<PAGE> 1
REGISTRATION NOS. 33-37718
811-6216
------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM N-4
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 / /
PRE-EFFECTIVE AMENDMENT NO. / /
POST-EFFECTIVE AMENDMENT NO. 11 /X/
AND/OR
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 /X/
AMENDMENT NO. 18
(Check appropriate box or boxes.)
MONY VARIABLE ACCOUNT A
(Exact Name of the Registrant as Specified in Charter)
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
(Name of Insurance Company)
1740 BROADWAY
NEW YORK, NEW YORK 10019
(Address of Principal Executive Office)
(212) 708-2000
(Telephone Number of Registrant)
------------------------
EDWARD P. BANK
VICE PRESIDENT AND DEPUTY GENERAL COUNSEL
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
1740 BROADWAY
NEW YORK, NEW YORK 10019
(Name and Address of Agent for Service)
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: It is proposed that this
filing become effective on May 1, 1995 pursuant to paragraph (b) of Rule 485.
------------------------
The Registrant has registered an indefinite amount of securities pursuant
to Rule 24f-2 under the Investment Company Act of 1940. The Rule 24f-2 Notice
was filed on February 24, 1995.
<PAGE> 2
PROSPECTUS
DATED MAY 1, 1995
GROUP FLEXIBLE PAYMENT VARIABLE ANNUITY CONTRACTS
ISSUED BY
MONY VARIABLE ACCOUNT A
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
The Group Flexible Payment Variable Annuity Contracts (the "Contracts")
described in this Prospectus provide for accumulation of cash value on a
variable basis and payment of annuity benefits. The Contracts are designed for
use by qualifying groups for retirement plans that may or may not qualify for
special federal income tax treatment. The types of pension plans that may
purchase the Contracts are retirement plans which receive favorable tax
treatment under Sections 401, 403, 408, or 457 of the Internal Revenue Code.
(See "Definitions -- Qualified Plans" at page 2.)
Individuals who are members of qualifying groups may make purchase payments
for the Contracts and will receive a certificate ("Certificate") which
summarizes the provisions of the Contracts. Holders of Certificates
("Certificateholders") may allocate, at the election of the Certificateholder,
purchase payments to either (i) a segregated investment account of The Mutual
Life Insurance Company of New York (the "Company"), which account has been
designated MONY Variable Account A (the "Variable Account"), or (ii) the
Guaranteed Interest Account, which is a part of the Company's General Account or
to both as the Certificateholder may determine. The Variable Account invests in
shares of Quest for Value Accumulation Trust at their net asset value. (See "The
Fund" at page 9.) Upon the issuance of the Certificate, purchase payments will
be allocated to the Money Market Subaccount of the Variable Account and will be
held there pending expiration of the Free Look Period. After expiration of the
Free Look Period, the Cash Value of the Certificate will automatically be
transferred to one or more of the subaccounts of the Variable Account in
accordance with the instructions of the Certificateholder. (See "PAYMENT AND
ALLOCATION OF NET PURCHASE PAYMENTS" at page 12.) Certificateholders bear the
complete investment risk for all amounts allocated to the Variable Account. This
Prospectus generally describes only the variable features of the Certificate.
(For a summary of the Guaranteed Interest Account, see "Guaranteed Interest
Account" at page 10.) This Prospectus sets forth the basic information that a
prospective purchaser should know before investing. Please keep this Prospectus
for future reference.
A Statement of Additional Information dated May 1, 1995, incorporated
herein by reference, and containing additional information about the Contracts
and the Certificates, has been filed with the Securities and Exchange
Commission. The Statement of Additional Information is available from the
Company without charge upon written request to the address shown on the request
form on page 32 of this Prospectus or by telephoning 1-800-487-6669. The Table
of Contents of the Statement of Additional Information can be found on page 32
of this Prospectus.
This Prospectus does not constitute an offer to sell or a solicitation of
an offer to buy the Contracts or the Certificates in any jurisdiction in which
such may not be lawfully made.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION, PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE. THIS PROSPECTUS IS VALID
ONLY WHEN ACCOMPANIED (OR PRECEDED) BY A CURRENT
PROSPECTUS FOR QUEST FOR VALUE ACCUMULATION TRUST.
------------------------
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
1740 BROADWAY
NEW YORK, NEW YORK 10019
1-800-487-6669
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Definitions........................................................................... 1
Synopsis.............................................................................. 3
The Company and the Variable Account.................................................. 9
The Mutual Life Insurance Company of New York....................................... 9
MONY Variable Account A............................................................. 9
The Fund............................................................................ 9
Guaranteed Interest Account........................................................... 11
Payment and Allocation of Net Purchase Payments....................................... 12
Issuance of the Certificate......................................................... 12
Free Look Privilege................................................................. 13
Allocation of Net Purchase Payments and Cash Value.................................. 13
Termination of the Certificate...................................................... 16
Surrenders............................................................................ 16
Death Benefit......................................................................... 18
Death Benefit Provided by the Certificate........................................... 18
Election and Effective Date of Election............................................. 18
Payment of Death Benefit............................................................ 18
Charges and Deductions................................................................ 18
Deductions from Payments............................................................ 18
Charges Against Cash Value.......................................................... 19
Mortality and Expense Risk Charge................................................... 21
Taxes............................................................................... 21
Investment Advisory Fee............................................................. 21
Annuity Provisions.................................................................... 22
Annuity Commencement Date........................................................... 22
Election and Change of Settlement Option............................................ 22
Settlement Options.................................................................. 22
Frequency of Annuity Payments....................................................... 23
Additional Provisions............................................................... 23
Other Provisions...................................................................... 24
Ownership........................................................................... 24
Provision Required by Section 72(s) of the Code..................................... 24
Provision Required by Section 401(a)(9) of the Code................................. 24
Contingent Annuitant................................................................ 25
Assignment.......................................................................... 26
Change of Beneficiary............................................................... 26
Substitution of Securities.......................................................... 26
Modification of the Contracts and Certificates...................................... 26
Change in Operation of Variable Accounts............................................ 26
Voting Rights......................................................................... 27
Distribution of the Contracts and Certificates........................................ 28
Federal Tax Status.................................................................... 28
Introduction........................................................................ 28
Tax Treatment of the Company........................................................ 28
Taxation of Annuities in General.................................................... 28
Annuity Contracts Governed by Section 403(b) of the Code............................ 29
Retirement Plans.................................................................... 30
Performance Data...................................................................... 30
Additional Information................................................................ 31
Legal Proceedings..................................................................... 31
Financial Statements.................................................................. 31
Table of Contents of Statement of Additional Information.............................. 32
Calculation of Surrender Charge....................................................... A-1
</TABLE>
i
<PAGE> 4
DEFINITIONS
ANNUITANT -- The person upon whose continuation of life any annuity payment
depends.
ANNUITY COMMENCEMENT DATE -- The date on which annuity payments are to
commence.
BENEFICIARY -- The party entitled to receive benefits payable at the death
of the Annuitant or (if applicable) the Contingent Annuitant.
CASH VALUE -- The dollar value as of any Valuation Date of all amounts
accumulated under the Certificate.
CERTIFICATE -- A Certificate issued in accordance with the Contract.
CERTIFICATE ANNIVERSARY -- An anniversary of the Certificate Date of the
Certificate.
CERTIFICATEHOLDER -- The person so designated in the application. If a
Certificate has been absolutely assigned, the assignee becomes the
Certificateholder. A collateral assignee is not the Certificateholder.
CERTIFICATE DATE -- The date shown as the Certificate Date in the
Certificate.
CERTIFICATE YEAR -- Any period of twelve (12) months commencing with the
Certificate Date and each Certificate Anniversary thereafter.
COMPANY -- --The Mutual Life Insurance Company of New York.
CONTINGENT ANNUITANT -- The party designated by the Certificateholder to
become the Annuitant, subject to certain conditions, on the death of the
Annuitant.
CONTRACT -- The Flexible Payment Variable Annuity Contract offered by the
Company and described in this Prospectus.
FREE LOOK PERIOD -- A period which follows the application for the
Certificate and its issuance to the Certificateholder. The period runs to the
date which 10 days (or longer in certain states) after the Certificateholder
receives the Certificate. (The Free Look Period is referred to in the
Certificate as the "Right to Return Certificate" period.) During the Free Look
Period, the Certificateholder may cancel the Certificate and receive a refund.
FUND -- Quest for Value Accumulation Trust, a Massachusetts business trust
formerly Quest Asset Builder Trust, a Massachusetts business trust.
GUARANTEED FREE SURRENDER AMOUNT --
For Non-Qualified Certificates -- An amount, up to 10 percent of the
Certificate's Cash Value on the date the first partial surrender request is
received during a Certificate Year, that may be surrendered without the
imposition of a Surrender Charge. For the purposes of the Guaranteed Free
Surrender Amount only, Non-Qualified Certificates include Certificates issued
for IRAs and SEP-IRAs.
For Qualified Certificates -- An amount, up to the greater of $10,000 (but
not more than the Certificate's Cash Value) or 10 percent of the Certificate's
Cash Value on the date the first partial surrender request is received during a
Certificate Year, that may be surrendered without the imposition of a Surrender
Charge. For the purposes of the Guaranteed Free Surrender Amount only, Qualified
Certificates exclude Certificates issued for IRAs and SEP-IRAs.
GUARANTEED INTEREST ACCOUNT -- A part of the Company's general account, the
Guaranteed Interest Account pays interest at a rate declared by the Company,
which the Company guarantees will not be less than 4%. For Certificates issued
on or after May 1, 1994 (or on or after such date as approval required in
certain states is obtained), the rate declared by the Company is guaranteed to
be not less than 3.5%.
HOME OFFICE -- The Company's administrative office at 1740 Broadway, New
York, N.Y. 10019. "Home Office" also includes the Company's Operations Center at
1 MONY Plaza, Syracuse, N.Y. 13202.
1
<PAGE> 5
NET PURCHASE PAYMENT -- An amount equal to a Purchase Payment, less any
deduction for premium or similar taxes.
NON-QUALIFIED CERTIFICATES -- Certificates issued under Non-Qualified
Plans.
NON-QUALIFIED PLANS -- Retirement Plans that do not receive favorable tax
treatment under Sections 401, 403, 408, or 457 of the Internal Revenue Code.
OPERATIONS CENTER -- The administrative office of the Company located at 1
MONY Plaza, Syracuse, New York 13202.
PORTFOLIO -- A separate investment portfolio of the Fund.
PURCHASE PAYMENT (PAYMENT) -- An amount paid to the Company by the
Certificateholder or on the Certificateholder's behalf as consideration for the
benefits provided by the Certificate.
QUALIFIED CERTIFICATES -- Certificates issued under Qualified Plans.
QUALIFIED PLANS -- Retirement plans that receive favorable tax treatment
under Sections 401, 403, 408, or 457 of the Internal Revenue Code.
SUBACCOUNT -- A subdivision of the Variable Account. Each Subaccount
invests exclusively in the shares of a corresponding Portfolio of the Fund.
SUCCESSOR CERTIFICATEHOLDER -- The living person who, at the death of the
Certificateholder, becomes the new Certificateholder.
SURRENDER CHARGE -- A contingent deferred sales charge that may be applied
against amounts surrendered. (See "Charges Against Cash Value -- Surrender
Charge" at page 18.)
SURRENDER VALUE -- The Certificate's Cash Value, less (1) any applicable
Surrender Charge and (2) any applicable Annual Certificate Charge.
UNIT -- The measure by which the Certificate's interest in each Subaccount
is determined.
VALUATION DATE -- Each day that the New York Stock Exchange is open for
trading or any other day on which there is sufficient trading in the securities
of a Portfolio of the Fund to affect materially the value of the Units of the
corresponding Subaccount.
VARIABLE ACCOUNT -- A separate investment account of the Company,
designated as MONY Variable Account A, into which Net Purchase Payments will be
allocated.
2
<PAGE> 6
SYNOPSIS
THE CONTRACTS AND THE CERTIFICATES
The Group Flexible Payment Variable Annuity Contracts (the "Contracts")
described in this Prospectus provide for the accumulation of values on a
variable basis or a guaranteed interest basis or a combination of both and the
payment of annuity benefits. The Contracts are designed for use in connection
with personal retirement plans, some of which (the "Qualified Plans") may
qualify for federal income tax advantages available under Sections 401, 403, 408
and 457 of the Internal Revenue Code (the "Code"). Individuals who are members
of qualifying groups may make purchase payments and each receive a certificate
("Certificate") which summarizes the provisions of the Contracts.
The Contracts and Certificates offered by this Prospectus are not available
for sale in connection with Qualified Plans which intend to qualify for federal
income tax advantages available under Section 403(b) of the Code.
THE VARIABLE ACCOUNT
Net Purchase Payments for the Certificates will be allocated at the
Certificateholder's option to Sub-accounts, made available therefor in
accordance with the terms of the Certificates, of a segregated investment
account of The Mutual Life Insurance Company of New York (the "Company"), which
account has been designated MONY Variable Account A (the "Variable Account") or
to the Guaranteed Interest Account, which is a part of the Company's general
account and consists of all the Company's assets other than assets allocated to
segregated investment accounts of the Company, including the Variable Account.
The Sub accounts of the Variable Account invest in shares of the Quest for Value
Accumulation Trust at their net asset value. (See "The Fund" at page 9).
Certificateholders bear the entire investment risk for all amounts allocated to
the Variable Account. Net Purchase Payments allocated to the Guaranteed Interest
Account will be credited with interest at rates guaranteed by the Company for
specified periods. (See "Guaranteed Interest Account" at page 11.)
PURCHASE PAYMENTS
For Non-Qualified Plans and individual retirement accounts and annuities
purchased by individuals under Section 408 of the Code (other than Simplified
Employee Pensions), the minimum initial Purchase Payment for the Certificate is
$2,000, except that, on and after May 1, 1992, the minimum initial Purchase
Payment for individuals is $600 if Purchase Payments are made through automatic
checking account withdrawals. For H.R.10 plans, certain corporate or association
retirement plans, Simplified Employee Pensions under Section 408 of the Code,
and annuity purchase plans sponsored by certain tax-exempt organizations,
governmental entities, or public school systems, the minimum initial Purchase
Payment is $600. Additional Purchase Payments of at least $100 may be made at
any time. Different limits apply where certain automatic payment plans are used.
(See "Issuance of the Certificate" at page 12.) The Company may change any of
these requirements in the future.
DEDUCTIONS FROM PURCHASE PAYMENTS
Deductions may be made from Purchase Payments for premium or similar taxes.
Currently, the Company makes no such deduction, but may do so with respect to
future payments. The amount of the deduction will vary from state to state, but
will generally range from 0 percent to 3.5 percent of Payments. Residents of the
Commonwealth of Pennsylvania should be aware that a tax on Purchase Payments has
been adopted; however, the Company currently is assuming responsibility for
payment of this tax. In the event that the Company will begin to make deductions
for such tax from future Purchase Payments, it will give notice to each affected
Certificateholder.
3
<PAGE> 7
FREE LOOK PRIVILEGE
Within ten days (or longer in certain states) of the day the Certificate is
delivered to the Certificateholder, it may be returned to the Company or to the
agent through whom it was purchased. When the Certificate is received by the
Company, it will be voided as if it had never been in force. Except for
Certificates entered into in the Commonwealth of Pennsylvania, the amount to be
refunded is equal to the greater of: (i) all Purchase Payments; and (ii) the
cash Value of the Certificate (as of the date the returned Certificate is
received at the Home Office or a local office of the Company, or by the agent
who sold the Certificate, or, if returned by mail, upon being postmarked,
properly addressed, and postage prepaid) plus any deductions from Purchase
Payments for taxes applicable to annuity considerations that may have been
deducted, any mortality and expense risk charges deducted in determining the
Unit value of the Variable Account, and asset charges deducted in determining
the share value of the Fund. For Certificates entered into in the Commonwealth
of Pennsylvania, the amount to be refunded is described in clause (ii) of the
immediately preceding sentence.
SURRENDER CHARGE
A contingent deferred sales charge (called a "Surrender Charge") will be
imposed upon requests for surrenders or commencement of annuity benefits where
the amount requested exceeds the amount of Net Purchase Payments during the
Certificate Year when the surrender or commencement of annuity benefits is
requested and during the seven preceding Certificate Years.
The Surrender Charge, which otherwise would have been deducted, will not be
deducted to the extent necessary to permit the Certificateholder to obtain, for
Qualified Certificates (other than Certificates issued for IRA and SEP-IRA), an
amount up to the greater of $10,000 (but not more than the Certificate's Cash
Value) or 10 percent of the Certificate's Cash Value on the date the first
partial surrender request is received during a Contract Year; and for
NonQualified Certificates (and Certificates issued for IRA and SEP-IRA), an
amount up to 10% of the Cash Value of the Certificate on the date the first
partial surrender request is received during a Contract Year. The Company
reserves the right to limit the number of partial surrenders under this
provision to 12 during any Certificate Year. In addition, the Certificate
details certain other circumstances under which a surrender charge will not be
imposed. The Surrender Charge is intended to reimburse the Company for expenses
incurred that are related to sales of the Certificate. In no event will the
aggregate Surrender Charge exceed 7 percent of the total Purchase Payments made
in the Certificate Year of the surrender and during the 7 preceding Certificate
Years. (See "Charges Against Cash Value -- Surrender Charge" at page 19.)
MORTALITY AND EXPENSE RISK CHARGE
A Mortality and Expense Risk Charge is deducted daily from the net assets
of the Variable Account for mortality and expense risks assumed by the Company.
This daily charge is equal to a charge on an annual basis of 1.25 percent of the
net assets of the Variable Account. (See "Mortality and Expense Risk Charge" at
page 21.)
TRANSFER CHARGE
Certificate value may be transferred without charge as many as 4 times in
any Certificate Year. For any additional transfer during a Certificate Year, a
transfer charge is not currently imposed, but the Company has reserved the right
to impose a charge for each transfer in excess of 4, which will not exceed $25
per transfer. If imposed, the transfer charge will be deducted from the
Certificate's Cash Value. (See "Charges Against Cash Value -- Transfer Charge"
at page 21.)
ANNUAL CERTIFICATE CHARGE
On each Certificate Anniversary prior to the Annuity Commencement Date, on
the Annuity Commencement Date, and on full surrender of the Certificate, the
Company deducts an Annual Certificate Charge from the Cash Value, to reimburse
the Company for administrative expenses relating to the maintenance of the
Certificate. The charge is currently $30, but the Company may in the future
change the amount of the charge.
4
<PAGE> 8
The charge will never, however, exceed $50. (See "Charges Against Cash
Value -- Annual Certificate Charge" at page 20.)
DEATH BENEFIT
In the event of death of the Annuitant (and the Contingent Annuitant, if
one has been named) prior to the Annuity Commencement Date, the Company will pay
a death benefit to the Beneficiary. If death of the Annuitant occurs after the
Annuity Commencement Date, no death benefit will be payable except as may be
payable under the settlement option selected. (See "Death Benefit" at page 18.)
TAX UPON SURRENDER
Amounts withdrawn may be subject to income tax. In addition, a penalty tax
may be payable pursuant to the Internal Revenue Code on withdrawal of amounts
accumulated under any annuity contract. (See "Federal Tax Status" at page 28.)
THE MERGER
Pursuant to an Agreement and Plan of Merger, entered into between MONY
Legacy Life Insurance Company ("MONY Legacy") and the Company, MONY Legacy was
merged ("Merger") into the Company on February 28, 1991. As a result of the
Merger, the Company became the depositor of, and became obligated under,
contracts issued by MONY Legacy ("Legacy Contracts"). As a result of the Merger,
assets, reserves, and other liabilities allocated to the MONY Legacy Variable
Account A (to which purchase payments made for the Legacy Contracts were
allocated prior to the Merger) became the assets, reserves, and other
liabilities of the Variable Account.
THE SUBSTITUTION
After September 16, 1994, purchase payments made by ValueMaster
Certificateholders allocated to the Subaccounts are used to purchase shares of
corresponding portfolios of the Quest for Value Accumulation Trust, a
Massachusetts business trust, which was established as the Quest Asset Builder
Trust ("Quest for Value Accumulation Trust"). The present name was adopted on
September 16, 1994. On September 16, 1994, the shares of the portfolio company
previously purchased with ValueMaster Certificateholder purchase payments (which
is now named the Enterprise Accumulation Trust) were redeemed in kind and the
assets received were used to purchase shares of the Quest for Value Accumulation
Trust (the "Substitution"). (See "The Fund" at page 8 and "Prospectus Summary"
at page 3 of the accompanying prospectus for the Quest for Value Accumulation
Trust.) Quest for Value Advisors, the investment advisor to the Quest for Value
Accumulation Trust, has agreed to continue to waive payment of that part or all
of its investment management fee which would cause the expenses of any portfolio
of the Quest for Value Accumulation Trust, when such fee is added to the other
expenses of the Quest for Value Accumulation Trust, to exceed 1.00% of that
portfolio's assets.
5
<PAGE> 9
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
MONY VARIABLE ACCOUNT A
TABLE OF FEES FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<S> <C>
CERTIFICATEOWNER TRANSACTION EXPENSES
Maximum Deferred Sales Load (Surrender Charge) (as a percentage
of amount surrendered)........................................................... 7%*
ANNUAL CERTIFICATE CHARGE............................................................. $30
SEPARATE ACCOUNT ANNUAL EXPENSES
Mortality and Expense Risk Fees..................................................... 1.25%**
</TABLE>
ANNUAL EXPENSES OF QUEST FOR VALUE ACCUMULATION TRUST:
QUEST FOR VALUE ACCUMULATION TRUST
ANNUAL EXPENSES FOR THE YEAR ENDED DECEMBER 31, 1994
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<CAPTION>
SMALL MONEY
EQUITY CAP MANAGED BOND MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Expenses................................... .12% .14% .06% .50% .60%
Management Fees............................ .60% .60% .60% .50% .40%
---- ---- ---- ---- ----
Total Quest for Value Accumulation
Trust Annual Expenses.................... .72% .74% .66% 1.00% 1.00%
==== ==== ==== ==== ====
</TABLE>
- ---------------
* The Surrender Charge percentage, which reduces to zero as shown in the table
below is determined by the number of Certificate Anniversaries since a
purchase payment was received.
SURRENDER CHARGE PERCENTAGE TABLE
<TABLE>
<CAPTION>
# OF CONTRACT SURRENDER
ANNIVERSARIES SINCE CHARGE
PURCHASE PAYMENT RECEIVED PERCENTAGE
- ------------------------- ----------
<S> <C>
0 7%
1 7
2 6
3 6
4 5
5 4
6 3
7 2
8 (or more) 0
</TABLE>
Surrender Charge may be reduced under certain circumstances which include
reduction in order to guarantee that certain amounts may be received free of
surrender charge. See "Charges Against Cash Value -- Guaranteed Free Surrender
Amount" at page 20.
** The Mortality and Expense Risk charge is deducted at a daily rate equivalent
to an annual rate of 1.25 percent from the value of the net assets of the
Separate Account.
The Table of Fees on page 6 reflects the fees and expenses which were
imposed or incurred by MONY Legacy Variable Account A prior to the merger of
MONY Legacy Life Insurance Company into the Company. No increase in fees or
expenses imposed or incurred resulted from the merger. Although MONY Variable
Account A is a new separate account which commenced operations in February 1991,
the expenses reflected in the Table of Fees reflect the historical data for MONY
Legacy Variable Account A as well as the operations of MONY Variable Account A
since the Merger.
6
<PAGE> 10
The purpose of the Table of Fees beginning on page 6 is to assist the
Certificateholder in understanding the various costs and expenses that the
Certificateholder will bear, directly or indirectly. The table reflects the
expenses of the separate account as well as of Quest for Value Accumulation
Trust. The expenses borne by the Separate Account are explained under the
caption "CHARGES AND DEDUCTIONS" at page 18 of this Prospectus. The expenses
borne by Quest for Value Accumulation Trust assumes that the management fee
waivers currently in effect will continue throughout the period shown and are
explained under the caption "Management of the Fund" at page 15 of the
accompanying prospectus for Quest for Value Accumulation Trust. The table does
not reflect income taxes or penalty taxes which may become payable under the
Internal Revenue Code or premium or other taxes which may be imposed under state
or local laws. No separate charges are assessed on the Group Contractholder.
EXAMPLE
If you surrender your Certificate at the end of the time periods shown
below, you would pay the following expenses (estimated as described in the
footnotes to the Table of Fees) on a $1,000 investment, assuming 5% annual
return on assets:
<TABLE>
<CAPTION>
AFTER AFTER
SUBACCOUNT 1 YEAR 3 YEARS
---------- ------ -------
<S> <C> <C>
Equity.............................................................. $ 83 $ 117
Small Cap........................................................... $ 83 $ 117
Managed............................................................. $ 83 $ 115
Bond................................................................ $ 86 $ 125
Money Market........................................................ $ 86 $ 125
</TABLE>
If you annuitize at the end of the time periods shown below, you would pay
the following expenses (estimated as described in the footnotes to the Table of
Fees) on a $1,000 investment, assuming 5% annual return on assets:
<TABLE>
<CAPTION>
AFTER AFTER
SUBACCOUNT 1 YEAR 3 YEARS
---------- ------ -------
<S> <C> <C>
Equity.............................................................. $ 83 $ 117
Small Cap........................................................... $ 83 $ 117
Managed............................................................. $ 83 $ 115
Bond................................................................ $ 86 $ 125
Money Market........................................................ $ 86 $ 125
</TABLE>
If you do not surrender your Certificate at the end of the time periods
shown below, you would pay the following expenses (estimated as described in the
footnotes to the Table of Fees) on a $1,000 investment, assuming 5% annual
return on assets:
<TABLE>
<CAPTION>
AFTER AFTER
SUBACCOUNT 1 YEAR 3 YEARS
---------- ------ -------
<S> <C> <C>
Equity.............................................................. $ 21 $ 63
Small Cap........................................................... $ 21 $ 64
Managed............................................................. $ 20 $ 62
Bond................................................................ $ 23 $ 72
Money Market........................................................ $ 23 $ 72
</TABLE>
The examples above should not be considered a representation of past or
future expenses, and actual expenses may be greater or lesser than those shown.
All Variable Account expenses as well as portfolio company (Quest for Value
Accumulation Trust) expenses (estimated as described in the footnotes to the
Table of Fees), net of fee waivers, are reflected in the examples. Not reflected
in the examples which assume redemption at the end of each time period are
income taxes and penalty taxes which may become payable under the Internal
Revenue Code or premium or other taxes which may be imposed under state or local
laws.
7
<PAGE> 11
CONDENSED FINANCIAL INFORMATION
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
MONY VARIABLE ACCOUNT A
ACCUMULATION UNIT VALUES
<TABLE>
<CAPTION>
UNITS
UNIT VALUE OUTSTANDING
------------------------------- ------------
DECEMBER 31, DECEMBER 31,
SUB-ACCOUNT INCEPTION* 1994 1994
- ----------- ---------- ------------ ------------
<S> <C> <C> <C>
Equity......................................... $20.15 $19.59 10,593
Small Cap...................................... 21.68 21.46 18,271
Managed........................................ 14.20 14.10 60,890
Bond........................................... 25.44 24.22 315,452
Money Market................................... 12.44 12.54 37,816
</TABLE>
- ---------------
* Variable Account A commenced operations on December 30, 1987. The Subaccounts
shown above became available for allocation on September 16, 1994.
8
<PAGE> 12
THE COMPANY AND THE VARIABLE ACCOUNT
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
The Mutual Life Insurance Company of New York (the "Company") is a mutual
life insurance company organized in the state of New York in 1842. The Company
is currently licensed to sell life insurance and annuities in all states of the
United States, the District of Columbia, Puerto Rico, the Virgin Islands, and
all Provinces of Canada. The Company's financial statements may be found in the
Statement of Additional Information. The principal offices of the Company are at
1740 Broadway, New York, New York 10019.
MONY VARIABLE ACCOUNT A
The Company established MONY Variable Account A (the "Variable Account") on
November 28, 1990, under New York law as a separate investment account. The
Variable Account holds assets that are segregated from all of the Company's
other assets and at present is used only to support flexible payment variable
annuity contracts. As a result of the Merger, the Variable Account received the
assets, reserves, and other liabilities of the MONY Legacy Variable Account A.
The Company is the legal holder of the assets in the Variable Account and
will at all times maintain assets in the Variable Account with a total market
value at least equal to the contract liabilities for the Variable Account. The
obligations under the Certificates are obligations of the Company. Income,
gains, and losses, whether or not realized, from assets allocated to the
Variable Account, are, in accordance with the Certificates, credited to or
charged against the Variable Account without regard to other income, gains, or
losses of the Company. The assets in the Variable Account may not be charged
with liabilities which arise from any other business the Company conducts. The
Variable Account's assets may include accumulations of the charges the Company
makes against Certificates participating in the Variable Account. From time to
time, any such additional assets may be transferred in cash to the Company's
General Account.
The Variable Account is registered with the Securities and Exchange
Commission ("SEC") under the Investment Company Act of 1940 ("1940 Act") as a
unit investment trust, which is a type of investment company. This does not
involve any supervision by the SEC of the management or investment policies or
practices of the Variable Account. For state law purposes, the Variable Account
is treated as a part or division of the Company. There are currently 11
Subaccounts within the Variable Account, however, not all Subaccounts are
available to the Certificateholder.
THE FUND
The Quest for Value Accumulation Trust was established as the Quest Asset
Builder Trust, and the present name was adopted on September 16, 1994. The Quest
for Value Accumulation Trust was established for the purpose of offering its
shares to the Company for allocation to Subaccounts of MONY Variable Account A
in accordance with instructions received from ValueMaster Contractholders
concerning the allocation of their purchase payments and to the separate
accounts of other insurance companies for allocation in accordance with the
instructions of their variable annuity and variable life insurance
contractholders. (See "Prospectus Summary" at page 3 of the accompanying
prospectus for The Quest for Value Accumulation Trust.)
At the close of business on September 16, 1994, the shares of the portfolio
company previously purchased with ValueMaster Contractholder purchase payments
(which is now named Enterprise Accumulation Trust) were redeemed through an
in-kind redemption, and the securities and cash received was used to purchase
shares of the Quest for Value Accumulation Trust. The Enterprise Accumulation
Trust was established on March 1, 1988 as the Quest for Value Accumulation
Trust, and its name was changed to Enterprise Accumulation Trust on September
16, 1994. Under its former name, its shares were offered to the Company for
purchase with ValueMaster Certificateholder purchase payments allocated to MONY
Variable Account A until the close of business on September 16, 1994.
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After September 16, 1994, each Subaccount of the Variable Account will
invest only in the shares of a corresponding Portfolio of Quest for Value
Accumulation Trust (the "Fund"). The Fund is registered with the SEC under the
1940 Act as open-end diversified management investment company. This
registration does not involve supervision by the SEC of the management or
investment practices or policies of the Fund. Shares of the Fund are also
currently sold to a separate account of a life insurance company affiliate of
the Company that was established to fund certain Flexible Premium Variable
Annuity contracts. Shares of the Fund may in the future be sold to other
separate accounts, and the Fund may in the future create new Portfolios. In
addition, the Company may make available additional Subaccounts with differing
or similar investment objectives. The Fund may withdraw from sale any or all of
the respective Portfolios in accordance with applicable law.
The Board of Trustees of the Quest for Value Accumulation Trust has
undertaken to monitor the Fund for the existence of any material irreconcilable
conflict between the interests of variable annuity contractholders and variable
life insurance contractholders and shall report any such conflict to the boards
of the Company and its affiliates. The Boards of Directors of the Company and
its affiliates have agreed to be responsible for reporting any potential or
existing conflicts to the Trustees of the Fund and, at their own cost, to remedy
such conflict up to and including establishing a new registered management
investment company and segregating the assets underlying the variable annuity
contracts and the variable life insurance contracts.
The Variable Account will purchase and redeem shares from the Fund at net
asset value. Shares will be redeemed to the extent necessary for the Company to
collect charges under the Certificates, to pay Surrender Value upon full
surrenders of the Certificates, to fund partial surrenders, to provide benefits
under the Certificates, and to transfer assets from one Subaccount to another or
between one or more Subaccounts of the Variable Account and the Guaranteed
Interest Account as requested by Certificateholders. Any dividend or capital
gain distribution received from a Portfolio of the Fund will be reinvested
immediately at net asset value in shares of that Portfolio and retained as
assets of the corresponding Subaccount.
