
therewith) received by the Custodian from issuers of the securities
being held for the Fund. With respect to tender or exchange
offers, the Custodian shall transmit promptly to the Fund all
written information received by the Custodian from issuers of the
securities whose tender or exchange is sought and from the party
(or his agents) making the tender or exchange offer.
Section 10. Custodian's Reports
The Custodian shall furnish the Fund as of the close of business
each day a statement showing all transactions and entries for the
account of the Fund. The books and records of the Custodian
pertaining to its actions as Custodian under this Agreement and
securities held hereunder by the Custodian shall be open to
inspection and audit by officers of the Fund, internal auditors
employed by the Fund's investment adviser, and independent auditors
employed by the Fund. The Custodian shall furnish the Fund in such
form as may reasonably be requested by the Fund a report, including
a list of the securities held by it in custody for the account(s)
of the Fund, identification of any subcustodian and identification
of such securities held by such subcustodian, as of the close of
business of the last business day of each month, which shall be
certified by a duly authorized officer of the Custodian. It is
further understood that additional reports may from time to time be
requested by the Fund. Should any report ever be filed with any
governmental authority pertaining to lost or stolen securities, the
Custodian will concurrently provide the Fund with a copy of that
report.
The Custodian also shall furnish such reports on its systems of
internal accounting control as the Fund may reasonably request from
time to time.
<PAGE>
PAGE 7
Section 11. Concerning Custodian
For its services hereunder the Custodian shall be paid such
compensation at such times as may from time to time be agreed on in
writing by the parties hereto in a Custodian Fee Agreement.
The Custodian shall not be liable for any action taken in good
faith upon any custodian order or facsimile herein described or
certified copy of any resolution of the Board of Managers of the
Fund, and may rely on the genuineness of any such document which it
may in good faith believe to have been validly executed.
The Fund agrees to indemnify and hold harmless Custodian and its
nominee from all taxes, charges, expenses, assessments, claims and
liabilities (including counsel fees) incurred or assessed against
it or its nominee in connection with the performance of this
Agreement, except such as may arise from the Custodian's or its
nominee's own negligent action, negligent failure to act or willful
misconduct. The Custodian is authorized to charge any account of
the Fund for such items. In the event of any advance of cash for
any purpose made by the Custodian resulting from orders or
instructions of the Fund, or in the event that the Custodian or its
nominee shall incur or be assessed any taxes, charges, expenses,
assessments, claims or liabilities in connection with the
performance of this Agreement, except such as may arise from its or
its nominee's own negligent action, negligent failure to act or
willful misconduct, any property at any time held for the account
of the Fund shall be security therefor.
The Custodian shall maintain a standard of care equivalent to that
which would be required of a bailee for hire and shall not be
liable for any loss or damage to the Fund resulting from
participation in a securities depository unless such loss or damage
arises by reason of any negligence, misfeasance, or willful
misconduct of officers or employees of the Custodian, or from its
failure to enforce effectively such rights as it may have against
any securities depository or from use of an agent, unless such loss
or damage arises by reason of any negligence, misfeasance, or
willful misconduct of officers or employees of the Custodian, or
from its failure to enforce effectively such rights as it may have
against any agent.
Section 12, Termination and Amendment of Agreement
The Fund and the Custodian mutually may agree from time to time in
writing to amend, to add to, or to delete from any provision of
this Agreement.
The Custodian may terminate this Agreement by giving the Fund
ninety days' written notice of such termination by registered mail
addressed to the Fund at its principal place of business.
The Fund may terminate this Agreement at any time by written notice
thereof delivered, together with a copy of the resolution of the
Board of Managers authorizing such termination and certified by the
Secretary of the Fund, by registered mail to the Custodian.
<PAGE>
PAGE 8
Upon such termination of this Agreement, assets of the Fund held by
the Custodian shall be delivered by the Custodian to a successor
custodian, if one has been appointed by the Fund, upon receipt by
the Custodian of a copy of the resolution of the Board of Managers
of the Fund certified by the Secretary, showing appointment of the
successor custodian, and provided that such successor custodian is
a bank or trust company, organized under the laws of the United
States or of any State of the United States, having not less than
two million dollars aggregate capital, surplus and undivided
profits. Upon the termination of this Agreement as a part of the
transfer of assets, either to a successor custodian or otherwise,
the Custodian will deliver securities held by it hereunder, when so
authorized and directed by resolution of the Board of Directors of
the Fund, to a duly appointed agent of the successor custodian or
to the appropriate transfer agents for transfer of registration and
delivery as directed. Delivery of assets on termination of this
Agreement shall be effected in a reasonable, expeditious and
orderly manner; and in order to accomplish an orderly transition
from the Custodian to the successor custodian, the Custodian shall
continue to act as such under this Agreement as to assets in its
possession or control. Termination as to each security shall
become effective upon delivery to the successor custodian, its
agent, or to a transfer agent for a specific security for the
account of the successor custodian, and such delivery shall
constitute effective delivery by the Custodian to the successor
under this Agreement.
In addition to the means of termination hereinbefore authorized,
this Agreement may be terminated at any time by the vote of a
majority of the outstanding shares of the Fund and after written
notice of such action to the Custodian.
