<PAGE>
As filed with the Securities and Exchange Commission on February 16, 1999
Registration No. 333-11137
811-1930
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form N-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
PRE-EFFECTIVE AMENDMENT NO. [_]
POST-EFFECTIVE AMENDMENT NO. 4 [X]
AND
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
AMENDMENT NO. 32 [X]
NEW ENGLAND VARIABLE ANNUITY FUND I
(Exact name of registrant)
METROPOLITAN LIFE INSURANCE COMPANY
(Name of insurance company)
One Madison Avenue, New York, New York 10010
(Address of insurance company's principal executive offices)
Insurance Company's Telephone Number: (212) 578-5364
Name and Address of Agent for Copy to:
Service:
John M. Loder, Esq.
Gary A. Beller, Esq. Ropes & Gray
Metropolitan Life Insurance Company One International Place
One Madison Avenue Boston, Massachusetts 02110-2624
New York, New York 10010
It is proposed that this filing will become effective (check appropriate
box):
[_] immediately upon filing pursuant to paragraph (b)
[_] on (date) pursuant to paragraph (b)
[_] 60 days after filing pursuant to paragraph (a)(1)
[X] on April 30, 1999 pursuant to paragraph (a)(1)
[_] 75 days after filing pursuant to paragraph (a)(2)
[_] on (date) pursuant to paragraph (a)(2)
Title of Securities Being Registered: Individual Variable Annuity
Contracts.
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<PAGE>
PROSPECTUS
New England Variable Annuity Fund I
Individual Variable Annuity Contracts
-----------------------------------------------------
Issued by
Metropolitan Life Insurance Company
One Madison Avenue, New York, New York 10010
Designated Office:
New England Life Insurance Company
501 Boylston Street, Boston, Massachusetts 02116
(617) 578-2000
April 30, 1999
This prospectus describes individual variable annuity contracts for
individuals and certain qualified and nonqualified retirement plans. Deferred
contracts can be purchased with either a single payment or flexible payments,
and immediate contracts can be purchased with a single payment. We invest net
purchase payments in New England Variable Annuity Fund I (the "Fund"), a
separate investment account of Metropolitan Life Insurance Company (the
"Company", "we", "us" or "our"). The investment objective of the Fund is
growth of capital through investment primarily in equity securities of a
diversified group of companies and industries.
New England Mutual Life Insurance Company initially issued the contracts.
New England Mutual merged into us on August 30, 1996.
We currently are not offering any new contracts. However, holders of
existing flexible payment deferred contracts may continue to make purchase
payments.
Please read this prospectus carefully and keep it for reference. This
prospectus contains information that you should know before investing. You can
obtain a Statement of Additional Information ("SAI") dated May 1, 1999. The
SAI is filed with the Securities and Exchange Commission (the "SEC") and is
incorporated by reference in this prospectus. The Table of Contents for the
SAI is on page 22 of this prospectus. For a free copy of the SAI, write to New
England Securities Corporation, 399 Boylston Street, Boston, Massachusetts
02116.
New England Securities Corporation, an indirect subsidiary of the Company,
serves as principal underwriter for the Fund.
Neither the SEC nor any state securities commission has approved these
contracts or determined that this prospectus is accurate or complete.
Any representation to the contrary is a criminal offense.
<PAGE>
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Special Terms used in this prospectus
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Annuitant: the person on whose life the variable annuity contract is issued
("you" if the contract is not owned by an individual).
Fund: a separate investment account of the Company through which amounts at-
tributable to the variable annuity contracts are aggregated and invested.
Payee: any person entitled to receive payments under the contract. The term
includes (1) an Annuitant, (2) a beneficiary or contingent beneficiary who be-
comes entitled to death proceeds, or (3) you, on surrender or partial surren-
der of the contract.
Contractholder: the person or entity with legal rights of ownership in the
contract ("you").
Deferred Contract: a variable annuity contract in which annuity payments be-
gin on a selected future maturity date.
Immediate Contract: a variable annuity contract in which annuity payments be-
gin at a date agreed upon by us and you. This date is normally the date the
purchase payment is applied.
Purchase Payments: amounts paid to us to purchase a variable annuity.
After-tax Purchase Payments: the balance of purchase payments remaining after
deducting any applicable state premium taxes.
Net Purchase Payments: the balance of purchase payments remaining after de-
ducting (1) any applicable state premium taxes and (2) sales and administra-
tive expenses.
Accumulation Period: the period during which amounts are accumulated under a
deferred annuity contract before application under a payment option.
Annuity Period: the period beginning when amounts accumulated under a de-
ferred annuity contract are applied under a payment option. An immediate annu-
ity contract is always in the annuity period.
Accumulation Unit: an accounting device used to calculate the contract value
before annuity payments begin.
Annuity Unit: an accounting device used to calculate the dollar amount of an-
nuity payments.
Maturity Date: the date on which annuity payments are scheduled to begin.
Designated Office: Our Designated Office for requests and elections, and com-
munications regarding death of the Annuitant or Contractholder is New England
Life Insurance Company, located at 501 Boylston Street, Boston, Massachusetts
02116, (617) 578-2000. Our Designated Office for the receipt of Purchase Pay-
ments is P.O. Box 75099, Chicago, IL 60675-5099.
2
<PAGE>
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Highlights
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Variable Annuity Contracts -- The variable annuity contracts are for use by
individuals and with retirement plans, including the following plans that
qualify for tax-benefited treatment: (1) retirement plans qualified under Sec-
tion 401(a), 401(k), or 403(a) of the Code ("Qualified Plans"); (2) annuity
purchase plans adopted by public school systems and certain tax-exempt organi-
zations under Section 403(b) of the Code ("TSA Plans"); (3) individual retire-
ment accounts adopted by or on behalf of individuals under Section 408(a) of
the Code and individual retirement annuities purchased under Section 408(b) of
the Code (both of which may be referred to as "IRAs"), including simplified
employee pension plans and salary reduction simplified employee pension plans
which are specialized IRAs that meet the requirements of Section 408(k) of the
Code ("SEPs" and "SARSEPs"); (4) eligible deferred compensation plans (within
the meaning of Section 457 of the Code) for employees of state and local gov-
ernments and tax-exempt organizations ("Section 457 Plans"); and (5) govern-
mental plans (within the meaning of Section 414(d) of the Code) for governmen-
tal employees, including Federal employees ("Governmental Plans").
The basic objective of the contracts is to provide annuity payments that
will tend to conform to changes in the cost of living more closely than a
fixed annuity would. To achieve this goal, annuity payments are based on the
changing values of the Fund's assets.
The Company -- The contracts were originally issued by New England Mutual. On
August 30, 1996, New England Mutual merged into us. New England Mutual's
separate corporate existence then ended, and we assumed legal ownership of all
of the assets of New England Mutual, including the Fund and its assets. As a
result of the merger, we are responsible for all of New England Mutual's lia-
bilities and obligations, including those created under the contracts. The
contracts now are variable contracts funded by a separate account, and each
Contractholder has become one of our policyholders. The merger is not expected
to have any adverse tax con-sequences on you or other contractholders.
The Fund's Adviser -- Capital Growth Management Limited Partnership ("CGM")
is investment adviser to the Fund for a fee equal to an annual rate of .3066%
of the Fund's average daily net assets. (See "Investment Advisory Services and
Deductions.")
Purchase of Variable Annuity Contracts -- No new contracts are being offered
at this time, but if you hold an existing flexible payment deferred contract,
you may continue to make purchase payments. In certain states, a premium tax
charge may be deducted from the purchase payment. (In other states, a premium
tax may be deducted from the contract value when annuity payments begin. The
maximum premium tax is 3.5%.) We then make a deduction for sales and adminis-
trative expenses from each after-tax purchase payment. Such expenses may ag-
gregate up to 9% of the after-tax purchase payment for flexible payment de-
ferred contracts and 8% of the after-tax purchase payment for single purchase
payment deferred or immediate contracts. The deduction from any purchase pay-
ment for sales expenses will not exceed 6% of the after-tax payment. Reduced
sales charges apply in certain cases. (See "Deductions from Purchase Payments
for Sales and Administrative Services and Premium Taxes.")
Other Deductions -- We are compensated for the mortality and expense risks
associated with the contracts by daily deductions from the Fund's net assets
equal to, on an annual basis, a maximum of .9490% for deferred contracts and
.6935% for immediate contracts. (See "Mortality and Expense Risks and Deduc-
tions.")
Surrender of Contract -- Before annuity payments begin, you may surrender
the contract without charge for its cash value or for other types of early
payment. (See "Surrender (Redemption) Proceeds" under "Accumulation Period
(Deferred Contracts).")
3
<PAGE>
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Expense Table
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The following table lists the charges and expenses that you will incur as a
Contractholder. The items listed include charges deducted from purchase
payments and charges assessed against the Fund's assets. The purpose of the
table is to help you understand the various direct and indirect costs and
expenses that you will incur.(1)
Contractholder Transaction Expenses
<TABLE>
<CAPTION>
Flexible Purchase Single Purchase
Payment Contracts Payment Contracts
------------------ ---------------------
<S> <C> <C>
Sales Load Imposed on Purchases (as a
percentage of purchase payments
after deduction of any applicable
premium tax)(2)..................... 6.0% 6.00% of first $5,000
3.75% of next $95,000
1.75% of excess
Administrative Charge Imposed on
Purchases (as a percentage of
purchase payments after deduction of
any applicable premium tax)......... 3.00% of first $46 2.00% of first $5,000
2.00% of excess 0.25% of excess
</TABLE>
Annual Expenses
(as a percentage of average net assets)(3)
<TABLE>
<S> <C>
Management Fee......................................................... 0.31%
Expense Risk Fee....................................................... 0.11%
Mortality Risk Fee(4).................................................. 0.84%
Other Expenses......................................................... 0.09%
----
Total Annual Expenses................................................ 1.35%
</TABLE>
Example (5)
There are no extra expenses if you surrender or annuitize your contract. At
the end of the time periods listed below, you would have paid the following
expenses on a $1,000 investment, assuming a 5% annual return on assets:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
For a flexible purchase payment deferred con-
tract: $93 $120 $148 $229
For a single purchase payment deferred con-
tract(6): $93 $119 $148 $229
</TABLE>
- -------
NOTES:
(1) All charges and expenses apply for the duration of the contracts, except
that the mortality and expense risk fees do not apply during the annuity
period if you elect to transfer the proceeds of the contract from the Fund
to our general assets. (See "Fixed Payment Options.")
(2) Premium taxes are not charged in all states and vary in amount from state
to state. The maximum premium tax currently deducted by us is 3.5%. In
most states, we deduct the premium tax from the contract value when you
elect to begin annuity benefits, rather than from purchase payments when
we receive them. (See "Deductions from Purchase Payments for Sales and
Administrative Services and Premium Taxes.")
(3) We have rounded the percentages shown in the Annual Expenses portion of
the table to the nearest hundredth of a percent. (See "Deductions from
Fund Assets.")
(4) The fee shown is for a deferred contract. The mortality risk fee for an
immediate contract is 0.58% of the Fund's average net assets. Therefore,
total annual expenses for an immediate contract would be lower than for a
deferred contract. (See "Mortality and Expense Risks and Deductions.")
(5) You should not consider the Example to be a representation of past or
future expenses. Actual expenses may be greater or less than those shown.
The figures assume that no premium tax has been deducted. Also, we have
rounded all expense amounts to the nearest dollar.
(6) The minimum purchase payment for a single purchase payment contract is
$2,000. However, we are not offering new contracts at this time.
4
<PAGE>
PER UNIT INCOME AND CAPITAL CHANGES
(For an Accumulation Unit Outstanding Throughout the Period)
(The 1997 and 1998 information in this table comes from financial
statements audited by Deloitte & Touche LLP,independent accountants, whose
report accompanies the financial statements of the Fund. The information in
this table relating to each of the three years in the period ended December
31, 1996, comes from financial statements audited by Coopers & Lybrand
L.L.P., independent accountants, whose report accompanies the financial
statements of the Fund.)