The Quest for Value Accumulation Trust receives investment advice with
respect to each of its Portfolios from Quest for Value Advisors which acts as
investment adviser to the Quest for Value Accumulation Trust. Quest for Value
Advisors is a subsidiary of Oppenheimer Capital, which is a subsidiary of
Oppenheimer Financial Corp.
The investment objectives of the Portfolios currently available to
Certificateholders through corresponding Subaccounts of the Variable Account are
set forth in the accompanying prospectus for each of the Funds and are described
briefly below. There is no assurance that these objectives will be met.
The investment objectives of each Portfolio are fundamental and may not be
changed without the approval of the holders of a majority of the outstanding
shares of the Portfolio affected (which, for the Fund means the lesser of (1) 67
percent of the Portfolio shares represented at a meeting at which more than 50
percent of the outstanding Portfolio shares are represented or (2) more than 50
percent of the outstanding Portfolio shares).
Each Certificateholder should periodically consider the allocation among
the Subaccounts and the Guaranteed Interest Account in light of current market
conditions and the investment risks attendant to investing in each of the Fund's
various Portfolios. A full description of the Fund, its investment objectives,
policies and restrictions, its expenses, the risks attendant to investing in
each of the Fund's Portfolios, and other aspects of its operation is contained
in the accompanying prospectus for the Fund, which should be read together with
this Prospectus.
The investment objectives of each of the Portfolios of the Fund is as
follows:
Equity Portfolio: Capital appreciation through investment in a diversified
portfolio of primarily equity securities selected on the basis of a
value-oriented approach to investing.
Small Cap Portfolio: Capital appreciation through investments in a
diversified portfolio of primarily equity securities of companies with market
capitalizations of under $1 billion.
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Managed Portfolio: Growth of capital over time through investment in a
portfolio consisting of common stocks, bonds, and cash equivalents, the
percentages of which will vary over time based on the investment manager's
assessments of relative investment values.
Bond Portfolio: High returns and projection of capital through investment
in a diversified portfolio of bonds and other fixed-income objectives.
Money Market Portfolio: Maximum current income consistent with stability
of principal by investing in a portfolio of high quality money market
instruments.
GUARANTEED INTEREST ACCOUNT
The Guaranteed Interest Account is a part of the Company's General Account
and consists of all the Company's assets other than assets allocated to
segregated investment accounts of the Company, including the Variable Account.
Crediting of Interest. Net Purchase Payments allocated by a
Certificateholder to the Guaranteed Interest Account will be credited with
interest at the rate declared by the Company which the Company guarantees will
not be less than 4% (0.010746% compounded daily). For Certificates issued on or
after May 1, 1994 (or on or after such later date as approval required in
certain states is obtained), the rate declared by the Company will be not less
than 3.5% (0.009426% compounded daily). Each interest rate declared by the
Company will be applicable for all Net Purchase Payments received or transfers
from the Variable Account completed within the period during which it is
effective. Initial Net Purchase Payments allocated to the Guaranteed Interest
Account will be credited with interest at the rate in effect for the date on
which the Certificate is issued (and the funds transferred into the Money Market
Subaccount) from and after the date on which the Free Look Privilege expires on
all funds transferred from the Money Market Subaccount to the Guaranteed
Interest Account. Amounts withdrawn from the Guaranteed Interest Account as a
result of a transfer, partial surrender, or any charge imposed in accordance
with the Certificate, will be deemed to be withdrawals of amounts (and any
interest credited thereon) most recently credited to the Guaranteed Interest
Account.
Prior to the expiration of the period for which a particular interest rate
was guaranteed, the Company will declare a renewal interest rate to be effective
for such succeeding period as the Company shall determine.
Descriptions of the Guaranteed Interest Account are included in this
Prospectus for the convenience of the purchaser. The Guaranteed Interest Account
and the general account of the Company are not registered under the Securities
Act of 1933 or the Investment Company Act of 1940. Accordingly, neither the
general account of the Company nor the Guaranteed Interest Account are generally
subject to the provisions of these Acts; however, disclosures regarding the
Guaranteed Interest Account and the general account of the Company may be
subject to certain generally applicable provisions of the federal securities
laws relating to the accuracy and completeness of statements made in
prospectuses. The staff of the Securities and Exchange Commission has not
reviewed the disclosures in this Prospectus which relate to the Guaranteed
Interest Account and the general account of the Company.
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<PAGE> 15
PAYMENT AND ALLOCATION OF NET PURCHASE PAYMENTS
ISSUANCE OF THE CERTIFICATE
Individuals who are members of a qualifying group and wish to purchase a
Certificate must complete an application and personally deliver it to a licensed
agent of the Company who is also a registered representative of MONY Securities
Corp. ("MSC"), a wholly-owned subsidiary of the Company, which is the principal
underwriter for the Certificates, or a registered broker-dealer which has been
authorized by MSC to sell the Certificate. Except where certain automatic
payment plans (i.e., government allotment, payroll deduction, or automatic
checking account withdrawal plans) are used, the minimum initial Purchase
Payment for the Certificate is currently $2,000 for NonQualified Plans, $2,000
for individual retirement accounts and annuities purchased by individuals under
Section 408 of the Code (other than Simplified Employee Pensions), and $600 for
H.R. 10 plans (selfemployed individuals' retirement plans under Sections 401 or
403(c) of the Code), Simplified Employee Pensions under Section 408 of the Code,
and annuity purchase plans sponsored by certain tax-exempt organizations,
governmental entities, or public school systems under Section 403(b) of the Code
("Tax Sheltered Annuities") and deferred compensation plans under Section 457 of
the Code. These minimum initial Payments must be paid with the application for
the Certificate. Additional Payments may be made at any time in the minimum
amount of $100. For certain automatic payment plans, however, the minimum
additional payment is $50.
The Contracts and Certificates offered by this Prospectus are not available
for sale in connection with Qualified Plans which intend to qualify for federal
income tax advantages available under Section 403(b) of the Code.
Different rules apply for government allotment, payroll deduction, and
automatic checking account withdrawal plans. For payroll deduction and automatic
checking account withdrawal plans, Purchase Payments must be made at an
annualized rate of $600 (i.e., $600 per year, $300 semiannually, $150 for each
quarter year, or $50 per month). For government allotment plans, the minimum
Purchase Payment is $50 per month.
The Company reserves the right to revise its rules from time to time to
specify different minimum Purchase Payments.
In addition, the prior approval of the Company is required before it will
accept a Purchase Payment where, with that Payment, cumulative Purchase Payments
made under any one or more Certificates held by the Certificateholder, less the
amount of any prior partial surrenders and their Surrender Charges, exceed
$1,500,000. The prior approval of the Company is also required before it will
accept that part of a payment (or transfer) which would cause amounts credited
to the Guaranteed Interest Account to exceed $250,000 on the date of payment (or
transfer).
The Company reserves the right to reject an application for any reason
permitted by law.
Net Purchase Payments received before the Certificate Date will be held in
the Company's General Account and will be credited with interest at not less
than 3.5 percent per annum if the Certificate is issued by the Company and
accepted by the Certificateholder. No interest will be paid if the Certificate
is not issued or if it is declined by the Certificateholder. If the application
is approved and the Certificate is subsequently issued and accepted by the
Certificateholder, then on the Certificate Date, amounts allocable to the
Certificate held in the Company's General Account will be transferred to the
Money Market Subaccount of the Variable Account. These amounts will be held in
that Subaccount pending expiration of the Free Look Period. (See "Free Look
Privilege" at page 13.) For purposes of crediting interest on amounts held in
the General Account, Purchase Payments will be treated as received on the day of
actual receipt at the Company's Operations Center. If an application is not
complete when received by the Company at its Operations Center, and if it is not
made complete within 5 days, the prospective purchaser will be informed of the
reasons for the delay and the initial Purchase Payment will be returned in full
(and the application will be declined), unless the prospective purchaser
consents to the Company's retaining the Purchase Payment until the application
is made complete.
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FREE LOOK PRIVILEGE
Within the period of 10 days (or longer in certain states) following the
day the Certificate is delivered to the Certificateholder (the "Free Look
Period"), the Certificateholder may return the Certificate to the Company or to
the agent through whom it was purchased. When the Certificate is received by the
Company, it will be voided as if it had never been in force. Except for
Certificates issued in the Commonwealth of Pennsylvania, the amount to be
refunded is equal to the greater of: (i) all Purchase Payments; and (ii) the
Cash Value of the Certificate (as of the date the returned Certificate is
received at the Home Office or a local office of the Company, or by the agent
who sold the Certificate, or, if returned by mail, upon being postmarked,
properly addressed, and postage prepaid) plus any deductions from Purchase
Payments for taxes, any mortality and expense risk charges deducted in
determining the Unit value of the Variable Account, and asset charges deducted
in determining the share value of the Funds. For Certificates entered into in
the Commonwealth of Pennsylvania, the amount to be refunded is described in
clause (ii) of the immediately preceding sentence.
ALLOCATION OF NET PURCHASE PAYMENTS AND CASH VALUE
Allocation of Net Purchase Payments. The Certificateholder may allocate on
the application Net Purchase Payments to the Subaccount(s) of the Variable
Account or to the Guaranteed Interest Account. Any Net Purchase Payments
received before the end of the Free Look Period (and any interest thereon) will
initially be allocated to the Money Market Subaccount of the Variable Account on
the later of (i) the Certificate Date and (ii) the date the Payment is received
at the Company's Operations Center. Net Purchase Payments will continue to be
allocated to that Subaccount until the Free Look Period expires and, if the
allocation on the application is incomplete or incorrect, a complete and correct
allocation notification is received by the Company. (See "Free Look Privilege"
above) After the Free Look Period has expired and, if applicable, the correct
and complete allocation notification has been received, the Certificate's Cash
Value held in the Money Market Subaccount will automatically be transferred to
the Subaccount(s) of the Variable Account or to the Guaranteed Interest Account
in accordance with the Certificateholder's percentage allocation.
After the Free Look Period, Net Purchase Payments under a nonautomatic
payment plan will be allocated in accordance with the Certificateholder's most
recent instructions on record with the Company, unless the Certificateholder at
the time a Purchase Payment is made specifies the amount (not less than $10.00
per Subaccount or 10 percent of the Payment) or the percentage of the Net
Purchase Payment to be allocated among the Subaccount(s). If the specific
allocation is incorrect or incomplete, then that Net Purchase Payment will be
made in accordance with the most recent correct payment allocation on record.
For automatic payment plans, Net Purchase Payments will be allocated in
accordance with the Certificateholder's most recent instructions on record.
The Certificateholder may change the allocation formula specified in the
initial allocation notification, or as changed in any subsequent notification,
for future Net Purchase Payments at any time without charge by sending the
Company at the Operations Center written notification. Prior allocation
instructions may also be changed by telephone, subject to the rules of the
Company and its right to terminate telephone allocation. Any such change,
whether made in writing or by telephone, will be effective not later than 7 days
after notification is received. The Company has adopted rules relating to
changes of allocations by telephone, which, among other things, outlines
procedures to be followed which are designed, and which the Company believes are
reasonable, to prevent unauthorized instructions. If these procedures are
followed, the Company shall not be liable for, and the Certificateholder will
therefore bear the entire risk of, any loss as a result of the Company's
following telephone instructions in the event that such instructions prove to be
fraudulent. A copy of the Guidelines and the Company's form for electing
telephone allocation privileges is available from licensed agents of the Company
who are also registered representatives of MSC or of a broker-dealer authorized
by MSC to offer the Certificates, or by calling 1-800-487-6669. The Company's
form must be signed and received at the Company's Syracuse Operations Center
before telephone allocation instructions will be accepted.
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The minimum percentage of each Net Purchase Payment that may be allocated
to any Subaccount of the Variable Account or to the Guaranteed Interest Account
is 10 percent; all percentages must be expressed in whole numbers and must total
100 percent. The minimum amount of each Net Purchase Payment that may be
allocated to any Subaccount of the Variable Account or to the Guaranteed
Interest Account is $10.00.
Upon receipt of a Purchase Payment, the Net Purchase Payments allocated to
Subaccounts of the Variable Account will be credited to the designated
Subaccount(s) in the form of Units. The number of Units to be credited to a
Subaccount is determined by dividing the dollar amount allocated to the
particular Subaccount by the Unit value for the particular Subaccount for the
Valuation Date on which the Purchase Payment is received.
The Unit Value for each Subaccount was established at $10 for the first
Valuation Date. The Unit Value for a Subaccount for any subsequent Valuation
Date is determined by subtracting (b) from (a) and dividing the result by (c),
where:
(a) is the per share net asset value on the Valuation Date of the Fund
Portfolio in which the Subaccount invests times the number of such shares
held in the Subaccount before the purchase or redemption of any shares on
that Date;
(b) is the mortality and expense risk charge accrued as of that
Valuation Date (the daily mortality and expense risk charge is a percentage
of the Subaccount's net asset value on the previous Valuation Date. If the
previous day was not a Valuation Date, then the daily mortality and expense
risk charge is the applicable percentage times the number of days since the
last Valuation Date times the Subaccount's net asset value on the last
Valuation Date); and
(c) is the total number of Units held in the Subaccount on the
Valuation Date before the purchase or redemption of any Units on that Date.
The Unit Value for these Subaccounts may increase, decrease, or remain
constant from Valuation Date to Valuation Date, depending upon the investment
performance of the Portfolio of the Fund in which the Subaccount is invested and
any expenses and charges deducted from the Variable Account. The
Certificateholder bears the entire investment risk. Certificateholders should
periodically review their allocations of payments and values in light of market
conditions and overall financial planning requirements.
Net Purchase Payments to be allocated to the Guaranteed Interest Account
will be credited to that account on the date of receipt at the Operations
Center, if that date is a Valuation Date, and, if not, on the next Valuation
Date. Interest will be credited daily. In the event that allocation of a Net
Purchase Payment would cause the amounts credited to the Guaranteed Interest
Account to exceed the $250,000 limit imposed by the Company, that part of a Net
Purchase Payment allocated to the Guaranteed Interest Account which equals the
difference between $250,000 and the amount credited to the Guaranteed Interest
Account on the date the allocation is to be made will be accepted (and credited
to the Guaranteed Interest Account) but the remainder of such allocation will be
returned to the Certificateholder.
Cash Value. The Certificate's Cash Value will reflect the investment
performance of the selected Subaccount(s) of the Variable Account, amounts
credited to the Guaranteed Interest Account, any Net Purchase Payments, any
partial surrenders, and all charges imposed in connection with the Certificate.
There is no guaranteed minimum Cash Value, except to the extent Net Purchase
Payments have been allocated to the Guaranteed Interest Account, and because a
Certificate's Cash Value at any future date will be dependent on a number of
variables, it cannot be predetermined.
Determination of Cash Value. The Cash Value of the Certificate is
determined on each Valuation Date. The Cash Value will be calculated first on
the Certificate Date and thereafter on each Valuation Date. On the Certificate
Date, the Certificate's Cash Value will be the Net Purchase Payments received
plus any interest credited on those Payments. During the period when Net
Purchase Payments are held in the General Account, interest will be credited to
the Certificate. (See "Issuance of the Certificate" at page 12.) After
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<PAGE> 18
allocation of the amounts in the General Account to the Variable Account or to
the Guaranteed Interest Account, on each Valuation Date, the Certificate's Cash
Value will be:
(1) The aggregate of the Cash Values attributable to the Certificate
in each of the Subaccounts on the Valuation Date, determined for each
Subaccount by multiplying the Subaccount's Unit value on that date by the
number of Subaccount Units allocated to the Certificate; plus
(2) any amount credited to the Guaranteed Interest Account (which
shall be the aggregate of all Net Purchase Payments, plus interest
credited, if any, plus or minus amounts transferred, if any, less partial
surrenders, if any, less any charges and deductions imposed in accordance
with the Certificate terms detailed in the Prospectus), plus
(3) any Net Purchase Payment received on that Valuation Date; less
(4) any partial surrender amount and its Surrender Charge made on that
Valuation Date; less
(5) any Annual Certificate Charge deductible on that Valuation Date.
In computing the Certificate's Cash Value, the number of Subaccount Units
allocated to the Certificate is determined after any transfers among Subaccounts
(and deduction of transfer charges) or between one or more of the Subaccounts
and the Guaranteed Interest Account, but before any other Certificate
transactions, such as receipt of Net Purchase Payments and partial surrenders,
on the Valuation Date. If the Certificate's Cash Value is to be calculated for a
day that is not a Valuation Date, the next following Valuation Date will be
used.
Transfers. After the Free Look Period has expired, the value attributable
to the Certificate may be transferred among the Subaccounts of the Variable
Account. There is no minimum amount that need be transferred. The Company will
effectuate transfers and determine all values in connection with transfers among
the Subaccounts on the date on which the transfer request is received at the
Operations Center, if that date is a Valuation Date and, if not, on the next
Valuation Date. Different provisions apply to transfers involving the Guaranteed
Interest Account. (See "Allocation of Net Purchase Payments and Cash Value --
Transfers Involving the Guaranteed Interest Account" at page 16.) Transfers may
be made by sending a written request to the Operations Center or by telephone,
subject to the rules of the Company and its right to terminate telephone
transfers. If a written transfer request is incomplete or incorrect, no transfer
will be made and the request will be returned to the Certificateholder.
Telephone transfer instructions will only be accepted if complete and correct.
The Company has adopted Guidelines relating to telephone transfers which, among
other things, outlines procedures to be followed which are designed, and which
the Company believes are reasonable, to prevent unauthorized transfers. If these
procedures are followed, the Company shall not be liable for, and the
Certificateholder will therefore bear the entire risk of, any loss as a result
of the Company's following telephone instructions in the event that such
instructions prove to be fraudulent. A copy of the Guidelines and the Company's
form for electing telephone transfers is available from licensed agents of the
Company who are also registered representatives of MSC or a broker-dealer
authorized by MSC to offer the Certificates, or by calling 1-800-487-6669. The
Company's form must be signed and received at the Company's Syracuse Operations
Center before telephone transfers will be accepted.
A transfer charge will not be imposed on the first 4 transfers made during
any Certificate Year. (See "Charges Against Cash Value -- Transfer Charge" at
page 21.) For any additional transfers during a Certificate Year, a transfer
charge is not currently imposed, but the Company has reserved the right to
impose a charge for each transfer in excess of 4, which will not exceed $25 per
transfer. If imposed, the transfer charge will be deducted from the
Subaccount(s) or the Guaranteed Interest Account from which the amounts are
transferred. This charge is in addition to the amount transferred. If, however,
there is insufficient Cash Value in a Subaccount or in the Guaranteed Interest
Account to provide for its proportionate share of the charge, then the entire
charge will be allocated in the same manner as the Annual Certificate Charge.
(See "Charges Against Cash Value -- Annual Certificate Charge" at page 20.) All
transfers included in a single request are treated as one transfer transaction.
A transfer resulting from the first reallocation of Cash Value at the expiration
of the Free Look Period will not be subject to a transfer charge, nor will it be
counted against the
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<PAGE> 19
4 transfers allowed in each Certificate Year without charge. Under present law,
transfers are not taxable transactions.
Transfers Involving the Guaranteed Interest Account. Transfers to or from
the Guaranteed Interest Account are subject to the following limitations. The
prior approval of the Company is required before it will accept that part of a
transfer which would cause amounts credited to the Guaranteed Interest Account
to exceed $250,000. The portion of any transfer which cannot be made because of
such limitation will be allocated back to the Subaccounts designated in that
transfer as the Subaccounts from which amounts were to be transferred in the
proportion that the amount requested by the Certificateholder to be transferred
from each Subaccount bears to the total amount transferred. Transfers of amounts
credited to the Guaranteed Interest Account to one or more Subaccounts may be
made once during each Certificate Year, and the amount which may be transferred
is limited to the greater of (i) 25% of the amounts credited to the Guaranteed
Interest Account of the Certificateholder on the date the transfer would take
effect or (ii) $5,000. Transfer requests involving the Guaranteed Interest
Account will be effective only on an anniversary of the Certificate Date or on a
Valuation Date not more than 30 days thereafter. Requests received not more than
10 days before the anniversary of the Certificate Date will be executed on the
anniversary of the Certificate Date. Requests received within 30 days after the
anniversary of the Certificate date will be executed on the Valuation Date which
coincides with or next follows the date the request is received. Requests
received more than thirty days before or after the anniversary of the
Certificate Date will be returned to the Certificateholder.
TERMINATION OF THE CERTIFICATE
The Certificate will remain in force until the earlier of (1) the date the
Certificate is surrendered in full, (2) the Annuity Commencement Date, (3) the
Certificate Anniversary on which, after deduction for any Annual Certificate
Charge then due, no Cash Value remains in the Certificate, and (4) the date the
Death Benefit is payable under the Certificate.
SURRENDERS
At any time on or before the Annuity Commencement Date and during the
lifetime of the Annuitant, the Certificateholder may elect to make a surrender
of all or part of the Certificate's value. Any such election shall specify the
amount of the surrender and will be effective on the date a proper request is
received by the Company at its Operations Center.
The amount of the surrender may be equal to the Certificate's Surrender
Value, which is its Cash Value less (1) any applicable Surrender Charge and (2)
(for a full surrender) any Annual Certificate Charge. The Surrender may also be
for a lesser amount (a "partial surrender") of at least $100. If a partial
surrender is requested, and that surrender would leave a Cash Value of less than
$1,000, then that partial surrender will be treated and processed as a full
surrender, and the entire Surrender Value will be paid to the Certificateholder.
For a partial surrender, any Surrender Charge will be in addition to the amount
requested by the Certificateholder.
A surrender will result in the cancellation of Units and the withdrawal of
amounts credited to the Guaranteed Interest Account, in accordance with the
directions of the Certificateholder, with an aggregate value equal to the dollar
amount of the surrender plus, if applicable, the Annual Certificate Charge and
any Surrender Charge. For a partial surrender, the Company will cancel Units of
the particular Subaccounts and withdraw amounts from the Guaranteed Interest
Account in accordance with the allocation specified by the Certificateholder in
written notice to the Company at its Operations Center at the time the request
for the partial surrender is received; provided, however, that allocations by a
Certificateholder against the Guaranteed Interest Account will be limited (the
"GIA Allocation Limitation") to that amount which bears the same proportion to
the total amount being surrendered as the amount credited to the Guaranteed
Interest Account of the Certificateholder bears to the total of (i) all amounts
credited to the Guaranteed Interest Account of the Certificateholder and (ii)
the aggregate value of Units held in all Subaccounts of the Certificateholder,
unless there is no Cash Value in any Subaccount at the time the transfer request
is received. Allocations may be by either amount or percentage. Allocations by
amount require that at least $25 be allocated against the
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<PAGE> 20
Guaranteed Interest Account or any Subaccount designated by the
Certificateholder. If there is insufficient Cash Value in the
Certificateholder's Guaranteed Interest Account or a Subaccount to provide for
the requested allocation against it, or if the GIA Allocation Limitation is
exceeded, or the request is incorrect, the request will not be accepted. If an
allocation is not requested, then the entire amount of the partial surrender
will be allocated against the Guaranteed Interest Account and each Subaccount in
the same proportion that the Certificate's Cash Value held in the Guaranteed
Interest Account and each Subaccount bears to the Certificate's Cash Value.
Any Surrender Charge will be allocated against the Guaranteed Interest
Account and each Subaccount in the same proportion that the amount of a partial
surrender allocated against the Guaranteed Interest Account and each Subaccount
bears to the total amount of the partial surrender. In the event that an
allocation of the partial surrender is not made, or there is insufficient cash
value in the Guaranteed Interest Account or any Subaccount to provide for its
proportionate share of the Surrender Charge, then the entire Surrender Charge
will be allocated against the Guaranteed Interest Account and each Subaccount in
the same proportion that the Cash Value held in the Guaranteed Interest Account
and each Subaccount (after allocation of the partial surrender amount) bears to
the Certificate's Cash Value.
Any cash surrender amount will be paid within seven (7) days from the date
the election becomes effective, except as the Company may be permitted to
postpone such payment in accordance with the Investment Company Act of 1940.
Postponement is currently permissible only (1) for any period (a) during which
the New York Stock Exchange is closed other than customary weekend and holiday
closings, or (b) during which trading on the New York Stock Exchange is
restricted as determined by the Securities and Exchange Commission, (2) for any
period during which an emergency exists as a result of which (a) disposal of
securities held by the Fund is not reasonably practicable, or (b) it is not
reasonably practicable to determine the value of the net assets of the Fund, or
(3) for such other periods as the Securities and Exchange Commission may by
order permit for the protection of Certificateholders. Any cash surrender
involving payment from amounts credited to the Guaranteed Interest Account may,
to the extent amounts are paid from the Guaranteed Interest Account, be
postponed, at the option of the Company, for up to 6 months from the date the
request for a surrender or proof of death is received by the Company. The
Certificateholder may elect to have the amount of a surrender settled under one
of the Settlement Options of the Certificate. (See "Annuity Provisions" at page
22.)
Since the Certificates offered by this Prospectus may be issued in
connection with retirement plans that meet the requirements of certain sections
of the Internal Revenue Code, reference should be made to the terms of the
particular retirement plan for any limitations or restrictions on cash
surrenders.
The tax consequences of a cash surrender should be carefully considered
(see "Federal Tax Status" at page 28).
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<PAGE> 21
DEATH BENEFIT
DEATH BENEFIT PROVIDED BY THE CERTIFICATE
In the event of the death of the Annuitant (and the Contingent Annuitant,
if one has been named) (see "Contingent Annuitant" at page 25) prior to the
Annuity Commencement Date, the Company will pay a Death Benefit to the
Beneficiary. The amount of the Death Benefit will be the greater of (a) the Cash
Value on the date of the Annuitant's death, and (b) the Purchase Payments paid,
less any partial surrenders and their Surrender Charges. If the death of the
Annuitant occurs on or after the Annuity Commencement Date, no Death Benefit
will be payable except as may be provided under the Settlement Option elected.
ELECTION AND EFFECTIVE DATE OF ELECTION
During the lifetime of the Annuitant and prior to the Annuity Commencement
Date, the Certificateholder may elect to have the Death Benefit of the
Certificate applied under one or more Settlement Options to effect an annuity
for the Beneficiary as payee after the death of the Annuitant. (See "Settlement
Options" at page 22.) If no election of a Settlement Option for the Death
Benefit is in effect on the date when proceeds become payable, the Beneficiary
may elect (a) to receive the Death Benefit in the form of a cash payment; or (b)
to have the Death Benefit applied under one of the Settlement Options. (See
"Settlement Options" at page 22.) If an election by the payee is not received by
the Company within thirty (30) days following the date proceeds become payable,
the payee will be deemed to have elected a cash payment. Either election
described above may be made by filing with the Company a written election in
such form as the Company may require. Any proper election of a method of
settlement of the Death Benefit by the Certificateholder will become effective
on the date it is signed, but any election will be subject to any payment made
or action taken by the Company before receipt of the notice at the Company's
Operations Center.
Reference should be made to the terms of any applicable retirement plan and
any applicable legislation for any limitations or restrictions on the election
of a method of settlement and payment of the Death Benefit.
PAYMENT OF DEATH BENEFIT
If the Death Benefit is to be paid in cash to the Beneficiary, payment will
be made within seven (7) days of the date the election becomes effective or is
deemed to become effective and due proof of death is received, except as the
Company may be permitted to postpone such payment in accordance with the
Investment Company Act of 1940. If the Death Benefit is to be paid in one sum to
the Successor Beneficiary, or to the estate of the deceased Annuitant, payment
will be made within seven (7) days of the date due proof of the death of the
Annuitant and the Beneficiary is received by the Company. Interest at a rate
determined by the Company will be paid on any Death Benefit paid in one sum,
from the date of the Annuitant's (or Contingent Annuitant's, if applicable)
death to the date of payment. The interest rate will not be less than 2 3/4
percent annually.
CHARGES AND DEDUCTIONS
No separate charges are assessed the Group Contractholder. Charges may be
assessed under the Certificates as follows:
DEDUCTIONS FROM PAYMENTS
A deduction may be made from each Purchase Payment for premium or similar
taxes prior to allocation of any Net Purchase Payment among the Subaccounts of
the Variable Account. Currently, the Company does not make such a deduction, but
may do so in the future. The Company will provide the Certificateholder with
written notice of its intention to make deductions for premium or other taxes.
Any such deduction will apply only to Purchase Payments made after notice has
been sent by the Company. The amount of the deduction will vary from locality to
locality, but will generally range from 0 percent to 3.5 percent of Purchase
Payments. Residents of the Commonwealth of Pennsylvania should be aware that a
tax on Purchase Payments has been
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<PAGE> 22
adopted; however, the Company currently is assuming responsibility for payment
of this tax. In the event that the Company will begin to make deductions for
such tax from future Purchase Payments, it will give notice to each affected
Contractholder.
CHARGES AGAINST CASH VALUE
Surrender Charge. The Certificate imposes a contingent deferred sales
charge, called a "Surrender Charge," on full and partial surrenders and on the
Annuity Commencement Date. The Surrender Charge, which will never exceed 7
percent of total Purchase Payments, is intended to reimburse the Company for
expenses incurred in distributing the Certificate. To the extent such charge is
insufficient to cover all distribution costs, the Company will make up the
difference using funds from its General Account, which may contain funds
deducted from the Variable Account to cover mortality and expense risks borne by
the Company. (See "Mortality and Expense Risk Charge" at page 21.)
If all or a portion of the Certificate's Surrender Value (see "Surrenders"
at page 16) is surrendered or if the Surrender Value is received at maturity on
the Annuity Commencement Date, a Surrender Charge will be calculated at the time
of surrender and will be deducted from the Cash Value. A Surrender Charge will
not be imposed against Cash Value surrendered in a Certificate Year up to an
amount equal to Net Purchase Payments made by the Certificateholder prior to the
Certificate Year of the surrender and the preceding 7 Certificate Years. In
addition, the Surrender Charge, which otherwise would have been deducted, will
not be deducted to the extent necessary to permit the Certificateholder to
obtain an amount equal to the Guaranteed Free Surrender Amount ("Guaranteed Free
Surrender Amount"). (See "Guaranteed Free Surrender Amount" at page 20.) No
Surrender Charge will be imposed if the surrender is a full surrender and the
following conditions are met: (i) the Annuitant is age 59 1/2 or older on the
date of the full surrender; (ii) the Certificate has been in force for at least
10 Certificate Years; and (iii) one or more Purchase Payments were remitted
during each of at least 7 of the 10 Certificate Years immediately preceding the
date of surrender. In addition, no Surrender Charge will be imposed if the
Certificate is surrendered after the third Certificate Year and the surrender
proceeds are paid under either Settlement Option 3 or Settlement Option 3A (See
"Settlement Options" at page 22). In no event will the aggregate Surrender
Charge exceed 7 percent of the total Purchase Payments made in the Year of the
surrender and during the 7 preceding Certificate Years. The Certificate Date and
Certificate Years shall remain unchanged as a result of the Merger.
For a partial surrender, the Surrender Charge will be deducted from any
remaining Certificate Value, if sufficient; otherwise, it will be deducted from
the amount surrendered. Any Surrender Charge will be allocated against the
Guaranteed Interest Account and each Subaccount of the Variable Account in the
same proportion that the amount of the partial surrender allocated against the
Guaranteed Interest Account and each Subaccount bears to the total amount of the
partial surrender. But, if there is insufficient cash value in the Guaranteed
Interest Account or any Subaccount to provide for its proportionate share of the
charge, then the entire charge will be allocated against the Guaranteed Interest
Account and each Subaccount in the same proportion that the Cash Value held in
the Guaranteed Interest Account and each Subaccount bears to the cash value in
the Guaranteed Interest Account and all Subaccounts.
No Surrender Charge will be deducted from Death Benefits. (See "Death
Benefit" at page 18.)
For purposes of determining the Surrender Charge, surrenders will be
attributed to payments on a first-in, first-out basis. Certificateholders should
note that this is different from the allocation method that is used for
determining tax obligations. (See "Federal Tax Status" at page 28.)