Section 13. General
Nothing expressed or mentioned in or to be implied from any
provision of this Agreement is intended to, or shall be construed
to give any person or corporation other than the parties hereto,
any legal or equitable right, remedy or claim under or in respect
of this Agreement, or any covenant, condition or provision herein
contained, this Agreement and all of the covenants, conditions and
provisions hereof being intended to be and being for the sole and
exclusive benefit of the parties hereto and their respective
successors and assigns.
This Agreement shall be governed by the laws of the State of
Minnesota.
IDS LIFE VARIABLE ANNUITY FUNDS A&B INC.
By /s/ James A. Mitchell
James A. Mitchell
President
IDS BANK & TRUST
By /s/ Mark Ellis
Mark Ellis
Vice President
<PAGE>
<PAGE>
Consent of Independent Auditors
We consent to the use of our report dated February 3, 1994 on the
consolidated financial statements of IDS Life Insurance Company for
Individual and Group Variable Annuity Contracts to be offered by
IDS Life Insurance Company, in Post-Effective Amendment No. 55 to
the Registration Statement (Forms N-1 No. 2-29358 and 2-47430)
being filed under the Securities Act of 1933 and the Investment
Company Act of 1940.
We also consent to the incorporation by reference therein of
our report dated January 24, 1994 with respect to the financial
statements of IDS Life Variable Annuity Fund B included in the 1993
Annual Report to IDS Life Variable Annuity Fund B contract holders.
We also consent to the incorporation by reference therein of our
report with respect to the financial statement schedules of IDS
Life Insurance Company for the years ended December 31, 1993, 1992,
and 1991 included in the Annual Report (Form 10-K) for 1993 filed
with the Securities and Exchange Commission.
Ernst & Young
Minneapolis, Minnesota
April 27, 1994
<PAGE>
<PAGE>
PAGE 1
IDS LIFE INSURANCE COMPANY
DIRECTORS POWER OF ATTORNEY
City of Minneapolis
State of Minnesota
Each of the undersigned, as directors of the below listed unit
investment trusts that previously have filed registration
statements and amendments thereto pursuant to the requirements of
the Securities Act of 1933 and the Investment Company Act of 1940
with the Securities and Exchange Commission:
<TABLE><CAPTION>
1933 Act 1940 Act
Reg. Number Reg. Number
<S> <C> <C>
IDS Life Accounts F, IZ, JZ, G, H and N
IDS Life Flexible Annuity 33-4173 811-3217
IDS Life Accounts F, IZ, JZ, G, H and N
IDS Life Variable and Combination
Retirement Annuities 2-73114 811-3217
IDS Life Accounts F, IZ, JZ, G, H and N
IDS Life Employee Benefit Annuity 33-52518 811-3217
IDS Life Accounts F, IZ, JZ, G, H and N
IDS Life Group Variable Annuity Contract 33-47302 811-3217
IDS Life Insurance Company
IDS Life Group Variable Annuity Contract
(Fixed Account) 33-48701 N/A
IDS Life Insurance Company
IDS Life Market Value Annuity 33-28976 N/A
IDS Life Insurance Company
IDS Life Preferred Choice Annuity 33-50968 N/A
IDS Life Variable Life Separate Account
Flexible Premium Variable Life Insurance Policy 33-11165 811-4298
IDS Life Variable Life Separate Account
IDS Life Single Premium Variable Life 2-97637 811-4298
IDS Life Variable Account for Smith Barney Shearson
LifeVest Single Premium Variable Life 33-5210 811-4652
IDS Life Account SBS
IDS Life Symphony Annuity 33-40779 812-7731
IDS Life Account RE
IDS Life Real Estate Variable Annuity 33-13375 N/A
IDS Life Variable Annuity Fund A 2-29081 811-1653
IDS Life Variable Annuity Fund B 2-47430 811-1674
</TABLE>
hereby constitutes and appoints William A. Stoltzmann, Mary Ellyn
Minenko and Colleen Curran or either one of them, as her or his
attorney-in-fact and agent, to sign for her or him in her or his
name, place and stead any and all filings, applications (including
applications for exemptive relief), periodic reports, registration
statements (with all exhibits and other documents required or
desirable in connection therewith) other documents, and amendments
thereto and to file such filings, applications, periodic reports,
registration statements other documents, and amendments thereto
with the Securities and Exchange Commission, and any necessary
states, and grants to any or all of them the full power and
authority to do and perform each and every act required or
necessary in connection therewith.<PAGE>
PAGE 2
Dated the 31st day of March, 1994.
/s/ Louis C. Fornetti /s/ Janis E. Miller
Louis C. Fornetti Janis E. Miller
/s/ David R. Hubers /s/ James A. Mitchell
David R. Hubers James A. Mitchell
/s/ Richard W. Kling /s/ Barry J. Murphy
Richard W. Kling Barry J. Murphy
/s/ Paul F. Kolkman /s/ Stuart A. Sedlacek
Paul F. Kolkman Stuart A. Sedlacek
/s/ Peter A. Lefferts /s/ Melinda S. Urion
Peter A. Lefferts Melinda S. Urion
<PAGE>