<TABLE>
<CAPTION>
Year Ended December 31
------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Income and expenses:
Total investment income......... $ .50 $ .29 $ .28 $ .24 $ .29 $ .16 $ .25 $ .24 $ .16 $ .22
Operating expenses.............. .38 .32 .24 .19 .16 .15 .14 .13 .10 .09
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net investment income (loss).... $ .12 $ (.03) $ .04 $ .05 $ .13 $ .01 $ .11 $ .11 $ .06 $ .13
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Capital changes:
Net investment income (loss).... $ .12 $ (.03) $ .04 $ .05 $ .13 $ .01 $ .11 $ .11 $ .06 $ .13
Net realized and unrealized
gains (losses) on investments.. 7.91 4.50 3.52 4.57 (1.08) 1.26 (.37) 3.35 .34 1.10
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net increase (decrease) in
accumulation unit value........ 8.03 4.47 3.56 4.62 (.95) 1.27 (.26) 3.46 .40 1.23
Accumulation unit value at
beginning of period............ 24.55 20.08 16.52 11.90 12.85 11.58 11.84 8.38 7.98 6.75
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Accumulation unit value at end
of period...................... $32.58 $24.55 $20.08 $16.52 $11.90 $12.85 $11.58 $11.84 $ 8.38 $ 7.98
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Ratio of operating expenses to
average net assets (%).......... 1.34 1.35 1.34 1.35 1.26 1.26 1.25 1.26 1.26 1.26
Ratio of net investment income
(loss) to average net
assets (%)...................... .44 (.09) .22 .34 1.06 .11 .98 1.11 .69 1.72
Portfolio turnover (%)........... 195.15 209.18 196.25 228.26 139.43 154.15 171.55 157.43 136.52 206.90
Number of accumulation units
outstanding at end of period
(in thousands).................. 2,237 2,694 3,013 3,399 4,038 4,411 5,104 5,499 5,961 6,958
</TABLE>
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Financial Statements
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The financial statements of the Fund and our financial statements are
included in the Statement of Additional Information.
5
<PAGE>
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Fund Performance
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The average annual total return of the Fund illustrated below is based upon
accumulation unit values for the 1, 5 and 10 year periods ending December 31,
1998. Calculations are based on a single investment of $1,000 assumed to be
made at the beginning of each period shown. These calculations reflect the
maximum sales and administrative load of 9% of the first $46 and 8% of the
balance. These calculations do not include any premium tax charges, which
apply in certain states and would reduce the results shown. The net amount
(the Net Purchase Payment) is divided by the accumulation unit value at the
beginning of each of the 1, 5 and 10 year periods to arrive at the number of
accumulation units held during each period. The units held are multiplied by
the accumulation unit value on December 31, 1998 to arrive at the contract
value. The average annual total return is the annual compounded rate of return
that would produce the contract value on December 31, 1998.
AVERAGE ANNUAL TOTAL RETURN
<TABLE>
<S> <C>
Period Ending December 31, 1998
1 Year................................................................. 17.8%
5 Years................................................................ 17.6%
10 Years................................................................ 15.7%
</TABLE>
The Fund's Annual and Semi-Annual Reports also illustrate historical
investment performance by showing the percentage change in the unit value
without reflecting the impact of any sales and administrative charges. The
average annual total returns shown above are lower than the historical
investment performance for the same periods because average annual total
returns reflect sales and administrative charges. The percent change in unit
value represents the increase in contract value that would occur if you did
not make any purchase payments or surrenders during the year. The Reports show
the percent change in unit value for every calendar year since inception of
the Fund. Additionally, the Reports show the percent change in unit value from
inception of the Fund to the date of the report and for the 15, 10, 5, and 1
year periods ending with the date of the report. The percentage change is
calculated by dividing the difference in unit values at the beginning and end
of the period by the beginning unit value.
6
<PAGE>
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Description of the Company and the Fund
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We are a mutual life insurance company whose principal office is at One Madi-
son Avenue, New York, N.Y. 10010. We were organized in 1866 under the laws of
the State of New York and have engaged in the life insurance business under
our present name since 1868. We operate as a life insurance company in all 50
states, the District of Columbia, Puerto Rico and all provinces of Canada. We
have over $330 billion in assets under management.
The contracts were originally issued by New England Mutual. On August 30,
1996, New England Mutual merged into us, and we acquired the Fund and assumed
the liabilities and obligations under the contracts.
New England Life Insurance Company, which was a subsidiary of New England Mu-
tual and became a subsidiary of us as a result of the merger, provides admin-
istrative services for the contracts and the Fund. These administrative serv-
ices include maintenance of your records and accounting, valuation, regulatory
and reporting services. New England Life, located at 501 Boylston Street, Bos-
ton, Massachusetts 02116, is our designated office for requests and elections,
and communications regarding death of the Annuitant or Contractholder, as fur-
ther described below. Our Designated Office for the receipt of Purchase Pay-
ments is P.O. Box 75099, Chicago, IL, 60675-5099.
New England Mutual established the Fund in 1969 as a separate investment ac-
count under Massachusetts law. The Fund is currently a separate investment ac-
count of ours, subject to New York law. The Fund is registered as an open-end
diversified management investment company under the Investment Company Act of
1940 (the "1940 Act"). The Fund meets the definition of a "separate account"
under Federal securities laws.
The variable annuity contracts provide that the assets in the Fund shall not
be chargeable with liabilities arising out of any other business that we may
conduct. The income and realized and unrealized capital gains or losses of the
Fund must be credited to or charged against the Fund without regard to our
other income and capital gains or losses. The obligations arising under the
variable annuity contracts are general corporate obligations for us.
The Fund is managed by its Board of Managers, which is elected by you and the
other Contractholders in accordance with the 1940 Act. The affairs of the Fund
are conducted in accordance with Rules and Regulations adopted by the Board.
The Rules and Regulations of the Fund permit it to reorganize and qualify as
a unit investment trust or to terminate registration under the 1940 Act. In
each case, approval by a majority vote of the Contractholders is needed, as
well as any necessary approval of the SEC.
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The Variable Annuity Contracts
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You may make one or more Purchase Payments to the Company. If you have a de-
ferred contract, each Net Purchase Payment is credited to your contract in the
form of Accumulation Units. If you have an immediate contract, the Net Pur-
chase Payment is credited in the form of Annuity Units. The value of these
Units fluctuates in accordance with the net investment results of the Fund.
A. How Contract Purchase Payments May be Made
The initial Purchase Payment for a flexible payment deferred contract must be
at least $10. Thereafter, Purchase Payments of $10 or more may be made at any
time. We may, however, limit the amount of Purchase Payments made in any con-
tract year to three times the anticipated annual contribution specified by you
in your contract application. After your first Purchase Payment, you are not
required to make any further payments to keep the contract in force.
B. Accumulation Unit Values, Annuity Unit Values and Net Investment Factors
Accumulation Unit Values are used to value deferred contracts during the Ac-
cumulation Period, as described below in C. 2 of this section under the cap-
tion "Accumulation Period (Deferred Contracts)--Contract Value." Annuity Unit
Values are used to determine the number of Annuity Units credited under a
variable payment option at annuitization and the amounts of payments made pur-
suant to a variable payment option during the Annuity Period. Accumulation
Unit Values and Annuity Unit Values are determined after the close of the New
York Stock Exchange on each day it is open for trading. The calculation is
made by multiplying the current Accumulation Unit Value or Annuity Unit Value,
as the case may be, by the appropriate Net Investment Factor determined as of
the
7
<PAGE>
closing of the New York Stock Exchange on that day. To determine a Net Invest-
ment Factor, the Fund takes into account (1) the investment income paid or ac-
crued on its assets since the previous determination of such Net Investment
Factor, plus or minus realized and unrealized capital gains or losses during
such period, and (2) deductions for any taxes paid or reserved due to the in-
come and realized and unrealized capital gains on assets of the Fund, other ex-
penses paid by the Fund, expense risk charge and mortality risk charge. The
formulas for determining Net Investment Factors are described under the caption
"Net Investment Factor" in the Statement of Additional Information. The Net In-
vestment Factor used to determine current Annuity Unit Values for immediate
contracts will differ from the Net Investment Factor used to determine current
Accumulation Unit Values during the Accumulation Period and Annuity Unit Values
during the Annuity Period for deferred contracts. This is because we make dif-
ferent deductions for mortality risk assumptions for each type of contract.
To determine the value of the Fund's assets, each security traded on a na-
tional securities exchange or on the NASDAQ national market system is valued at
the last reported sale price on the principal exchange on a given day. If there
has been no reported sale on that day, then the last reported bid price on that
day is used. Any security traded in the over-the-counter market is valued at
the last reported bid price. Any securities or other assets for which current
market quotations are not readily available are valued at fair value as deter-
mined in good faith by CGM acting under the supervision of the Board of Manag-
ers.
C. Accumulation Period (Deferred Contracts)
1. How Accumulation Units are Calculated
During the Accumulation Period, each Net Purchase Payment is credited to your
contract in the form of Accumulation Units. The number of Accumulation Units
credited is equal to the Net Purchase Payment divided by the value of an Accu-
mulation Unit next determined following receipt of the Purchase Payment at our
Designated Office.
2. Contract Value
The value of your contract during the Accumulation Period is determined by
multiplying the total number of Accumulation Units credited to your contract by
the current value of an Accumulation Unit (the "Accumulation Unit Value").
3. Surrender (Redemption) Proceeds
While the Annuitant is living, you may surrender your contract for its value
in cash during the Accumulation Period or apply the value under a fixed or
variable payment option during the Accumulation Period. (See "Annuity Payment
Options Available" and "General Limitations on Options.") Your request for sur-
render must be in writing. We must receive your request at our Designated Of-
fice prior to the Maturity Date or the death of the Annuitant (whichever is
earlier). We normally pay surrender proceeds within seven days, subject to our
right to suspend payments under some circumstances described below. You also
may make a partial surrender or withdrawal in the same manner. We are not re-
quired to permit a partial surrender or withdrawal that would reduce the con-
tract value to less than $200. Further, the Federal tax laws impose penalties
upon, and in some cases prohibit, certain premature distributions from the con-
tracts. (See "Federal Income Tax Status.")
When we receive a request for surrender, we will cancel the number of Accumu-
lation Units necessary to equal the dollar amount of the withdrawal. Surrenders
will be based on Accumulation Unit Values next determined after the surrender
request is received at our Designated Office or, if payment is to be made under
a payment option, at a later date as may be specified in the surrender request.
Surrender proceeds will be increased accordingly if surrender of a contract
results in a credit against the premium tax liability of the Company.
The Fund may suspend the right of surrender or redemption and may postpone
payment when:
. the exchange is closed on dates other than weekends or holidays,
. permitted by the rules of the SEC during periods when trading on the ex-
change is restricted,
. an emergency makes it impracticable for the Fund to dispose of its securi-
ties or to determine the value of its net assets fairly, or
. permitted by the SEC for the protection of investors.
No redemption is permitted in connection with a contract issued pursuant to
the Optional Retirement Program of The University of Texas System prior to the
Annuitant's death, retirement, or termination of employment in all institutions
of higher education.
8
<PAGE>
If contracts are issued in connection with retirement plans, you should refer
to each contract and the terms of the applicable plan or trust regarding limi-
tations or restrictions on surrender for cash or other forms of early settle-
ment. You also should pay careful attention to tax consequences. (See "Federal
Income Tax Status.")
4. Death Proceeds
If the Annuitant or Contractholder dies during the Accumulation Period under
a deferred contract, we will pay to the beneficiary the contract's death pro-
ceeds after we receive due proof of death. Death proceeds are equal to the
greater of (1) all Purchase Payments made, without interest, adjusted for any
partial surrenders, and (2) the value of the contract next determined on the
date when due proof of death is received at our Designated Office or the date
on which you make written election of payment at our Designated Office (which-
ever is later). (See restrictions on payment options imposed by Section 72(s)
of the Code, discussed below.)
Death proceeds are paid in cash or applied to one or more of the fixed or
variable methods of payment available (see "Annuity Payment Options Avail-
able"), depending upon the election made by you during your life (or if appli-
cable, the life of the Annuitant). Such an election, particularly in the case
of contracts issued for tax qualified retirement plans, is subject to any ap-
plicable requirements of Federal tax law. If you have not made such an elec-
tion, payment will be in a single sum, unless the beneficiary elects an annu-
ity payment option within 90 days after we receive due proof of the
Annuitant's or Contractholder's death. Whether and when you make such an elec-
tion could affect when you are deemed to have received the contract's death
proceeds under the tax laws.