Amount of Surrender Charge. The amount of Surrender Charge is determined
as follows:
Step 1. Allocate Purchase Payments on a first-in, first-out basis to the
amount surrendered (any Purchase Payments previously allocated to
calculate a surrender charge are unavailable for allocation to
calculate any future surrender charges); and
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<PAGE> 23
Step 2. Multiply each such allocated Purchase Payment by the appropriate
surrender charge percentage determined on the basis of the table
below:
SURRENDER CHARGE PERCENTAGE TABLE
<TABLE>
<CAPTION>
# OF CONTRACT SURRENDER
ANNIVERSARIES SINCE CHARGE
PURCHASE PAYMENT RECEIVED PERCENTAGE
- ------------------------- ----------
<S> <C>
0 7%
1 7
2 6
3 6
4 5
5 4
6 3
7 2
8 (or more) 0
</TABLE>
Step 3. Add the products of each multiplication in Step 2 above.
Guaranteed Free Surrender Amount. The Surrender Charge may be reduced by
using the Guaranteed Free Surrender Amount provided for in the Certificate. For
Non-Qualified Certificates (and Certificates issued for IRA and SEP-IRA) in
certain states which have granted approval, the Guaranteed Free Surrender Amount
provides that an amount up to 10% of the Certificate's Cash Value (on the date
the first partial surrender request is received during a Certificate Year) may
be surrendered without application of a surrender charge. For Qualified
Certificates (other than Certificates issued for IRA and SEP-IRA) in certain
states which have granted approval, the Guaranteed Free Surrender Amount
provides that the greater of $10,000 (but not more than the Certificate's Cash
Value) or 10% of the Certificate's Cash Value (on the date the first partial
surrender request is received during a Certificate Year) may be surrendered
without application of surrender charge. (See a registered representative of MSC
or of a broker-dealer authorized by MSC to offer the Certificates who is also a
licensed agent of the Company for which states have granted approval.) In those
states where approval has not been granted, the Guaranteed Free Surrender Amount
provides that up to 10% of the Certificate's Cash Value (on the date the partial
surrender request is received) may be surrendered without application of a
surrender charge, provided that no prior partial surrender was made during that
Certificate Year. Since Purchase Payments are allocated on a first-in, first-out
basis, the free surrender amount will not reduce surrender charges to the extent
that any Cash Value in that amount is equal to Purchase Payments received 8 or
more Certificate Anniversaries ago. The Company reserves the right to limit the
number of partial surrender requests to not more than 12 per Certificate Year.
For illustrations of how the Surrender Charge is calculated, see Appendix A
on page A-1 of this Prospectus.
Annual Certificate Charge. The Company has primary responsibility for the
administration of the Certificate and the Variable Account. Ordinary
administrative expenses expected to be incurred include premium collection,
recordkeeping, processing death benefit claims and surrenders, preparing and
mailing reports, and overhead costs. In addition, the Company expects to incur
certain additional administrative expenses in connection with the issuance of
the Certificate, including the review of applications and the establishment of
Certificate records.
The Company intends to administer the Certificate itself.
An Annual Certificate Charge will be deducted from the Certificate's Cash
Value to help cover administrative expenses. Currently, the amount of the charge
is $30, but it may be increased to as much as $50 on 30 days' written notice to
the Certificateholder. The charge will be deducted on (a) each Certificate
Anniversary prior to the Annuity Commencement Date, (b) the Annuity Commencement
Date, and (c) the date of full surrender (if that date is not a Certificate
Anniversary). The amount of the charge will be allocated against the Guaranteed
Interest Account and each Subaccount of the Variable Account in the same
proportion that the Cash Value in the Guaranteed Interest Account and each
Subaccount bears to the Cash
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<PAGE> 24
Value of the Certificate. The Company does not expect to make any profit from
the administrative cost deductions.
Transfer Charge. The Company has reserved the right to impose a transfer
charge, which will not exceed $25, for each transfer instructed by the
Certificateholder among the Subaccounts or to or from the Guaranteed Interest
Account and one or more of the Subaccounts in excess of 4 transfers in a
Certificate Year, to compensate the Company for the costs of effectuating the
transfer. Currently, the Company does not do so. The Company does not expect to
make a profit from the transfer charge. This charge will be deducted from the
Certificate's Cash Value held in the Subaccount(s) from which the transfer is
made, or from the Guaranteed Interest Account if a transfer is made therefrom,
and will be allocated against these Subaccount(s) or the Guaranteed Interest
Account in the same proportion as the amounts transferred. If there is
insufficient value in a Subaccount or the Guaranteed Interest Account to provide
for that Subaccount's or the Guaranteed Interest Account's proportionate share
of the charge, then the entire charge will be allocated in the same manner as
the Annual Certificate Charge. (See "Charges Against Cash Value -- Annual
Certificate Charge" at page 20.)
MORTALITY AND EXPENSE RISK CHARGE
A daily charge will be deducted from the value of the net assets of the
Variable Account to compensate the Company for mortality and expense risks
assumed in connection with the Certificate. This daily charge from the Variable
Account will be at the rate of 0.003425 percent (equivalent to an annual rate of
1.25 percent) of the average daily net assets of the Variable Account. Of the
1.25 percent charge, .80 percent is for assuming mortality risks, and .45
percent is for assuming expense risks. The daily charge will be deducted from
the net asset value of the Variable Account, and therefore the Subaccounts, on
each Valuation Date. These charges will not be deducted from the Guaranteed
Interest Account. Where the previous day (or days) was not a Valuation Date, the
deduction on the Valuation Date will be 0.003425 percent multiplied by the
number of days since the last Valuation Date.
The Company believes that this level of charge is within the range of
industry practice for comparable flexible payment variable annuity contracts.
The mortality risk assumed by the Company is that Annuitants may live for a
longer time than projected, and that an aggregate amount of annuity benefits
greater than that projected will accordingly be payable. In making this
projection, the Company has used the mortality rates from the 1983 Table "a"
(discrete functions without projections for future mortality), with 3 percent
interest. The expense risk assumed is that expenses incurred in issuing and
administering the Certificates will exceed the administrative charges provided
in the Certificates.
The Company does not expect to make a profit from the mortality and expense
risk charge. Should, however, the amount of the charge exceed the amount needed,
the excess will be retained by the Company in its general account. Should the
amount of the charge be inadequate, the Company will pay the difference out of
its general account.
TAXES
Currently, no charge will be made against the Variable Account for federal
income taxes. The Company may, however, make such a charge in the future if
income or gains within the Variable Account will incur any federal income tax
liability. Charges for other taxes, if any, attributable to the Variable Account
may also be made. (See "Federal Tax Status" at page 28.)
INVESTMENT ADVISORY FEE
Because the Variable Account purchases shares of the Fund, the net assets
of the Variable Account will reflect the investment advisory fee and other
expenses incurred by the Fund. Quest for Value Advisors, a subsidiary of
Oppenheimer Capital, as investment adviser to the Fund, will receive .60 percent
of the aggregate average daily net assets of the Equity, Small Cap, and Managed
Portfolios; .50 percent of the
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<PAGE> 25
aggregate average daily net assets of the Bond Portfolio; and .40 percent of the
aggregate average daily net assets of the Money Market Portfolio. The investment
adviser will reimburse the Fund for the amount, if any, by which the aggregate
ordinary operating expenses of any of these Portfolios incurred by the Fund in
any calendar year in which shares are being offered exceed the most restrictive
expense limitations then in effect under any state securities law or regulation.
Currently, the most restrictive expense limitation in effect limits expenses of
each Fund Portfolio to an amount equal to 2.5 percent of the first $30 million
of average daily net assets of the Portfolio, 2.0 percent of the next $70
million of average daily net assets of the Portfolio, and 1.5 percent of the
average daily net assets of the Portfolio in excess of $100 million.
ANNUITY PROVISIONS
ANNUITY COMMENCEMENT DATE
Annuity payments under a Certificate will begin on the Annuity Commencement
Date that is selected by the Certificateholder at the time the Certificate is
applied for. The Annuity Commencement Date chosen may be no earlier than the
Certificate Anniversary nearest the Annuitant's 10th birthday, and no later than
the Certificate Anniversary nearest the Annuitant's 85th birthday. The minimum
number of years from the Certificate Date to the Annuity Commencement Date is
10. The Annuity Commencement Date may be advanced to a date not earlier than the
10th Certificate Anniversary or deferred from time to time by the
Certificateholder by written notice to the Company, provided that (1) notice of
such deferral or advance is received by the Company prior to the then current
Annuity Commencement Date, and (2) the new Annuity Commencement Date is a date
which is not later than the Certificate Anniversary nearest the Annuitant's 85th
birthday. A particular retirement plan may contain other restrictions.
On the Annuity Commencement Date, the Certificate's Surrender Value will be
applied to provide an annuity or any other option previously chosen by the
Certificateholder and permitted by the Company. A supplementary contract will be
issued, and that contract will set forth the terms of the settlement. No
payments may be requested under the Certificate's surrender provisions after the
Annuity Commencement Date, and no surrender will be permitted except as may be
available under the Settlement Option elected.
For Certificates issued in connection with retirement plans, reference
should be made to the terms of the particular retirement plan for any
limitations or restrictions on the Annuity Commencement Date.
ELECTION AND CHANGE OF SETTLEMENT OPTION
During the lifetime of the Annuitant and prior to the Annuity Commencement
Date, the Certificateholder may elect one or more of the Settlement Options
described below, or such other settlement option (including a lump-sum payment)
as may be agreed to by the Company. The Certificateholder may also change any
election, but written notice of an election or change of election must be
received by the Company at its Operations Center prior to the Annuity
Commencement Date. If no election is in effect on the Annuity Commencement Date,
Settlement Option 3, for a Life Annuity with 10 years certain, based on the
Annuitant's life, will be deemed to have been elected.
Settlement Options may also be elected by the Certificateholder or the
Beneficiary as provided in the Death Benefit and Surrender sections of this
Prospectus. (See "Death Benefit" at page 18 and "Surrenders" at page 16.)
Where applicable, reference should be made to the terms of a particular
retirement plan and any applicable legislation for any limitations or
restrictions on the options that may be elected.
SETTLEMENT OPTIONS
Proceeds settled under the Settlement Options listed below or otherwise
currently available will not participate in the investment experience of the
Variable Account.
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<PAGE> 26
Settlement Option 1 -- Interest Income: Interest on the proceeds at a rate
(not less than 2 3/4 percent per year) set by the Company each year.
Settlement Option 2 -- Income for Specified Period: Fixed monthly payments
for a specified period of time, as elected. The payments may, at the Company's
option, be increased by additional interest each year.
Settlement Option 3 -- Single Life Income: Payments for the life of the
payee and for a period certain. The period certain may be (a) 0 years, 10 years,
or 20 years, or (b) the period required for the total income payments to equal
the proceeds (refund period certain). The amount of the income will be
determined by the Company on the date the proceeds become payable.
Settlement Option 3A -- Joint Life Income: Payments during the joint
lifetime of the payee and one other person, and during the lifetime of the
survivor. The survivor's monthly income may be equal to either (a) the income
payable during the joint lifetime or (b) two-thirds of that income. If a person
for whom this option is chosen dies before the first monthly payment is made,
the survivor will receive proceeds instead under Settlement Option 3, with 10
years certain.
Settlement Option 4 -- Income of Specified Amount: Income, of an amount
chosen, for as long as the proceeds and interest last. The amount chosen to be
received as income in each year may not be less than 10 percent of the proceeds
settled. Interest will be credited annually on the amount remaining unpaid at a
rate determined annually by the Company. This rate will not be less than 2 3/4
percent per year.
The Certificate contains annuity payment rates for Settlement Options 3 and
3A described in this Prospectus. The rates show, for each $1,000 applied, the
dollar amount of the monthly fixed annuity payment, when this payment is based
on minimum guaranteed interest as described above.
The annuity payment rates may vary according to the Settlement Option
elected and the age of the payee. The mortality table used in determining the
annuity payment rates for Options 3 and 3A is the 1983 Table "a" (discrete
functions, without projections for future mortality), with 3 1/2 percent
interest.
Under Settlement Option 3, if income based on the period certain elected is
the same as the income provided by another available period or periods certain,
the Company will deem the election to have been made of the longest period
certain.
In Qualified Plans, settlement options available to Certificateholders may
be restricted by the terms of the plans.
FREQUENCY OF ANNUITY PAYMENTS
Annuity payments will be paid as monthly installments unless the payee
requests quarterly, semiannual, or annual installments at the time the option is
chosen. However, if the net amount available to apply under any Settlement
Option under any circumstances is less than $1,000, the Company shall have the
right to pay such amount in one lump sum. In addition, if the payments provided
for would be less than $25, the Company shall have the right to change the
frequency of payments to such intervals as will result in payments of at least
$25.
ADDITIONAL PROVISIONS
The Company may require proof of age of the Annuitant before making any
life annuity payment provided for by the Certificate. If the age of the
Annuitant has been misstated, the amount payable will be the amount that the
amount settled would have provided at the correct age. Once life income payments
have begun, any underpayments will be made up in one sum with the next annuity
payment; overpayments will be deducted from the future annuity payments until
the total is repaid.
The Certificate must be returned to the Company upon any settlement. Prior
to any settlement of a death claim, due proof of the Annuitant's death must be
submitted to the Company.
Where any benefits under the Certificate are contingent upon the
recipient's being alive on a given date, the Company may require proof
satisfactory to it that such condition has been met.
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<PAGE> 27
The Certificates described in this Prospectus contain annuity payment rates
that distinguish between men and women. On July 6, 1983, the Supreme Court held
in Arizona Governing Committee v. Norris that optional annuity benefits provided
under an employer's deferred compensation plan could not, under Title VII of the
Civil Rights Act of 1964, vary between men and women on the basis of sex.
Because of this decision, the annuity payment rates applicable to Certificates
purchased under an employment-related insurance or benefit program may in some
cases not vary on the basis of the Annuitant's sex. Unisex rates to be provided
by the Company will apply for Qualified Plans and those plans where an employer
believes that the Norris decision applies.
Employers and employee organizations should consider, in consultation with
legal counsel, the impact of Norris, and Title VII generally, and any comparable
state laws that may be applicable, on any employment-related plan for which a
Certificate may be purchased.
OTHER PROVISIONS
OWNERSHIP
The Certificateholder has all rights and may receive all benefits under the
Certificate. During the lifetime of the Annuitant (and the Contingent Annuitant
if one has been named), the Certificateholder shall be the person so designated
in the application, unless changed, or unless a Successor Certificateholder
becomes the Certificateholder. On and after the death of the Annuitant (and the
Contingent Annuitant, if applicable), the Beneficiary shall be the
Certificateholder.
The Certificateholder may name a Successor Certificateholder or a new
Certificateholder at any time. If the Certificateholder dies, the Successor
Certificateholder, if living, becomes the Certificateholder. Any request for
change must be: (1) made in writing; and (2) received at the Company. The change
will become effective as of the date the written request is signed. A new choice
of Certificateholder or Successor Certificateholder will not apply to any
payment made or action taken by the Company prior to the time a request for
change is received. Certificateholders should consult a competent tax advisor
prior to changing Certificateholders.
PROVISION REQUIRED BY SECTION 72(S) OF THE CODE
If the Certificateholder of a Non-Qualified Plan dies before the Annuity
Commencement Date and while the Annuitant is living, and if that
Certificateholder's spouse is not the Successor Certificateholder as of the date
of that Certificateholder's death (as evidenced by proof satisfactory to the
Company), then the Certificate will be surrendered as of the date of that death.
If the Successor Certificateholder is the Beneficiary, the surrender proceeds
may, at the option of the Successor Certificateholder, be paid over the life of
the Successor Certificateholder. Such payments must begin no later than one year
after such date of death. If the Successor Certificateholder is a surviving
spouse, then the surviving spouse will be treated as the new Certificateholder
of the Certificate. Under such circumstances, it shall not be necessary to
surrender the Certificate. If the spouse is not the Successor Certificateholder
and there is no designated beneficiary, the proceeds must be distributed within
5 years after the date of death. However, under the terms of the Certificate, if
the spouse is not the Successor Certificateholder, the Certificate will be
surrendered as of the date of death and the proceeds will be paid to the
Beneficiary. This provision shall not extend the term of the Certificate beyond
the date when death proceeds become payable.
Further, if the Certificateholder dies on or after the Annuity Commencement
Date, then any remaining portion of the proceeds will be distributed at least as
rapidly as under the method of distribution being used as of the date of the
Certificateholder's death.
PROVISION REQUIRED BY SECTION 401(A)(9) OF THE CODE
The entire interest of a Qualified Plan Participant under the contract will
be distributed to the Certificateholder or his/her designated Beneficiary either
by or beginning not later than April 1 of the calendar
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<PAGE> 28
year following the calendar year in which such Participant attains age 70 1/2.
The period over which such distribution will be made is the life of such
Participant or the lives of such Participant and Designated Beneficiary.
Where distributions have begun in accordance with the previous paragraph
and the Participant dies before Certificateholder's entire interest has been
distributed to him/her, the remaining portion of such interest will be
distributed at least as rapidly as under the method of distribution being used
as of the date of the Participant's death. If the Participant dies before the
commencement of such distributions and there is no Designated Beneficiary, the
Certificate will be surrendered as of the date of death. The surrender proceeds
must be distributed within 5 years after the date of death. But if there is a
Designated Beneficiary, the surrender proceeds may, at the option of the
Designated Beneficiary, be paid over the life of the Designated Beneficiary. In
such case, distributions will begin not later than one year after the
Participant's death. If the Designated Beneficiary is the surviving spouse of
the Participant, the date on which the distributions will begin shall not be
earlier than the date on which the Participant would have attained age 70 1/2.
If the surviving spouse dies before distributions to him/her begin, the
provisions of this paragraph shall be applied as if the surviving spouse were
the Participant. If the Plan is an IRA under Section 408 of the Code, the
surviving spouse may elect to forgo distribution and treat the IRA as his/her
own Plan.
Qualified Plan Certificates include those qualifying for special treatment
under Section 401, 403, and 408 of the Code.
It is the Certificateholder's responsibility to assure that distribution
rules imposed by the Code will be met.
CONTINGENT ANNUITANT
Except where the Certificate is issued in connection with a Qualified Plan,
a Contingent Annuitant may be designated by the Certificateholder. Such
designation may be made once before annuitization, either (1) in the application
for the Certificate, or (2) after the Certificate is issued, by written notice
to the Company at its Operations Center. The Contingent Annuitant may be deleted
by written notice to the Company at its Operations Center. A designation or
deletion of a Contingent Annuitant will take effect as of the date the written
election was signed. The Company, however, must first accept and record the
change at its Operations Center. The change will be subject to any payment made
by the Company or action taken by the Company before receipt of the notice at
the Company's Operations Center. The Contingent Annuitant will be deleted from
the Certificate automatically by the Company as of the Certificate Anniversary
nearest the Contingent Annuitant's 85th birthday.
On the death of the Annuitant, the Contingent Annuitant will become the
Annuitant, under the following conditions:
(1) the death of the Annuitant must have occurred before the Annuity
Commencement Date;
(2) the Contingent Annuitant is living on the date of the Annuitant's
death;
(3) if the Annuitant was the Certificateholder on the date of death,
the Successor Certificateholder must have been the Annuitant's spouse; and
(4) if the Annuity Commencement Date is later than the Certificate
Anniversary nearest the Contingent Annuitant's 85th birthday, the Annuity
Commencement Date will be automatically advanced to that Certificate
Anniversary.
Effect of Contingent Annuitant's Becoming the Annuitant. If the Contingent
Annuitant becomes the Annuitant at the death of the Annuitant, in accordance
with the conditions specified above, the Death Benefit proceeds of the
Certificate will be paid to the Beneficiary only on the death of the Contingent
Annuitant. If the Contingent Annuitant was the Beneficiary on the Annuitant's
death, the Beneficiary will be changed automatically to the person who was the
Successor Beneficiary on the date of death. If there was no Successor
Beneficiary, then the Contingent Annuitant's executors or administrators, unless
the Certificateholder directed
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<PAGE> 29
otherwise, will become the Beneficiary. All other rights and benefits under the
Certificate will continue in effect during the lifetime of the Contingent
Annuitant as if the Contingent Annuitant were the Annuitant.
ASSIGNMENT
The Company will not be bound by any assignment until the assignment (or a
copy) is received by the Company at its Home Office. The Company is not
responsible for the validity or effect of any assignment. The Company shall not
be liable as to any payment or other settlement made by the Company before
receipt of the assignment.
If the Certificate is issued pursuant to certain retirement plans, then it
may not be assigned, pledged or otherwise transferred except under such
conditions as may be allowed under applicable law.
Because an assignment may be a taxable event, a Certificateholder should
consult a competent tax advisor before assigning the Certificate.
CHANGE OF BENEFICIARY
So long as the Certificate is in force, the Beneficiary or Successor
Beneficiary may be changed by written request to the Company at its Operations
Center in a form acceptable to the Company. The Certificate need not be returned
unless requested by the Company. The change will take effect as of the date the
request is signed, whether or not the Annuitant is living when the request is
received by the Company. The Company will not, however, be liable for any
payment made or action taken before receipt and acknowledgement of the request
at its Operations Center.
SUBSTITUTION OF SECURITIES
If the shares of any Portfolio of the Fund should no longer be available
for investment by the Variable Account or, if in the judgment of the Company's
Board of Trustees, further investment in shares of one or more of the Portfolios
of the Fund should become inappropriate in view of the purposes of the
Certificate, the Company may substitute shares of another mutual fund for shares
of the Fund already purchased or to be purchased in the future by Purchase
Payments under the Certificate. A substitution of securities in any Subaccount
will take place only with prior approval of the Securities and Exchange
Commission and under such requirements as it may impose.
MODIFICATION OF THE CONTRACTS AND CERTIFICATES
Upon notice to the Contractholder and the Certificateholder, the Contract
and the Certificate may be modified by the Company, but only if such
modification (1) is necessary to make the Contract or the Certificate or the
Variable Account comply with any law or regulation issued by a governmental
agency to which the Company is subject or (2) is necessary to assure continued
qualification of the Contract and the Certificate under the Internal Revenue
Code or other federal or state laws relating to retirement annuities or annuity
contracts or (3) is necessary to reflect a change in the operation of the
Variable Account or the Subaccounts or the Guaranteed Interest Account or (4)
provides additional Settlement Options or fixed accumulation options. In the
event of any modification, the Company may make appropriate endorsement in the
Contract and the Certificate to reflect such modification.
CHANGE IN OPERATION OF VARIABLE ACCOUNTS
At the Company's election and subject to any necessary vote by persons
having the right to give instructions with respect to the voting of shares of
the Fund held by the Subaccounts, the Variable Account may be operated as a
management company under the Investment Company Act of 1940 or it may be
deregistered under the Investment Company Act of 1940 in the event registration
is no longer required. Deregistration of the Variable Account requires an order
by the Securities and Exchange Commission. In the event of any change in the
operation of the Variable Account pursuant to this provision, the Company may
26
<PAGE> 30
make appropriate endorsement to the Certificate to reflect the change and take
such other action as may be necessary and appropriate to effect the change.
VOTING RIGHTS
All of the assets held in the Subaccounts of the Variable Account will be
invested in shares of the corresponding Portfolios of the Fund. The Company is
the legal holder of those shares and as such has the right to vote to elect the
Board of Trustees of the Fund, to vote upon certain matters that are required by
the 1940 Act to be approved or ratified by the shareholders of a mutual fund,
and to vote upon any other matter that may be voted upon at a shareholder's
meeting. To the extent required by law, the Company will vote the shares of the
Fund held in the Variable Account (whether or not attributable to
Certificateholders) at shareholder meetings of the Fund in accordance with the
instructions received from Certificateholders. The number of votes will be
determined as of the record date selected by the Board of Trustees of the Fund.
The Company will furnish Certificateholders with the proper forms to enable them
to give it these instructions. Currently, the Company may disregard voting
instructions under the circumstances described in the following paragraph.
The Company may, if required by state insurance officials, disregard voting
instructions if those instructions would require shares to be voted to cause a
change in the subclassification or investment objectives or policies of one or
more of the Portfolios of the Fund, or to approve or disapprove an investment
adviser or principal underwriter for the Fund. In addition, the Company itself
may disregard voting instructions that would require changes in the investment
objectives or policies of any Portfolio or in an investment adviser or principal
underwriter for the Fund, if the Company reasonably disapproves those changes in
accordance with applicable federal regulations. If the Company does disregard
voting instructions, it will advise Certificateholders of that action and its
reasons for the action in the next semiannual report to Certificateholders.
Each Certificateholder will have the equivalent of one vote per $100 of
value attributable to the Certificate held in each Subaccount of the Variable
Account, with fractional votes for amounts less than $100. For voting purposes,
this value attributable to the Certificate is equal to the Cash Value. These
votes, represented as votes per $100 of value in each Subaccount of the Variable
Account, are converted into a proportionate number of votes in shares of the
corresponding Portfolio of the Fund. Shares of the Fund held in each Subaccount
for which no timely instructions from Certificateholders are received will be
voted by the Company in the same proportion as those shares in that Subaccount
for which instructions are received. Should applicable federal securities laws
or regulations permit, the Company may elect to vote shares of the Fund in its
own right.
The number of shares of the corresponding Portfolio of the Fund in a
Subaccount for which instructions may be given by a Certificateholder is
determined by dividing the portion of the value attributable to the Certificate
held in that Subaccount by the net asset value of one share in the corresponding
Portfolio of the Fund. In other words, if the value attributable to the
Certificate held in the Subaccount were $540 and the net asset value of the
Fund's shares of the Portfolio held in that Subaccount were $20 per share on the
record date, then the Certificateholder could issue instructions on 5.4 votes
(representing votes per $100 of value attributable to the Certificate held in
the Subaccount), which would be converted into instructions on 27 shares of the
Fund.
Matters on which Certificateholders may give voting instructions include
the following: (1) approval of any change in the Investment Advisory Agreement
and Services Agreement for the Portfolio(s) of the Fund corresponding to the
Certificateholder's selected Subaccount(s); (2) any change in the fundamental
investment policies of the Portfolio(s) corresponding to the Certificateholder's
selected Subaccount(s); and (3) any other matter requiring a vote of the
shareholders of the Fund. With respect to approval of the Investment Advisory
Agreement or any change in a Portfolio's fundamental investment policies,
Certificate holders participating in that Portfolio will vote separately on the
matter pursuant to the requirements of Rule 18f-2 under the 1940 Act.
27
<PAGE> 31
DISTRIBUTION OF THE CONTRACTS AND CERTIFICATES
MONY Securities Corp. ("MSC"), a New York corporation which is a
wholly-owned subsidiary of the Company, will act as the principal underwriter of
the Contracts and the Certificates, pursuant to an underwriting agreement with
the Company. MSC is registered as a broker-dealer under the Securities Exchange
Act of 1934 and is a member of the National Association of Securities Dealers.
The Contracts and the Certificates are sold by individuals who are registered
representatives of MSC and who are also licensed as life insurance agents for
the Company. The Contracts and the Certificates may also be sold through other
broker-dealers authorized by MSC and applicable law to do so. Commissions and
other expenses directly related to the sale of the Certificates will not exceed
6.0 percent of Purchase Payments. Additional compensation may be paid for other
services not directly related to the sale of the Certificates. Such services
include the training of personnel and the production of promotional literature.
FEDERAL TAX STATUS
INTRODUCTION
The Contracts and the Certificates described in this Prospectus are
designed for use by retirement plans that may or may not qualify for favorable
tax treatment under the provisions of Section 401, 403, 408(b), and 457 of the
Code. The ultimate effect of federal income taxes on the value of the
Certificate's Cash Value, on annuity payments, and on the economic benefit to
the Certificateholder, the Annuitant, and the Beneficiary may depend upon the
type of retirement plan for which the Certificate is purchased and upon the tax
and employment status of the individual concerned.
The following discussion of the treatment of the Certificates and of the
Company under the federal income tax laws is general in nature, is based upon
the Company's understanding of current federal income tax laws, and is not
intended as tax advice. Any person contemplating the purchase of a Certificate
should consult a qualified tax adviser. A more detailed description of the
treatment of the Certificate under federal income tax laws is contained in the
Statement of Additional Information. THE COMPANY DOES NOT MAKE ANY GUARANTEE
REGARDING ANY TAX STATUS, FEDERAL, STATE, OR LOCAL, OF ANY CERTIFICATE OR ANY
TRANSACTION INVOLVING THE CERTIFICATES.
TAX TREATMENT OF THE COMPANY
Under existing federal income tax laws, the income of the Variable
Accounts, to the extent that it is applied to increase reserves under the
Certificates, is substantially non-taxable to the Company.
TAXATION OF ANNUITIES IN GENERAL
The Certificates offered by this Prospectus are designed for use in
connection with Qualified Plans and Non-Qualified Plans. All or a portion of the
contributions to such plans will be used to make Purchase Payments under the
Certificates. In general, contributions to Qualified Plans and income earned on
contributions to all plans are tax-deferred until distributed to plan
participants or their beneficiaries. Such tax deferral is not, however,
available for Non-Qualified Plans if the Certificateholder is other than a
natural person unless the Certificate is held as agent for a natural person.
Annuity payments made as retirement distributions under a Certificate, except to
the extent of employee (in the case of Qualified Plans) or Certificateholder (in
the case of Non-Qualified Plans) contributions, are generally taxable to the
annuitant as ordinary income. Certificateholders, Annuitants, and Beneficiaries
should seek qualified advice about the tax consequences of distributions,
withdrawals, and payments under the retirement plans in connection with which
the Certificates are purchased.
The Company has been advised by Quest for Value Advisors, investment
adviser to the Trust, that the Bond Portfolio of the Trust inadvertently did not
comply with the investment diversification requirements of, and regulations
under, Internal Revenue Code Section 817(h) ("817(h) Requirements") during the
period from September 17, 1994 to February 22, 1995. Quest for Value Advisors
also has advised the Company that
28
<PAGE> 32
the bond portfolio of the trust ("Old Trust"), the shares of which were
purchased by purchase payments allocated by Contractholders to the Bond
Subaccount prior to September 17, 1994, also did not comply with the 817(h)
Requirements during the period from December 31, 1993 to September 16, 1994 (the
date on which the Substitution, discussed on page 5 of the Prospectus, of the
shares of the Bond Portfolio were substituted for shares of the bond portfolio
of the Old Trust). The result of the failure to meet the diversification
requirements ("non-diversification") is that the Company is required to file a
request with the Internal Revenue Service for a private letter ruling that the
inadvertent non-diversification will not cause the Contracts of Contractholders
who had purchase payments allocated to the Bond Subaccount during the period
from October 1, 1993 to December 31, 1994 to lose the income tax deferral on the
increase in cash values of those Contracts during such period or otherwise fail
to be considered as an annuity during such period. The request for a private
letter ruling will be filed and will involve payment by the Company of such
penalties to the Internal Revenue Service as may be agreed upon by the Internal
Revenue Service and the Company. The Company has also been advised by Quest for
Value Advisors that revised procedures have been adopted to help assure that the
portfolios will be managed in accordance with the 817(h) Requirements in the
future and that, since February 23, 1995, the portfolios all have been in
compliance with the 817(h) Requirements.
The Company will withhold and remit to the United States Government and,
where applicable, to state governments part of the taxable portion of each
distribution made under a Certificate unless the Certificateholder or Annuitant
provides his or her taxpayer identification number to the Company and notifies
the Company that he or she chooses not to have amounts withheld.
Under the Technical and Miscellaneous Revenue Act of 1988 ("TAMRA"), for
purposes of determining the amount includible in gross income with respect to
distributions not received as an annuity, including deemed distributions
resulting from gratuitous transfers, all annuity contracts issued by the same
company to the same Certificateholder during any 12 month period, other than
those issued to qualified retirement plans, will be treated as one annuity
contract. The IRS is given power to prescribe rules to prevent avoidance of this
rule through special purchases of contracts or otherwise. None of these rules is
expected to affect tax-benefitted plans.
Effective January 1, 1993, distributions of plan benefits from qualified
plans, other than individual retirement arrangements ("IRAs"), generally will be
subject to mandatory federal income tax withholding unless they either are:
1. Part of a series of substantially equal periodic payments (at least
annually) for the participant's life or life expectancy, the joint lives
or life expectancies of the participant and his/her beneficiary, or a
period certain of not less than 10 years; or
2. Required by the Code upon the participant's attainment of age 70 1/2 or
death.