Section 72(s) of the Code requires that, in order to qualify as annuities un-
der Section 72 of the Code, all contracts (1) issued after January 18, 1985
and (2) not for use with various tax qualified retirement plans, must have
limitations on the period during which payments from the contract may be made
upon the death of the Contractholder or Annuitant. Please refer to your con-
tract for a description of these limitations. There are rules comparable to
Section 72(s) that govern the timing of payments after the death of the Annui-
tant for tax-benefited retirement plans. (See discussion under heading "Dis-
tributions from the Contract" on page 18 of this prospectus.)
Deferred contracts subject to the law of Texas issued before May 1, 1978 con-
tain a special death benefit provision. Please refer to such contracts for a
description of this provision.
D. Annuity Period (Deferred and Immediate Contracts)
The Annuity Period for a deferred contract begins when amounts accumulated
under the contract are applied under an annuity payment option. An immediate
contract is always in the Annuity Period.
1. Choice of Retirement Date and Annuity Payment Option
If a contract is used in connection with tax qualified retirement plans,
please refer to the terms of the particular plan. Such plan will ordinarily
provide for a time when benefits must begin, the period during which such pay-
ments may be made, the payment options that may be selected, and the minimum
annual amounts of such payments.
a. Deferred Contracts
When you apply for a deferred contract, ordinarily you select (1) a retire-
ment date (Maturity Date) on which we will begin to make annuity payments and
(2) a form of payment option. (See "Annuity Payment Options Available.") You
may select any of the annuity payment options on a fixed or variable basis, or
a combination of both. You may (within the limits of the retirement plan, if
your contract is issued in connection with such a plan) defer the Maturity
Date or change the annuity payment form at any time before annuity payments
would otherwise have begun. You also may surrender the contract in whole or in
part at any time before or on the Maturity Date.
b. Immediate Contracts
Under immediate contracts, annuity payments begin on a date mutually agreed
upon by us and you, normally the date that the Purchase Payment is applied to
the contract. Only the Single Life Annuity and Joint Life Annuity Options are
available under these contracts, and only on a variable payment basis (see
"Annuity Payment Options Available"). The purchaser of an immediate contract
may, at any time before the first annuity payment, surrender the contract for
the surrender proceeds, which would be the amount of assets established in the
Fund to meet the obli-
9
<PAGE>
gation for future annuity payments under the contract. Payment of surrender
proceeds is made in the same manner as under deferred contracts. (See "Surren-
der (Redemption) Proceeds.")
2. Sex-Neutral Contracts
In 1983, the United States Supreme Court ruled that annuity benefits derived
from contributions made to certain employer-sponsored plans on or after August
1, 1983 must be determined on a sex-neutral basis. Under the decision, bene-
fits derived from contributions made prior to August 1, 1983 can continue to
be calculated on a sex-distinct basis. The Court's decision does not affect
nonemployer-related individual retirement accounts funded through the purchase
of variable annuity contracts by an individual.
Except as described below, the contracts use sex-neutral annuity rates if an-
nuity payments under such contracts began after August 1, 1983. Sex-neutral
annuity rates are the applicable male rates, whether the Payee is male or fe-
male. Sex-distinct annuity rates continue to apply only to contracts for which
annuity payments began prior to August 1, 1983. (See "Variable Payment
Options.")
For contracts issued in New York or Oregon for use in situations not involv-
ing an employer-sponsored plan, we will calculate benefits on a sex-distinct
basis.
3. Fixed and Variable Payment Options
When you select an annuity payment option (see "Annuity Payment Options
Available" below), you also may choose to apply annuity proceeds to a fixed
payment option, a variable payment option or a combination of both. If you do
not select a payment option by the Maturity Date, variable payments will be
made while the Payee is living or for ten years, whichever is longer. (See
"Annuity Payment Options Available" below.)
a.Fixed Payment Options
Fixed payment options are available only under deferred contracts. We will
transfer all proceeds applied under fixed payment options from the Fund to our
general assets. These proceeds will no longer participate in or be affected by
the investment performance of the Fund.
When the option selected involves a life contingency, the applicable annuity
purchase rates vary depending on the particular annuity payment option se-
lected and on the age of the Payee (and, where sex-neutral annuity rates do
not apply, on the sex of the Payee).
b.Variable Payment Options
When a variable payment option is elected under a deferred contract, the pro-
ceeds (or the selected portion thereof) will be applied at the annuity pur-
chase rates that we currently are using for immediate contracts, or at the an-
nuity purchase rates stated in the contract, whichever are more favorable to
the Payee. In the case of immediate contracts, the Net Purchase Payment is ap-
plied at our current variable annuity purchase rates.
As in the case of fixed payment options, when the option selected involves a
life contingency, the applicable annuity purchase rates vary depending on the
particular annuity payment option selected and the age of the Payee (and where
sex-neutral annuity rates do not apply, on the sex of the Payee). Under the
variable payment options, however, payments may vary from month to month, de-
pending upon the investment performance of the Fund.
We determine the amount of the basic payment level by applying the appropri-
ate annuity purchase rates to the proceeds used to provide the annuity. The
amount of the initial variable annuity payment is the same as the basic pay-
ment level unless the contract is an immediate contract and the initial pay-
ment is due more than 14 days after the Net Purchase Payment is applied. The
older the Payee, the greater the basic payment level, because the Payee's life
expectancy, and thus the period of anticipated income payments, will be short-
er. Under contracts with sex-distinct purchase rates, a given contract value
will require a higher basic payment for a male Payee than for a female Payee,
reflecting the longer life expectancy of females. If you have selected a pay-
ment option that provides for a refund at death of the Payee or that guaran-
tees that payments will be made for a certain period after the death of the
Payee, the contract value will produce a lower basic payment level.
If you select an assumed interest rate, it will affect both the basic payment
level and the amount by which subsequent payments to the Payee increase or de-
crease. If the net investment performance of the Fund is the same as the as-
sumed interest rate, the monthly payments will remain level. If the net in-
vestment performance exceeds the assumed interest rate, the monthly payments
will increase. Conversely, if the net investment performance is less than the
assumed interest rate, the payments will decrease.
Unless otherwise provided, we will assume an annual interest rate of 3.5%. If
a 3.5% rate would trigger a first
10
<PAGE>
payment that is larger than permitted under applicable state law or regula-
tion, then we will select a lower rate. Subject to our consent, and if permit-
ted under applicable state law, you may elect a different annual assumed in-
terest rate, up to 5%.
Election of a higher assumed interest rate produces a larger initial payment,
a more slowly rising series of subsequent payments when the actual net invest-
ment performance exceeds the assumed interest rate, and a more rapid drop in
subsequent payments when the actual net investment performance is less than
the assumed interest rate.
We will continue to deduct "expense risk" and "mortality risk" charges from
the Fund's assets after the Maturity Date if we make annuity payments under
any variable payment option, including an option not involving a life contin-
gency and under which we bear no mortality risk. (See "Mortality and Expense
Risks and Deductions" below for an explanation of these risk charges.)
4. Annuity Payment Options Available
a. Payments for Specified Period (Deferred Contracts Only)
The proceeds may be paid in monthly payments for a definite number of years
selected by you up to 30 years.
b. Single Life Annuity
This option and the Joint Life Annuity option (see below) involve life con-
tingencies, since they provide that payments will be made during the continua-
tion of one or more lives.
i. With No Period Certain
We pay the proceeds in monthly payments during the life of the Payee. This
form of Single Life Annuity option offers the maximum level of monthly pay-
ments under an option, payable over the entire life of the Payee. Under this
form, it would be possible to receive only one annuity payment if the Payee
should die before the due date of the second annuity payment, two annuity
payments if the Payee should die before the due date of the third annuity
payment, and so on.
ii. With Period Certain
This form of Single Life Annuity option is similar to the form described un-
der i. above except that payments are guaranteed during the period elected.
If the Payee should die prior to the end of that period, annuity payments
will continue during the remainder of the period to the designated beneficia-
ry. You may elect the period to be 120 months; 240 months; or, under variable
payment options only, the nearest whole number of months equal to the amount
applied to this option divided by the dollar amount of the basic payment lev-
el.
c. Joint Life Annuity
i. With No Period Certain
We pay the proceeds in monthly payments during the joint life of the Payee
and a designated joint Payee, and thereafter during the remaining life of the
survivor. Under this form of Joint Life Annuity option, it would be possible
to receive only one annuity payment if both Payees should die before the due
date of the second annuity payment, two annuity payments if both should die
before the due date of the third annuity payment, and so on.
ii. With 120 Months Certain
This form of Joint Life Annuity option is similar to the form described un-
der i. above, except that the payments are guaranteed for a period of 120
months. If both the Payee and the joint Payee should die before the end of
the period, annuity payments will be continued for the remainder of the pe-
riod to the designated beneficiary.
iii. With Reduced Payments to Survivor (No Period Certain)
This form of Joint Life Annuity option is similar to the form described un-
der i. above except that the payments to the survivor, which continue for the
survivor's remaining life, are reduced to two-thirds of the amount that would
have been payable if both Payees were still living. Under this form of Joint
Life Annuity option, it would be possible to receive only one annuity payment
if both Payees should die before the due date of the second annuity payment,
two annuity payments if both should die before the due date of the third an-
nuity payment, and so on.
d.Other Methods of Payment
In addition to the annuity payment options described above, you may selecet
other methods of payment if we agree to the method selected.
11
<PAGE>
5.General Limitations on Options
In order to qualify as annuities under Section 72 of the Code, all contracts
(1) issued after January 18, 1985 and (2) not for use with various tax quali-
fied retirement plans, limit the period over which payments from the contracts
may be made on your death. Comparable rules govern the timing of payments af-
ter the death of the Annuitant in the case of tax-benefited retirement plans.
Please refer to the discussion under "Death Proceeds."
After you receive a payment under an option involving a life contingency, you
may not change to another option unless we agree. Once annuity payments under
such options begin, you cannot surrender the contract for a single sum cash
payment. However, in the case of any such option involving a period certain,
the successor Payee may, at any time after the death of the Annuitant (or both
Annuitants in the case of a Joint Life Annuity), elect to surrender the con-
tract for a single cash payment equal to the commuted value (which is calcu-
lated based on the Assumed Interest Rate) of all remaining unpaid payments.
Under variable options which do not involve life contingencies (such as the
Payments for Specified Period option), you may surrender the contract for the
current value in cash of the Accumulation Units standing to its credit. Alter-
natively, if the amounts involved are adequate, they may be applied to any
other payment option. Payment or application of surrender proceeds during the
Annuity Period shall be in accordance with the procedures that apply to sur-
renders during the Accumulation Period. (See "Surrender (Redemption) Pro-
ceeds.") The election of any option, particularly in connection with contracts
issued for tax qualified retirement plans, is subject to Federal tax law re-
quirements, which may restrict your selection of beneficiaries and manner of
payment. We recommend that you consult a qualified tax adviser before electing
any option.
Options shall be available only with our consent if the amount to be applied
is less than $2,000. We may change the frequency of your payments to quarter-
ly, semiannually or annually to bring the amount of each periodic payment to
at least $20.
E. Ownership Rights Under the Contract
During the Annuitant's lifetime, all rights under the contract belong solely
to you unless otherwise provided. Such rights include the right to
. change the beneficiary
. change the payment option
. assign the contract (subject to limitations)
. exercise all other rights, benefits, options and privileges given by the
contract or allowed by us. Transfer of ownership of your contract from a
"pension plan" under the Employee Retirement Income Security Act of 1974
("ERISA") to a non-spousal beneficiary may require spousal consent.
Qualified Plans and certain TSA Plans with sufficient employer involvement
are considered "pension plans" under ERISA and are subject to rules under the
Retirement Equity Act of 1984. These rules require that benefits from con-
tracts purchased by a pension plan and distributed to or owned by a partici-
pant be provided in accordance with certain spousal consent, present value and
other requirements that are not enumerated in the contract. Thus, the tax con-
sequences of the purchase of the contracts by pension plans should be consid-
ered carefully.
Contracts that are used with tax qualified retirement plans (defined below
under "Retirement Plans Offering Federal Tax Benefits") contain restrictions
on transfer or assignment that must be satisfied in order to assure continued
eligibility for the favorable tax treatment. Such favorable tax treatment is
described below under "Federal Income Tax Status." In accordance with these
requirements, you may not change ownership of such a contract, nor may the
contract be sold, assigned or pledged as collateral for a loan or for any
other purpose except under certain limited circumstances. If you are contem-
plating a sale, assignment or pledge of the contract, you should carefully re-
view the contract's provisions and consult a qualified tax adviser.
If contracts are used in connection with retirement plans that do not qualify
for tax-benefited treatment, such plans also may restrict your exercise of
rights.
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Investment Objective, Policies and Restrictions
- -------------------------------------------------------------------------------
A. Objective and Policies
The investment objective of the Fund is growth of capital through investment
primarily in equity securities of a diversified group of companies and indus-
tries. We will not change the investment objective in any material way without
approval by a majority of the votes attributable to outstanding contracts.
12
<PAGE>
The Fund invests primarily in seasoned issues that trade on national or re-
gional stock exchanges or in the over-the-counter market. Current income is
not an important factor in the selection of equity securities. Income and re-
alized capital gains from portfolio investments are reinvested.
The Fund's portfolio normally consists principally of common stocks and secu-
rities convertible into or carrying rights to purchase common stocks. However,
during periods when management believes that economic or market conditions
make it advisable, a substantial portion of the Fund's assets may be held tem-
porarily in cash or fixed income securities (including long-term fixed income
securities) whether or not convertible or carrying such rights. We cannot es-
timate when or for how long the Fund may employ such a defensive strategy. Al-
so, as a matter of operational policy, the Fund will hold sufficient amounts
of cash and United States Government or other high-grade liquid securities to
meet current expenses and variable annuity contract obligations. Such assets
also may be held for limited periods pending investment in accordance with the
Fund's investment policies.
Primary emphasis in the selection of issues for the Fund's portfolio is given
to those securities that management believes offer a potential for long-term
appreciation. However, this emphasis does not preclude occasional investment
for short-term appreciation. The Fund's portfolio turnover rate was approxi-
mately 196% in 1996, 209% in 1997 and [ ]% in 1998. The Fund's portfolio turn-
over rate may vary significantly depending on the volatility of prevailing or
anticipated economic and market conditions. Higher levels of portfolio turn-
over may result in higher brokerage costs to the Fund.
The Fund may change these investment policies without your approval.
There are risks inherent in the ownership of any security. There is no assur-
ance that the Fund will achieve its investment objective. Equity securities
are subject to price declines as well as advances, and the prices of such se-
curities can decline while the cost of living is rising. Fixed income securi-
ties are subject to credit risk (the risk that the obligor will default in the
payment of principal and/or interest) and to market risk (the risk that the
market value of the securities will change as a result of changes in market
rates of interest). The value of the Fund's investments is subject to risks of
changing economic conditions and to the risk that management may not antici-
pate such changes and, to the extent consistent with the Fund's investment ob-
jective and policies, may not make appropriate changes in the Fund's portfo-
lio. The Fund and the Company depend on the smooth functioning of computer
systems for both internal operations and overall investment performance. Many
computer systems in use today cannot distinguish between the year 1900 and the
year 2000. If computer systems fail to process information properly relating
to the year 2000, the Fund's and the Company's operations and services could
be harmed and the securities in which the Fund invests may not perform as well
as they otherwise might.
CGM, the Company and certain service providers to the Fund have reported that
each expects to modify its systems, as necessary, prior to January 1, 2000 to
address the so-called "year 2000 problem." However, there can be no assurance
that the problems will be corrected, and Fund or Company operations and serv-
ices provided to Contractholders may be affected. Additionally, there can be
no assurance that improperly functioning computers will not affect specific
issuers or broad markets.
The Fund may invest in repurchase agreements. Under these agreements, the
Fund purchases a security subject to the agreement of the seller to repurchase
the security at an agreed upon price and date. The resale price exceeds the
purchase price and reflects an agreed upon market rate unrelated to the coupon
rate on the purchased security. Repurchase agreements can be regarded as loans
by the Fund to the seller, collateralized by the securities that are the sub-
ject of the agreement. Repurchase agreements allow the Fund to earn a return
on temporarily available cash at relatively low market risk. While the under-
lying security may be a bill, certificate of indebtedness, note or bond issued
by an agency, authority or instrumentality of the U.S. Government, the obliga-
tion of the seller is not guaranteed by the U.S. Government. As a result,
there is a risk that the seller may fail to repurchase the underlying securi-
ty. In such event, the Fund will attempt to exercise rights with respect to
the underlying security, including possible sale in the market. However, the
Fund may be subject to various delays and risks of loss, including (1) possi-
ble declines in the value of the underlying security while the Fund seeks to
enforce its rights, (2) possible reduced levels of income and lack of access
to income during this period, and (3) inability to enforce rights and expenses
of attempted enforcement.
B. Restrictions
The investment restrictions set forth below are fundamental policies and may
not be changed without approval by a majority vote of the Contractholders.
Please refer to the Statement of Additional Information for a description of
13
<PAGE>
other investment restrictions. Some of those restrictions are fundamental pol-
icies that may not be changed without Contractholder approval, while others
may be changed by the Board of Managers without Contractholder approval.
The Fund will not:
1. Purchase any security (other than United States Government obligations)
if, as a result, more than 5% of the Fund's total assets (taken at current
value) would be invested in securities of any one issuer or more than 10% of
the outstanding voting securities of any one issuer would be held by the Fund;
2. Concentrate its investments in particular industries, although it may in-
vest up to 25% of its total assets (taken at current value) in a single indus-
try;
3. Borrow money, except as a temporary measure for extraordinary or emer-
gency purposes, but not for investment purposes, and in an amount not in ex-
cess of 5% of its total assets (taken at current value) at the time of such
borrowing.
In addition, Section 817(h) of the Code requires the investments of the Fund
to be "adequately diversified" under Treasury Regulations. If there is a con-
flict between the restrictions listed above and the regulations under Section
817(h), the regulations will control. (See discussion of the Section 817(h)
regulations under "Special Rules for Annuities Used by Individuals or With
Plans and Trusts Not Qualifying Under the Code for Tax-Benefited Treatment,"
below.)
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Deductions and Expenses
- -------------------------------------------------------------------------------
A. Deductions from Purchase Payments for Sales and Administrative Services and
Premium Taxes
New England Securities is the principal underwriter for the Fund under a dis-
tribution agreement among the Fund, New England Securities and us. We retain
the deductions for sales expenses described below, except for amounts paid to
New England Securities for services it performs and expenses it incurs as
principal underwriter. Registered representatives of New England Securities
receive commissions on the sale of flexible purchase payment contracts at a
maximum rate of 5% of purchase payments.
Under the terms of an administrative agreement between the Fund and us, we
furnish or bear the expense of all legal, actuarial and accounting services,
office space, facilities and equipment, services of executive and other per-
sonnel and all other administrative services necessary or appropriate to carry
on the various functions of the Fund. We do not bear expenses attributable to
sales activities, which are covered by the distribution agreement. To cover
the cost of providing these services, we retain the deduction for administra-
tive expenses described below.
Under the provisions of the administrative agreement and the contracts, the
following items are payable directly by the Fund (see "Accumulation Unit Val-
ues, Annuity Unit Values and Net Investment Factors"): (1) any taxes paid or
reserved for the income and realized and unrealized capital gains on assets of
the Fund, (2) fees for mortality and expense risks assumed and for investment
advisory services, (3) brokerage commissions and taxes, if any, for the pur-
chase or sale of the Fund's portfolio securities, and (4) fees and expenses of
the Board of Managers, including the auditing of Fund assets.
Various states impose a premium tax on annuity purchase payments received by
insurance companies. We may deduct these taxes from Purchase Payments and cur-
rently do so for contracts issued in South Dakota. Certain states may require
or allow us to pay the premium tax when you elect to begin receiving annuity
benefits, rather than when we receive Purchase Payments. In those states we
may deduct the premium tax on the date when annuity payments begin. The maxi-
mum premium tax currently deducted is 3.5%. In the future, we may deduct pre-
mium taxes if required by state insurance tax law, or the applicable premium
tax rates may change.
Surrender of a contract may result in a credit against our premium tax lia-
bility in some states. If this happens, your surrender proceeds will be in-
creased accordingly.
Premium tax rates may be changed by law, administrative interpretations or
court decisions. Premium tax amounts will depend on, among other things, the
state of residence of the Annuitant and state insurance tax law.
Sales and administrative expenses are deducted from each After-tax Purchase
Payment. The remaining amount is the Net Purchase Payment. We expect that the
deductions for sales expenses will cover sales expenses over the life of the
contracts. Any sales expenses not covered by the deduction for sales expenses,
will be recovered from our general account, including any income derived from
the mortality and expense risk deductions (see "Mortality and Expense Risks
and Deductions").
14
<PAGE>
Deductions from each After-tax Purchase Payment for sales and administrative
expenses are set out in the table below:
Deductions Applicable to Flexible Purchase Payment Contracts
<TABLE>
<CAPTION>
Portion of Deduction Deduction for
Total After-Tax for Sales Administrative Total
Purchase Payment Expenses Expenses Deduction
<S> <C> <C> <C>
First $46 6.0% 3.0% 9.0%
Balance 6.0% 2.0% 8.0%
Deductions Applicable to Single Purchase Payment Contracts
<CAPTION>
Portion of Deduction Deduction for
Total After-Tax for Sales Administrative Total
Purchase Payment Expenses Expenses Deduction
<S> <C> <C> <C>
First $ 5,000 6.00% 2.00% 8.0%
Next 95,000 3.75% 0.25 4.0
Balance 1.75 0.25 2.0
</TABLE>
Under contracts sold to the following persons, purchase payments will be sub-
ject to the usual deductions for administrative expenses and premium taxes, if
any, but will not be subject to any deductions for sales expenses:
. certain present and retired employees and certain current and former
directors and trustees (including members of the Board of Managers of the
Fund) of New England Mutual and NELICO and mutual funds sponsored by NELICO
. current and retired agents and general agents of New England Mutual and
NELICO and their insurance company subsidiaries
. certain current and retired employees of such agents and general agents
. the surviving spouses of the employees, agents and general agents listed
above
. any retirement plan or trust for the benefit of the persons listed above.
B. Deductions from Fund Assets
1.Investment Advisory Services and Deductions
Capital Growth Management Limited Partnership ("CGM"), One International
Place, Boston, Massachusetts 02110, is the investment adviser to the Fund un-
der an advisory agreement dated August 30, 1996. The agreement provides that
CGM will manage, subject to the supervision of the Fund's Board of Managers,
the investment and reinvestment of the assets of the Fund. For providing such
services, the Fund pays CGM a fee at the annual rate of .3066% of the average
daily net assets of the Fund. This fee is computed on a daily basis and is
payable monthly.
The general partner of CGM is a corporation controlled equally by Robert L.
Kemp and G. Kenneth Heebner. Nvest Companies, L.P., an affiliate of the Compa-
ny, owns a 50% limited partnership investment in CGM. CGM provides discretion-
ary investment services to advisory clients, including other investment com-
pany portfolios.
2.Mortality and Expense Risks and Deductions
We assume the "expense risk" and the "mortality risk" under the contracts,
for which we receive deductions from Fund assets.
The "expense risk" is the risk that the deductions for sales and administra-
tive expenses, and the deductions for investment advisory services, may be in-
sufficient to cover the actual cost of such items.
The "mortality risk" has two elements: (1) a "life annuity mortality risk"
and, in the case of deferred contracts, (2) a "minimum death refund risk."
Under the "life annuity mortality risk," we agree to make annuity payments
under options involving life con-
15
<PAGE>
tingencies regardless of how long a particular Annuitant or other Payee lives
and regardless of how long all Annuitants or other Payees as a class live.
Under deferred contracts, we also assume a "minimum death refund risk" by
providing that a death benefit will be payable upon death of the Annuitant
during the Accumulation Period. (See "Death Proceeds" for a description of the
death benefit payable.)
For assuming these risks, we make the following daily deductions from the
Fund's net assets:
(1) For deferred contracts: .00260% (.9490% on an annual basis consisting of
.8395% for mortality risk assumptions and .1095% for expense risk
assumptions).
(2) For immediate contracts: .00190% (.6935% on an annual basis consisting of
.5840% for mortality risk assumptions and .1095% for expense risk
assumptions).