Such withholding can be avoided if the participant's interest is rolled
over into another qualified plan, including an IRA. The withholding can be
avoided if the participant's interest is directly transferred by the old plan to
another eligible qualified plan, including an IRA. A direct transfer to the new
plan can be made only in accordance with the terms of the old plan. If
withholding is not avoided, the amount withheld may be subject to income tax and
excise tax penalties.
Under the generation skipping transfer tax, the Company may be liable for
payment of this tax under certain circumstances. In the event that the Company
determines that such liability exists, an amount necessary to pay the generation
skipping transfer tax may be subtracted from the death benefit proceeds.
ANNUITY CONTRACTS GOVERNED BY SECTION 403(B) OF THE CODE
An annuity contract will not be treated as a Qualified Certificate under
Section 403(b) of the Code unless distributions which are attributable to a
contribution made pursuant to a salary reduction agreement may be paid only: (1)
when the Certificateholder attains age 59 1/2; (2) when the Certificateholder
separates from the service of his employer; (3) when the Certificateholder dies;
(4) when the Certificateholder becomes permanently disabled within the meaning
of Section 72(m) of the Code; or (5) in the case of hardship. These restrictions
generally apply to contributions made after December 31, 1988 and to any
increase in Cash Value
29
<PAGE> 33
of the Certificate after December 31, 1988. Therefore effective January 1, 1989
and thereafter, any contributions made, or increase in Cash Value, on or after
January 1, 1989 will be restricted from withdrawal except upon attainment of age
59 , separation from service, death, disability or hardship (hardship
withdrawals are to be limited to the amount of the Certificateholder's Purchase
Payments). However, any Purchase Payments that reflect employer contributions
and the earnings thereon will not be restricted unless specifically provided for
by the applicable employer's plan.
RETIREMENT PLANS
The Certificates described in this Prospectus are designed for use with the
following types of retirement plans:
(1) Pension and Profit-Sharing Plans established by business employers
and certain associations, as permitted by Sections 401(a) and 401(k) of the
Code, including those purchasers who would have been covered under the
rules governing H.R. 10 (Keogh) Plans;
(2) Individual Retirement Annuities permitted by Sections 219 and
408(b) of the Code, including Simplified Employee Pensions established by
employers pursuant to Section 408(k);
(3) Tax-Sheltered Annuity Plans established by certain educational and
tax-exempt organizations under Section 403(b) of the Code (the Certificates
offered by this Prospectus are not available for sale in connection with
Qualified Plans which intend to qualify for federal income tax advantages
available under Section 403(b) of the Code);
(4) Deferred compensation plans provided by certain governmental
entities under Section 457 of the Code; and
(5) Non-Qualified Plans.
The tax rules applicable to participants in such retirement plans vary
according to the type of plan and its terms and conditions. Therefore, no
attempt is made herein to provide more than general information about the use of
Certificates with the various types of retirement plans. Participants in such
plans as well as Certificateholders, Annuitants, and Beneficiaries are cautioned
that the rights of any person to any benefits under these plans are subject to
the terms and conditions of the plans themselves, regardless of the terms and
conditions of the Certificates. The Company will provide purchasers of
Certificates used in connection with Individual Retirement Annuities with such
supplementary information as may be required by the Internal Revenue Service or
other appropriate agency. Any person contemplating the purchase of a Certificate
should consult a qualified tax adviser.
PERFORMANCE DATA
From time to time the performance of one or more of the Subaccounts may be
advertised. The performance data contained in these advertisements is based upon
historical earnings and is not indicative of future performance. The data for
each Subaccount reflects the results of the corresponding Portfolio of the Fund
and recurring charges and deductions borne by or imposed on the Portfolio and
the Subaccount. Set forth below for each Subaccount is the manner in which the
data contained in such advertisements will be calculated.
Money Market Subaccount. The performance data for this Subaccount will
reflect the "yield" and "effective yield". The "yield" of the Subaccount refers
to the income generated by an investment in the Subaccount over the seven day
period stated in the advertisement. This income is "annualized", that is, the
amount of income generated by the investment during that week is assumed to be
generated each week over a 52-week period and is shown as a percentage of the
investment. The "effective yield" is calculated similarly, but, when annualized,
the income earned by an investment in the Subaccount is assumed to be
reinvested. The "effective yield" will be slightly higher than the "yield"
because of the compounding effect of this assumed reinvestment.
Subaccounts other than the Money Market Subaccount. The performance data
for these Subaccounts will reflect the "yield" and "total return". The "yield"
of each of these Subaccounts refers to the income
30
<PAGE> 34
generated by an investment in that Subaccount over the 30 day period stated in
the advertisement and is the result of dividing that income by the value of the
Subaccount. The value of each Subaccount is the average daily number of Units
outstanding multiplied by the Unit Value on the last day of the period. The
"yield" reflects deductions for all charges, expenses, and fees of both the Fund
and the Variable Account other than the Surrender Charge. "Total return" for
each of these Subaccounts refers to the return a Certificateholder would receive
during the period indicated if a $1,000 Purchase Payment was made the indicated
number of years ago. It reflects historical investment results less charges and
deductions of both the Fund and the Variable Account, including any Surrender
Charge imposed as a result of the full Surrender, with the distribution being
made in cash rather than in the form of one of the settlement options, at the
close of the period for which the "total return" data is given. Returns for
periods exceeding one year reflect the average annual total return for such
period. Total return data may also be shown assuming that the Certificate
continues in force (i.e., was not surrendered) beyond the close of the periods
indicated in which case that data would reflect all charges and deductions of
both the Fund and the Variable Account other than the Surrender Charge. In
addition, to the total return data described above based upon a $1,000
investment, comparable data may also be shown for an investment equal to the
amount of the average purchase payment made by a purchaser of a Certificate
during the prior year.
Non-standardized Performance Data. From time to time, average total return
or other performance data may also be advertised in non-standardized formats.
Non-standardized performance data will be accompanied by standard performance
data, and the period covered or other non-standard features will be disclosed.
In addition, reference in advertisements may be made to various indices,
including without limitation, the Standard & Poor's 500 Stock Index and the
Shearson Lehman Brothers Corporate/Government Index, and to various ranking
services, including, without limitation, the Lipper Annuity and Closed End
Survey compiled by Lipper Analytical Services and the VARDS report compiled by
Variable Annuity Research and Data Service in order to provide the reader a
basis for comparison.
ADDITIONAL INFORMATION
This prospectus does not contain all the information set forth in the
registration statement, certain portions of which have been omitted pursuant to
the rules and regulations of the Securities and Exchange Commission. The omitted
information may be obtained from the Commission's principal office in
Washington, D.C., upon payment of the fees prescribed by the Commission.
For further information with respect to the Company and the Contracts and
Certificates offered by this prospectus, including the Statement of Additional
Information (which includes financial statements relating to the Company),
Contractholders and Certificateholders and prospective investors may also
contact the Company at its address or phone number set forth on the cover of
this Prospectus for requesting such statement. The Statement of Additional
Information is available from the Company without charge.
LEGAL PROCEEDINGS
There are no legal proceedings to which the Variable Account or the
principal underwriter is a party. The Company is engaged in various kinds of
routine litigation which, in the opinion of the Company, are not of material
importance in relation to the total capital and surplus of the Company.
FINANCIAL STATEMENTS
The financial statements for the Company, included in the Statement of
Additional Information, should be considered only as bearing on the ability of
the Company to meet its obligations under the Contracts and Certificates. The
financial statements of the Company should not be considered as bearing on the
investment performance of the assets held in the Variable Account. The financial
statements of the Company and the Variable Account are included in the Statement
of Additional Information.
31
<PAGE> 35
TABLE OF CONTENTS
OF
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1995
<TABLE>
<CAPTION>
ITEM PAGE
- -------------------------------------------------------------------------------------- ----
<S> <C>
The Mutual Life Insurance Company of New York......................................... 1
Legal Opinion......................................................................... 1
Independent Accountants............................................................... 1
Federal Tax Status.................................................................... 1
Performance Data...................................................................... 4
Financial Statements.................................................................. F-1
</TABLE>
If you would like to receive a copy of the MONY Variable Account A
Statement of Additional Information, please return this request to:
The Mutual Life Insurance Company of New York
Mail Drop 76-18
500 Frank W. Burr Boulevard
Teaneck, New Jersey 07666-6888
Your name
Address
City State Zip
Please send me a copy of the MONY Variable Account A Statement of
Additional Information.
Policy C3-88
FORM NO. 13493SL (5/95) 33-37718
32
<PAGE> 36
APPENDIX A
CALCULATION OF SURRENDER CHARGE
ILLUSTRATION 1
Suppose an initial Purchase Payment of $15,000 is the only payment made,
and no taxes are deducted from this payment. At the beginning of the third
Contract Year, the Cash Value of the Contract has grown to $18,000 and the
Contractholder requests a partial surrender of $2,000.
The Surrender Charge is determined as follows:
Step 1: Purchase Payments are allocated to the surrender amount, as
follows:
<TABLE>
<CAPTION>
# OF
CERTIFICATE ANNIVERSARIES AMOUNT AMOUNT AVAILABLE
SINCE PURCHASE PAYMENT CERTIFICATE YEAR ALLOCATED FOR ALLOCATION TO
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER FUTURE SURRENDERS
- ------------------------- ---------------- ------------ -----------------
<S> <C> <C> <C>
0 3 $ 0 $ 0
1 2 0 0
2 1 2,000 13,000
</TABLE>
IF THE CONTRACT IS A NON-QUALIFIED CONTRACT --
Step 2: The Guaranteed Free Surrender Amount is calculated as 10% of the
Cash Value ($1,800). Reduce the resulting amount allocated to
surrender ($2,000) by the Guaranteed Free Surrender Amount
($1,800), and apply the Surrender Charge Percentages as follows:
<TABLE>
<CAPTION>
# OF AMOUNT OF
CERTIFICATE ANNIVERSARIES AMOUNT SURRENDER SURRENDER
SINCE PURCHASE PAYMENT CERTIFICATE YEAR ALLOCATED CHARGE CHARGE
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER PERCENTAGE (AMT X PET)
- ------------------------- ---------------- ------------ ---------- -----------
<S> <C> <C> <C> <C>
0 3 $ 0 7% $ 0
1 2 0 7 0
2 1 200 6 12
</TABLE>
Step 3: Summing the resulting Amounts of Surrender Charge produces a total
Surrender Charge of $12.
The Surrender Charge, plus the amount of the surrender is then deducted
from the remaining Cash Value of the Non-Qualified Contract, for a total
withdrawal of $2,012.
IF THE CONTRACT IS A QUALIFIED CONTRACT --
Step 2: The Guaranteed Free Surrender Amount is calculated as up to the
greater of 10% of the Cash Value ($1,800) of the Qualified Contract or up to
$10,000. Since the partial surrender requested is less than $10,000 (although it
is greater than 10 percent), there is no Surrender Charge.
Since there is no Surrender Charge, the entire amount requested is
available under the Guaranteed Free Surrender Amount provision of the Qualified
Contract.
Assuming that in the middle of the tenth Contract Year, a full surrender is
requested. The Cash Value at the time of full surrender is $28,000. Since this
is a full surrender, the Annual Contract Charge (currently $30) is deducted from
the Cash Value, leaving a remaining Cash Value balance of $27,970. For this
calculation, there is $13,000 of Purchase Payments made in the first Contract
Year.
A-1
<PAGE> 37
The Surrender Charge is determined as follows:
Step 1: Purchase Payments are allocated to the surrender amount, as
follows:
<TABLE>
<CAPTION>
# OF
CONTRACT ANNIVERSARIES AMOUNT
SINCE PURCHASE PAYMENT CONTRACT YEAR ALLOCATED
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER
- ---------------------- ---------------- ------------
<S> <C> <C>
0 0 $ 10
1- 9 0
2 8 0
3 7 0
4 6 0
5 5 0
6 4 0
7 3 0
8 or more 1 and 2 13,000
</TABLE>
IF THE CONTRACT IS A NON-QUALIFIED CONTRACT --
Step 2: The Guaranteed Free Surrender Amount is calculated as up to 10% of
the Cash Value ($2,800) of the Non-Qualified Contract. Reduce the
resulting amount allocated to surrender ($13,000) by the Guaranteed
Free Surrender Amount ($2,800), and apply the Surrender Charge
Percentages as follows:
<TABLE>
<CAPTION>
# OF AMOUNT OF
CERTIFICATE ANNIVERSARIES AMOUNT SURRENDER SURRENDER
SINCE PURCHASE PAYMENT CERTIFICATE YEAR ALLOCATED CHARGE CHARGE
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER PERCENTAGE (AMT X PET)
- ------------------------- ---------------- ------------ ---------- -----------
<S> <C> <C> <C> <C>
0 0 $ 10 0% $ 7
1 9 0 7 0
2 8 0 6 0
3 7 0 6 0
4 6 0 5 0
5 5 0 4 0
6 4 0 3 0
7 3 0 2 0
8 or more 1 and 2 10,200 0 0
</TABLE>
Step 3: Summing the resulting Amounts of Surrender Charge produces a total
Surrender Charge of $0.
A-2
<PAGE> 38
IF THE CONTRACT IS A QUALIFIED CONTRACT --
Step 2: The Guaranteed Free Surrender Amount is calculated as up to the
greater of 10% of the Cash Value ($2,800) of the Qualified Contract
or up to $10,000. Reduce the resulting amount allocated to
surrender ($13,000) by the Guaranteed Free Surrender Amount
($10,000), and apply the Surrender Charge Percentages as follows:
<TABLE>
<CAPTION>
# OF
CERTIFICATE ANNIVERSARIES AMOUNT OF
SINCE PURCHASE AMOUNT SURRENDER SURRENDER
PAYMENT CERTIFICATE YEAR ALLOCATED CHARGE CHARGE
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER PERCENTAGE (AMT X PET)
- ------------------------ ---------------- ------------ ---------- -----------
<S> <C> <C> <C> <C>
0 10 $ 0 7% $ 0
1 9 0 7 0
2 8 0 6 0
3 7 0 6 0
4 6 0 5 0
5 5 0 4 0
6 4 0 3 0
7 3 0 2 0
8 or more 1 and 2 3,000 0 0
</TABLE>
Step 3: Summing the resulting Amounts of Surrender Charge produces a total
Surrender Charge of $0.
Since there are no Purchase Payments such that 7 or less policy
anniversaries had passed since they were received, no part of the surrender
proceeds are subject to a Surrender Charge. Hence, no Surrender Charge is
assessed on this full surrender.
ILLUSTRATION 2
Suppose Purchase Payments of $2,000 are made at the beginning of every
Contract Year. No taxes are deducted from these Payments. In the middle of the
third Contract Year, a partial surrender of $500 is requested. Suppose the Cash
Value has grown to $7,000 at the time of the partial surrender request.
The Surrender Charge is determined as follows:
Step 1: Purchase Payments are allocated to the surrender amount, as
follows:
<TABLE>
<CAPTION>
# OF
CERTIFICATE ANNIVERSARIES
SINCE PURCHASE AMOUNT AMOUNT AVAILABLE
PAYMENT CERTIFICATE YEAR ALLOCATED FOR ALLOCATION TO
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER FUTURE SURRENDERS
- ------------------------- ---------------- ------------ -----------------
<S> <C> <C> <C>
0 3 $ 0 $ 2,000
1 2 0 2,000
2 1 500 1,500
</TABLE>
IF THE CONTRACT IS A NON-QUALIFIED CONTRACT --
Step 2: The Guaranteed Free Surrender Amount is calculated as up to 10% of
the Cash Value ($700) of the Non-Qualified Contract. Reduce the
resulting amount allocated to surrender ($500) by the Guaranteed
Free Surrender Amount ($700), and apply the Surrender Charge
Percentages as follows:
<TABLE>
<CAPTION>
# OF
CERTIFICATE ANNIVERSARIES AMOUNT OF
SINCE PURCHASE AMOUNT SURRENDER SURRENDER
PAYMENT CERTIFICATE YEAR ALLOCATED CHARGE CHARGE
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER PERCENTAGE (AMT X PET)
- ------------------------- ---------------- ------------ ---------- -----------
<S> <C> <C> <C> <C>
0 3 $0 7% $ 0
1 2 0 7 0
2 1 0 6 0
</TABLE>
Step 3: Summing the resulting Amounts of Surrender Charge produces a total
Surrender Charge of $0.
A-3
<PAGE> 39
The partial surrender will be allocated to $500 of payments made in the
first Contract Year. But since 10 percent of the Cash Value ($700) of the
Non-Qualified Contract could be surrendered under the Guaranteed Free Surrender
Amount Provision, the partial surrender of $500 could be withdrawn without a
surrender charge.
IF THE CONTRACT IS A QUALIFIED CONTRACT --
Step 2: The Guaranteed Free Surrender Amount is calculated as up to the
greater of 10% of the Cash Value ($700) of the Qualified Contract
or up to $10,000. Since the partial surrender requested is less
than $10,000 and less than 10% there is no surrender charge.
Since there is no Surrender Charge, the entire amount requested is
available under the Guaranteed Free Surrender Amount provision of the Qualified
Contract.
Assume that Purchase Payments of $2,000 have continually been made at the
beginning of each Contract Year, and that in the middle of the tenth Contract
Year, a partial surrender of $7,500 is requested. The Cash Value is $32,600 at
the time of the partial surrender request.
The Surrender Charge is determined as follows:
Step 1: Purchase Payments are allocated to the surrender amount, as
follows:
<TABLE>
<CAPTION>
# OF CERTIFICATE
ANNIVERSARIES SINCE AMOUNT AMOUNT AVAILABLE
PURCHASE PAYMENT CERTIFICATE YEAR ALLOCATED FOR ALLOCATION TO
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER FUTURE SURRENDERS
- ------------------------- ---------------- ------------ -----------------
<S> <C> <C> <C>
0 10 $ 0 $ 2,000
1 9 0 2,000
2 8 0 2,000
3 7 0 2,000
4 6 0 2,000
5 5 0 2,000
6 4 2,000 0
7 3 2,000 0
8 or more 1 and 2 3,500 0
</TABLE>
IF THE CONTRACT IS A NON-QUALIFIED CONTRACT
Step 2: The Guaranteed Free Surrender Amount is calculated as 10% of the
Cash Value ($3,260) of the Non-Qualified Contract. Reduce the
resulting amount allocated to surrender ($3,500) in Contract Years
1 and 2 by the Guaranteed Free Surrender Amount ($3,260), and apply
the Surrender Charge Percentages as follows:
<TABLE>
<CAPTION>
# OF CERTIFICATE AMOUNT OF
ANNIVERSARIES SINCE AMOUNT SURRENDER SURRENDER
PURCHASE PAYMENT CERTIFICATE YEAR ALLOCATED CHARGE CHARGE
RECEIVED BY US PAYMENT RECEIVED TO SURRENDER PERCENTAGE (AMT X PET)
- ------------------------- ---------------- ------------ ---------- -----------
<S> <C> <C> <C> <C>
6 4 $2,000 3% $60
7 3 2,000 2 40
8 or more 1 and 2 240 0 0
</TABLE>
Step 3: Summing the resulting Amounts of Surrender Charge produces a total
Surrender Charge of $100.
The Surrender Charge, plus the amount of the surrender is then deducted
from the remaining Cash Value of the Non-Qualified Contract, for a total
withdrawal of $7,600.
IF THE CONTRACT IS A QUALIFIED CONTRACT
A-4
<PAGE> 40
Step 2: The Guaranteed Free Surrender Amount is calculated as up to the
greater of 10% of the Cash Value ($3,260) of the Qualified Contract
or up to $10,000. Since the partial surrender requested is less
than $10,000 (although it is greater than 10 percent), there is no
surrender charge.
Since there is no Surrender Charge, the entire amount requested is
available under the Guaranteed Free Surrender Amount provision of the Qualified
Contract.
Assuming that in the middle of the twelfth Contract Year, a full surrender
with the full proceeds being settled under Settlement Option 3, Single Life
Income for 10 years certain and during the balance of the annuitant's lifetime,
payments of $2,000 have continuously been made at the beginning of each contract
year. The Cash Value at the time of the full surrender is $26,000. Since this
example assumes a full surrender is being made, the Annual Contract Charge
(currently $30) is deducted from the Cash Value, leaving a remaining Cash Value
of $25,970.
Since the full proceeds are being applied to Settlement Option 3, the
Surrender Charge is $0. The entire remaining Cash Value of $25,970 is applied to
the settlement option.
A-5
<PAGE> 41
THE VALUEMASTER
STATEMENT OF ADDITIONAL INFORMATION
DATED MAY 1, 1995
GROUP FLEXIBLE PAYMENT
VARIABLE ANNUITY CONTRACT
ISSUED BY
MONY VARIABLE ACCOUNT A
AND
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
This Statement of Additional Information is not a prospectus, but it
relates to, and should be read in conjunction with, the prospectus dated May 1,
1995 for the Group Flexible Payment Variable Annuity Contract ("Contract")
issued by The Mutual Life Insurance Company of New York ("Company"). The
prospectus is available, at no charge, by writing the Company at 500 Frank W.
Burr Boulevard, Teaneck, New Jersey, 07666-6888, Mail Drop 76-18 or by calling
1-800-487-6669.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ITEM PAGE
- ---- ----
<S> <C>
The Mutual Life Insurance Company of New York......................................... 1
Legal Opinion......................................................................... 1
Independent Accountants............................................................... 1
Federal Tax Status.................................................................... 1
Performance Data...................................................................... 4
Financial Statements.................................................................. F-1
FORM NO. 13493 SL (5/95) 33-37718
</TABLE>
<PAGE> 42
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
The Mutual Life Insurance Company of New York ("Company") is a mutual life
insurance company organized under the laws of the state of New York in 1842. The
principal offices of the Company are at 1740 Broadway, New York, New York 10019.
The Company had total assets under management at the end of 1994 of
approximately $17.7 billion. During 1993, the Company completed the sale of its
group pension division to AEGON USA, Inc. ("AEGON"). As a result of the sale,
assets and liabilities of up to $6.3 billion will be transferred to AEGON and
various subsidiaries through a series of transactions, including reinsurance.
The Company is licensed to sell insurance and annuities in all states of the
United States, the District of Columbia, Puerto Rico, the Virgin Islands, and
all Provinces of Canada.
At May 1, 1995, the rating assigned to the Company by A.M. Best Company,
Inc., an independent insurance company rating organization, was Company A-
(Excellent) based upon an analysis of financial condition and operating
performance through the end of 1993. The A.M. Best rating of the Company should
be considered only as bearing on the ability of the Company to meet its
obligations under the Certificates.
LEGAL OPINION
Legal matters relating to federal securities laws applicable to the issue
and sale of the Contracts and the Certificates and all matters of New York law
pertaining to the Contracts and the Certificates, including the validity of the
Contracts and the Certificates and the Company's right to issue the Contracts
and the Certificates, have been passed upon by Edward P. Bank, Esq., Vice
President and Deputy General Counsel, of the Company.
INDEPENDENT ACCOUNTANTS
The financial statements included herein have been audited by Coopers &
Lybrand L.L.P., independent accountants, and are included herein in reliance on
the reports of said firm given on the authority of that firm as experts in
accounting and auditing. Coopers & Lybrand's office is located at 1301 Avenue of
the Americas, New York, New York 10019.
FEDERAL TAX STATUS
INTRODUCTION
The Certificate is designed for use to fund retirement plans which may or
may not be Qualified Plans under the provisions of the Internal Revenue Code
(the "Code"). The ultimate effect of federal income taxes on the Certificate
value, on annuity payments, and on the economic benefit to the
Certificateholder, Annuitant, or Beneficiary depends on the type of retirement
plan for which the Certificate is purchased and upon the tax and employment
status of the individual concerned. The discussion contained herein is general
in nature and is not intended as tax advice. Each person concerned should
consult a competent tax adviser. No attempt is made to consider any applicable
state or other tax laws. Moreover, the discussion herein is based upon the
Company's understanding of current federal income tax laws as they are currently
interpreted. No representation is made regarding the likelihood of continuation
of those current federal income tax laws or of the current interpretations by
the Internal Revenue Service.
TAXATION OF ANNUITIES IN GENERAL
Section 72 of the Code governs taxation of annuities in general. Except in
the case of certain corporate and other non-individual Certificateholders, there
are no income taxes on increases in the value of a Certificate until a
distribution occurs, in the form of a full surrender, a partial surrender, a
death benefit, an assignment or gift of the Certificate, or as annuity payments.
1
<PAGE> 43
SURRENDERS, DEATH BENEFITS, ASSIGNMENTS AND GIFTS
A Certificateholder who fully surrenders his or her Certificate is taxed on
the portion of the payment that exceeds his or her cost basis in the
Certificate. For Non-Qualified Certificates, the cost basis is generally the
amount of the Purchase Payments made for the Certificate, and the taxable
portion of the surrender payment is taxed as ordinary income. For Qualified
Certificates, the cost basis is generally zero, except to the extent of
non-deductible employer contributions, and the taxable portion of the surrender
payment is generally taxed as ordinary income subject to special elective 5-year
(and, for certain eligible persons, 10-year) income averaging in the case of
Qualified Certificates. A Beneficiary entitled to receive a lump sum death
benefit upon the death of the Annuitant is taxed on the portion of the amount
that exceeds the Certificateholder's cost basis in the Certificate. If the
Beneficiary elects to receive annuity payments within 60 days of the Annuitant's
death, different tax rules apply. (See "Annuity Payments" below.)
Partial surrenders received under Non-Qualified Certificates prior to
annuitization are first included in gross income to the extent Surrender Value
exceeds Purchase Payments, less prior non-taxable distributions, and the balance
is treated as a non-taxable return of principal to the Certificateholder. For
partial surrenders under a Qualified Certificate, payments are generally
prorated between taxable income and non-taxable return of investment.
There are special rules for Qualified Plans or contracts involving 85
percent or more employee contributions. Since the cost basis of Qualified
Certificates is generally zero, however, partial surrender amounts will
generally be fully taxed as ordinary income.
A Certificateholder who assigns or pledges a Non-Qualified Certificate is
treated as if he or she had received the amount assigned or pledged and thus is
subject to taxation under the rules applicable to surrenders. A
Certificateholder who gives away the Certificate (i.e., transfers it without
full and adequate consideration) to anyone other than his or her spouse is
treated for income tax purposes as if he or she had fully surrendered the
Certificate.
ANNUITY PAYMENTS
The non-taxable portion of each annuity payment is determined by an
"exclusion ratio" formula which establishes the ratio that the cost basis of the
Certificate bears to the total expected value of annuity payments for the term
of the annuity. The remaining portion of each payment is taxable. Such taxable
portion is taxed at ordinary income rates. For Qualified Certificates, the cost
basis is generally zero. With annuity payments based on life contingencies, the
payments will become fully taxable once the Annuitant lives longer than the life
expectancy used to calculate the non-taxable portion of the prior payments.
Conversely, a tax deduction in the Annuitant's last taxable year, equal to the
unrecovered cost basis, is available if the Annuitant does not live to life
expectancy.
PENALTY TAX
Payments received by Certificateholders, Annuitants, and Beneficiaries
under both Qualified and Non-Qualified Certificates may be subject to both
ordinary income taxes and a penalty tax equal to 10 percent of the amount
received that is includable in income. The penalty is not imposed on amounts
received: (a) after the taxpayer attains age 59 1/2; (b) in a series of
substantially equal payments made for life or life expectancy following
separation from service; (c) after the death of the Certificateholder (or, where
the Certificateholder is not a human being, the death of the Annuitant); (d) if
the taxpayer is totally disabled; (e) upon early retirement under the plan after
the taxpayer's attainment of age 55; or (f) which are used for certain medical
care expenses. Exceptions (e) and (f) do not apply to Individual Retirement
Accounts and Annuities and Non-Qualified Certificates. An additional exception
for Non-Qualified Certificates is amounts received as an immediate annuity.
2
<PAGE> 44
INCOME TAX WITHHOLDING
The Company is required to withhold federal, and, where applicable, state,
income taxes on taxable amounts paid under the Certificate unless the recipient
elects not to have withholding apply. The Company will notify recipients of
their right to elect not to have withholding apply.
Effective January 1, 1993, distributions of plan benefits from qualified
plans, other than individual retirement arrangements ("IRAs"), generally will be
subject to mandatory federal income tax withholding unless they either are:
1. Part of a series of substantially equal periodic payments (at least
annually) for the participant's life or life expectancy, the joint lives or
life expectancies of the participant and his/her beneficiary, or a period
certain of not less than 10 years; or
2. Required by the Code upon the participant's attainment of age
70 1/2 or death.
Such withholding can be avoided if the participant's interest is rolled
over into another qualified plan, including an IRA. The withholding can be
avoided if the participant's interest is directly transferred by the old plan to
another eligible qualified plan, including an IRA. A direct transfer to the new
plan can be made only in accordance with the terms of the old plan. If
withholding is not avoided, the amount withheld may be subject to income tax and
excise tax penalties.
DIVERSIFICATION STANDARDS
The United States Secretary of the Treasury has the authority to set
standards for diversification of the investments underlying variable annuity
contracts (other than pension plan contracts). The Secretary of the Treasury has
issued certain regulations. Further regulations may be issued. The Funds are
designed to be managed to meet the diversification requirements for the
Certificate as those requirements may change from time to time. The Company
intends to satisfy those requirements so that the Certificate will be treated as
an annuity contract. The Secretary of the Treasury has announced that he expects
to issue regulations or Revenue Rulings that will prescribe the circumstances in
which a Certificateholder's control of the investments of a segregated asset
account may cause the Certificateholder, rather than the insurance company, to
be treated as the owner of the assets of the account. The regulations or Revenue
Rulings could impose requirements that are not reflected in the Certificate. The
Company, however, has reserved certain rights to alter the Certificate and
investment alternatives so as to comply with such regulations or Revenue
Rulings. Since the regulations or Revenue Rulings have not been issued, there
can be no assurance as to the content of such regulations or Revenue Rulings or
even whether application of the regulations or Revenue Rulings will be
prospective. For these reasons, Certificateholders are urged to consult with
their own tax advisers.
QUALIFIED PLANS
The Certificate is designed for use with several types of Qualified Plans.
The tax rules applicable to participants in such Qualified Plans vary according
to the type of plan and the terms and conditions of the plan itself. Moreover,
many of these tax rules were changed by the Tax Reform Act of 1986. Therefore,
no attempt is made herein to provide more than general information about the use
of the Certificate with the various types of Qualified Plans. Participants under
such Qualified Plans as well as Certificateholders, Annuitants, and
Beneficiaries are cautioned that the rights of any person to any benefits under
such Qualified Plans may be subject to the terms and conditions of the plans
themselves, regardless of the terms and conditions of the Certificate issued in
connection therewith. Following are brief descriptions of the various types of
Qualified Plans and of the use of the Certificate in connection therewith.
Purchasers of the Certificate should seek competent advice concerning the terms
and conditions of the particular Qualified Plan and use of the Certificate with
that plan.
TAX-SHELTERED ANNUITIES
Section 403(b) of the Code permits public school employees and employees of
certain types of charitable organizations specified in Section 501(c)(3) of the
Code and certain educational organizations to purchase
3
<PAGE> 45
annuity contracts and, subject to certain contribution limitations, exclude the
amount of Purchase Payments from gross income for tax purposes. However, such
Purchase Payments may be subject to Social Security (FICA) taxes. These annuity
contracts are commonly referred to as "Tax-Sheltered Annuities." The
Certificates are not available for sale to Qualified Plans which intend to
qualify for federal income tax advantages under Section 403(b).
H.R. 10 PLANS
The Self-Employed Individuals Tax Retirement Act of 1962, as amended, which
is commonly referred to as "H.R. 10," permits self-employed individuals to
establish Qualified Plans for themselves and their employees. The tax
consequences to participants under such plans depend upon the plan itself. In
addition, such plans are limited by law to maximum permissible contributions,
distribution dates, and tax rates applicable to distributions. In order to
establish such a plan, a plan document, usually in prototype form preapproved by
the Internal Revenue Service, is adopted and implemented by the employer.
INDIVIDUAL RETIREMENT ACCOUNTS AND ANNUITIES
Section 408 of the Code permits eligible individuals to contribute to
individual retirement programs known as "Individual Retirement Accounts" and
"Individual Retirement Annuities." These Individual Retirement Accounts and
Annuities are subject to limitations on the amounts which may be contributed,
the persons who may be eligible, and on the time when distributions may
commence. In addition, distributions from certain types of Qualified Plans may
be placed on a tax-deferred basis into an Individual Retirement Account or
Annuity.