The percentage of these deductions will not increase over the life of your
contract.
C. Total Expenses
For the year ended December 31, 1998, the Fund's total expenses equalled
1.34% of its average net assets.
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Retirement Plans Offering Federal Tax Benefits
- -------------------------------------------------------------------------------
The Federal tax laws provide for a variety of retirement plans offering tax
benefits. These plans, which may be funded through the purchase of the
contracts, include:
1. Plans qualified under Section 401(a), 401(k) or 403(a) of the Code
("Qualified Plans");
2. Annuity purchase plans adopted by public school systems and certain tax-
exempt organizations pursuant to Section 403(b) of the Code ("TSA
Plans");
3. Individual retirement accounts adopted by or on behalf of individuals
pursuant to Section 408(a) of the Code and individual retirement
annuities purchased pursuant to Section 408(b) of the Code (both of which
may be referred to as "IRAs"), including simplified employee pension
plans and salary reduction simplified employee pension plans, which are
specialized IRAs that meet the requirements of Section 408(k) of the Code
("SEPs" and "SARSEPs");
4. Eligible deferred compensation plans (within the meaning of Section 457
of the Code) for employees of state and local governments and tax-exempt
organizations ("Section 457 Plans"); and
5. Governmental plans (within the meaning of Section 414(d) of the Code) for
governmental employees, including Federal employees ("Governmental
Plans").
You should consult a qualified tax adviser regarding (1) the suitability of
the contracts as a funding vehicle for tax qualified retirement plans, (2) the
rules underlying such plans, and (3) state and Federal tax aspects of such
plans.
A summary of the Federal tax laws regarding contributions to, and distribu-
tions from, the above tax-benefited retirement plans is presented below under
the heading "Special Rules for Annuities Purchased for Annuitants under Re-
tirement Plans Qualifying for Tax-Benefited Treatment." If a tax-benefited re-
tirement plan lost its qualification for tax-exempt status, employees would
lose some of the tax benefits described here.
In the case of most TSA Plans under Section 403(b)(1) of the Code, and in the
case of IRAs purchased under Section 408(b) of the Code, the contracts com-
prise the retirement "plan" itself. These contracts will be endorsed, if nec-
essary, to comply with Federal and state legislation governing such plans, and
such endorsements may alter certain contract provisions. Please refer to the
contracts and any endorsements for more complete information.
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Federal Income Tax Status
- -------------------------------------------------------------------------------
This discussion is a general description of the Federal income tax aspects of
the variable annuity contracts. It is not intended as tax advice. For more
complete information, you should consult a qualified tax adviser.
A. Tax Status of the Company and the Fund
We are taxed as a life insurance company under the Code. The Fund and its op-
erations are part of our total operations and are not taxed separately. Under
current law, no taxes are payable on the investment income and capital
16
<PAGE>
gains of the Fund. Such income and gains are retained in the Fund and will not
be taxable until the Annuitant or the Annuitant's beneficiary receives annuity
payments or other distributions.
If the law changes so that the assets, investment income or capital gains of
the Fund are subject to taxes, the contracts provide that we may make an ap-
propriate charge or reserve against the assets of the Fund for such taxes.
B. Taxation of the Contracts
The contracts are considered annuity contracts taxed under Section 72 of the
Code. Generally Section 72 provides that you are not taxed on increases in the
value of the contracts until the Annuitant or beneficiary receives annuity
payments. (Exceptions to this rule are discussed below under "Special Rules
for Annuities Used by Individuals or with Plans and Trusts Not Qualifying Un-
der the Code for Tax-Benefited Treatment.")
Under Section 72, to the extent there is an "investment" in an annuity con-
tract, a portion of each annuity payment is excluded from gross income as a
return of such investment. The balance of each annuity payment is includible
in gross income and taxable as ordinary income. In general, contributions made
to an annuity contract that are deductible by the contributor and earnings on
all contributions to the annuity contract will not constitute an "investment"
in the annuity contract under Section 72.
1. Special Rules for Annuities Purchased for Annuitants Under Tax Qualified
Retirement Plans
Below is a summary of the Federal tax laws applicable to contributions to,
and distributions from, retirement plans that qualify for Federal tax bene-
fits. Such plans are defined above under the heading "Retirement Plans Offer-
ing Federal Tax Benefits." The following summary does not include everything
you need to know regarding such tax laws. The Code provisions and the rules
and regulations under the Code regarding retirement trusts and plans, the doc-
uments that must be prepared and executed, and the requirements that must be
met to obtain favorable tax treatment are very complex. If you are thinking
about purchasing a contract for use with a tax qualified retirement plan, you
should consult a qualified tax adviser regarding applicable Federal and state
tax aspects of the contracts and, if applicable, the suitability of the con-
tracts as investments under ERISA.
a. Plan Contribution Limitations
i. Qualified Plans, SEPs, SARSEPs and Governmental Plans
The law may limit the amount of money you may contribute to Qualified Plans,
SEPs, SARSEPs and Governmental Plans in any contract year. New SARSEPs may
not be established after January 1, 1997. Any purchase payments attributable
to such contributions are tax deductible to the employer and are not cur-
rently taxable to the Annuitants for whom the contracts are purchased. The
contributions to the contract and any increase in contract value attributable
to such contributions are not taxed until payments from the contract are made
to the Annuitant or his/her beneficiaries.
ii. TSA Plans
Purchase Payments attributable to contributions to TSA Plans are not in-
cluded in the Annuitant's income to the extent such Purchase Payments do not
exceed the lesser of $10,000 or the "exclusion allowance." The exclusion al-
lowance is a calculation that takes into consideration the Annuitant's in-
cludible compensation, number of years of service, and prior years of contri-
butions. For more information, the Annuitant should obtain a copy of IRS Pub-
lication 571 on TSA Programs for Employees of Public Schools and Certain Tax-
Exempt Organizations, which will assist the Annuitant in calculating the ex-
clusion allowance to which he or she may be entitled for any given tax year.
Any Purchase Payments attributable to permissible contributions under Code
Section 403(b) (and earnings thereon) are not taxable to the Annuitant until
distributions are made from the contract.
iii. IRAs
The maximum tax deductible purchase payment that may be contributed each
year to an IRA is the lesser of $2,000 or 100% of includible compensation if
the taxpayer is not covered under an employer plan. A spousal IRA is avail-
able if the taxpayer and spouse file a joint return and the spouse earns no
compensation (or elects to be treated as earning no compensation) and is be-
low age 70 1/2. In the case of a spousal IRA, the maximum tax deductible pur-
chase payment that may be deducted with respect to the non-working spouse is
$2,000 for tax years beginning January 1, 1997. If covered under an employer
plan, taxpayers are permitted to make deductible pur-
17
<PAGE>
chase payments; however, for 1998 the deductions are phased out and eventu-
ally eliminated for taxpayers with an adjusted gross income between $30,000
and $40,000 for an individual, between $50,000 and $60,000 for a married cou-
ple filing jointly and between $0 and $10,000 for a married person filing
separately. A taxpayer may also make nondeductible purchase payments. Howev-
er, the total of deductible and nondeductible purchase payments may not ex-
ceed the limits described above for deductible payments. For more information
concerning contributions to IRAs, you should obtain a copy of IRS Publication
590 on Individual Retirement Accounts.
iv. Section 457 Plans
Generally, under a Section 457 Plan, an employee or executive may defer in-
come under a written agreement in an amount equal to the lesser of 33 1/3% of
includible compensation or $8,000. The amounts deferred (including earnings
on deferred amounts) are includible in gross income only in the tax year in
which such amounts are paid or made available to the employee or executive or
his/her beneficiary. Once contributed to the plan, any contracts purchased
with employee contributions remain the sole property of the employer and may
be subject to the general creditors of the employer. The employer retains all
ownership rights to the contract including any voting and redemption rights
that may accrue to the contract(s) issued under the plan. This rule does not
apply, however, to amounts deferred under a plan maintained by a state or lo-
cal government. Such amounts must be held for the exclusive benefit of the
employee or his/her beneficiary in a trust, custodial account or annuity con-
tract. Under a transitional rule, a plan in existence before August 20, 1996
had until January 1, 1999 to comply with this requirement.
b. Distributions from the Contract
Mandatory Withholding on Certain Distributions
Many distributions called "eligible rollover distributions" from Qualified
Plans and from many TSA Plans are subject to automatic withholding of 20%. You
can avoid withholding by arranging a direct transfer of the eligible rollover
distribution to a Qualified Plan, TSA or IRA. After December 31, 1998, permis-
sible hardship withdrawals from TSA and 401(k) Plans will no longer be treated
as "eligible rollover distributions."
i. Qualified Plans, TSA Plans, IRAs, SEPs, SARSEPs and Governmental Plans
Payments made from the contracts held under a Qualified Plan, TSA Plan, IRA,
SEP, SARSEP or Governmental Plan are taxable under Section 72 of the Code as
ordinary income in the year of receipt. Any amount received in surrender of
all or part of the contract value prior to annuitization will also be in-
cluded in income in the year of receipt subject to restrictions and penalties
discussed below. If there is any "investment" in the contract, a portion of
each amount received is excluded from gross income as a return of such in-
vestment. Distributions or withdrawals prior to age 59 1/2 may be subject to
a penalty tax of 10% of the amount includible in income. This penalty tax
does not apply (1) to distributions of excess contributions or deferrals; (2)
to distributions made on account of the Annuitant's death, retirement, dis-
ability or early retirement at or after age 55; (3) when distribution from
the contract is in the form of an annuity over the life or life expectancy of
the Annuitant (or joint lives or life expectancies of the Annuitant and his
or her beneficiary); or (4) when distribution is made pursuant to a qualified
domestic relations order. In the case of IRAs, the exceptions for distribu-
tions on account of early retirement at or after age 55 or made pursuant to a
qualified domestic relations order do not apply.
If the Annuitant dies before distributions begin, distributions must be com-
pleted within five years after death, unless payments begin within one year
after death and are made over the life (or life expectancy) of the beneficia-
ry. If the Annuitant's spouse is the beneficiary, distributions need not be-
gin until the Annuitant would have reached age 70 1/2. If the Annuitant dies
after annuity payments have begun, payments must continue to be made at least
as frequently as payments made before death.
With respect to TSA Plans, contributions to the contract made after December
31, 1988 and any increases in contract value after that date may not be dis-
tributed prior to the account holder attaining age 59 1/2, termination of em-
ployment, death or disability. Contributions (but not earnings) made after
December 31, 1988 may also be distributed by reason of financial hardship.
These restrictions on withdrawal will not apply to the contract value as of
December 31, 1988. These restrictions are not expected to change the circum-
stances under which transfers to other
18
<PAGE>
investments that qualify for tax-free treatment under Section 403(b) of the
Code may be made.
Annuity payments, periodic payments or annual distributions must begin by
the later of April 1 of the calendar year following the year in which the An-
nuitant attains age 70 1/2 or the year in which the Annuitant retires. Each
annual distribution must equal or exceed a "minimum distribution amount,"
which is determined by minimum distribution rules under the plan. A penalty
tax of up to 50% of the amount that should be distributed may be imposed by
the Internal Revenue Service for failure to distribute the required minimum
amount.
ii. Section 457 Plans
When the Annuitant receives a distribution under a contract held under a
Section 457 Plan, such amounts are taxed as ordinary income in the year re-
ceived. The plan must not permit distributions prior to the Annuitant's sepa-
ration from service (except in the case of unforeseen emergency). In addi-
tion, a distribution from a state or local government plan before age 59 1/2
may be subject to an additional penalty tax of 10% of the amount included in
income, unless the Annuitant is otherwise exempt.
Generally, annuity payments, periodic payments or annual distributions must
begin by April 1 of the calendar year following the year in which the Annui-
tant attains age 70 1/2. Minimum distributions under a Section 457 Plan may
be further deferred if the Annuitant remains employed with the sponsoring em-
ployer. Each annual distribution must equal or exceed a "minimum distribution
amount," which is determined by distribution rules under the plan. A penalty
tax of up to 50% of the amount that should be distributed may be imposed by
the Internal Revenue Service for failure to distribute the required minimum
amount. If the Annuitant dies before distributions begin, the same special
distribution rules generally apply in the case of Section 457 Plans as in the
case of Qualified Plans, TSA Plans, IRAs, SEPs, SARSEPs and Governmental
Plans. These rules are discussed above in the immediately preceding section
of this prospectus. An exception to these rules provides that if the benefi-
ciary is other than the Annuitant's spouse, distribution must be completed
within 15 years of death, regardless of the beneficiary's life expectancy.