CORPORATE PENSION AND PROFIT-SHARING PLANS
Sections 401(a) and 403(a) of the Code permit corporate employers to
establish various types of retirement plans for employees. Such retirement plans
may permit the purchase of the Certificate to provide benefits under the plans.
CERTAIN GOVERNMENTAL ENTITIES
Section 457 of the Code permits certain governmental entities to establish
deferred contribution plans. Such deferred contribution plans may permit the
purchase of the Certificate to provide benefits under the plans.
PERFORMANCE DATA
The Equity, Small Cap, Managed, Bond, and Money Market Subaccounts will be
used to purchase shares of the corresponding portfolios of the Quest for Value
Accumulation Trust. Those portfolios will be managed according to the same
investment objectives, policies, and techniques as the portfolios of the same
name of the Enterprise Accumulation Trust, the shares of which were previously
available for purchase by the Company with purchase payments made by ValueMaster
Certificateholders. The performance shown below should not be taken as an
indication of future performance of the portfolios of the Quest for Value
Accumulation Trust.
Shares of the Enterprise Accumulation Trust were redeemed in kind at the
close of business on September 16, 1994, and the assets received were used to
purchase shares of the Quest for Value Accumulation Trust (see "The
Substitution" at page 5 of the Prospectus and "Prospectus Summary" at page 3 of
the accompanying prospectus for the Quest for Value Accumulation Trust).
MONEY MARKET SUBACCOUNT
For the seven-day period ended December 31, 1994, the yield was 4.29% and
the effective yield was 4.30%.
4
<PAGE> 46
The yield was calculated by dividing the result of subtracting the value of
one Unit at the end of the seven day period ("Seventh Day Value") from the value
of one Unit at the beginning of the seven day period ("First Day Value") by the
First Day Value (the resulting quotient being the "Base Period Return") and
multiplying the Base Period Return by 365 divided by 7 to obtain the annualized
yield.
The effective yield was calculated by compounding the Base Period Return
calculated in accordance with the preceding paragraph, adding 1 to the Base
Period Return, raising that sum to a power equal to 365 divided by 7 and
subtracting 1 from the result.
As the Money Market Subaccount invests only in shares of the Money Market
Portfolio of the Fund, the First Day Value reflects the per share net asset
value of the Money Market Portfolio (which will normally be $1.00) and the
number of shares of the Money Market Portfolio of the Fund held in the Money
Market Subaccount. The Seventh Day Value reflects increases or decreases in the
number of shares of the Money Market Portfolio of the Fund held in the Money
Market Subaccount due to the declaration of dividends (in the form of shares and
including dividends (in the form of shares) on shares received as dividends) of
the net investment income and the daily charges and deductions from the
Subaccount for mortality and expense risks and a deduction for the Annual
Certificate Charge imposed on each Certificate Anniversary which has been
pro-rated to reflect the shortened 7-day period and allocated to the Money
Market Subaccount in the proportion that the total value of the Money Market
Subaccount bore to the total value of the Variable Account at the end of the
period indicated. Net investment income reflects earnings on investments less
expenses of the Fund including the Investment Advisory Fee (which for
calculating the yield and effective yield quoted above is assumed to be .40
percent, the fee which would be charged based upon the amount of assets under
management on the last day of the period for which the quoted yield is stated).
Not reflected in either the yield or effective yield are surrender charges,
which will not exceed 7% of total Purchase Payments made prior to the
Certificate Year of surrender and the preceding 7 Certificate Years.
SUBACCOUNTS OTHER THAN MONEY MARKET SUBACCOUNT
TOTAL RETURN
The total return for the Subaccounts other than the Money Market
Subaccount, assuming that the Certificates remain in force throughout the
periods, is shown in the table below. This table does not reflect the impact of
the tax laws, if any, on total return as a result of the surrender.
MONY VARIABLE ACCOUNT A
TOTAL RETURN
(ASSUMING $1,000 PAYMENT AT BEGINNING
OF PERIOD AND SURRENDER AT END OF PERIOD)
<TABLE>
<CAPTION>
FOR THE PERIOD SINCE INCEPTION
THROUGH DECEMBER 31, 1994
SUBACCOUNT (AVERAGE ANNUAL
- ---------- ------------------------------
<S> <C>
Equity.............................................................. -27.78%
Small Cap........................................................... -22.77%
Managed............................................................. -33.14%
Bond................................................................ -21.93%
</TABLE>
- ---------------
Although MONY Variable Account A commenced operations in February 1991, the
Subaccounts shown above became available for allocation on September 17, 1994.
Total return for the period since inception reflects the total return since that
date. Total return is not indicative of future performance.
The table above assumes that a $1,000 payment was made to each Subaccount
at the beginning of the period shown, that no further payments were made, that
any distributions from the corresponding Portfolio of the Fund were reinvested,
and that the Certificateholder surrendered the Certificate for cash, rather than
electing commencement of annuity benefits in the form of one of the Settlement
Options available, at the end
5
<PAGE> 47
of the period shown. The total return percentages shown in the table reflect the
historical rates of return, deductions for all charges, expenses, and fees of
both the Fund (including the Investment Advisory Fee described in the Prospectus
(see "Investment Advisory Fee" at page 20) and the Variable Account which would
be imposed on the payment assumed, including a contingent deferred sales
(Surrender) charge imposed as a result of the full surrender and a deduction for
the Annual Certificate Charge imposed on each Certificate Anniversary and upon
full surrender and allocated to each Subaccount in the proportion that the total
value of that Subaccount bore to the total value of the Variable Account at the
end of the period indicated. Total return since inception is annualized.
The total return for the Subaccounts other than the Money Market
Subaccount, assuming that the Certificates remain in force throughout the
periods indicated, is shown in the table below.
MONY VARIABLE ACCOUNT A
TOTAL RETURN
(ASSUMING $1,000 PAYMENT AT BEGINNING OF
PERIOD AND CERTIFICATE CONTINUES IN FORCE)
<TABLE>
<CAPTION>
FOR THE PERIOD SINCE INCEPTION
THROUGH DECEMBER 31, 1994
SUBACCOUNT (AVERAGE ANNUAL)
- ---------- ------------------------------
<S> <C>
Equity.............................................................. -9.17%
Small Cap........................................................... -3.33%
Managed............................................................. -15.45%
Bond................................................................ -2.35%
</TABLE>
- ---------------
Although MONY Variable Account A commenced operations in February 1991, the
Subaccounts shown above became available for allocation on September 17, 1994.
Total return for the period since inception reflects the total return since that
date. Total return is not indicative of future performance.
The table above reflects the same assumptions and results as the table
appearing on page 5, except that no contingent deferred sales (surrender) charge
has been deducted. The data reflected in the table above reflects the total
return a Certificateholder would have received during that period if he did not
surrender his Certificate.
In addition to the total returns shown above, total returns may also be
shown for the average purchase payment made by a purchaser of the Certificate.
For 1994, the average purchase payment made was assumed to be $25,000. The
following tables show total returns calculated on the same basis as the two
tables above, except that the purchase payment is $25,000.
MONY VARIABLE ACCOUNT A
TOTAL RETURN
(ASSUMING $25,000 PAYMENT AT BEGINNING OF
PERIOD AND SURRENDER AT END OF PERIOD)
<TABLE>
<CAPTION>
FOR THE PERIOD SINCE INCEPTION
THROUGH DECEMBER 31, 1994
SUBACCOUNT (AVERAGE ANNUAL)
- ---------- ------------------------------
<S> <C>
Equity.............................................................. -22.78%
Small Cap........................................................... -22.77%
Managed............................................................. -33.14%
Bond................................................................ -21.93%
</TABLE>
- ---------------
Although MONY Variable Account A commenced operations in February 1991, the
Subaccounts shown above became available for allocation on September 17, 1994.
Total return for the period since inception reflects the total return since that
date. Total return is not indicative of future performance.
6
<PAGE> 48
MONY VARIABLE ACCOUNT A
TOTAL RETURN
(ASSUMING $25,000 PAYMENT AT BEGINNING OF
PERIOD AND SURRENDER AT END OF PERIOD)
<TABLE>
<CAPTION>
FOR THE PERIOD SINCE INCEPTION
THROUGH DECEMBER 31, 1994
SUBACCOUNT (AVERAGE ANNUAL)
- ---------- ------------------------------
<S> <C>
Equity.............................................................. -9.17%
Small Cap........................................................... -3.33%
Managed............................................................. -15.45%
Bond................................................................ -2.35%
</TABLE>
- ---------------
Although MONY Variable Account A commenced operations in February 1991, the
Subaccounts shown above became available for allocation on September 17, 1994.
Total return for the period since inception reflects the total return since that
date. Total return is not indicative of future performance.
30-DAY YIELD:
The yield for each of the Subaccounts other than the Money Market
Subaccount is shown for the 30-day periods indicated in the following table.
MONY VARIABLE ACCOUNT A
YIELD FOR 30-DAY PERIOD
<TABLE>
<CAPTION>
YIELD FOR 30 DAYS ENDED EQUITY SMALL CAP MANAGED BOND
- ----------------------- ------ --------- ------- ----
<S> <C> <C> <C> <C>
December 31, 1994....................................... .65% -.27% 1.35% 4.92%
</TABLE>
- ---------------
The 30-day yield is not indicative of future results.
The yield shown in the table above is computed by subtracting from the net
investment income of the corresponding Portfolio of the Fund charges and
expenses imposed by the Variable Account and dividing the result by the value of
the Subaccount. For the Equity and Small Cap Portfolios and for the stocks and
equity securities of the Managed Portfolio of the Fund, net investment income is
the net of the dividends accrued (of the stated dividend rate multiplied by the
number of days the particular security is in the Portfolio) on all equity
securities during the 30-day period and expenses accrued for the period. It does
not reflect capital gains or losses. For the Bond Portfolio and the debt
obligations held by the Managed Portfolio of the Fund, net investment income is
the net of interest earned on the obligation held by the Portfolio and expenses
accrued for the period. Interest earned on the obligation is determined by (i)
computing the yield to maturity based on the market value of each obligation
held in the corresponding Portfolio at the close of business on the thirtieth
day of the period (or as to obligations purchased during that 30-day period,
based on the purchase price plus accrued interest); (ii) dividing the yield to
maturity for each obligation by 360; (iii) multiplying that quotient by the
market value of each obligation (including actual accrued interest) for each day
of the subsequent 30-day month that the obligation is in the Portfolio; and (iv)
totaling the interest on each obligation. Discount or premium amortization is
recomputed at the beginning of each 30-day period and with respect to discount
and premium on mortgage or other receivables-backed obligations subject to
monthly payment of principal and interest, discount and premium is amortized on
the remaining security, based on the cost of the security, to the weighted
average maturity date, if available, or to the remaining term of the security,
if the weighted average maturity date is not available. Gain or loss
attributable to actual monthly paydowns is reflected as an increase or decrease
in interest income during that period.
The yield shown reflects deductions for all charges, expenses, and fees of
both the Fund and the Variable Account other than the contingent deferred sales
(surrender) charge. The surrender charge will not exceed 7% of total Purchase
Payments made in the Certificate Year of surrender and the preceding 7
Certificate Years.
7
<PAGE> 49
Net investment income of the corresponding Portfolio less all charges and
expenses imposed by the Variable Account is divided by the product of the
average daily number of Units outstanding and the value of one Unit on the last
day of the period. The sum of the quotient and 1 is raised to the 6th power, 1
is subtracted from the result, and then multiplied by 2.
OTHER NON-STANDARDIZED PERFORMANCE DATA:
From time to time, average annual total return or other performance data
may also be advertised in non-standardized formats. Non-standard performance
data will be accompanied by standard performance data, and the period covered or
other non-standard features will be disclosed.
YEAR TO DATE TOTAL RETURN:
The tables below show total returns for the year to date (January 1, 1995
to February 10, 1995) which have not been annualized and which assume a $1,000
and a $25,000 payment made at the beginning of the period and reflecting the
same assumptions and results as the table appearing at the top of page 6,
except, in the case of the column headed "Certificate Continues In Force", no
contingent deferred sales (surrender) charge or annual contract charge has been
deducted:
MONY VARIABLE ACCOUNT A
YEAR TO DATE TOTAL RETURN
JANUARY 1 TO FEBRUARY 10, 1995
(ASSUMING $1,000 PAYMENT AT BEGINNING OF PERIOD)
<TABLE>
<CAPTION>
SURRENDER AT CERTIFICATE CONTINUES
SUBACCOUNT END OF PERIOD IN FORCE
- ---------- ------------- ---------------------
<S> <C> <C>
Equity............................................... -.47% 6.04%
Small Cap............................................ -9.00% -1.63%
Managed.............................................. -.22% 7.39%
Bond................................................. -5.59% 1.53%
</TABLE>
MONY VARIABLE ACCOUNT A
YEAR TO DATE TOTAL RETURN
JANUARY 1 TO FEBRUARY 10, 1995
(ASSUMING $25,000 PAYMENT AT BEGINNING OF PERIOD)
<TABLE>
<CAPTION>
SURRENDER AT CERTIFICATE CONTINUES
SUBACCOUNT END OF PERIOD IN FORCE
- ---------- ------------- ---------------------
<S> <C> <C>
Equity............................................... -.23% 6.04%
Small Cap............................................ -7.99% -1.63%
Managed.............................................. 1.09% 7.39%
Bond................................................. -4.79% 1.53%
</TABLE>
FINANCIAL STATEMENTS
The financial statements of the Company should be distinguished from the
financial statements of the Variable Account. The financial statements of the
Company should be considered only as bearing upon the ability of the Company to
meet its obligations under the Contracts and Certificates and should not be
considered as bearing on the investment performance of the assets held in the
Variable Account. The financial statements of the Company and the Variable
Account are included in the Statement of Additional Information.
8
<PAGE> 50
FINANCIAL STATEMENTS AND NOTES TO FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
With respect to MONY Variable Account A
Report of Independent Accountants................................................... F-2
Statements of assets and liabilities as of December 31, 1994........................ F-3
Statements of operations for the year ended December 31, 1994....................... F-6
Statements of changes in net assets for the years ended December 31, 1994 and
1993............................................................................. F-9
Notes to financial statements....................................................... F-12
With respect to The Mutual Life Insurance Company of New York:
Comment on financial statements of MONY............................................. F-16
Report of Independent Accountants................................................... F-17
Balance sheets as of December 31, 1994 and 1993..................................... F-18
Statements of operations for the years ended December 31, 1994 and 1993............. F-19
Statements of surplus for the years ended December 31, 1994 and 1993................ F-20
Statements of cash flows for the years ended December 31, 1994 and 1993............. F-21
Notes to financial statements....................................................... F-22
</TABLE>
F-1
<PAGE> 51
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees of
Mutual Life Insurance Company of New York and the
Contractholders of MONY Variable Account A:
We have audited the accompanying statements of assets and liabilities of
MONY Variable Account A (comprising, respectively, the MONY Series Fund, Inc.'s
Equity Growth, Equity Income, Intermediate Term Bond, Long Term Bond,
Diversified, Money Market and Government Securities Subaccounts, the Quest for
Value Accumulation Trust's Money Market, Bond, Equity, Small Cap, and Managed
Subaccounts, and the Enterprise Accumulation Trust's Equity, Small Cap, Managed
(formerly, three of the subaccounts constituting the Quest for Value
Accumulation Trust), International Growth and High Yield Bond Subaccounts) as of
December 31, 1994, the related statements of operations for the year then ended
for all of the subaccounts except MONY Series Fund's Government Securities for
which the period is from December 16, 1994 (commencement of operations) to
December 31, 1994, Quest for Value Accumulation Trust's Subaccounts for which
the period is from September 17, 1994 (commencement of operations) to December
31, 1994 and the Enterprise Accumulation Trust's International Growth and High
Yield Bond Subaccounts for which the period is from November 22, 1994
(commencement of operations) to December 31, 1994 and the statements of changes
in net assets for each of the two years in the period then ended or for the
periods as described above. These financial statements are the responsibility of
MONY'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. Our procedures included
confirmation of securities owned as of December 31, 1994 by correspondence with
the custodian. 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 financial position of each of the respective
subaccounts constituting MONY Variable Account A as of December 31, 1994, and
the results of their operations and the changes in their net assets for each of
the periods referred to above, in conformity with generally accepted accounting
principles.
COOPERS & LYBRAND L.L.P.
New York, New York
February 21, 1995
F-2
<PAGE> 52
MONY
VARIABLE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1994
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
---------------------------------------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY GOVERNMENT
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET SECURITIES
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT TOTAL
---------- ---------- ------------ ---------- ---------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments in MONY
Series Fund, Inc.,
at net asset value
(Notes 2 and 5)
(total cost
$27,547,543)........ $163,409 $227,810 $5,842,393 $7,723,242 $281,005 $11,709,157 $ 25,675 $25,972,691
Amount due from (to)
MONY................ 0 0 (500) 2,271 0 19,381 0 21,152
---------- ---------- ------------ ---------- ---------- ----------- ---------- -----------
Total
Assets...... 163,409 227,810 5,841,893 7,725,513 281,005 11,728,538 25,675 25,993,843
---------- ---------- ------------ ---------- ---------- ----------- ---------- -----------
LIABILITIES
Amount due to (from)
MONY Series Fund,
Inc. ............... 0 0 (500) 2,271 0 19,381 0 21,152
---------- ---------- ------------ ---------- ---------- ----------- ---------- -----------
Net Assets............ $163,409 $227,810 $5,842,393 $7,723,242 $281,005 $11,709,157 $ 25,675 $25,972,691
========== ========== =========== =========== ========== ========== ========== ==========
Net assets consist of:
Contractholders' net
payments.......... $ 66,422 $ 83,466 $5,209,496 $6,597,941 $159,786 $10,782,556 $ 25,706 $22,925,373
Accumulated net
investment
income............ 20,969 90,394 1,054,075 1,853,709 90,613 926,601 130 4,036,491
Accumulated net
realized gains on
investments....... 43,043 38,921 97,758 378,389 27,568 0 0 585,679
Unrealized
appreciation
(depreciation) of
investments....... 32,975 15,029 (518,936) (1,106,797) 3,038 0 (161) (1,574,852)
---------- ---------- ------------ ---------- ---------- ----------- ---------- -----------
Net Assets............ $163,409 $227,810 $5,842,393 $7,723,242 $281,005 $11,709,157 $ 25,675 $25,972,691
========== ========== =========== =========== ========== ========== ========== ==========
Number of units
outstanding*........ 8,121 12,401 398,645 476,335 16,718 872,441 2,571
---------- ---------- ------------ ---------- ---------- ----------- ----------
Net asset value per
unit outstanding.... $ 20.12 $ 18.37 $ 14.66 $ 16.21 $ 16.81 $ 13.42 $ 9.99
========== ========== =========== ========== ========== ========== ==========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-3
<PAGE> 53
MONY
VARIABLE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED)
DECEMBER 31, 1994
<TABLE>
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
-------------------------------------------------------------------------
INTERNATIONAL HIGH YIELD
EQUITY SMALL CAP MANAGED GROWTH BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT TOTAL
----------- ----------- ----------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments in Enterprise
Accumulation Trust at net
asset value (Notes 2 and 5)
(total cost $113,353,048)..... $12,764,779 $16,098,042 $85,431,789 $190,173 $146,764 $114,631,547
Amount due from (to) MONY....... 2,138 599 595 0 0 3,332
----------- ----------- ----------- ---------- ---------- ------------
Total Assets................ 12,766,917 16,098,641 85,432,384 190,173 146,764 114,634,879
----------- ----------- ----------- ---------- ---------- ------------
LIABILITIES
Amount due to (from) Enterprise
Accumulation Trust............ 2,138 599 595 0 0 3,332
----------- ----------- ----------- ---------- ---------- ------------
Net Assets...................... $12,764,779 $16,098,042 $85,431,789 $190,173 $146,764 $114,631,547
============ ============ ============ ========== ========== =============
Net assets consist of:
Contractholders' net
payments.................... $10,776,718 $14,348,616 $70,795,015 $188,614 $145,305 $ 96,254,268
Accumulated net investment
income (losses)............. 361,231 941,044 4,509,752 (122) 922 5,812,827
Accumulated net realized gains
(losses) on investments..... 1,171,458 741,959 9,372,994 (458) 0 11,285,953
Unrealized appreciation of
investments................. 455,372 66,423 754,028 2,139 537 1,278,499
----------- ----------- ----------- ---------- ---------- ------------
Net Assets...................... $12,764,779 $16,098,042 $85,431,789 $190,173 $146,764 $114,631,547
============ ============ ============ ========== ========== =============
Number of units outstanding*.... 651,102 742,341 3,528,618 19,197 14,621
----------- ----------- ----------- ---------- ----------
Net asset value per unit
outstanding................... $ 19.60 $ 21.69 $ 24.21 $ 9.91 $ 10.04
============ ============ ============ ========== ==========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-4
<PAGE> 54
MONY
VARIABLE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED)
DECEMBER 31, 1994
<TABLE>
<CAPTION>
QUEST FOR VALUE ACCUMULATION TRUST
---------------------------------------------------------------------------------
MONEY SMALL
MARKET BOND EQUITY CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT TOTAL
---------- ---------- -------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments in Quest for Value
Accumulation Trust at net asset value
(Notes 2 and 5) (total cost
$9,950,308)........................... $474,224 $858,846 $207,551 $392,130 $7,641,126 $9,573,877
Amount due from (to) Quest for Value
Accumulation Trust.................... 0 0 0 2,381 0 2,381
---------- ---------- -------- -------- ---------- ----------
Total Assets.......................... 474,224 858,846 207,551 394,511 7,641,126 9,576,258
---------- ---------- -------- -------- ---------- ----------
LIABILITIES
Amount due to (from) MONY............... 0 0 0 2,381 0 2,381
---------- ---------- -------- -------- ---------- ----------
Net Assets.............................. $474,224 $858,846 $207,551 $392,130 $7,641,126 $9,573,877
========== ========== ========= ========= ========== ==========
Net assets consist of:
Contractholders' net payments......... $469,987 $864,767 $213,458 $393,596 $8,028,666 $9,970,474
Accumulated net investment income
(losses)............................ 4,237 12,296 (767) (1,269) (28,155) (13,658)
Accumulated net realized losses on
investments......................... 0 (141) (12) (52) (6,303) (6,508)
Unrealized depreciation of
investments......................... 0 (18,076) (5,128) (145) (353,082) (376,431)
---------- ---------- -------- -------- ---------- ----------
Net Assets.............................. $474,224 $858,846 $207,551 $392,130 $7,641,126 $9,573,877
========== ========== ========= ========= ========== ==========
Number of units outstanding*............ 37,816 60,890 10,593 18,271 315,452
---------- ---------- -------- -------- ----------
Net asset value per unit outstanding.... $ 12.54 $ 14.10 $ 19.59 $ 21.46 $ 24.22
========== ========== ========= ========= ==========
</TABLE>
- ---------------
* Units outstanding have been rounded for presentation purposes.
See notes to financial statements.
F-5
<PAGE> 55
MONY
VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
------------------------------------------------------------------------
EQUITY EQUITY INTERMEDIATE LONG TERM
GROWTH INCOME TERM BOND BOND DIVERSIFIED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ------------ ------------ ------------ ------------
FOR THE FOR THE FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994 1994 1994
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Dividend income................. $ 4,282 $ 14,152 $ 338,846 $ 573,605 $ 9,673
Mortality and expense risk
charges (Note 3)............... (2,121) (3,007) (71,777) (107,166) (3,901)
-------- -------- ---------- ----------- -------
Net investment income........... 2,161 11,145 267,069 466,439 5,772
Realized and unrealized gains
(losses) on investments
(Note 2):
Proceeds from sales............ 23,184 32,724 2,090,784 3,575,590 51,012
Cost of shares sold............ 14,301 27,440 2,127,054 3,552,042 46,071
-------- -------- ---------- ----------- -------
Net realized gains (losses)
on investments................. 8,883 5,284 (36,270) 23,548 4,941
Net decrease in unrealized
appreciation of investments.... (10,106) (17,480) (390,623) (1,185,741) (11,623)
-------- -------- ---------- ----------- -------
Net realized and unrealized
losses on investments.......... (1,223) (12,196) (426,893) (1,162,193) (6,682)
-------- -------- ---------- ----------- -------
Net increase (decrease) in
net assets resulting from
operations..................... $ 938 $ (1,051) $ (159,824) $ (695,754) $ (910)
======== ======== ========== =========== =======
<CAPTION>
MONY SERIES FUND, INC.
-------------------------------------------------
GOVERNMENT
SECURITIES
SUBACCOUNT
--------------
MONEY FOR THE PERIOD
MARKET DECEMBER 16,
SUBACCOUNT 1994 TOTAL
------------ (COMMENCEMENT -----------------
FOR THE OF OPERATIONS) FOR THE VARIOUS
YEAR ENDED THROUGH PERIODS ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994
------------ -------------- -----------------
<S> <C> <C> <C>
Dividend income................. $ 341,272 $ 143 $ 1,281,973
Mortality and expense risk
charges (Note 3)............... (108,342) (13) (296,327)
----------- ----- -----------
Net investment income........... 232,930 130 985,646
Realized and unrealized gains ----------- ----- ------------
(losses) on investments
(Note 2):
Proceeds from sales............ 43,696,011 13 49,469,318
Cost of shares sold............ 43,696,011 13 49,462,932
----------- ----- ------------
Net realized gains (losses)
on investments................. 0 0 6,386
Net decrease in unrealized
appreciation of investments.... 0 (161) (1,615,734)
----------- ----- ------------
Net realized and unrealized
losses on investments.......... 0 (161) (1,609,348)
----------- ----- ------------
Net increase (decrease) in
net assets resulting from
operations..................... $ 232,930 $ (31) $ (623,702)
============ ======== ============
</TABLE>
See notes to financial statements.
F-6
<PAGE> 56
MONY
VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
-------------------------------------------------------------------------
MONEY
MARKET BOND
SUBACCOUNT SUBACCOUNT
------------- -------------
FOR THE FOR THE EQUITY SMALL CAP MANAGED
PERIOD PERIOD SUBACCOUNT SUBACCOUNT SUBACCOUNT
JANUARY 1, JANUARY 1, ------------ ------------ ------------
1994 1994 FOR THE FOR THE FOR THE
THROUGH THROUGH YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER 16, SEPTEMBER 16, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994 1994 1994
------------- ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Dividend income.................. $ 15,899 $ 54,536 $ 279,066 $ 758,559 $ 3,723,530
Mortality and expense risk
charges (Note 3)................ (6,892) (7,046) (139,801) (180,629) (1,026,335)
----------- --------- ---------- ---------- -----------
Net investment income (loss)..... 9,007 47,490 139,265 577,930 2,697,195
----------- --------- ---------- ---------- -----------
Realized and unrealized gains
(losses) on investments
(Note 2):
Proceeds from sales............. 2,715,725 867,207 1,820,180 3,754,509 19,862,635
Cost of shares sold............. 2,715,725 951,675 1,553,583 3,458,829 15,361,965
----------- --------- ---------- ---------- -----------
Net realized gains (losses)
on investments.................. 0 (84,468) 266,597 295,680 4,500,670
Net (decrease) increase in
unrealized appreciation of
investments..................... 0 0 (140,222) (993,907) (6,171,838)
----------- --------- ---------- ---------- -----------
Net realized and unrealized gains
(losses) on investments......... 0 (84,468) 126,375 (698,227) (1,671,168)
----------- --------- ---------- ---------- -----------
Net increase (decrease) in
net assets resulting from
operations...................... $ 9,007 $ (36,978) $ 265,640 $ (120,297) $ 1,026,027
=========== ========= ========== ========== ===========
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
-------------------------------------------------
INTERNATIONAL HIGH YIELD
GROWTH BOND
SUBACCOUNT SUBACCOUNT
-------------- --------------
FOR THE PERIOD FOR THE PERIOD
NOVEMBER 22, NOVEMBER 22,
1994 1994 TOTAL
(COMMENCEMENT (COMMENCEMENT ---------------
OF OPERATIONS) OF OPERATIONS) FOR THE VARIOUS
THROUGH THROUGH PERIODS ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994
-------------- -------------- ---------------
<S> <C> <C> <C>
Dividend income.................. $ 0 $1,040 $ 4,832,630
Mortality and expense risk
charges (Note 3)................ (122) (118) (1,360,943)
-------- ------- -----------
Net investment income (loss)..... (122) 922 3,471,687
-------- ------- -----------
Realized and unrealized gains
(losses) on investments
(Note 2):
Proceeds from sales............. 16,937 125 29,037,318
Cost of shares sold............. 17,395 125 24,059,297
-------- ------- -----------
Net realized gains (losses)
on investments.................. (458) 0 4,978,021
Net (decrease) increase in
unrealized appreciation of
investments..................... 2,139 537 (7,303,291)
-------- ------- -----------
Net realized and unrealized gains
(losses) on investments......... 1,681 537 (2,325,270)
-------- ------- -----------
Net increase (decrease) in
net assets resulting from
operations...................... $ 1,559 $1,459 $ 1,146,417
======== ======= ===========
</TABLE>
See notes to financial statements.
F-7
<PAGE> 57
MONY
VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
QUEST FOR VALUE ACCUMULATION TRUST
---------------------------------------------------------------------------------------------------
MONEY MARKET BOND EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT TOTAL
-------------- -------------- -------------- -------------- -------------- --------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17,
1994 1994 1994 1994 1994 1994
(COMMENCEMENT (COMMENCEMENT (COMMENCEMENT (COMMENCEMENT (COMMENCEMENT (COMMENCEMENT
OF OPERATIONS) OF OPERATIONS) OF OPERATIONS) OF OPERATIONS) OF OPERATIONS) OF OPERATIONS)
THROUGH THROUGH THROUGH THROUGH THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994 1994 1994 1994
-------------- -------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Dividend income............. $ 6,095 $ 15,396 $ 0 $ 0 $ 0 $ 21,491
Mortality and expense risk
charges
(Note 3)................... (1,858) (3,100) (767) (1,269) (28,155) (35,149)
------- ------- ------ ------ ------------ ------------
Net investment income
(losses)................... 4,237 12,296 (767) (1,269) (28,155) (13,658)
------- ------- ------ ------ ------------ ------------
Realized and unrealized
gains (losses) on
investments (Note 2):
Proceeds from sales........ 173,234 5,258 5,943 3,734 228,003 416,172
Cost of shares sold........ 173,234 5,399 5,955 3,786 234,306 422,680
------- ------- ------ ------ ------------ ------------
Net realized losses on
investments................ 0 (141) (12) (52) (6,303) (6,508)
Net decrease in unrealized
appreciation of
investments................ 0 (18,076) (5,128) (145) (353,082) (376,431)
------- ------- ------ ------ ------------ ------------
Net realized and unrealized
losses on investments...... 0 (18,217) (5,140) (197) (359,385) (382,939)
------- ------- ------ ------ ------------ ------------
Net increase (decrease) in
net assets resulting from
operations................. $ 4,237 $ (5,921) $ (5,907) $ (1,466) $ (387,540) $ (396,597)
======== ======== ======== ======== ========== ==========
</TABLE>
See notes to financial statements.
F-8
<PAGE> 58
MONY
VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MONY SERIES FUND, INC.
-----------------------------------------------------------------------------------------------
LONG TERM
EQUITY GROWTH EQUITY INCOME INTERMEDIATE TERM BOND BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
-------------------------- -------------------------- -------------------------- ------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1993 1994 1993 1994 1993 1994
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income
(losses).................... $ 2,161 $ 5,340 $ 11,145 $ 15,942 $ 267,069 $ 251,693 $ 466,439
Net realized gains (losses) on
investments................. 8,883 4,745 5,284 2,134 (36,270) 109,939 23,548
Net increase (decrease) in
unrealized appreciation of
investments................. (10,106) 3,285 (17,480) 10,386 (390,623) (126,138) (1,185,741)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in net
assets resulting from
operations.................... 938 13,370 (1,051) 28,462 (159,824) 235,494 (695,754)
------------ ------------ ------------ ------------ ------------ ------------ ------------
From unit transactions:
Net proceeds from the issuance
of units.................... 931 14,813 1,308 7,954 2,137,359 2,803,174 2,625,849
Net asset value of units
redeemed or used to meet
contract obligations........ 17,715 10,454 25,568 8,053 1,484,343 1,138,735 2,942,799
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) from
unit transactions............. (16,784) 4,359 (24,260) (99) 653,016 1,664,439 (316,950)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in net
assets........................ (15,846) 17,729 (25,311) 28,363 493,192 1,899,933 (1,012,704)
Net assets beginning of
period........................ 179,255 161,526 253,121 224,758 5,349,201 3,449,268 8,735,946
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net assets end of period*...... $163,409 $179,255 $227,810 $253,121 $ 5,842,393 $ 5,349,201 $ 7,723,242
========== ========== ========== ========== =========== =========== ============
Units outstanding beginning of
period........................ 8,985 8,777 13,713 13,730 354,965 243,826 499,364
Units issued during the
period........................ 43 788 69 450 144,778 188,407 156,210
Units redeemed during the
period........................ 907 580 1,381 467 101,098 77,268 179,239
---------- ---------- ---------- ---------- ----------- ----------- ------------
Units outstanding end of
period........................ 8,121 8,985 12,401 13,713 398,645 354,965 476,335
========== ========== ========== ========== =========== =========== ============
- ---------------
*Includes undistributed net
investment income of: ....... $ 20,969 $ 18,808 $ 90,394 $ 79,249 $ 1,054,075 $ 787,006 $ 1,853,709
<CAPTION>
MONY SERIES FUND, INC.
--------------------------------------------------------------------------------------
GOVERNMENT
SECURITIES
SUBACCOUNT
----------------
FOR THE
LONG TERM PERIOD
BOND DIVERSIFIED MONEY MARKET DECEMBER 16,
SUBACCOUNT SUBACCOUNT SUBACCOUNT 1994
---------- -------------------------- -------------------------- (COMMENCEMENT
FOR THE FOR THE FOR THE FOR THE FOR THE OF OPERATIONS)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1993 1994 1993 1994 1993 1994
------------ ------------ ------------ ------------ ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income
(losses).................... $ 417,876 $ 5,772 $ 8,821 $ 232,930 $ 91,619 $ 130
Net realized gains (losses) on
investments................. 335,825 4,941 590 0 0 0
Net increase (decrease) in
unrealized appreciation of
investments................. (18,938) (11,623) 18,418 0 0 (161)
------------ ----------- ---------- ------------ ------------ ------
Net increase (decrease) in net
assets resulting from
operations.................... 734,763 (910) 27,829 232,930 91,619 (31)
------------ ------------ ------------ ------------ ------------ ------
From unit transactions:
Net proceeds from the issuance
of units.................... 4,395,638 8,628 8,813 42,507,931 46,722,722 25,706
Net asset value of units
redeemed or used to meet
contract obligations........ 2,246,358 47,110 2,998 39,141,870 46,058,001 0
------------ ------------ ------------ ------------ ------------ ------
Net increase (decrease) from
unit transactions............. 2,149,280 (38,482) 5,815 3,366,061 664,721 25,706
------------ ------------ ------------ ------------ ------------ ------
Net increase (decrease) in net
assets........................ 2,884,043 (39,392) 33,644 3,598,991 756,340 25,675
Net assets beginning of
period........................ 5,851,903 320,397 286,753 8,110,166 7,353,826 0
------------ ------------ ------------ ------------ ------------ ------
Net assets end of period*...... $ 8,735,946 $281,005 $320,397 $ 11,709,157 $ 8,110,166 $ 25,675
=========== ========== ========== ============ ============ ==============
Units outstanding beginning of
period........................ 377,464 19,018 18,654 620,100 570,819 0
Units issued during the
period........................ 256,463 526 555 3,214,369 3,593,854 2,571
Units redeemed during the
period........................ 134,563 2,826 191 2,962,028 3,544,573 0
------------ ------------ ------------ ------------ ------------ ------
Units outstanding end of
period........................ 499,364 16,718 19,018 872,441 620,100 2,571
=========== ========== ========== ============ ============ ==============
- ---------------
*Includes undistributed net
investment income of: ....... $ 1,387,270 $ 90,613 $ 84,841 $ 926,601 $ 693,671 $ 130
<CAPTION>
MONY SERIES FUND, INC.
--------------------------
TOTAL
--------------------------
FOR THE
VARIOUS FOR THE
PERIODS YEAR
ENDED ENDED
DECEMBER 31, DECEMBER 31,
1994 1993
------------ ------------
<S> <C> <C>
From operations:
Net investment income
(losses).................... $ 985,646 $ 791,291
Net realized gains (losses) on
investments................. 6,386 453,233
Net increase (decrease) in
unrealized appreciation of
investments................. (1,615,734) (112,987)
------------ ------------
Net increase (decrease) in net
assets resulting from
operations.................... (623,702) 1,131,537
------------ ------------
From unit transactions:
Net proceeds from the issuance
of units.................... 47,307,712 53,953,114
Net asset value of units
redeemed or used to meet
contract obligations........ 43,659,405 49,464,599
------------ ------------
Net increase (decrease) from
unit transactions............. 3,648,307 4,488,515
------------ ------------
Net increase (decrease) in net
assets........................ 3,024,605 5,620,052
Net assets beginning of
period........................ 22,948,086 17,328,034
------------ ------------
Net assets end of period*...... $ 25,972,691 $ 22,948,086
============ ============
Units outstanding beginning of
period........................ 1,516,145 1,233,270
Units issued during the
period........................ 3,518,566 4,040,517
Units redeemed during the
period........................ 3,247,479 3,757,642
------------ ------------
Units outstanding end of
period........................ 1,787,232 1,516,145
============ ============
- ---------------
*Includes undistributed net
investment income of: ....... $ 4,036,491 $ 3,050,845
</TABLE>
See notes to financial statements.
F-9
<PAGE> 59
MONY
VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED)
<TABLE>
<CAPTION>
ENTERPRISE ACCUMULATION TRUST
------------------------------------------------------------------------------------
MONEY MARKET BOND
SUBACCOUNT SUBACCOUNT
------------------------- -----------------------
FOR THE FOR THE EQUITY
PERIOD PERIOD SUBACCOUNT
JANUARY 1, JANUARY 1, FOR THE --------------------------
1994 FOR THE 1994 YEAR FOR THE FOR THE
THROUGH YEAR ENDED THROUGH ENDED YEAR ENDED YEAR ENDED
SEPTEMBER 16, DECEMBER 31, SEPTEMBER 16, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1993 1994 1993 1994 1993
---------- ---------- ---------- -------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income (losses)...... $ 9,007 $ 7,451 $ 47,490 $ 51,004 $ 139,265 $ 111,311
Net realized gains (losses) on
investments....................... 0 0 (84,468) 2,947 266,597 654,915
Net increase (decrease) in
unrealized appreciation of
investments....................... 0 0 0 (15,406) (140,222) (285,489)
---------- ---------- ---------- -------- ----------- ----------
Net increase (decrease) in net assets
resulting from operations........... 9,007 7,451 (36,978) 38,545 265,640 480,737
---------- ---------- ---------- -------- ----------- ----------
From unit transactions:
Net proceeds from the issuance
of units.......................... 1,178,240 1,198,500 276,377 62,623 4,393,632 4,081,757
Net asset value of units redeemed or
used to meet contract
obligations....................... 1,965,716 1,254,743 860,165 38,665 1,388,936 725,636
---------- ---------- ---------- -------- ----------- ----------
Net increase (decrease) from unit
transactions........................ (787,476) (56,243) (583,788) 23,958 3,004,696 3,356,121
---------- ---------- ---------- -------- ----------- ----------
Net increase (decrease) in net
assets.............................. (778,469) (48,792) (620,766) 62,503 3,270,336 3,836,858
Net assets beginning of period....... 778,469 827,261 620,766 558,263 9,494,443 5,657,585
---------- ---------- ---------- -------- ----------- ----------
Net assets end of period*............ $ 0 $ 778,469 $ 0 $620,766 $12,764,779 $9,494,443
========= ========= ========= ======== ========== =========
Units outstanding beginning of
period.............................. 63,344 67,974 41,798 40,243 496,795 315,372
Units issued during the period....... 95,472 97,880 18,722 4,264 223,727 220,683
Units redeemed during the period..... 158,816 102,510 60,520 2,709 69,420 39,260
---------- ---------- ---------- -------- ----------- ----------
Units outstanding end of period...... 0 63,344 0 41,798 651,102 496,795
========= ========= ========= ======== ========== =========
- ---------------
* Includes undistributed net
investment income (loss) of:....... $ 0 $ 128,522 $ 0 $167,953 $ 361,231 $ 221,966
<CAPTION>
INTERNATIONAL
GROWTH
SUBACCOUNT
-------
FOR THE
PERIOD
SMALL CAP MANAGED NOVEMBER 22,
SUBACCOUNT SUBACCOUNT 1994
--------------------------- ---------------------------- (COMMENCE- MENT
OF
FOR THE FOR THE FOR THE FOR THE OPERATIONS)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1993 1994 1993 1994
----------- ----------- ----------- ------------ --------------
<S> <C> <C> <C> <C> <C>
From operations:
Net investment income (losses)...... $ 577,930 $ 215,537 $ 2,697,195 $ 840,416 $ (122)
Net realized gains (losses) on
investments....................... 295,680 250,995 4,500,670 3,255,726 (458)
Net increase (decrease) in
unrealized appreciation of
investments....................... (993,907) 694,990 (6,171,838) 179,644 2,139
----------- ----------- ----------- ------------ -------
Net increase (decrease) in net assets
resulting from operations........... (120,297) 1,161,522 1,026,027 4,275,786 1,559
----------- ----------- ----------- ------------ -------
From unit transactions:
Net proceeds from the issuance
of units.......................... 7,123,098 7,139,619 29,888,848 35,272,150 195,813
Net asset value of units redeemed or
used to meet contract
obligations....................... 2,524,254 373,965 15,783,741 3,700,770 7,199
----------- ----------- ----------- ------------ -------
Net increase (decrease) from unit
transactions........................ 4,598,844 6,765,654 14,105,107 31,571,380 188,614
----------- ----------- ----------- ------------ -------
Net increase (decrease) in net
assets.............................. 4,478,547 7,927,176 15,131,134 35,847,166 190,173
Net assets beginning of period....... 11,619,495 3,692,319 70,300,655 34,453,489 0
----------- ----------- ----------- ------------ -------
Net assets end of period*............ $16,098,042 $11,619,495 $85,431,789 $ 70,300,655 $ 190,173
========== ========== ========== ========== =========
Units outstanding beginning of
period.............................. 529,142 198,539 2,941,211 1,571,876 0
Units issued during the period....... 330,290 348,894 1,208,188 1,528,645 19,940
Units redeemed during the period..... 117,091 18,291 620,781 159,310 743
----------- ----------- ----------- ------------ -------
Units outstanding end of period...... 742,341 529,142 3,528,618 2,941,211 19,197
========== ========== ========== ========== =========
- ---------------
* Includes undistributed net
investment income (loss) of:....... $ 941,044 $ 363,114 $ 4,509,752 $ 1,812,557 $ (122)
<CAPTION>
HIGH YIELD
BOND
SUBACCOUNT
------------
FOR THE
PERIOD
NOVEMBER 22, TOTAL
1994 ----------------------------
(COMMENCE- FOR THE
MENT OF VARIOUS
OPERATIONS) PERIODS FOR THE
THROUGH ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1993
------------ ------------ -----------
<S> <C> <C> <C>
From operations:
Net investment income (losses)...... $ 922 $ 3,471,687 $ 1,225,719
Net realized gains (losses) on
investments....................... 0 4,978,021 4,164,583
Net increase (decrease) in
unrealized appreciation of
investments....................... 537 (7,303,291) 573,739
------------ ------------ -----------
Net increase (decrease) in net assets
resulting from operations........... 1,459 1,146,417 5,964,041
------------ ------------ -----------
From unit transactions:
Net proceeds from the issuance
of units.......................... 145,312 43,201,320 47,754,649
Net asset value of units redeemed or
used to meet contract
obligations....................... 7 22,530,018 6,093,779
------------ ------------ -----------
Net increase (decrease) from unit
transactions........................ 145,305 20,671,302 41,660,870
------------ ------------ -----------
Net increase (decrease) in net
assets.............................. 146,764 21,817,719 47,624,911
Net assets beginning of period....... 0 92,813,828 45,188,917
------------ ------------ -----------
Net assets end of period*............ $ 146,764 $114,631,547 $92,813,828
========== =========== ==========
Units outstanding beginning of
period.............................. 0 4,072,290 2,194,004
Units issued during the period....... 14,622 1,910,961 2,200,366
Units redeemed during the period..... 1 1,027,372 322,080
------------ ------------ -----------
Units outstanding end of period...... 14,621 4,955,879 4,072,290
========== =========== ==========
- ---------------
* Includes undistributed net
investment income (loss) of:....... $ 922 $ 5,812,627 $ 2,694,112
</TABLE>
See notes to financial statements.
F-10
<PAGE> 60
MONY
VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED)
<TABLE>
<CAPTION>
QUEST FOR VALUE ACCUMULATION TRUST
---------------------------------------------------------------------------------------------
MONEY MARKET BOND EQUITY SMALL CAP MANAGED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT TOTAL
------------- ------------- ------------- ------------- ------------- -------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
PERIOD PERIOD PERIOD PERIOD PERIOD PERIOD
SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17, SEPTEMBER 17,
1994 1994 1994 1994 1994 1994
(COMMENCEMENT (COMMENCEMENT (COMMENCEMENT (COMMENCEMENT (COMMENCEMENT (COMMENCEMENT
OF OF OF OF OF OF
OPERATIONS) OPERATIONS) OPERATIONS) OPERATIONS) OPERATIONS) OPERATIONS)
THROUGH THROUGH THROUGH THROUGH THROUGH THROUGH
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994 1994 1994 1994
------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
From operations:
Net investment income
(losses)................... $ 4,237 $ 12,296 $ (767) $ (1,269) $ (28,155) $ (13,658)
Net realized gains (losses)
on investments............. 0 (141) (12) (52) (6,303) (6,508)
Net increase (decrease) in
unrealized appreciation of
investments................ 0 (18,076) (5,128) (145) (353,082) (376,431)
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net
assets resulting from
operations................... 4,237 (5,921) (5,907) (1,466) (387,540) (396,597)
------------- ------------- ------------- ------------- ------------- -------------
From unit transactions:
Net proceeds from the
issuance of units.......... 641,363 866,925 218,605 396,030 8,148,593 10,271,516
Net asset value of units
redeemed or used to meet
contract obligations....... 171,376 2,158 5,147 2,434 119,927 301,042
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) from
unit transactions............ 469,987 864,767 213,458 393,596 8,028,666 9,970,474
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net
assets....................... 474,224 858,846 207,551 392,130 7,641,126 9,573,877
Net assets beginning of
period....................... 0 0 0 0 0 0
------------- ------------- ------------- ------------- ------------- -------------
Net assets end of period*...... $ 474,224 $ 858,846 $ 207,551 $ 392,130 $ 7,641,126 $ 9,573,877
============= ============= ============= ============= ============= =============
Units outstanding beginning of
period....................... 0 0 0 0 0 0
Units issued during the
period....................... 51,569 61,044 10,848 18,384 320,287 462,132
Units redeemed during the
period....................... 13,753 154 255 113 4,835 19,110
------------- ------------- ------------- ------------- ------------- -------------
Units outstanding end of
period....................... 37,816 60,890 10,593 18,271 315,452 443,022
============= ============= ============= ============= ============= =============
- ---------------
* Includes undistributed net
investment income (loss)
of:.......................... $ 4,237 $ 12,296 $ (767) $ (1,269) $ (28,155) $ (13,658)
</TABLE>
See notes to financial statements.
F-11
<PAGE> 61
MONY
VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND BUSINESS:
MONY Variable Account A (the "Variable Account") is a separate investment
account established on November 28, 1990 by The Mutual Life Insurance Company of
New York ("MONY"), under the laws of the State of New York.
The Variable Account operates as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act"). The Variable Account holds
assets that are segregated from all of MONY's other assets and, at present, is
used only to support Flexible Payment Variable Annuity Policies. These policies
are issued by MONY. MONY is currently taxed as a life insurance company and will
include the Variable Account's operations in its tax return. MONY does not
expect, based upon current tax law, to incur any income tax burden upon the
earnings or realized capital gains attributable to the Variable Account. Based
on this expectation, no charges are currently being deducted from the Variable
Account for Federal income tax purposes.
There are currently seventeen subaccounts within the Variable Account, each
invests only in a corresponding portfolio of the MONY Series Fund, Inc. (the
"Fund"), Enterprise Accumulation Trust (the "Trust") or the Quest for Value
Accumulation Trust ("Quest") collectively the "Funds". The Funds are registered
under the 1940 Act as open-end, diversified, management investment companies.
2. SIGNIFICANT ACCOUNTING POLICIES:
A. Investments:
The investment in shares of each of the respective portfolios is stated at
the net asset values of each portfolio. Except for the Money Market Portfolios,
as noted below, net assets values are based upon market quotations of the
securities held in each of the corresponding portfolios. Significant accounting
policies of the Funds are as follows:
Portfolio Valuations:
Short-term securities are valued at amortized cost. The amortized cost of a
security is determined by valuing it at original cost and thereafter amortizing
any discount or premium at a constant rate until maturity.
Securities held for investment in the other portfolios are valued as
follows:
Common stocks traded on national securities exchanges are valued at the
last sales price as of the close of the New York Stock Exchange or at the last
bid price for over-the-counter securities.
Bonds are valued at the last available price provided by an independent
securities valuation company for securities traded on a national securities
exchange. Bonds that are listed on a national securities exchange but are not
traded and bonds that are regularly traded in the over-the-counter market are
valued at the mean of the last available bid and asked prices.
Foreign securities are valued on the basis of independent pricing services
approved by the Board of Directors of the Trust, and such pricing services
generally follow the same procedures in valuing foreign equity securities as
they value domestic equity securities.
All other securities, including any restricted securities, will be valued
at their fair value as determined in good faith by the Boards of the Funds.
F-12
<PAGE> 62
MONY
VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
2. SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED):
B. Security Transactions and Investment Income:
Security transactions are recorded as of the trade date.
Dividend income is recorded on the ex-dividend date.
Realized gains and losses from investments sold are determined on the basis
of identified cost for accounting and tax purposes.
C. Other Information:
A full presentation of the related Financial Statements and Footnotes of
the Enterprise Accumulation Trust and the Quest For Value Accumulation Trust can
be found on pages 127 to 164 and 165 to 216, respectively.
3. RELATED PARTY TRANSACTIONS:
Policy premiums received from MONY by the Variable Account represent gross
policy premiums recorded by MONY less deductions retained for any premium taxes.
A periodic deduction is made from the Cash Value of the Contract for the
Annual Contract Charge. The deduction is for the expenses of administration and
is treated by the Variable Account as a contractholder redemption. The amount
deducted for 1994 was $121,246.
MONY receives from the Variable Account the amounts deducted for mortality
and expense risks at an annual rate of 1.25 percent of aggregate average daily
net assets. As MONY America, a wholly-owned subsidiary of MONY, acts as
investment adviser to the Series Fund, it receives amounts paid by the Series
Fund for those services. MONY is the legal holder of the assets held by the
Variable Account.
Enterprise Capital Management, Inc., ("Enterprise") a wholly-owned
subsidiary of MONY, acts as investment adviser to the Trust, and it receives
amounts paid by the Trust for those services.
4. CHANGE IN ADVISORY ARRANGEMENT:
Quest offered its shares to variable annuity separate accounts of the
Mutual Life Insurance Company of New York ("MONY") and its affiliate, MONY Life
Insurance Company of America as a funding vehicle for the MONYMaster and
ValueMaster variable annuity contracts issued by them. Quest also offered its
shares to variable annuity separate accounts of Provident Mutual Life Insurance
Company of Philadelphia and its affiliate, Provident Mutual Life and Annuity
Company of America (together, the "PM Companies") as a funding vehicle for
certain variable annuity contracts issued by these insurers. Owners of
ValueMaster contracts and contracts issued by the PM Companies are referred to
herein as "non-MONYMaster" contract owners.
On May 26, 1994, the Board of Trustees (the "Trustees") of Quest approved
new advisory arrangements for the Equity, Small Cap and Managed Portfolios of
Quest. Such advisory arrangements were approved by the shareholders of each
portfolio at a special meeting called for such purpose (the "Special Meeting").
Under the new arrangements, Enterprise became the investment adviser for the
three portfolios, and Quest for Value Advisors ("Quest Advisors"), the
portfolios' former investment adviser, became sub-adviser to these portfolios,
subject to the oversight of Enterprise. The two firms are rendering these
services at the same aggregate annual advisory fee rate as is currently in
effect (.60% of average daily net assets). The current advisory arrangements was
not changed for the Bond and Money Market Portfolios of Quest.
F-13
<PAGE> 63
MONY
VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
4. CHANGE IN ADVISORY ARRANGEMENT -- (CONTINUED):
In connection with the implementation of new advisory arrangements as
described above, the assets of the Equity, Small Cap, Managed, Bond and Money
Market Portfolios of Quest supporting the non-MONYMaster contracts were
transferred on a pro-rata basis to substantially identical corresponding
portfolios of a newly-formed management investment company advised by Quest
Advisors, the new Quest for Value Accumulation Trust (the "New Quest"). The
division of net assets were in accordance with relative net asset value of the
shares of each portfolio of Quest attributable to MONYMaster contract owners and
non-MONYMaster contract owners, respectively. Shares of each portfolio
attributable to non-MONYMaster contract owners were redeemed in kind at net
asset value without a sales charge, and such assets were reinvested in the New
Quest by using such assets to purchase an equivalent number of shares of the New
Quest.
The assets redeemed and reinvested in New Quest were as follows:
<TABLE>
<S> <C>
Equity........................................................... $ 217,603
Small Cap........................................................ 318,781
Managed.......................................................... 8,126,663
Bond............................................................. 783,568
Money Market..................................................... 626,212
</TABLE>
This transaction resulted in an adjustment to the basis of the net assets
reinvested in New Quest. As a result, the Bond Subaccount recognized the
unrealized depreciation of $80,426 on September 16, 1994 as a realized loss on
the net assets redeemed.
5. INVESTMENTS:
Investments in MONY Series Fund, Inc. at cost, at December 31, 1994 consist
of the following:
<TABLE>
<CAPTION>
EQUITY EQUITY INTERMEDIATE LONG TERM MONEY GOVERNMENT
GROWTH INCOME TERM BOND BOND DIVERSIFIED MARKET SECURITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO TOTAL
--------- --------- ------------ ---------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares beginning of
period:
Shares............... 8,660 15,406 508,963 724,975 23,786 8,110,166 0 9,391,956
Amount............... $136,174 $220,612 $5,477,514 $8,657,002 $ 305,736 $ 8,110,166 $ 0 $ 22,907,204
Shares acquired:
Shares............... 202 330 257,731 271,869 654 46,953,730 2,686 47,487,202
Amount............... $ 4,279 $ 5,457 $2,672,023 $3,151,474 $ 8,629 $46,953,730 $ 25,706 $ 52,821,298
Shares received for
reinvestment of
dividends:
Shares............... 208 911 34,753 54,786 736 341,272 15 432,681
Amount............... $ 4,282 $ 14,152 $ 338,846 $ 573,605 $ 9,673 $ 341,272 $ 143 $ 1,281,973
Shares redeemed:
Shares............... 1,134 1,978 202,227 313,976 3,791 43,696,011 1 44,219,118
Amount............... $ 14,301 $ 27,440 $2,127,054 $3,552,042 $ 46,071 $43,696,011 $ 13 $ 49,462,932
--------- --------- ------------ ---------- ----------- ----------- ---------- ------------
Net change:
Shares............... (724 ) (737 ) 90,257 12,679 (2,401) 3,598,991 2,700 3,700,765
Amount............... $ (5,740 ) $ (7,831 ) $ 883,815 $ 173,037 $ (27,769) $ 3,598,991 $ 25,836 $ 4,640,339
--------- --------- ------------ ---------- ----------- ----------- ---------- ------------
Shares end of period:
Shares............... 7,936 14,669 599,220 737,654 21,385 11,709,157 2,700 13,092,721
Amount............... $130,434 $212,781 $6,361,329 $8,830,039 $ 277,967 $11,709,157 $ 25,836 $ 27,457,543
======== ======== =========== ========== ========= ========== ========== ==========
</TABLE>
F-14
<PAGE> 64
MONY
VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
5. INVESTMENTS--(CONTINUED):
Investments in Enterprise Accumulation Trust at cost, at December 31, 1994
consist of the following:
<TABLE>
<CAPTION>
INTERNATIONAL HIGH YIELD
EQUITY SMALL CAP MANAGED GROWTH BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO TOTAL
----------- ----------- ----------- ------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Shares beginning of period:
Shares....................... 528,938 624,033 3,292,771 0 0 4,445,742
Amount....................... $ 8,898,849 $10,559,165 $63,374,789 $ 0 $ 0 $ 82,832,803
Shares acquired:
Shares....................... 260,684 468,540 1,563,311 41,924 29,287 2,363,746
Amount....................... $ 4,685,075 $ 8,172,724 $32,941,407 $ 205,429 $145,312 $ 46,149,947
Shares received for
reinvestment of dividends:
Shares....................... 15,713 42,313 179,274 0 209 237,509
Amount....................... $ 279,066 $ 758,559 $ 3,723,530 $ 0 $ 1,040 $ 4,762,195
Shares redeemed:
Shares....................... 101,266 218,141 932,004 3,505 25 1,254,941
Amount....................... $ 1,553,583 $ 3,458,829 $15,361,965 $ 17,395 $ 125 $ 20,391,897
----------- ----------- ----------- ------------- ---------- -------------
Net change:
Shares....................... 175,131 292,712 810,581 38,419 29,471 1,346,314
Amount....................... $ 3,410,558 $ 5,472,454 $21,302,972 $ 188,034 $146,227 $ 30,520,245
----------- ----------- ----------- ------------- ---------- -------------
Shares end of period:
Shares....................... 704,069 916,745 4,103,352 38,419 29,471 5,792,056
Amount....................... $12,309,407 $16,031,619 $84,677,761 $ 188,034 $146,227 $ 113,353,048
========== ========== ========== =========== ========== ===========
</TABLE>
Investments in Quest for Value Accumulation Trust at cost, at December 31,
1994 consist of the following:
<TABLE>
<CAPTION>
MONEY
MARKET BOND EQUITY SMALL CAP MANAGED
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO TOTAL
--------- --------- --------- --------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Shares beginning of period:
Shares................................. 0 0 0 0 0 0
Amount................................. $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Shares acquired:
Shares................................. 641,363 92,237 11,775 22,778 377,581 1,145,734
Amount................................. $641,363 $866,925 $218,634 $396,061 $8,228,514 $ 10,351,497
Shares received for reinvestment of
dividends:
Shares................................. 6,095 1,687 0 0 0 7,782
Amount................................. $ 6,095 $ 15,396 $ 0 $ 0 $ 0 $ 21,491
Shares redeemed:
Shares................................. 173,234 571 321 216 10,748 185,090
Amount................................. $173,234 $ 5,399 $ 5,955 $ 3,786 $ 234,306 $ 422,680
--------- --------- --------- --------- ---------- ------------
Net change:
Shares................................. 474,224 93,353 11,454 22,562 366,833 968,426
Amount................................. $474,224 $876,922 $212,679 $392,275 $7,994,208 $ 9,950,308
--------- --------- --------- --------- ---------- ------------
Shares end of period:
Shares................................. 474,224 93,353 11,454 22,562 366,833 968,426
Amount................................. $474,224 $876,922 $212,679 $392,275 $7,994,208 $ 9,950,308
======== ======== ======== ========= ========= ==========
</TABLE>
F-15
<PAGE> 65
COMMENT ON FINANCIAL STATEMENTS OF MONY
The following financial statements relate to the condition and operations
of MONY and should be distinguished from the financial statements of MONY
Variable Account A. As explained on the preceding pages, the values of the
interests of Contractholders under the Contract described in this Prospectus are
affected by the investment results of MONY Variable Account A. Financial
statements of MONY should be considered only as bearing upon the ability of MONY
to meet its obligations under the Contract.
F-16
<PAGE> 66
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees of
The Mutual Life Insurance Company of New York:
We have audited the accompanying balance sheets of The Mutual Life
Insurance Company of New York as of December 31, 1994 and 1993, and the related
statements of operations, surplus, and cash flows for the years then ended.
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 audits 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 financial position of The Mutual Life Insurance
Company of New York as of December 31, 1994 and 1993, and the results of its
operations and its cash flows for the years then ended in conformity with
accounting practices prescribed or permitted by the Insurance Department of the
State of New York, which are considered generally accepted accounting principles
for mutual life insurance companies.
Our audits were conducted for the purpose of expressing an opinion on the
financial statements taken as a whole. The Supplemental Schedule of Selected
Financial Data is presented to comply with the NAIC's Annual Statement
Instructions and is not a required part of the basic financial statements. The
Supplemental Schedule of Selected Financial Data has been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion, is fairly stated, in all material respects, in relation to the
basic financial statements taken as a whole.