2. Special Rules for Annuities Used by Individuals or With Plans and Trusts
Not Qualifying Under the Code for Tax-Benefited Treatment
For an annuity held by an individual, any increase in the accumulated value
of the contract is not taxable until received as annuity payments or as a full
or partial lump sum.
Under Section 72(u) of the Code, however, contracts not held by a natural
person (i.e., those held by a corporation or certain trusts) generally are not
treated as an annuity contract for Federal tax purposes. As a result, an annu-
ity contractholder who is not a natural person must include in income any in-
crease during the taxable year in the accumulated value over the investment in
the contract.
Section 817(h) of the Code requires the investments of the Fund to be "ade-
quately diversified" under Treasury Regulations. Failure to do so means that
the contracts would cease to qualify as annuities for Federal tax purposes.
Regulations specifying the diversification requirements have been issued by
the Department of Treasury, and we believe that the Fund complies fully with
these requirements.
Any amount received by surrender of all or part of the contract value prior
to annuitization will be included in gross income to the extent of any in-
creases in the value of the contract resulting from earnings or gains of the
Fund.
The Code also imposes a 10% penalty tax on amounts received under a contract
that are includible in gross income. The penalty tax will not apply to any
amount received under the contract:
. after you have attained age 59 1/2,
. after your death,
. after you have become totally and permanently disabled,
. as one of a series of substantially equal periodic payments made for your
life (or life expectancy) or the joint lives (or life expectancies) of you
and a beneficiary,
. if the contract is purchased under certain types of retirement plans or
arrangements,
. that is allocable to investments in the contract before August 14, 1982, or
. if the contract is an immediate annuity contract.
In the calculation of any increase in value for contracts entered into after
October 4, 1988, all annuity contracts
19
<PAGE>
issued by us or our affiliates to the same Contractholder within a calendar
year will be treated as one contract.
3. Tax Withholding
The Code and the laws of some states require tax withholding on distributions
made under annuity contracts, unless the recipient has elected not to have any
amount withheld. We give recipients an opportunity to tell us whether taxes
should be withheld.
- -------------------------------------------------------------------------------
Voting Rights
- -------------------------------------------------------------------------------
The Fund does not hold regular annual meetings of Contractholders. Rather,
meetings of Contractholders are held only when required by the 1940 Act or as
otherwise deemed appropriate by the Fund's Board of Managers.
All Contractholders have the right to vote at any meeting of Contractholders,
and the number of votes each Contractholder may cast is determined by refer-
ence to the record date, which is chosen by the Board of Managers and which
must be within 90 days before the date of the meeting. Each Contractholder may
cast (1) on a contract in the Accumulation Period, a number of votes equal to
the number of Accumulation Units credited to the contract and (2), on a con-
tract in the Annuity Period, a number of votes equal to (a) the amount of as-
sets established in the Fund to meet the obligation for future payments under
variable options elected under the contract divided by (b) the value of an Ac-
cumulation Unit. The number of votes attributable to a contract during the An-
nuity Period will tend to decrease over time.
Although you have the sole right to cast all votes attributable to the con-
tract, during the Accumulation Period or the Annuity Period, an Annuitant or
other Payee may have the right to instruct Contractholders how to vote certain
shares associated with the rights or obligations of the Annuitant or other
Payee. Each Annuitant or other Payee, if any, who has the right to instruct a
Contractholder with respect to any votes, is entitled to receive from the
Contractholder a notice of that right and of the number of votes to which such
right applies. The Fund will provide all notices and proxy materials to the
Contractholders in sufficient number for distribution to all such Annuitants
and other Payees.
20
<PAGE>
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
SPECIAL TERMS USED IN THIS PROSPECTUS..................................... 2
HIGHLIGHTS................................................................ 3
EXPENSE TABLE............................................................. 4
PER UNIT INCOME AND CAPITAL CHANGES....................................... 5
FINANCIAL STATEMENTS...................................................... 5
FUND PERFORMANCE.......................................................... 6
DESCRIPTION OF THE COMPANY AND THE FUND................................... 7
THE VARIABLE ANNUITY CONTRACTS............................................ 7
A. How Contract Purchase Payments May be Made............................. 7
B. Accumulation Unit Values, Annuity Unit Values and Net Investment
Factors................................................................ 7
C. Accumulation Period (Deferred Contracts)............................... 8
1. How Accumulation Units are Calculated............................... 8
2. Contract Value...................................................... 8
3. Surrender (Redemption) Proceeds..................................... 8
4. Death Proceeds...................................................... 9
D. Annuity Period (Deferred and Immediate Contracts)...................... 9
1. Choice of Retirement Date and Annuity Payment Option................ 9
2. Sex-Neutral Contracts............................................... 10
3. Fixed and Variable Payment Options.................................. 10
4. Annuity Payment Options Available................................... 11
5. General Limitations on Options...................................... 12
</TABLE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
E. Ownership Rights Under the Contract.................................... 12
INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS........................... 12
A. Objective and Policies................................................. 12
B. Restrictions........................................................... 13
DEDUCTIONS AND EXPENSES................................................... 14
A. Deductions from Purchase Payments for Sales and Administrative Services
and Premium Taxes...................................................... 14
B. Deductions from Fund Assets............................................ 15
1. Investment Advisory Services and Deductions......................... 15
2. Mortality and Expense Risks and Deductions.......................... 15
C. Total Expenses......................................................... 16
RETIREMENT PLANS OFFERING FEDERAL TAX BENEFITS............................ 16
FEDERAL INCOME TAX STATUS................................................. 16
A. Tax Status of the Company and the Fund................................. 16
B. Taxation of the Contracts.............................................. 17
1. Special Rules for Annuities Purchased for Annuitants Under Tax
Qualified Retirement Plans ......................................... 17
2. Special Rules for Annuities Used by Individuals or With Plans and
Trusts Not Qualifying Under the Code for Tax-Benefited Treatment.... 19
3. Tax Withholding..................................................... 20
VOTING RIGHTS........................................................... 20
</TABLE>
21
<PAGE>
---------------------------------------
Statement of Additional Information
Table of Contents
---------------------------------------
<TABLE>
<CAPTION>
Page
-----
<S> <C>
HISTORY............................................................. II-3
INVESTMENT OBJECTIVE AND POLICIES................................... II-3
MANAGEMENT OF THE FUND.............................................. II-4
INVESTMENT ADVISORY AND OTHER SERVICES.............................. II-6
Advisory Agreement................................................ II-6
Administrative Agreement.......................................... II-7
Distribution Agreement............................................ II-7
Safekeeping of Securities......................................... II-7
Independent Accountants........................................... II-8
PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS.................... II-8
DISTRIBUTION OF CONTRACTS........................................... II-8
CALCULATION OF PERFORMANCE DATA..................................... II-9
ANNUITY PAYMENTS.................................................... II-10
NET INVESTMENT FACTOR............................................... II-12
EXPERTS............................................................. II-12
FINANCIAL STATEMENTS................................................
</TABLE>
---------------------------------------
If you would like to obtain a copy of the Statement of Additional
Information of the Fund, please complete the request form below and mail it
to:
New England Securities Corporation
399 Boylston Street
Boston, Massachusetts 02116
Please send a copy of the Statement of Additional
Information of New England Variable Annuity Fund I to:
----------------------------------------------------
Name
----------------------------------------------------
Street
----------------------------------------------------
City State Zip
22
<PAGE>
NEW ENGLAND VARIABLE ANNUITY FUND I
Individual Variable Annuity Contracts
---------------------------------------------------
Issued by
METROPOLITAN LIFE INSURANCE COMPANY
STATEMENT OF ADDITIONAL INFORMATION
(PART B)
April 30, 1999
This Statement of Additional Information is not a prospectus. This Statement
of Additional Information relates to the Prospectus dated April 30, 1999 and
should be read in conjunction therewith. A copy of the Prospectus may be
obtained by writing to New England Securities Corporation ("New England
Securities"), 399 Boylston Street, Boston, Massachusetts 02116.
VA-143SAI-98
II-1
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
HISTORY................................................................... II-3
INVESTMENT OBJECTIVE AND POLICIES ........................................ II-3
MANAGEMENT OF THE FUND ................................................... II-4
INVESTMENT ADVISORY AND OTHER SERVICES ................................... II-6
Advisory Agreement ..................................................... II-6
Administrative Agreement ............................................... II-7
Distribution Agreement ................................................. II-7
Safekeeping of Securities............................................... II-7
Independent Accountants ................................................ II-8
PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS ......................... II-8
DISTRIBUTION OF CONTRACTS ................................................ II-8
CALCULATION OF PERFORMANCE DATA .......................................... II-9
ANNUITY PAYMENTS ......................................................... II-10
NET INVESTMENT FACTOR .................................................... II-12
EXPERTS .................................................................. II-12
FINANCIAL STATEMENTS .....................................................
</TABLE>
II-2
<PAGE>
HISTORY
New England Variable Annuity Fund I (the "Fund") is a separate account of
Metropolitan Life Insurance Company ("MetLife" or the "Company"). The Fund was
originally a separate account of New England Mutual Life Insurance Company
("New England Mutual"), and became a separate account of the Company when New
England Mutual merged with and into the Company on August 30, 1996.
INVESTMENT OBJECTIVE AND POLICIES
The investment objective and policies of the Fund are summarized on the
front page of the Prospectus and in the text of the Prospectus under the
heading "Investment Objective, Policies and Restrictions."
As disclosed in the Prospectus, the Fund invests primarily in equity
securities such as common stocks and securities convertible into or carrying
rights to purchase common stocks. However, when management considers that
economic or market conditions make it advisable, the Fund may take a defensive
position by investing a substantial portion of its assets in cash or fixed
income securities (including long-term fixed income securities) whether or not
convertible or carrying such rights. No estimate can be made as to when or for
how long the Fund will employ such defensive strategies; however, in the past,
such periods have approached one year in length.
The investment restrictions set forth in paragraphs 1 through 5 below are
fundamental policies and may not be changed without approval by a majority
vote of the Contractholders.
The Fund will not:
1. Underwrite the securities of other issuers, except that it may acquire
portfolio securities under circumstances where, upon the subsequent sale of
such securities, the Fund might be deemed to be an underwriter for purposes
of the Securities Act of 1933;
2. Purchase or sell commodities or commodity contracts;
3. Purchase or sell interests in real estate except such as are
represented by marketable securities of companies, including real estate
trusts, whose assets consist substantially of mortgages and other liens on
real property and interests therein and which therefore may represent
indirect interests in real estate;
4. Make loans. Neither the purchase of a portion of an issue of publicly-
distributed bonds, debentures, corporate notes or other evidences of
indebtedness, nor the purchase of short-term debt securities issued by a
company whose equity securities are listed on the New York Stock Exchange,
nor the entering into of a repurchase agreement shall constitute the making
of a loan for purposes of this investment restriction;
5. Purchase any security restricted as to disposition under Federal
securities laws, or otherwise not readily transferable.
The investment restrictions set forth in paragraphs 1 through 6 below may be
changed by the Board of Managers of the Fund without Contractholder approval.
The Fund will not:
1. Make investments for the purpose of exercising control or management;
2. Acquire securities of other investment companies except through
purchases in the open market involving only customary broker's commissions
and only if after any such acquisition not more than 5% of the total assets
of the Fund (taken at current value) would be so invested and not more than
3% of the total outstanding voting stock of any one investment company
would be held;
3. Purchase securities on margin (except that it may obtain such short-
term credits as are necessary for the clearance of transactions);
4. Make short sales;
5. Participate on a joint or joint and several basis in any trading
account in securities;
6. Write, purchase or sell puts, calls or combinations thereof or write
warrants.
II-3
<PAGE>
MANAGEMENT OF THE FUND
The Board of Managers and the officers of the Fund and their addresses, ages
and principal occupations during the past five years are as follows:
John J. Arena, Manager, (62).