New York, New York
February 28, 1995
F-17
<PAGE> 67
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------
1994 1993
---------- ----------
<S> <C> <C>
ASSETS
Cash............................................................. $ 15,466 $ 37,507
Investments:
Short-term investments......................................... 135,206 167,363
Bonds.......................................................... 3,568,544 3,314,810
Preferred stocks............................................... 19,467 34,828
Common stocks.................................................. 191,795 188,112
Subsidiary companies........................................... 123,401 121,150
Mortgage loans................................................. 1,771,305 2,115,185
Real estate.................................................... 1,943,241 1,813,207
Policy loans................................................... 1,188,775 1,212,763
Other invested assets.......................................... 339,151 360,730
Investment income due and accrued................................ 139,570 138,847
Premiums deferred and uncollected................................ 210,547 210,674
Separate account assets.......................................... 1,835,772 4,897,667
Federal income taxes recoverable................................. 45,045 --
Amounts due from reinsurers...................................... 104,622 24,104
Other assets..................................................... 38,094 41,049
---------- ----------
Total assets................................................ $11,670,001 $14,677,996
========== ==========
POLICY RESERVES, LIABILITIES AND SURPLUS
Policy reserves:
Life insurance and annuity reserves............................ $7,385,975 $7,539,360
Health insurance reserves...................................... 134,796 124,981
Deposits left with the Company................................. 496,421 505,228
Liabilities:
Dividends to policyholders..................................... 210,841 204,485
Policy claims in process of settlement......................... 65,559 61,481
Amounts due to reinsurers...................................... 117,700 21,001
Taxes accrued.................................................. 160,636 130,101
Separate account liabilities................................... 1,828,368 4,891,233
Other liabilities.............................................. 265,759 276,807
Interest maintenance reserve................................... 3,728 8,145
Investment reserves............................................ 90,000 90,000
Asset valuation reserve........................................ 230,148 224,999
---------- ----------
Total policy reserves and liabilities....................... 10,989,931 14,077,821
Surplus:
Surplus notes.................................................. 72,317 --
Special surplus funds.......................................... 27,150 27,150
Unassigned surplus............................................. 580,603 573,025
---------- ----------
Surplus..................................................... 680,070 600,175
---------- ----------
Total policy reserves, liabilities and surplus.............. $11,670,001 $14,677,996
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-18
<PAGE> 68
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
STATEMENTS OF OPERATIONS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
-------------------------
1994 1993
---------- ----------
<S> <C> <C>
Premiums, annuity considerations and fund deposits.............. $1,380,437 $1,880,441
Net investment income........................................... 590,504 878,168
Revenue from ceded reinsurance.................................. 155,071 14,379
Other income (net).............................................. 38,969 44,607
---------- ----------
2,164,981 2,817,595
Policyholder and contractholder benefits........................ 1,508,822 1,906,176
Change in policy and contract reserves.......................... (32,767) (2,720,109)
Commissions..................................................... 70,923 78,547
Operating expenses.............................................. 291,003 317,905
Reinsurance of group pension liabilities........................ 2,619,449 2,727,364
Transfer (from)/to separate accounts............................ (2,607,724) 198,260
Other deductions (net).......................................... 6,927 (18,570)
---------- ----------
1,856,633 2,489,573
---------- ----------
Net gain from operations before dividends and federal income
taxes......................................................... 308,348 328,022
Dividends to policyholders...................................... 215,932 214,839
---------- ----------
Net gain from operations before federal income taxes............ 92,416 113,183
Federal income taxes............................................ 6,700 10,877
---------- ----------
Net gain from operations........................................ 85,716 102,306
Net realized capital gains/(losses) (net of federal income tax
of $4,080 and ($13,820) and excluding $1,582 and $24,405
transferred to Interest Maintenance Reserve).................. (4,296) 1,876
---------- ----------
Net Income...................................................... $ 81,420 $ 104,182
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-19
<PAGE> 69
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
STATEMENTS OF SURPLUS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
----------------------
1994 1993
-------- ---------
<S> <C> <C>
Surplus, beginning of year.......................................... $600,175 $ 620,786
-------- ---------
Net income.......................................................... 81,420 104,182
Change in net unrealized capital losses............................. (55,211) (185,043)
Change in non-admitted assets....................................... (5,274) (1,545)
Change in asset valuation reserve................................... (5,149) (25,565)
Change in policy reserve valuation basis............................ -- 55,546
Change in investment reserves....................................... -- 65,000
Provision for non-qualified retirement benefits..................... (555) (7,211)
Provision for contingencies......................................... (9,800) (14,000)
Issuance of surplus notes (net of underwriting costs)............... 69,990 --
Other changes to surplus............................................ 4,474 (11,975)
-------- ---------
Net change in surplus for the year.................................. 79,895 (20,611)
-------- ---------
Surplus, end of year................................................ $680,070 $ 600,175
======== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-20
<PAGE> 70
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
-----------------------
1994 1993
--------- ---------
<S> <C> <C>
CASH FLOW PROVIDED FROM OPERATIONS:
Premiums, annuity considerations and fund deposits............... $1,380,988 $1,880,070
Investment income net of investment expenses..................... 640,325 970,131
Other income..................................................... 97,437 37,680
Net change in policy loans....................................... 23,940 19,736
Policy benefits paid............................................. (1,492,816) (1,913,524)
Transfers to separate accounts (See Note 2)...................... (11,525) (189,613)
Commissions, other expenses and taxes paid....................... (360,655) (389,973)
Dividends to policyholders....................................... (209,576) (230,405)
Federal income taxes (excluding capital gains tax)............... 6,502 (1,164)
--------- ---------
Net cash from operations...................................... 74,620 182,938
--------- ---------
PROCEEDS FROM INVESTMENTS SOLD, MATURED OR REPAID:
Bonds (See Note 2)............................................... 805,903 3,002,123
Stocks........................................................... 115,515 79,664
Mortgage loans (See Note 2)...................................... 337,436 1,411,527
Real estate...................................................... 34,725 24,096
Other invested assets............................................ 27,615 17,160
Other............................................................ 145 435
--------- ---------
Total investment proceeds..................................... 1,321,339 4,535,005
--------- ---------
OTHER CASH PROVIDED:
Issuance of surplus notes (net of underwriting costs)............ 69,990 --
Other sources.................................................... 1,381 40,849
--------- ---------
Total cash provided........................................... 1,467,330 4,758,792
--------- ---------
CASH APPLIED:
Cost of investments acquired:
Bonds......................................................... 1,061,124 1,542,222
Stocks........................................................ 92,753 137,175
Mortgage loans................................................ 112,269 128,818
Real estate................................................... 128,269 77,734
Other invested assets......................................... 36,988 73,906
--------- ---------
Total investments acquired.................................. 1,431,403 1,959,855
--------- ---------
Transfer of group pension liabilities (See Note 2)............... -- 2,727,364
Other cash applied............................................... 90,125 38,658
--------- ---------
Total cash applied............................................ 1,521,528 4,725,877
--------- ---------
Net change in cash and short-term investments.................... (54,198) 32,915
Cash and short-term investments, beginning of year................. 204,870 171,955
--------- ---------
Cash and short-term investments, end of year....................... $ 150,672 $ 204,870
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-21
<PAGE> 71
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The Mutual Life Insurance Company of New York (the "Company") is a mutual
life insurance company primarily engaged in the business of providing life
insurance and disability income protection and asset accumulation products. The
Company's financial statements have been prepared on the basis of accounting
practices and procedures prescribed or permitted by the Insurance Department of
the State of New York, which are considered to be generally accepted accounting
principles ("GAAP") for mutual life insurance companies domiciled in New York.
The following is a description of the principal accounting practices and
procedures:
a. Premiums are included in revenue over the premium payment periods
of the related policies. Annuity considerations and fund deposits are
included in revenue as received.
Commissions and other costs related to issuance, maintenance and
settlement of policies are charged to operations in the year incurred.
b. Short-term investments are carried at cost and consist of
securities with maturities of three months or less. Bonds eligible for
amortization under rules promulgated by the National Association of
Insurance Commissioners ("NAIC") are carried at amortized cost, while all
other bonds are carried at values adopted by the NAIC, which approximate
fair market value. Loan backed bonds and structured securities are valued
at amortized cost using the effective interest method considering
anticipated prepayments at the date of purchase; significant changes in the
estimated cash flows from the original purchase assumptions are accounted
for using the retrospective method. Common stocks are carried at market
value except investments in subsidiaries, which are generally carried on
the equity basis. Preferred stocks are carried principally at cost except
for those securities in or near default which are valued at market. Policy
loans are carried at their unpaid balances.
Mortgage loans other than those in process of foreclosure are carried at
their unpaid balances adjusted for unamortized discount. Real estate
owned for investment is carried at depreciated cost, less encumbrances
($7 million in 1994 and $18 million in 1993). Joint ventures and limited
partnerships in real estate, cable television and energy are included in
other invested assets and are carried principally at their equity value.
Other investments are generally carried at cost.
Real estate acquired through foreclosure is carried at the lower of cost
or estimated fair value at the time of foreclosure, less accumulated
depreciation and encumbrances. Mortgage loans in process of foreclosure
are also carried at the lower of cost or estimated fair value. Fair
value is determined by using the estimated discounted cash flows
expected from the underlying real estate properties. These projected
cash flows are based on estimates regarding future operating expenses,
lease rates, occupancy levels and investors' targeted yields.
The Company provides, through a direct charge to surplus, an investment
valuation reserve for permanent impairment of real estate investments,
joint ventures and limited partnerships in real estate and mortgage
loans delinquent for more than 60 days and restructured mortgage loans.
This reserve reflects, in part, the excess of the carrying value of such
assets over the estimated undiscounted cash flows expected from the
underlying real estate properties. These projected cash flows are based
on estimates similar to those described in the preceding paragraph. As
of December 31, 1994 and 1993, the Company's investment reserve for its
mortgage loan and real estate investments was $90 million.
c. Realized investment gains and losses (net of tax) for bonds and
mortgage loans resulting from changes in interest rates are deferred, and
credited or charged to the Interest Maintenance Reserve ("IMR"). These
amounts are amortized into net income over the remaining years to expected
maturity of the assets sold. Unrealized capital gains and losses are
recorded directly to surplus.
F-22
<PAGE> 72
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: -- (CONTINUED)
The Asset Valuation Reserve ("AVR") is based upon a formula prescribed
by the NAIC and functions as a reserve for potential
non-interest-related investment losses. In addition, realized investment
gains and losses (not subject to the IMR) and unrealized gains and
losses result in offsetting increases and decreases in the AVR. These
changes to the AVR are recorded directly to surplus.
d. Policy reserves for life insurance, annuities, and supplemental
benefits are computed by using permitted statutory interest rates and
mortality factors. Reserves computed by a modified commissioners' reserve
valuation method represent approximately 74% and 72% of gross life
insurance reserves at December 31, 1994 and 1993, respectively.
Reserves for life insurance were principally determined by using the
1941, 1958 and 1980 Commissioners' Standard Ordinary Mortality and the
American Experience Tables and assumed interest rates ranging from 2.25%
to 7%. Reserves for individual and group annuity mortality tables have
assumed interest rates ranging from 2.25% to 9.5%.
During 1993, the Company changed its methods of accounting for certain
reserves with the approval of the New York Insurance Department. The
Company increased the valuation interest rate on certain policies from
2.5% to a range of 3.5% to 5.0%, resulting in an increase in surplus of
$12.5 million, and released reserves held for retired employees life
insurance, resulting in an increase in surplus of $43 million.
Policy claims in process of settlement include provisions for payments
to be made on reported claims and on claims incurred but not reported.
e. The Company's subsidiaries are not consolidated. The subsidiaries
are carried principally on the statutory equity basis. Changes in the
Company's equity in subsidiaries are included in unrealized capital gains
and losses. Dividends from subsidiaries are recognized as investment income
when declared.
f. Dividends to policyholders are determined annually by the Board of
Trustees.
g. Certain assets designated as "non-admitted" assets (principally
miscellaneous receivables) are excluded from the balance sheets.
h. Separate account assets and liabilities represent segregated funds
administered and invested by the Company for the benefit of certain
contractholders. Approximately 93% of these assets consist of securities
reported at market value and 7% consist of fixed income securities carried
at amortized cost. Premiums, benefits and expenses of the separate accounts
are included in the Company's statements of operations.
i. No deferred taxes are recognized for differences that exist between
financial reporting and taxable income.
j. The Company uses the constant-yield method of depreciation for
substantially all investment real estate, real estate joint ventures and
cable television limited partnerships acquired prior to January 1, 1991.
Acquisitions subsequent to January 1, 1991 and foreclosed real estate are
depreciated on the straight line method. Real estate assets and
improvements are generally depreciated over ten to forty year periods and
leasehold improvements over the lives of the leases. Depreciation expense
related to investments in real estate was $50.5 million and $47.8 million
in 1994 and 1993, respectively; accumulated depreciation was $185.1 million
and $139.3 million at December 31, 1994 and 1993, respectively.
k. Special surplus funds consist primarily of amounts required by the
State of New York to be assigned as surplus funds for group insurance,
separate accounts, and aviation reinsurance.
F-23
<PAGE> 73
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: -- (CONTINUED)
l. Certain amounts for 1993 have been reclassified to conform to the
1994 presentation.
2. REINSURANCE OF GROUP PENSION BUSINESS:
On December 31, 1993, the Company entered into an agreement with AEGON USA,
Inc. ("AEGON USA") under which the Company transferred assets with a book value
of approximately $2.7 billion, consisting primarily of approximately $1.1
billion of mortgage loans and approximately $1.4 billion of debt securities,
including $380 million of securities rated as non-investment grade by the NAIC
and approximately $200 million in cash and short-term securities. The Company
transferred a corresponding amount of liabilities relating to its full service
group pension contracts, consisting primarily of tax-deferred annuity, 401(k)
and managed funds lines of business, to AEGON USA's wholly-owned subsidiary,
AUSA Life Insurance Company, Inc. ("AUSA Life"). AUSA Life also acquired the
corporate infrastructure supporting the group pension business, including
personnel, data processing systems, facilities and regional offices. In
connection with the transaction, the Company and AEGON USA have entered into
certain service agreements. These agreements, among other things, provide that
the Company will continue to manage the transferred assets, and AUSA Life will
continue to provide certain administrative services to the Company's remaining
group pension contracts not included in the transfer.
The initial transfer of the liabilities was made through indemnity
reinsurance. During 1994 approximately $2.1 billion of contractholder
liabilities were converted from indemnity to assumption reinsurance, whereby
AUSA Life replaced the Company as the primary obligor. It is anticipated that
most of the remaining contracts will be converted to assumption reinsurance in
which AUSA Life will replace the Company as the primary obligor under the
contracts to the extent allowed by state laws and regulations of the applicable
states. If any such contractholder rejects the assumption, or if the assumption
of any holder's contract is precluded by law, such holder's contract will
continue to be reinsured by AUSA Life on an indemnity reinsurance basis, and the
Company will remain contingently liable under the contract in the event that
AUSA Life fails to perform its reinsurance obligations. Additionally, on
December 31, 1993 the Company agreed to transfer to AUSA Life, through
assumption reinsurance, approximately $3.6 billion of separate account business
related to the group pension contracts described above. As of December 31, 1994,
the remaining non-transferred separate account business amounted to
approximately $600 million.
In connection with the transaction, at December 31, 1993, the Company made
a $200 million capital investment in AEGON USA by purchasing $150 million of
Series A and $50 million of Series B notes, which have a term of nine years and
receive a market rate of interest set at the date of issuance. In addition to
interest payments on the notes, the Company has the right to receive certain
payments based on the profits of the transferred business in force on the
transaction date, a future payment tied to the determination of the value of the
transferred business at the end of nine years, and a potential payment based on
new business growth. Net operating losses, if any, on the transferred business
for any year will be carried forward to reduce profit payments in subsequent
years. Any deficit remaining at the end of the nine year term and any adjustment
related to the final value of the transferred business may only be applied to
reduce the principal amount of any outstanding Series A notes. During 1994, the
Company earned $84.7 million based upon the profits of the transferred group
pension business and recorded this amount as revenue from ceded reinsurance in
the Summary of Operations. Pursuant to the assumption agreement, the Company
expects to acquire approximately $68 million of additional Series A notes during
1995 with payments from the profits of the transferred business.
F-24
<PAGE> 74
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
3. SUBSIDIARY COMPANIES:
At December 31, 1994 and 1993, the Company's investments in subsidiaries,
all of which are wholly-owned, consisted of the following:
<TABLE>
<CAPTION>
1994 1993
------ ------
(IN MILLIONS)
<S> <C> <C>
MONY Life Insurance Company of America................... $104.9 $102.2
Non-life subsidiaries.................................... 18.5 19.0
------ ------
$123.4 $121.2
====== ======
</TABLE>
At December 31, 1994, MONY Life Insurance Company of America ("MONY
America") had assets of $2.4 billion; including bonds ($992 million), mortgage
loans ($176 million) and separate account assets ($998 million); and liabilities
of $2.3 billion, primarily life insurance and annuity reserves ($1.3 billion)
and separate account liabilities ($998 million). Capital and surplus of MONY
America was $105 million. In 1994, total revenues of MONY America were $597
million, benefits and expenses were $585 million and net income, including
realized capital losses, was $6 million.
During 1993, the Company contributed $25 million to the capital of MONY
America. During 1994 and 1993, the Company made aggregate capital contributions
of $3.5 million and $31.1 million, respectively, to certain non-life
subsidiaries. The Company also received aggregate capital distributions of $3
million in 1994 and $2.8 million in 1993 from its non-life subsidiaries.
In 1994, the Company purchased commercial mortgages with a book value of $5
million from MONY America for consideration of $4 million. During 1993, the
Company purchased commercial mortgages and bonds with a book value of
approximately $232 million from MONY America for consideration of $237 million.
In each of these transactions, the consideration was based on the estimated fair
value of the assets.
4. COMMITMENTS AND CONTINGENCIES:
The Company has guaranteed to certain states that the surplus of MONY
America will be maintained at amounts at least equal to the minimum surplus
required for admission to those states.
During 1986 and 1987, MONY Funding Inc., a wholly-owned subsidiary of the
Company, issued $150 million of 8 1/4% notes due October 29, 1996 and $125
million of 8 1/8% notes due April 7, 1997, and invested the proceeds in
partially amortizing and nonamortizing commercial mortgage loans scheduled to
mature concurrently with the notes. As of December 31, 1994, the Company had
repurchased approximately $60 million of these notes. The Company has guaranteed
the principal and interest of the remaining outstanding notes.
At December 31, 1994, the Company has guaranteed principal and interest of
$34 million on mortgages and real estate held by unrelated investors.
The Company maintains lines of credit with domestic banks totaling $150
million with scheduled renewal dates during 1995. The Company has not borrowed
against its credit lines since 1982.
In November 1994, the Company reached an agreement for the transfer of the
management of its information systems operations to Computer Sciences
Corporation ("CSC"). Under the terms of this agreement to operate, manage and
enhance its information systems operations, the Company will pay CSC an
estimated $205 million over the seven-year contract period. The total payments
under the contract may vary based upon certain factors, including the volume of
computing services and the introduction of new information systems technology.
F-25
<PAGE> 75
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
4. COMMITMENTS AND CONTINGENCIES: -- (CONTINUED)
The Company is a defendant in various legal actions arising primarily from
its investment and insurance operations. In addition, insurance companies are
subject to assessments, up to statutory limits, by state guaranty funds for
losses of policyholders of insolvent insurance companies. In the opinion of
management, assessments and the outcome of the legal proceedings will not have a
material adverse effect on the financial position and the results of operations
of the Company.
5. PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS:
Employee Retirement Plans
The Company has a qualified defined benefit pension plan covering
substantially all its employees. The benefits are based on years of service and
the employee's final average annual compensation. The Company's funding and
accounting policies are to contribute annually the maximum amount that can be
deducted for federal income taxes and to charge expenses in the year the
contributions are made. No contributions were made in the current year or prior
year because the plan was subject to the full funding limitation under the
Internal Revenue Code. At December 31, 1993, the plan's accumulated benefit
obligation, determined in accordance with Statement of Financial Accounting
Standards No. 87 and valued as of December 31, 1993 based on an assumed
settlement rate of 7.5%, was $200.2 million, including vested benefits of $197.9
million, and the fair value of plan assets was $354.9 million.
The Company also has a qualified money purchase pension plan covering
substantially all career field underwriters. Company contributions of 5% of
earnings plus an additional 2% of such earnings in excess of the social security
wage base are made each year. In addition, after-tax voluntary field underwriter
contributions of up to 10% of earnings are allowed. At December 31, 1993, the
fair value of plan assets was $172.8 million.
The Company sponsors a non-qualified defined benefit pension plan, which
provides benefits in excess of Internal Revenue Service limits to certain
employees. The benefits are based on years of service and the employee's final
average annual compensation. Pension benefits are paid from the Company's
general account. The amounts accrued by the Company for this plan, based on an
assumed 7.4% weighted average interest rate for 1994 and 7.3% for 1993 were
$32.4 million and $32.7 million in 1994 and 1993, respectively. The Company also
maintains various non-qualified defined contribution plans. The amounts accrued
for these various plans were $43.4 million and $40.5 million in 1994 and 1993,
respectively.
Deferred Compensation Plan
The Company has incentive savings plans in which substantially all
employees and career field underwriters are eligible to participate. The Company
matches employee and field underwriter contributions up to 3% and 2%,
respectively, of eligible compensation as defined. In addition, for employees,
the Company contributes 2% of eligible compensation for non-officer employees,
and may contribute up to an additional 3%. In addition, the Company has two
compensation plans for key employees which allow deferral of current
compensation, as allowed by New York Insurance Law.
Postretirement Benefits
The Company provides certain health care and life insurance (postretirement
benefits) for retired employees and field underwriters. In accordance with NAIC
requirements, the Company accrues the estimated employee cost of retiree benefit
payments for retirees and fully vested employees by estimating the actuarial
present value of benefits expected to be paid after retirement.
At December 31, 1992, the Company determined that the total pre-tax
postretirement benefit obligation approximated $82.9 million. The Company has
elected to amortize this transition obligation over a period of twenty years as
an expense in its Statement of Operations. The amount of transition obligation
amortized in
F-26
<PAGE> 76
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
5. PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS: -- (CONTINUED)
1994 and 1993 totaled approximately $4.2 million in each year. The total cost to
provide life insurance and health benefits for fully vested and retired
employees, including the expense described above, was $12.4 million in 1994 and
$13.6 million in 1993.
At December 31, 1994, the unfunded postretirement benefit obligation for
retirees and fully vested employees was $75.9 million, with $14.1 million
included in other liabilities. The discount rate used in determining the
accumulated postretirement benefit obligation was 8.5%, and the health care cost
trend rate was 11.0% graded to 6.0% over 15 years.
The health care cost trend rate assumption has an effect on the amounts
reported. To illustrate, an increase in the assumed health care cost trend rates
of one percentage point in each year would increase the postretirement benefit
obligation as of December 31, 1994 by $1.4 million and the estimated eligibility
cost and interest cost components of net periodic postretirement benefit cost
for 1994 by $0.2 million.
6. FEDERAL INCOME TAXES:
Commencing with the tax year 1994, the Company anticipates electing to file
a consolidated federal income tax return with its life and non-life affiliates.
For the tax year 1993, the Company filed a consolidated federal income tax
return with only its life insurance affiliate, MONY America. The allocation of
federal income taxes is based upon separate return calculations with current
credit for net losses. Intercompany tax balances are settled annually in the
first quarter.
As a mutual life insurer, the Company must reduce its deduction for
policyholder dividends for the taxable year by a portion of its surplus
determined on the basis of a tentative rate compiled from preliminary life
insurance industry data and published by the Internal Revenue Service ("IRS").
In the subsequent year, final life insurance industry data is available and the
rate is recomputed and published by the IRS. The reduction in the policyholder
dividends deduction initially reported is adjusted based on the difference
between the tentative and recomputed rates in the federal income tax return
filed for the subsequent year. The Company's current federal income tax expense
reflects the tentative rate for the current year and the adjustment based on the
difference between the recomputed and tentative rates for the prior year.
The Company's federal income tax returns for years through 1989 have been
examined with no proposed material adjustments. In the opinion of management,
adequate provision has been made for any additional taxes which may become due
with respect to open years.
Pre-tax operating gains and pre-tax realized gains, as reported in the
accompanying statements of operations, differ from taxable income reported for
tax purposes. Significant differences include the deferral and amortization of
policy acquisition costs for tax purposes, the difference between statutory and
tax reserves, the taxable portion of the Company's surplus, depreciation expense
and related recapture, utilization of capital loss carryovers, capital gains
deferred to the IMR, alternative minimum tax preference items and equity in
partnerships and joint ventures.
During 1994, the Company reached a settlement with the United States
Department of Justice relating to tax litigation for the years 1981-1983. The
settlement provides for a refund of taxes of $15 million. Interest on the refund
of approximately $30 million is included in other income in the 1994 Summary of
Operations. The Company has recorded a $45 million receivable for the combined
tax refund and related interest as federal income taxes recoverable at December
31, 1994.
F-27
<PAGE> 77
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
7. LEASES:
The Company has entered into various operating lease agreements for office
space and furniture and equipment. These leases have remaining non-cancelable
lease terms in excess of one year. Total rental expense for these operating
leases amounted to $25.8 million in 1994 and $27.9 million in 1993. The future
minimum rental obligations under these leases at December 31, 1994 are as
follows:
<TABLE>
<CAPTION>
(IN MILLIONS)
-------------
<S> <C>
1995............................................................ $ 23.4
1996............................................................ 20.2
1997............................................................ 18.2
1998............................................................ 14.3
1999............................................................ 11.1
Later years..................................................... 77.3
-------------
$ 164.5
=========
</TABLE>
8. CAPITAL GAINS/(LOSSES):
The Company realized net capital gains/(losses) (after tax and IMR) of $(4)
million in 1994 and $2 million in 1993 as follows:
<TABLE>
<CAPTION>
1994 1993
---- ----
(IN MILLIONS)
<S> <C> <C>
REALIZED CAPITAL GAINS/(LOSSES)
Bonds and preferred stock.................................... $ 0 $ 85
Common stock................................................. (2 ) 4
Mortgage loans............................................... 7 (77)
Real estate and other investments............................ (3 ) 0
---- ----
2 12
Tax benefit (provision)...................................... (4 ) 14
Transferred to IMR, net of taxes............................. (2 ) (24)
---- ----
Net realized capital gains/(losses)........................ $(4 ) $ 2
==== ====
</TABLE>
During 1994 and 1993, realized capital gains resulting from changes in
interest rates on fixed income securities of $1.6 million (net of $0.6 million
tax) and $24 million (net of $13 million tax), respectively, were transferred to
the Company's IMR for future amortization into net income.
F-28
<PAGE> 78
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
8. CAPITAL GAINS/(LOSSES): -- (CONTINUED)
The Company incurred net unrealized capital losses of $55 million in 1994
and $185 million in 1993. The 1994 and 1993 unrealized losses include writedowns
of approximately $86 million and $225 million, respectively, on real estate
acquired through foreclosure and mortgage loans in process of foreclosure,
including real estate held by subsidiaries. These losses are detailed by asset
type in the table below:
<TABLE>
<CAPTION>
1994 1993
---- -----
(IN MILLIONS)
<S> <C> <C>
UNREALIZED CAPITAL GAINS/(LOSSES)
Bonds and preferred stock................................... $ 19 $ 16
Common stock................................................ (6) (1)
Mortgage loans.............................................. (10) (53)
Real estate................................................. (73) (104)
Subsidiaries................................................ 2 (42)
Other investments........................................... 13 (1)
---- -----
Total unrealized capital losses........................... $(55) $(185)
==== =====
</TABLE>
9. COMMON STOCKS:
Common stocks include marketable equity securities carried at market values
of $55.9 million and $36.6 million at December 31, 1994 and 1993, respectively,
and nonmarketable equity investments carried at estimated fair values of $135.9
million and $151.5 million at December 31, 1994 and 1993, respectively. The cost
of marketable equity securities was $62.7 million and $39.4 million at December
31, 1994 and 1993, respectively. At December 31, 1994, gross unrealized gains
were $8.4 million, and gross unrealized losses were $15.2 million for marketable
equity securities.
F-29
<PAGE> 79
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
10. FIXED INCOME SECURITIES:
Fixed Income Securities by Investment Type:
The amortized cost and estimated fair value (see note 13) of investments in
fixed income securities which include short-term investments, bonds and
preferred stocks as of December 31, 1994 and December 31, 1993 are as follows:
<TABLE>
<CAPTION>
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
------------------ --------------- --------------- ------------------
(DOLLARS IN MILLIONS) 1994 1993 1994 1993 1994 1993 1994 1993
- ------------------------------------------- ------- ------- ----- ------ ------ ----- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury securities and obligations
of U.S. government agencies............ $ 314.5 $ 293.7 $ 0.9 $ 2.9 $ 4.2 $ 0.3 $ 311.2 $ 296.3
Collateralized Mortgage Obligations:
Government Agency-Backed............... 250.5 168.7 0 1.1 26.6 0.8 223.9 169.0
Non-Agency Backed...................... 52.2 37.4 0.1 1.1 2.6 0.2 49.7 38.3
Other asset-backed securities:
Government Agency-Backed............... 90.0 102.4 1.1 5.7 5.1 0.2 86.0 107.9
Non-Agency Backed...................... 145.8 112.4 2.4 13.2 2.7 0 145.5 125.6
Foreign governments...................... 21.7 29.2 0 1.9 0.5 0 21.2 31.1
Utilities................................ 287.0 283.7 5.6 20.3 18.0 1.0 274.6 303.0
Affiliates............................... 30.2 60.2 0 3.6 0.1 0 30.1 63.8
Corporate bonds.......................... 2,376.6 2,227.1 25.8 154.5 106.6 34.2 2,295.8 2,347.4
------- ------- ----- ------ ------ ----- ------- -------
Total bonds............................ 3,568.5 3,314.8 35.9 204.3 166.4 36.7 3,438.0 3,482.4
Redeemable preferred stock............... 19.5 34.8 0.2 1.2 0.7 3.2 19.0 32.8
Commercial paper......................... 135.2 167.4 0 0 0 0 135.2 167.4
------- ------- ----- ------ ------ ----- ------- -------
Total.................................. $3,723.2 $3,517.0 $36.1 $205.5 $167.1 $39.9 $3,592.2 $3,682.6
======== ======== ===== ====== ====== ===== ======== ========
</TABLE>
Amortized cost represents the principal amount of fixed income securities
adjusted by unamortized premium or discount and reduced by writedowns of $40.5
million and $55.1 million for bonds and $0.3 million and $4 million for
preferred stock at December 31, 1994 and 1993, respectively, as required by the
NAIC for securities which are in or near default.
At December 31, 1994, 83% of the Company's Collateralized Mortgage
Obligation (CMO) portfolio was held in U.S. government and government
agency-backed securities. The remainder of the CMO portfolio consisted of NAIC
category 1 investment grade securities.
Maturities of Fixed Income Securities:
The amortized cost of fixed income securities and estimated fair value by
maturity date (excluding scheduled sinking funds) as of December 31, 1994 is the
following:
F-30
<PAGE> 80
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
10. FIXED INCOME SECURITIES: -- (CONTINUED)
<TABLE>
<CAPTION>
ESTIMATED
AMORTIZED FAIR
COST VALUE
--------- ---------
(IN MILLIONS)
<S> <C> <C>
Due in one year or less.................................. $ 202.0 $ 199.2
Due after one year through five years.................... 1,128.0 1,119.7
Due after five years through ten years................... 1,473.0 1,404.5
Due after ten years...................................... 920.2 868.8
--------- ---------
$3,723.2 $3,592.2
======== ========
</TABLE>
Expected maturities may differ from contractual maturities because
borrowers may have the right to call or prepay obligations with or without call
or prepayment penalties.
Proceeds from sales of investments in debt securities during 1994 and 1993
were $331.9 million and $2,111.3 million, respectively. Gross gains of $19.5
million in 1994 and $95.5 million in 1993, and gross losses of $10.9 million in
1994 and $30.1 million in 1993 were realized on these sales.
11. OFF-BALANCE SHEET RISK AND CONCENTRATION OF CREDIT RISK:
Financial Instruments with Off-Balance Sheet Risk:
In 1992, the Company entered into an agreement with a bank to lend
securities to approved borrowers. There were no loaned securities as of December
31, 1994 or 1993.
Concentration of Credit Risk:
At December 31, 1994 and 1993, the Company had no single investment
(excluding U.S. Treasury securities) exceeding 2.1% and 2.0%, respectively, of
total general account assets.
The bond portfolio is diversified by industry type. The industries that
comprise more than 10% of the carrying value of the bond portfolio at December
31, 1994 are Financial Services of $477 million (13.4%), Consumer goods and
services of $356 million (10.0%), and Government and Agencies of $677 million
(18.9%). At December 31, 1993, the industries comprising in excess of 10% of the
bond portfolio carrying value were Financial Services of $489.0 million (14.8%),
Consumer goods and services of $365 million (11.0%) and Government and Agencies
of $594 million (17.9%).
The Company holds below investment grade bonds of $231 million at December
31, 1994. Below investment grade bonds are defined as those securities rated in
categories 3 through 6 by the NAIC, which are approximately equivalent to bonds
rated below BBB by rating agencies. These bonds consist mostly of privately
issued bonds, which are monitored by the Company through extensive internal
analysis of the financial condition of the borrowers, and which include
protective debt covenants. Of these bonds, $103 million are in category 3, which
is considered to be medium quality by the NAIC. At December 31, 1993, the
Company's investments in below investment grade bonds were $293 million.
The Company has significant investments in commercial and agricultural
mortgage loans and real estate (including joint ventures and partnerships).
Approximately 50% of the Company's real estate and mortgage portfolio is
invested in office building properties. The locations of property
collateralizing mortgage loans and real estate investment carrying values (in
millions) at December 31, 1994 and 1993 are as follows:
F-31
<PAGE> 81
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
11. OFF-BALANCE SHEET RISK AND CONCENTRATION OF CREDIT RISK: -- (CONTINUED)
<TABLE>
<CAPTION>
1994 1993
---------------- ----------------
GEOGRAPHIC REGION $ % $ %
- ------------------------------------------------------ ------ ----- ------ -----
<S> <C> <C> <C> <C>
Southeast............................................. $1,133 28.0 $1,160 27.1
West.................................................. 742 18.3 784 18.4
Northeast............................................. 669 16.5 683 16.0
Mountain.............................................. 584 14.5 599 14.0
Southwest............................................. 463 11.5 484 11.3
Midwest............................................... 453 11.2 564 13.2
------ ----- ------ -----
Total............................................... $4,044 100.0% $4,274 100.0%
====== ===== ====== =====
</TABLE>
The states with the largest concentrations of mortgage loans and real
estate investments at December 31, 1994 are: California, $579 million (14.3%);
Texas, $384 million (9.5%); New York, $335 million (8.3%); Georgia, $315 million
(7.8%); Arizona, $281 million (6.9%); Illinois, $281 million (6.9%); Florida,
$254 million (6.3%); Colorado, $215 million (5.3%).
12. MORTGAGE LOANS, REAL ESTATE AND OTHER INVESTED ASSETS:
The Company invests in mortgage loans collateralized by commercial and
agricultural real estate. Such mortgage loans consist primarily of first
mortgage liens on completed income producing properties. As of December 31,
1994, $370 million of mortgage loans have terms that require amortization, and
$1.4 billion of loans require partial amortization or are non-amortizing.