330 Beacon Street, Boston MA 02116.
Retired; formerly, Vice Chairman of the Board of Directors, Bay Banks, Inc.
and President of BayBank Investment Management, BayBanks, Inc., 1992-1994.
John W. Flynn, Manager, (59).
791 Main Street, Warren, RI 02885.
Retired; formerly, Vice Chairman, Chief Financial Officer, Fleet Financial
Group, 1990-1993.
Anne M. Goggin*, Manager, (50).
New England Life Insurance Company ("NELICO"), 501 Boylston Street, Boston, MA
02117.
Senior Vice President and Associate General Counsel, NELICO, since 1997; Vice
President, General Counsel, Secretary and Clerk, New England Securities,
since 1993. Formerly, Vice President and Counsel, New England Mutual, 1994-
1996.
Nancy Hawthorne, Manager, (48).
Pilot House, Lewis Wharf, Boston, MA 02110.
Formerly, Chief Executive Officer and Managing Partner, Hawthorne, Krass &
Associates; Executive Vice President, Enterprise Transformation Media One;
and Senior Vice President and Chief Financial Officer, Continental
Cablevision, Inc. Director, Perini Corporation, Director, Avid Technologies
and Commercial Union Assurance Co.
Joseph M. Hinchey, Manager, (74).
193 Wamphassuc Road, Stonington, CT 06378.
Retired; formerly, Senior Vice President--Finance, Analog Devices, Inc.
(manufacturer of electronic devices). Trustee, Union College and Citizens
Scholarship Foundation of America, Inc.
Robert B. Kittredge, Manager, (78).
21 Sturdivant Road, Cumberland Foreside, ME 04110.
Retired; Trustee, CGM Trust and CGM Capital Development Fund, formerly, Vice
President, General Counsel and Director, Loomis, Sayles & Company,
Incorporated.
John T. Ludes, Manager, (62).
American Brands, 1700 E. Putnam Avenue, Old Greenwich, CT 06870.
President & Chief Operating Officer American Brands since 1995. Formerly,
President and CEO, Acushnet Company 1982-1995.
Dale Rogers Marshall, Manager, (62).
Wheaton College, 26 East Main Street, Norton, MA 02766.
President, Wheaton College; formerly, Academic Dean, Wellesley College.
Marie C. Swift, Secretary, (45).
NELICO, 501 Boylston Street, Boston, MA 02117.
Second Vice President and Counsel since 1998; formerly, Counsel and Assistant
Secretary, NELICO, 1992-1998; and Counsel and Assistant Secretary, New
England Mutual, until 1996.
Frederick K. Zimmermann*, Manager and Chairman, (47).
NELICO, 501 Boylston Street, Boston, MA 02117.
Executive Vice President and Chief Investment Officer, NELICO, since 1996;
Chairman of the Board and President, TNE Advisers, Inc.; Chairman of the
Board and President, New England Pension and Annuity Company; formerly,
Director and Vice President--Investments, NELICO, until 1996; Executive Vice
President (1993-1996) of New England Mutual.
- -------
*Indicates a Board member who is an "interested person" as defined by the
Investment Company Act of 1940 (the "1940 Act").
II-4
<PAGE>
Committees of the Board. The Managers have delegated certain authority to an
Executive Committee consisting of Messrs. Arena, Hinchey and Zimmermann and
other authority to the Audit Committee or the Contract Review and Governance
Committee. The latter two committees currently have the same members (Mses.
Hawthorne and Marshall and Messrs. Arena, Flynn, Hinchey, Kittredge and
Ludes), all of whom are Managers who are not interested persons of the Fund.
The Executive Committee is authorized to exercise broad decision-making
responsibility, on behalf of the Fund's Board of Managers, with respect to
issues that require immediate response and for which it is difficult or
impractical to contact all of the members of the Board within the time frame
required for the decision.
The Audit Committee reviews financial and accounting controls and
procedures; recommends the selection of the independent accountants; reviews
the scope of the audit; reviews financial statements and audit reports; and
reviews the independence of the independent accountants and approval of fees
and assignments relating to both audit and non-audit activities of the
independent accountants. Mr. Hinchey currently serves as chairman of the Audit
Committee.
The Contract Review and Governance Committee reviews and makes
recommendations to the Board as to contracts requiring approval of a majority
of the Managers who are not interested persons of the Fund and any other
contracts which may be referred to it by the Board. The Committee also
recommends to the Board nominees for election as Managers of the Fund and
recommends the compensation of the Managers who are not interested persons of
the Fund. Mr. Arena currently serves as chairman of the Contract Review and
Governance Committee.
Board Compensation. The Fund does not pay any remuneration to officers or
Managers who are interested persons of the Fund.
Each Manager who is not an "interested person" of the Fund also serves as
trustee and member of the same committees of New England Zenith Fund and for
serving in all capacities receives an aggregate retainer fee at the annual
rate of $20,000 and aggregate attendance fees of $2,500 for each board meeting
attended. In addition, the chairman of the Contract Review and Governance
Committee receives a retainer at the annual rate of $6,000, and the chairman
of the Audit Committee receives a retainer at the annual rate of $4,000. These
fees are allocated among the Fund and the series of New England Zenith Fund
based on a formula that takes into account, among other factors, the net
assets of the Fund and each such series of New England Zenith Fund.
During the fiscal year ended December 31, 1998, the persons who were then
Managers of the Fund received the amounts set forth below for serving as a
Manager of the Fund and for also serving on the Board of Trustees of New
England Zenith Fund. As of December 31, 1998, there were a total of 14 series
of New England Zenith Fund.
<TABLE>
<CAPTION>
Total Compensation
from the Fund and
Aggregate Compensation New England Zenith
Name of Manager from the Fund in 1998 Fund in 1998
--------------- ---------------------- ------------------
<S> <C> <C>
John J. Arena........................ $ $
John W. Flynn........................
Nancy Hawthorne......................
Joseph M. Hinchey....................
Robert B. Kittredge..................
John T. Ludes........................
Laurens MacLure(b)...................
Dale Rogers Marshall.................
</TABLE>
- -------
(a) Also includes compensation paid by the portfolios of the CGM Funds, a
group of mutual funds for which Capital Growth Management Limited
Partnership, the investment adviser of the Fund, serves as investment
adviser.
(b) Retired from service as a manager of Fund effective July 31, 1998.
II-5
<PAGE>
INVESTMENT ADVISORY AND OTHER SERVICES
Advisory Agreement. Capital Growth Management Limited Partnership ("CGM"),
One International Place, Boston, Massachusetts 02110, serves as investment
adviser to the Fund under an advisory agreement dated August 30, 1996. CGM has
served as the Fund's investment adviser since March 1, 1990. Prior to March 1,
1990, the Fund was managed by Loomis Sayles & Company, Incorporated ("Loomis
Sayles"), whose Capital Growth Management Division was reorganized into CGM on
that date. CGM is a limited partnership whose sole general partner is Kenbob,
Inc., a corporation controlled equally by Robert L. Kemp and G. Kenneth
Heebner. CGM provides discretionary investment management services to mutual
funds and other clients.
CGM, subject to the supervision of the Fund's Board of Managers, manages the
investment and reinvestment of Fund assets. For providing such services, the
Fund pays CGM a fee at the annual rate of .3066% of the average daily net
assets of the Fund (which excludes any accrued tax liabilities and reserves
for taxes arising from the income and realized and unrealized capital gains on
the assets of the Fund). This fee is computed on a daily basis and is payable
monthly. During the years ended December 31, 1996, 1997 and 1998 the Fund paid
CGM advisory fees of $189,501, $221,842 and $232,028.
The advisory agreement provides that it shall continue in effect for an
initial term of two years from the date of its execution and thereafter from
year to year so long as its continuance is approved at least annually by (i)
the Board of Managers of the Fund or by the affirmative vote of a majority of
the votes which may be cast by all Contractholders ("majority vote of the
Contractholders") and (ii) by the vote of a majority of the Board of Managers
who are not interested persons of the Fund or of CGM, cast at a meeting called
for that purpose. (Majority vote of the Contractholders means 67% or more of
the votes present (in person or by proxy) and entitled to be cast if
Contractholders entitled to cast more than 50% of the outstanding votes of the
Fund are present (in person or by proxy), or more than 50% of all votes which
are entitled to be cast by all Contractholders of the Fund, whichever is
less.) Any amendment to the advisory agreement must be approved by majority
vote of the Contractholders and by vote of a majority of the Managers who are
not such interested persons. The agreement may be terminated without penalty
by the Board of Managers or the Contractholders upon 60 days' written notice
to CGM or by CGM upon 90 days' written notice to the Fund, and it terminates
automatically in the event of its assignment. In addition, the agreement will
automatically terminate if the Fund shall at any time be required by the
Company to eliminate all reference to the phrase "New England" in its name,
unless the continuance of the agreement after such change of name is approved
by majority vote of the Contractholders and by a majority of the Managers who
are not interested persons of the Fund or CGM. The agreement also provides
that CGM shall not be subject to any liability in connection with the
performance of its services thereunder in the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of its obligations or
duties.
CGM has individual and institutional clients besides the Fund, including the
following other investment company portfolios: CGM American Tax Free Fund, CGM
Capital Development Fund, CGM Mutual Fund, CGM Fixed Income Fund, CGM Focus
Fund, CGM Realty Fund, New England Growth Fund (a series of New England Funds
Trust I) and the Capital Growth Series of New England Zenith Fund.
Managers of the Fund may also serve as officers, directors, or trustees of
other investment companies advised by CGM or of other corporate or fiduciary
clients of CGM. Such clients may include some accounts of MetLife and its
affiliates ("MetLife accounts"). The other investment companies and clients
served by CGM sometimes invest in securities in which the Fund also invests.
If the Fund and such other investment companies, or clients advised by CGM
(including MetLife accounts) desire to buy or sell the same portfolio
securities at about the same time, purchases and sales will be allocated to
the extent practicable on a pro rata basis in proportion to the amounts
desired to be purchased or sold for each. It is recognized that in some cases
the practices described in this paragraph could have a detrimental
II-6
<PAGE>
effect on the price or amount of the securities which the Fund purchases or
sells. In other cases, however, it is believed that these practices may
benefit the Fund. It is the opinion of the Board of Managers that the
desirability of retaining CGM as adviser to the Fund outweighs the
disadvantages, if any, which might result from these practices.
Nvest Companies, L.P. ("Nvest Companies"), owns a 50% limited partnership
interest in CGM. The Company owns directly and indirectly, through its wholly-
owned subsidiary, MetLife New England Holdings, Inc. a majority limited
partnership interest in Nvest Companies and, through MetLife New England
Holdings, Inc. ("MetLife Holdings"), a 100% interest in Nvest Companies'
managing general partner, Nvest Corporation. Nvest Companies' advising general
partner, Nvest, L.P., is a publicly traded company listed on the New York
Stock Exchange. Nvest Corporation is the sole general partner of Nvest, L.P.
Administrative Agreement. Under the terms of an administrative agreement
between the Fund and the Company, the Company furnishes or bears the expense
of all legal, actuarial and accounting services, office space, facilities and
equipment, services of executive and other personnel and all other
administrative services necessary or appropriate to carry on the various
functions of the Fund, but not including expenses attributable to sales
activities, which are covered by the distribution agreement among the Fund,
the Company and New England Securities. As compensation, the Company retains
the deduction for administrative expenses described in the prospectus under
the heading "Deductions from Purchase Payments for Sales and Administrative
Services and Premium Taxes." For the years 1996, 1997 and 1998 this deduction
amounted to $6,484, $5,779 and $4,036, respectively.
Under the provisions of the administrative agreement and the contracts, the
following items are payable directly by the Fund: (a) any taxes paid or
reserved for, arising from the income and realized and unrealized capital
gains and assets of the Fund, (b) fees for mortality and expense risks assumed
and for investment advisory services, (c) brokerage commissions and taxes, if
any, in connection with the purchase or sale of the Fund's portfolio
securities, and (d) fees and expenses of the Board of Managers, including the
auditing of Fund assets.
Administrative Services Agreement. Pursuant to an administrative services
agreement between the Company and New England Life Insurance Company
("NELICO"), NELICO serves as the Designated Office for servicing the Contracts
and performs certain other administrative services for the Company relating to
the Fund and the Contracts. NELICO is compensated for these services based on
the expenses it incurs in providing them. NELICO was a wholly-owned subsidiary
of New England Mutual before it merged into the Company, and became an
indirect subsidiary of the Company through MetLife Holdings as a result of the
merger.