Mortgage loans delinquent over 90 days or in process of foreclosure were $33
million at December 31, 1994 and $97 million at December 31, 1993. Properties
acquired through foreclosure during the year amounted to $108 million and $184
million in 1994 and 1993, respectively.
The Company has performing restructured mortgage loans of $237 million as
of December 31, 1994 and $220 million as of December 31, 1993. The new terms
typically defer a portion of contract interest payments to future periods.
Interest is recognized in income based on the modified rate of the loan.
Deferred interest, which is the difference between the original contractual rate
and the modified rate, is excluded from income. Gross interest income on
restructured loans that would have been recorded in accordance with the loans'
original terms was approximately $23 million in 1994 and $21 million in 1993.
Gross interest income recognized in net income for the period from these loans
was approximately $16 million in 1994 and $14 million in 1993. There are no
commitments to lend additional funds to any debtor involved in a restructuring.
Other invested assets of $339 million and $361 million at December 31, 1994
and 1993, respectively, include, primarily, investments in real estate joint
ventures and limited partnerships.
F-32
<PAGE> 82
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
13. ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS:
The following table presents the carrying amounts and estimated fair values
of the Company's financial instruments at December 31, 1994. The calculations of
estimated fair values involve considerable judgement. Accordingly, these
estimates of fair value are not necessarily indicative of the values that could
be negotiated in an actual sale.
<TABLE>
<CAPTION>
ESTIMATED
CARRYING FAIR
AMOUNT VALUE
-------- ----------
(IN MILLIONS)
<S> <C> <C>
FINANCIAL ASSETS:
Cash................................................. $ 15.5 $ 15.5
Short term investments............................... 135.2 135.2
Preferred Stock...................................... 19.5 19.0
Common Stock (unaffiliated).......................... 191.8 191.8
Fixed Income Securities.............................. 3,568.5 3,438.0
Mortgage Loans....................................... 1,771.3 1,718.2
Separate Account Assets.............................. 1,835.8 1,827.6
FINANCIAL LIABILITIES:
Investment-type contracts............................ 1,704.1 1,680.3
Separate Account Liabilities......................... 1,828.4 1,820.2
</TABLE>
The methods and assumptions utilized in estimating these fair values of
financial instruments are summarized as follows:
The estimated fair value of cash, short term investments and equity
securities approximate their respective carrying amounts.
Fixed Income Securities (See Note 10)
The estimated fair values of fixed income securities are based upon quoted
market prices, where available. The fair values of fixed income securities not
actively traded and other non-publicly traded securities are estimated using
values obtained from independent pricing services or, in the case of private
placements, by discounting expected future cash flows using a current market
interest rate commensurate with the credit quality and term of the investments.
Mortgage Loans
The fair value of mortgage loans is estimated by discounting expected
future cash flows, using current interest rates for similar loans to borrowers
with similar credit risk. Loans with similar characteristics are aggregated for
purposes of the calculations.
Policy Loans
Policy loans are an integral component of insurance contracts and have no
maturity dates. Management has determined that it is not practicable to estimate
the fair value of policy loans.
Separate Account
The estimated fair value of separate account assets and liabilities is
based upon estimates of values available upon full surrender.
F-33
<PAGE> 83
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
13. ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS: -- (CONTINUED)
Investment-type contract liabilities
The fair values of the Company's liabilities under investment-type
contracts are estimated by discounting expected cash outflows using interest
rates currently offered for similar contracts with maturities consistent with
those remaining for the contracts being valued, where appropriate. The fair
values of other investment-type contracts are based on estimates of the value of
payments available upon full surrender.
14. RESERVES:
The withdrawal characteristics of the Company's annuity actuarial reserves
and deposit liabilities as of December 31, 1994 were as follows:
<TABLE>
<CAPTION>
RESERVES
-------------
(IN MILLIONS)
<S> <C>
Not subject to discretionary withdrawal provision.............. $ 1,325
SUBJECT TO DISCRETIONARY WITHDRAWAL -- WITH ADJUSTMENT:
- with market value adjustment................................ 655
- at book value less surrender charges........................ 408
- at market value............................................. 1,027
-------
Subtotal.................................................. 2,090
SUBJECT TO DISCRETIONARY WITHDRAWAL -- WITHOUT ADJUSTMENT:
- at book value (minimal or no charge or adjustment).......... 1,176
-------
Total annuity actuarial reserves and deposit liabilities
(gross)...................................................... 4,591
Less: Reinsurance......................................... 639
-------
Total annuity actuarial reserves and deposit liabilities
(net)........................................................ $ 3,952
========
</TABLE>
The amounts shown above are included in the Company's balance sheet as life
insurance and annuity reserves ($2.2 billion) and separate account liabilities
($1.8 billion).
15. REINSURANCE:
Life insurance business is ceded on a yearly renewable term basis under
various reinsurance contracts. The Company's practice is to retain no more than
$3 million of risk on any one person for individual products and $4.5 million
for last survivor products. The total amount of reinsured life insurance in
force on this basis was $8.9 billion and $9.7 billion at December 31, 1994 and
1993, respectively. Premiums ceded under these contracts were $33.0 million and
$31.4 million; benefit payments recovered were approximately $23.3 million and
$30.0 million; policy reserve credits recorded were $28.9 million and $28.6
million; and recoverable amounts on paid and unpaid losses were $8.2 million and
$14.7 million in 1994 and 1993, respectively.
The Company reinsured certain whole life contracts issued from 1985 through
1991 under an agreement which combines the modified coinsurance and the
coinsurance bases. Reserves subject to this agreement were $295.9 million in
1994 and $263.1 million in 1993, for which the Company recorded policy reserve
credits of $45.0 million in both 1994 and 1993. Premiums ceded under this
contract were $58.1 million in 1994 and $62.5 million in 1993.
The Company reinsured certain whole life contracts issued from 1985 through
1988 under an agreement which combines the modified coinsurance and the
coinsurance bases. Reserves subject to this agreement were $325.0 million in
1994 and $298.2 million in 1993, for which the Company recorded policy reserve
credits of $55.0 million in both 1994 and 1993, respectively. Premiums ceded
under this contract were $51.1 million in 1994 and $54.7 million in 1993.
F-34
<PAGE> 84
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
15. REINSURANCE: -- (CONTINUED)
The Company has entered into coinsurance agreements with other insurers
related to a portion of its disability income, extended term insurance,
guaranteed interest contract and long-term disability claim liabilities. Under
the terms of these agreements at December 31, 1994 and 1993, ceded premiums were
$41.1 million and $41.6 million, respectively. The total ceded reserves and
claims liabilities under these agreements were $244 million and $272 million at
December 31, 1994 and 1993, respectively.
During 1994, the Company entered into an agreement to reinsure
approximately 50% of its block of paid-up life insurance policies. Pursuant to
this agreement, the Company ceded total liabilities of $123 million and received
a ceding commission of $12.7 million from the reinsurer. The Company transferred
assets equal to the total liabilities ceded into a segregated portfolio within
its general account to secure benefit payments from the reinsurer and
established a funds withheld liability to the reinsurer for a corresponding
amount.
The Company is contingently liable with respect to ceded insurance should
any reinsurer be unable to meet its obligations under these agreements.
16. SURPLUS NOTES:
During 1994, the Company completed the sale of $125 million of 30-year
Surplus Notes which generated net proceeds of $70 million after a discount of
42.146% from the principal amount payable at maturity and issuance expenses of
approximately $2.3 million. The $70 million of net proceeds has increased the
Company's surplus by a corresponding amount. Following the discount period,
interest will begin to accrue on August 15, 1999; thereafter, interest on the
Notes is scheduled to be paid on February 15 and August 15 of each year,
commencing February 15, 2000, at a rate of 11.25% per annum. Each accrual and
payment of interest on the Notes may be made only with the prior approval of the
New York State Superintendent of Insurance. Accordingly, the Company has made no
charge against its surplus for the accretion of discount on the Notes as
authorized by the New York State Insurance Department.
17. ACCOUNTING DEVELOPMENTS:
During 1993, the Financial Accounting Standards Board (FASB) issued
Interpretation No. 40, "Applicability of Generally Accepted Accounting
Principles to Mutual Life Insurance and Other Enterprises." The Interpretation
requires mutual life insurance companies which issue financial statements
described as prepared "in conformity with generally accepted accounting
principles" to apply all applicable authoritative accounting pronouncements in
preparing those statements. The provisions of this Interpretation are effective
for fiscal years beginning after December 15, 1995. The Interpretation indicates
that financial statements of mutual life insurance companies which are prepared
on the basis of statutory accounting practices may no longer receive an
unqualified audit opinion stating that the financial statements have been
prepared in accordance with GAAP.
In January 1995, the FASB issued Statement of Financial Accounting
Standards No. 120, "Accounting and Reporting by Mutual Life Insurance
Enterprises and by Insurance Enterprises for Certain Long-Duration Participating
Contracts." This Statement extends the requirements of FASB Statements No. 60,
"Accounting and Reporting by Insurance Enterprises", No. 97, "Accounting and
Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for
Realized Gains and Losses from the Sale of Investments", and No. 113,
"Accounting and Reporting for Reinsurance of Short-Duration and Long-Duration
Contracts", to mutual life insurance enterprises. In 1995, the AICPA established
accounting for certain participating life insurance contracts of mutual life
insurance enterprises in its Statement of Position 95-1, "Accounting for Certain
Insurance Activities of Mutual life Insurance Enterprises". FASB Statement No.
120 and the AICPA Statement of Position are effective for fiscal years beginning
after December 15, 1995. The Company is currently evaluating the impact of these
accounting developments on its financial statements.
F-35
<PAGE> 85
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA
FOR THE YEAR ENDED DECEMBER 31, 1994
(AMOUNTS IN $ THOUSANDS)
The following is a summary of certain financial data from the Company's
Annual Statement included in other exhibits and schedules subjected to audit
procedures by independent accountants and utilized by the Company's actuaries in
the determination of reserves.
<TABLE>
<S> <C>
INVESTMENT INCOME EARNED
Government Bonds............................................. 34,449
Other bonds (unaffiliated)................................... 237,308
Bonds of affiliates.......................................... 2,486
Preferred stocks (unaffiliated).............................. 4,061
Preferred stocks of affiliates............................... 0
Common stocks (unaffiliated)................................. 19,203
Common stocks of affiliates.................................. 3,500
Mortgage loans............................................... 177,916
Real estate.................................................. 293,459
Premium notes, policy loans and liens........................ 75,317
Collateral loans............................................. 0
Cash on hand and on deposit.................................. 113
Short-term investments....................................... 10,350
Other Invested Assets........................................ 6,787
Derivative Instruments....................................... 543
Aggregate write-ins for investment income.................... 3,288
---------
Gross investment income................................... 868,780
=========
REAL ESTATE OWNED -- BOOK VALUE LESS ENCUMBRANCES.............. 1,943,241
MORTGAGE LOANS -- BOOK VALUE:
Farm mortgages............................................... 371,994
Residential mortgages........................................ 4,265
Commercial mortgages......................................... 1,396,212
---------
Total mortgage loans...................................... 1,772,471
=========
MORTGAGE LOANS BY STANDING -- BOOK VALUE:
Good standing................................................ 1,502,541
Good standing with restructured terms........................ 236,516
Interest overdue more than three months, not in
foreclosure............................................... 5,688
Foreclosure in process....................................... 27,726
OTHER LONG TERM ASSETS -- STATEMENT VALUE...................... 1,526,588
COLLATERAL LOANS............................................... 0
</TABLE>
F-36
<PAGE> 86
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA -- (CONTINUED)
<TABLE>
<S> <C>
BONDS AND STOCKS OF PARENTS, SUBSIDIARIES AND
AFFILIATES -- BOOK VALUE
Bonds........................................................ 30,215
Preferred Stocks............................................. 0
Common Stocks................................................ 129,252
BONDS AND SHORT-TERM INVESTMENTS BY CLASS AND MATURITY:
BONDS BY MATURITY -- STATEMENT VALUE
Due within one year or less............................... 301,221
Over 1 year through 5 years............................... 1,100,124
Over 5 years through 10 years............................. 1,775,889
Over 10 years through 20 years............................ 372,709
Over 20 years............................................. 153,807
---------
Total by Maturity....................................... 3,703,750
=========
BONDS BY CLASS -- STATEMENT VALUE
Class 1................................................... 2,192,155
Class 2................................................... 1,280,600
Class 3................................................... 102,925
Class 4................................................... 36,609
Class 5................................................... 56,693
Class 6................................................... 34,768
---------
Total by Class.......................................... 3,703,750
=========
TOTAL BONDS PUBLICLY TRADED.................................... 1,665,334
TOTAL BONDS PRIVATELY PLACED................................... 2,038,416
PREFERRED STOCKS -- STATEMENT VALUE............................ 19,467
COMMON STOCKS -- MARKET VALUE.................................. 315,196
SHORT TERM INVESTMENTS -- BOOK VALUE........................... 135,206
FINANCIAL OPTIONS OWNED -- STATEMENT VALUE..................... 2
FINANCIAL OPTIONS WRITTEN AND IN FORCE -- STATEMENT VALUE...... 0
FINANCIAL FUTURES CONTRACTS OPEN -- CURRENT PRICE.............. 0
CASH ON HAND & ON DEPOSIT...................................... 15,466
LIFE INSURANCE IN FORCE:
Industrial................................................... 0
Ordinary..................................................... 68,771,173
Credit Life.................................................. 0
Group Life................................................... 6,663,070
AMOUNT OF ACCIDENTAL DEATH INSURANCE IN FORCE UNDER ORDINARY
POLICIES..................................................... 4,342,890
</TABLE>
F-37
<PAGE> 87
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA -- (CONTINUED)
<TABLE>
<S> <C>
LIFE INSURANCE POLICIES WITH DISABILITY PROVISIONS IN FORCE:
Industrial................................................... 0
Ordinary..................................................... 38,666,791
Credit Life.................................................. 0
Group Life................................................... 139,684
SUPPLEMENTARY CONTRACTS IN FORCE:
Ordinary -- Not Involving Life Contingencies
Amount on Deposit......................................... 153,251
Income Payable............................................ 1,630
Ordinary -- Involving Life Contingencies
Income Payable............................................ 6,264
Group -- Not Involving Life Contingencies
Amount on Deposit......................................... 3,446
Income Payable............................................ 545
Group -- Involving Life Contingencies
Income Payable............................................ 7
ANNUITIES:
Ordinary
Immediate -- Amount of Income Payable..................... 6,805
Deferred -- Fully Paid Account Balance.................... 22,542
Deferred -- Not Fully Paid -- Account Balance............. 12,110
Group
Amount of Income Payable.................................. 30,320
Fully Paid Account Balance................................ 37,438
Not Fully Paid -- Account Balance......................... 3
ACCIDENT AND HEALTH INSURANCE -- PREMIUMS IN FORCE:
Ordinary..................................................... 77,209
Group........................................................ 4,755
Credit....................................................... 0
DEPOSIT FUNDS AND DIVIDEND ACCUMULATIONS:
Deposit Funds -- Account Balance............................. 1,150,720
Dividend Accumulations -- Account Balance.................... 311,375
</TABLE>
F-38
<PAGE> 88
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
SUPPLEMENTAL SCHEDULE OF SELECTED FINANCIAL DATA -- (CONTINUED)
<TABLE>
<S> <C>
CLAIM PAYMENTS 1994:
Group Accident and Health Year -- Ended December 31, 1994
1994...................................................... 13,152
1993...................................................... 3,143
1992...................................................... 4,930
Other Accident & Health
1994...................................................... 2,525
1993...................................................... 4,251
1992...................................................... 7,903
Other Coverages that use developmental methods to calculate
claim reserves
1994...................................................... 0
1993...................................................... 0
1992...................................................... 0
</TABLE>
F-39
<PAGE> 89
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(A) The following Financial Statements are included in this Registration
Statement:
(1) With respect to MONY Variable Account A
(a) Report of Independent Accountants
(b) Statements of assets and liabilities as of December 31, 1994
(c) Statements of operations for the year ended December 31, 1994
(d) Statements of changes in net assets for the years ended December
31, 1994 and 1993
(e) Notes to financial statements
(2) With respect to The Mutual Life Insurance Company of New York:
(a) Comment on financial statements of MONY
(b) Report of Independent Accountants
(c) Balance sheets as of December 31, 1994 and 1993
(d) Statements of operations for the years ended December 31, 1994 and
1993
(e) Statements of surplus for the years ended December 31, 1994 and
1993
(f) Statements of cash flows for the years ended December 31, 1994 and
1993
(g) Notes to financial statements
(B) Exhibits
(1) Resolutions of Board of Trustees of The Mutual Life Insurance
Company of New York ("Company") authorizing the establishment of MONY
Variable Account A ("Variable Account"), adopted November 28, 1990, filed
as Exhibit (1) to Pre-Effective Amendment No. 1 to Registration Statement
(Registration Nos. 33-37722 and 811-6216) dated December 17, 1990, are
incorporated herein by reference.
(2) Not applicable.
(3) (a) Underwriting Agreement between MONY Securities Corp., The
Mutual Life Insurance Company of New York, and MONY Series Fund, Inc. filed
as Exhibit (3)(a) to Registration Statement (Registration No. 33-37718)
dated November 9, 1990, is incorporated herein by reference.
(b) Specimen Agreement with Registered Representatives filed as
Exhibit 3(b) to PreEffective Amendment No. 1, to Registration Statement
(Registration Nos. 33-37722 and 811-6216) dated December 17, 1990, is
incorporated herein by reference.
(c) Specimen Agreement (Career Contract) between the Company and
selling agents (with Commission Schedule), filed as Exhibit 3(c) to
Registration Statement Nos. 33-18626 and 811-5394, dated November 20,
1987, is incorporated herein by reference.
(4) Proposed forms of Flexible Payment Variable Annuity Contracts and
Certificates.
(5) Proposed form of Application for Flexible Payment Variable Annuity
Contract and Certificate (included in Exhibit 4).
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(6) Articles of Incorporation and By-Laws of the Company, filed as
Exhibit 6 to Registration Statement (Registration Nos. 33-19836 and
811-5457) No. 33-13850, dated January 27, 1988, is incorporated herein by
reference.
(7) Not applicable.
(8) Not applicable.
(9) Opinion and Consent of Edward P. Bank, Esq., as Vice President and
Deputy General Counsel, filed as Exhibit 9 to Post-Effective Amendment No.
2 to Registration Statement (Registration Nos. 33-37718 and 811-6216) dated
February 28, 1992, is incorporated herein by reference.
(10) Consent of Coopers & Lybrand L.L.P., Independent Accountants for
MONY Variable Account A.
Consent of Coopers & Lybrand L.L.P., Independent Accountants for The
Mutual Life Insurance Company of New York.
(11) Not applicable.
(12) Not applicable.
(13) Calculation of Performance Data, filed as Exhibit 13 to
Post-Effective Amendment No. 10 to Registration Statement (Registration
Nos. 33-37718 and 811-6216) dated February 28, 1995, is incorporated by
reference.
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
1. TRUSTEES
<TABLE>
<S> <C>
Claude M. Ballard, Jr......... Ltd. Partner, Goldman, Sachs & Company, New York, N.Y.
Tom H. Barrett................ Retired Chairman of the Board, President & Chief Executive
Officer, The Goodyear Tire & Rubber Company, Akron, Ohio.
David L. Call................. Dean, Cornell University, College of Agriculture and Life
Sciences, Ithaca, New York.
G. Robert Durham.............. President and Chief Executive Officer, Walter Industries,
Inc., Tampa, Florida.
James B. Farley............... Retired Chairman and Chief Executive Office, MONY
Robert Holland, Jr............ Chairman of the Board, ROKHER-J, Inc., White Plains, New
York.
James L. Johnson.............. Chairman Emeritus, GTE Corporation, Stamford, Connecticut.
John R. Meyer................. Professor, Harvard University, Cambridge, Massachusetts.
Paul A. Miller................ Chairman of the Executive Committee, Pacific Enterprises,
Los Angeles, California.
Jane C. Pfeiffer.............. Management Consultant, Greenwich, Connecticut.
Thomas C. Theobald............ Chairman, Continental Bank, Chicago, Illinois, Chicago,
Illinois.
David D. Thompson, M.D........ Consultant, The New York Hospital; Coordinator of Clinical
Education, Cornell University Medical College, New York,
New York.
</TABLE>
2. OFFICER-TRUSTEES
Michael I. Roth, Chairman and Chief Executive Officer, MONY; Director,
Chairman of the Board, and President, MONY Life Insurance Company of America;
Director, MONY CS.
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Samuel J. Foti, President and Chief Operating Officer, MONY; Director,
President and Chief Operating Officer, MONY Life Insurance Company of America;
Director, MONY Brokerage, Inc., MONY Financial Planning, Inc.
Kenneth M. Levine, Executive Vice President and Chief Investment Officer,
MONY; Director, Chairman, and President, MONY Series Fund, Inc.; Director, 1740
Advisers, Inc., MONY Life Insurance Company of America, MONY Realty Partners,
Inc., and 1740 Ventures, Inc.
3. OTHER OFFICERS
Thomas J. Conklin, Senior Vice President and Secretary, MONY.
Richard E. Connors, Senior Vice President, MONY; Director, MONY Life
Insurance Company of America.
Richard Daddario, Executive Vice President and Chief Financial Officer,
MONY; Vice President, MONY Advisers, Inc.; Director, Vice President and
Controller, MONY Life Insurance Company of America.
Phillip A. Eisenberg, Senior Vice President and Chief Actuary, MONY;
Director and Vice President, MONY Life Insurance Company of America.
Stephen J. Hall, Senior Vice President, MONY; Director, MONY Life Insurance
Company of America.
Richard E. Mulroy, Jr., Senior Vice President and General Counsel, MONY.
Theodore J. Shalack, Senior Vice President, MONY; Director and President,
MONY Credit Corporation; Director and Vice President, MONY Life Insurance
Company of America; Director, MONY Brokerage, Inc.
Francis J. Waldron, Senior Vice President, MONY.
David V. Weigel, Vice President -- Treasurer, MONY; Vice President and
Treasurer, MONY Credit Corporation, MONY Realty Partners, Inc., and 1740
Ventures, Inc.; Treasurer, 1740 Advisers, Inc., MONY Life Insurance Company of
America, MONY Series Fund, Inc., MONY Brokerage, Inc., MONY Financial Planning,
Inc., MONY-Rockville/GP, Inc., MONY Bloomfield Hills, Inc., and MONY Funding,
Inc.
For more than the past five years, the principal occupation of each of the
officers listed above (except Messrs. Daddario and Roth) has been an officer of
MONY. Mr. Daddario was formerly employed by Primerica Corporation in the
following capacities: January, 1988 to January, 1989 -- Vice President,
Corporate Controller; January 1987 to January, 1988 -- Assistant Corporate
Controller; January, 1986 to January, 1987 -- Managing Director, Policy and
Reporting; January, 1985 to January 1986 -- Director, Policy and Reporting. Mr.
Roth was employed from January, 1987 to March, 1989 as Executive Vice President
and Chief Financial Officer of Primerica Corporation and prior to January, 1987,
he served as Executive Vice President of that company.
The business address for all officers and officer-trustees of the Company
is 1740 Broadway, New York, New York 10019.
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
REGISTRANT.
The following is a diagram showing all corporations directly or indirectly
controlled by or under common control with the Company, showing the state or
other sovereign power under the laws of which each is organized and the
percentage ownership of voting securities giving rise to the control
relationship. (See diagram on following page.) Omitted from the diagram are
subsidiaries of the Company that, considered in the aggregate, would not
constitute a "significant subsidiary" (as that term is defined in Rule 8b-2
under Section 8 of the Investment Company Act of 1940) of the Company.
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ORGANIZATIONAL CHART
Attach a chart or listing presenting the identities of interrelationships
between the parent, all affiliated insurers and other affiliates, identifying
all insurers as such and listing the Federal Employer's Identification Number
for each. The NAIC Company code and two-letter state abbreviation of the state
of domicile should be included for all domestic insurers. The relationship of
the Holding Company Group to the ultimate parent (if such parent is outside the
reported holding company) should be shown. No non-insurer need be shown if it
does not have any activities reported in Part 2 and its total assets are less
than one-half of one percent of the total assets of the largest affiliated
insurer.
ORGANIZATIONAL CHART
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ITEM 27. NUMBER OF CERTIFICATE OWNERS:
As of December 31, 1994, MONY Variable Account A had 157 owners of
contracts.
ITEM 28. INDEMNIFICATION
The By-Laws of The Mutual Life Insurance Company of New York provide, in
Article XVI as follows:
Each person (and the heirs, executors and administrators of such person)
made or threatened to be made a party to any action, civil or criminal, by
reason of being or having been a trustee, officer, or employee of the
corporation (or by reason of serving any other organization at the request of
the corporation) shall be indemnified to the extent permitted by the law of the
State of New York and in the manner prescribed therein. To this end, and as
authorized by Chapter 513, 1986 Laws of New York, the Board of Trustees may
adopt all resolutions, authorize all agreements and take all actions with
respect to the indemnification of trustees and officers, and the advance payment
of their expenses in connection therewith.
Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification for such
liabilities (other than the payment by the Registrant of expense incurred or
paid by a director, officer, or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant, will (unless in the opinion of its counsel the
matter has been settled by controlling precedent) submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
ITEM 29. PRINCIPAL UNDERWRITERS
(a) MONY Securities Corp. ("MSC"), a wholly-owned subsidiary of The Mutual
Life Insurance Company of New York ("MONY"), is the principal underwriter of the
Registrant and also acts as principal underwriter for MONY Series Fund, Inc.
(the "Fund"). MONY acts as sub-investment adviser to the Fund through a services
agreement.
(b) The names, titles, and principal business addresses of the officers of
MSC are listed on Schedule A of Form BD for MSC (Registration No. 8-15289)
(originally filed on behalf of MONY Sales, Inc. on November 23, 1969) and Form
U-4 filed by each individual officer, the text of which is hereby incorporated
by reference.
(c) No commissions or other compensation was received by the principal
underwriter, directly or indirectly, from or MONY Variable Account A during
fiscal year 1992 and 1992.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
Accounts, books, and other documents required to be maintained by Section
31(a) of the Investment Company Act of 1940 and the Rules promulgated thereunder
are maintained by The Mutual Life Insurance Company of New York, in whole or in
part, at its principal offices at 1740 Broadway, New York, New York 10019, at
its Operations Center at 1 MONY Plaza, Syracuse, New York 13202 or at its
Marketing Center at 500 Frank W. Burr Boulevard, Teaneck, New Jersey 07666-6888.
ITEM 31. MANAGEMENT SERVICES
Not applicable.
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<PAGE> 94
ITEM 32. UNDERTAKINGS
(a) Registrant hereby undertakes to file post-effective amendments to the
Registration Statement as frequently as is necessary to ensure that the audited
financial statements in the Registration Statement are never more than 16 months
old for so long as payments under the variable annuity contracts may be
accepted;
(b) Registrant hereby undertakes to include either (1) as part of any
application to purchase a contract offered by the prospectus, a space that an
applicant can check to request a Statement of Additional Information, or (2) a
post card or similar written communication affixed to or included in the
prospectus that the applicant can remove to send for a Statement of Additional
Information;
(c) Registrant hereby undertakes to deliver any Statement of Additional
Information and any financial statements required to be made available under
this Form promptly upon written or oral request.
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<PAGE> 95
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, MONY Variable Account A, has
duly caused this Post-Effective Amendment No. 14 to this Registration Statement
to be signed on its behalf by the undersigned thereunto duly authorized, in the
City of New York, State of New York, on this 25th day of April, 1994.
MONY VARIABLE ACCOUNT A
(Registrant)
THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK
(Depositor)
By: /s/ MICHAEL I. ROTH
------------------------------------
Michael I. Roth, Trustee,
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 14 to this Registration Statement has been signed
below by the following persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE DATE
- ---------------------------------------------- -------------------
<S> <C>
/S/ MICHAEL I. ROTH
- ----------------------------------------------
Michael I. Roth
Trustee, Chairman and Chief Executive Officer
/S/ SAMUEL J. FOTI
- ----------------------------------------------
Samuel J. Foti
Trustee, President and Chief Operating Officer
/S/ KENNETH M. LEVINE April 25, 1995
- ----------------------------------------------
Kenneth M. Levine
Trustee, Executive Vice President and
Chief Investment Officer
/S/ RICHARD DADDARIO
- ----------------------------------------------
Richard Daddario
Executive Vice President and
Chief Financial Officer
/S/ PHILLIP A. EISENBERG
- ----------------------------------------------
Phillip A. Eisenberg
Senior Vice President and Chief Actuary
/S/ THOMAS J. CONKLIN
- ----------------------------------------------
Thomas J. Conklin
Senior Vice President and Secretary
</TABLE>
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<TABLE>
<CAPTION>
SIGNATURE DATE
- --------------------------------------------- -------------------
<S> <C>
</TABLE>
<TABLE>
<S> <C>
- ---------------------------------------------
Claude M. Ballard, Jr.*
Trustee
- ---------------------------------------------
Tom H. Barrett*
Trustee
- ---------------------------------------------
David L. Call*
Trustee
- ---------------------------------------------
G. Robert Durham*
Trustee
- ---------------------------------------------
James B. Farley*
Trustee
- ---------------------------------------------
Robert Holland, Jr.*
Trustee
April 25, 1995
- ---------------------------------------------
James L. Johnson*
Trustee
- ---------------------------------------------
John R. Meyer*
Trustee
- ---------------------------------------------
Paul A. Miller*
Trustee
- ---------------------------------------------
Jane C. Pfeiffer*
Trustee
</TABLE>
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<TABLE>
<CAPTION>
SIGNATURE DATE
- --------------------------------------------- -------------------
<S> <C>
- ---------------------------------------------
Thomas C. Theobald*
Trustee
*By /s/ THOMAS J. CONKLIN
- ---------------------------------------------
Thomas J. Conklin
Attorney In Fact
</TABLE>
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- ---------------------------------------------------------------------------
<S> <C>
(10) Consent of Coopers & Lybrand, Independent Accountants
(27) Financial Data Schedule
</TABLE>
<PAGE> 1
[COOPERS & LYBRAND LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
_____________
We consent to the inclusion in Post-Effective Amendment No. 11 to the
Registration Statement on Form N-4 (File No. 33-37718) of our report dated
February 21, 1995, on our audit of the financial statements of MONY Variable
Account A and our report dated February 28, 1995, on our audit of the financial
statements of The Mutual Life Insurance Company of New York.
We also consent to the reference to our Firm in the Statement of Additional
Information under the caption "Independent Accountants".
/s/ Coopers & Lybrand L.L.P.
----------------------------
COOPERS & LYBRAND L.L.P.
New York, New York
April 24, 1995
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM COMPANY'S
ANNUAL STATEMENT WHICH IS PREPARED BASED ON STATUTORY ACCOUNTING PRINCIPLES AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<DEBT-HELD-FOR-SALE> 0
<DEBT-CARRYING-VALUE> 3,568,543,549
<DEBT-MARKET-VALUE> 3,438,000,000
<EQUITIES> 334,663,307
<MORTGAGE> 1,771,305,289
<REAL-ESTATE> 1,943,241,305
<TOTAL-INVEST> 9,145,679,009
<CASH> 150,672,460
<RECOVER-REINSURE> 104,622,197
<DEFERRED-ACQUISITION> 0
<TOTAL-ASSETS> 11,670,001,156
<POLICY-LOSSES> 6,429,823,042
<UNEARNED-PREMIUMS> 7,259,047
<POLICY-OTHER> 54,848,708
<POLICY-HOLDER-FUNDS> 1,603,025,773
<NOTES-PAYABLE> 0
<COMMON> 0
0
0
<OTHER-SE> 680,070,134
<TOTAL-LIABILITY-AND-EQUITY> 11,670,001,156
1,380,436,402
<INVESTMENT-INCOME> 590,504,397
<INVESTMENT-GAINS> (215,847)
<OTHER-INCOME> 194,039,846
<BENEFITS> 1,494,706,570
<UNDERWRITING-AMORTIZATION> 0
<UNDERWRITING-OTHER> 361,925,748
<INCOME-PRETAX> 92,200,436
<INCOME-TAX> 10,780,767
<INCOME-CONTINUING> 81,419,669
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 81,419,669
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
</TABLE>