Distribution Agreement. New England Securities serves as principal
underwriter for the Fund pursuant to a distribution agreement among the Fund,
the Company and New England Securities. The agreement does not obligate New
England Securities to sell a specific number of contracts. The Company retains
the deduction for sales expenses described in the prospectus under the heading
"Deductions from Purchase Payments for Sales and Administrative Services and
Premium Taxes". For the years 1996, 1997 and 1998, these deductions amounted
to $17,197, $15,471 and $10,811, respectively.
New England Securities also serves as principal underwriter to New England
Retirement Investment Account, The New England Variable Account, New England
Variable Life Separate Account, New England Variable Annuity Separate Account
and New England Zenith Fund.
Safekeeping of Securities. The Fund maintains custody of its securities
pursuant to a safekeeping and services agreement with State Street Bank and
Trust Company ("State Street Bank"), 225 Franklin Street, Boston,
Massachusetts 02110. Eligible securities of the Fund are held on deposit with
The Depository Trust Company. The safekeeping agreement differs from the
typical forms of mutual fund custodian agreements in that the responsibilities
of the bank are less broad. For example, the Company, under its administrative
agreement with the Fund, retains substantially more flexibility in dealing
with cash balances and has much greater responsibility for pricing in the
II-7
<PAGE>
context of contract sales and redemptions. The Company bears State Street
Bank's costs under the safekeeping and services agreement in accordance with
the terms of the administrative agreement with the Fund.
Independent Accountants. The Fund's independent accountants are Deloitte &
Touche LLP, 125 Summer Street, Boston, Massachusetts 02110. Deloitte & Touche
LLP conducts an annual audit of the Fund's financial statements, conducts an
examination of securities owned by the Fund and held pursuant to the
safekeeping agreement, and consults with the Company's financial personnel on
current accounting and financial matters relating to the Fund. Coopers &
Lybrand L.L.P. served as the Fund's independent auditors prior to 1997.
PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS
In buying and selling portfolio securities for the Fund, CGM always seeks
the best price and execution. Transactions in unlisted securities are carried
out through brokers or dealers who make the primary market for such securities
unless, in the judgment of CGM, a more favorable price can be obtained by
carrying out such transactions through other brokers or dealers.
CGM selects only brokers which it believes are financially responsible, will
provide efficient and effective services in executing, clearing and settling
the order and will charge commission rates which, when combined with the
quality of the foregoing services, will produce the best price and execution
for the transaction. This does not necessarily mean that the lowest available
brokerage commissions will be paid. However, the commissions are believed to
be competitive with generally prevailing rates. CGM will use its best efforts
to obtain information as to the general level of commission rates being
charged by the brokerage community from time to time and will evaluate the
overall reasonableness of brokerage commissions paid on transactions by
reference to such data. In making such evaluation, all factors affecting
liquidity and execution of the order, as well as the amount of the capital
commitment by the brokers in connection with the order, are taken into
account. The Fund will not pay a broker a commission at a higher rate than
otherwise available for the same transaction in recognition of the value of
research services provided by the broker or in recognition of the value of any
other services provided by the broker which do not contribute to the best
price and execution of the transaction.
Receipt of research services from brokers may sometimes be a factor in
selecting a broker which CGM believes will provide best price and execution
for a transaction. These research services include not only a wide variety of
reports on such matters as economic and political developments, industries,
companies, securities, portfolio strategy, account performance, daily prices
of securities, stock and bond market conditions and projections, asset
allocation and portfolio structure, but also meetings with management
representatives of issuers and with other analysts and specialists. Although
it is not possible to assign an exact dollar value to these services, they
may, to the extent used, tend to reduce CGM's expenses. These services may be
used by CGM in servicing other client accounts and in some cases may not be
used with respect to the Fund. Receipt of services or products other than
research from brokers is not a factor in the selection of brokers.
In 1998, brokerage transactions for the Fund aggregating $254,473,559 were
allocated to brokers providing research services and $272,778 in commissions
were paid on these transactions. During 1996, 1997 and 1998 the Fund paid
total brokerage fees of $275,771, $249,359 and $287,278, respectively.
DISTRIBUTION OF CONTRACTS
New England Securities Corporation, an indirect subsidiary of the Company,
is the principal underwriter of the contracts. The contracts are no longer
offered for sale, but contractholders may make on-going purchase payments
under the Fund's flexible purchase payment contracts. NELICO's life insurance
agents and insurance brokers who are
II-8
<PAGE>
registered representatives of New England Securities service the contracts.
The Company pays commissions, none of which are retained by New England
Securities, to the registered representatives who have sold the contracts. In
1996, 1997 and 1998 New England Mutual or (after August 30, 1996) the Company
paid commissions to those registered representatives with respect to ongoing
purchase payments under the contracts in the amounts of $14,426, $16,159 and
$ , respectively.
CALCULATION OF PERFORMANCE DATA
As set forth in the prospectus under "Fund Performance," the Fund's Annual
and Semi-Annual Reports show the percentage change in unit value of the Fund
without reflecting the impact of any sales and administrative charges. (The
Annual and Semi-Annual Reports also illustrate the Fund's Average Annual Total
Return, which does reflect the deduction of sales and administration charges.)
The percent change in unit value represents what the increase in contract
value would be for a Contractholder who did not make any Purchase Payments or
surrenders during the year. The percentage change in unit value is shown for
every calendar year since inception of the Fund to the date of the report and
for 20, 15, 10, 5 and 1 year periods ending with the date of the report. The
percentage change is calculated by dividing the difference in unit values at
the beginning and end of the period by the beginning unit value.
The following percentage change in unit value figures appear in the Fund's
Annual Report for the year ended December 31, 1998.
<TABLE>
<CAPTION>
Percent Change in Unit Value
- ----------------------------
<S> <C>
27 years, 9 months ended December 31, 1998............................ +2,714.8%
20 years ended December 31, 1998...................................... +2,659.7%
15 years ended December 31, 1998...................................... +726.0%
10 years ended December 31, 1998...................................... +382.90%
5 years ended December 31, 1998....................................... +153.5%
1 year ended December 31, 1998........................................ +32.7%
</TABLE>
II-9
<PAGE>
Annual Percent Change in Unit Value
Since Fund Inception
<TABLE>
<CAPTION>
Accumulation %
Date Unit Value Change
---- ------------ ------
<S> <C> <C>
March 25, 1971........................................ $ 1.157298 --
December 31, 1971..................................... 1.180085 +2.0
December 31, 1972..................................... 1.324345 +12.2
December 31, 1973..................................... 1.144645 -13.6
December 31, 1974..................................... 0.786512 -31.3
December 31, 1975..................................... 0.981727 +24.8
December 31, 1976..................................... 1.147484 +16.9
December 31, 1977..................................... 1.077867 -6.1
December 31, 1978..................................... 1.180390 +9.5
December 31, 1979..................................... 1.356685 +14.9
December 31, 1980..................................... 1.907809 +40.6
December 31, 1981..................................... 2.046992 +7.3
December 31, 1982..................................... 3.254033 +59.0
December 31, 1983..................................... 3.943886 +21.2
December 31, 1984..................................... 3.572709 -9.4
December 31, 1985..................................... 4.823900 +35.0
December 31, 1986..................................... 6.156190 +27.6
December 31, 1987..................................... 7.017161 +14.0
December 31, 1988..................................... 6.745649 -3.9
December 31, 1989..................................... 7.984578 +18.4
December 31, 1990..................................... 8.383448 +5.0
December 31, 1991..................................... 11.835525 +41.2
December 31, 1992..................................... 11.576959 -2.2
December 31, 1993..................................... 12.850577 +11.0
December 31, 1994..................................... 11.899473 -7.4
December 31, 1995..................................... 16.523266 +38.9
December 31, 1996..................................... 20.079854 +21.5
December 31, 1997..................................... 24.547721 +22.3
December 31, 1998..................................... 32.575691 +32.7
</TABLE>
ANNUITY PAYMENTS
When a variable payment option is selected, the contract proceeds will be
applied at annuity purchase rates, which vary depending on the particular
option selected and the age of the payee (and, where sex-neutral annuity rates
are not applicable, on the sex of the payee when the payment option selected
involves a life contingency). The impact of the choice of option and the sex
and age of the payee on the level of annuity payments is described in the
prospectus under "Variable Payment Options."
The amount of the basic payment level is determined by applying the
applicable annuity purchase rate to the amount applied to provide the annuity.
This basic payment level is converted into annuity units, the number of which
remains constant. Each monthly annuity payment is in an amount equal to that
number of annuity units multiplied by the value of the applicable annuity unit
as of the date of payment. The values of annuity units will change from day to
day, depending upon the investment performance of the Fund.
The selection of an assumed interest rate will affect both the basic payment
level and the amount by which subsequent payments increase or decrease. The
basic payment level is calculated on the assumption that the Net
II-10
<PAGE>
Investment Factors (discussed below) applicable to the contract will be
equivalent on an annual basis to a net investment return at the assumed
interest rate. If this assumption is met following the date any payment is
determined, then the amount of the next payment will be exactly equal to the
amount of the preceding payment. If the actual Net Investment Factors are
equivalent to a net investment return greater than the assumed interest rate,
the next payment will be larger than the preceding one; if the actual Net
Investment Factors are equivalent to a net investment return smaller than the
assumed interest rate, then the next payment will be smaller than the
preceding payment. The definition of the assumed interest rate, and the effect
of the level of the assumed interest rate on the amount of monthly payments,
is explained in the prospectus under "Variable Payment Options."
The number of annuity units credited under a variable payment option is
determined as follows:
(1) The proceeds under a deferred contract, or the Net Purchase Payment
under an immediate contract, are applied at the Company's annuity purchase
rates for the selected assumed interest rate to determine the basic payment
level.
(2) The number of annuity units is determined by dividing the amount of
the basic payment level by the applicable annuity unit value next
determined following the application of proceeds (in the case of a deferred
contract) or Net Purchase Payment (in the case of an immediate contract).
The dollar amount of the initial payment will be at the basic payment level
(if, in the case of an immediate contract, the payment is due not later than
14 days after the Net Purchase Payment is applied). The dollar amount of each
subsequent payment is determined by multiplying the number of annuity units by
the applicable annuity unit value which is determined at least 14 days before
the payment is due.
The value of an annuity unit depends on the assumed interest rate and on the
Net Investment Factor applicable at the time of valuation. The Net Investment
Factor, and thus changes in the value of an annuity unit under a variable
payment option, reflects daily deductions for investment advisory services and
mortality and expense risks. (See "Net Investment Factor" below). The initial
annuity unit values were set at $1.00 effective on the date on which assets
were first placed in the Fund.
The annuity unit value for any day is equal to the corresponding annuity
unit value previously determined multiplied by the applicable Net Investment
Factor for the New York Stock Exchange trading day then ended, and further
multiplied by the assumed interest factor for each day since the annuity unit
value was last determined. The assumed interest factor represents the daily
equivalent of the contract's annual assumed interest rate. In the calculation
of annuity unit values, the assumed interest factor has the effect of reducing
the Net Investment Factor by an amount equal to the daily equivalent of the
contract's assumed interest rate. The result of this adjustment is that if the
Net Investment Factor for a valuation period is greater (when expressed as an
annual net investment return) than the assumed interest rate, the annuity unit
value will increase. If the Net Investment Factor for the period is less (when
expressed as an annual net investment return) than the assumed interest rate,
the annuity unit value will decrease. At an assumed interest rate of 3.5% the
assumed interest factor is .9999058. Assumed interest factors for other
assumed interest rates are computed on a consistent basis.
II-11
<PAGE>
NET INVESTMENT FACTOR
The Net Investment Factor for the Fund is determined after the New York
Stock Exchange closes on each day on which the Exchange is open for trading (a
"Trading Day") as follows:
On each Trading Day a Gross Investment Rate is determined from the
investment performance of the Fund since the close of regular trading on the
New York Stock Exchange on the preceding Trading Day. This rate may be
positive or negative and is equal to:
i. The investment income since the close of regular trading on the New
York Stock Exchange on the preceding Trading Day, plus capital gains minus
capital losses for the same period, whether realized or unrealized, less
deductions for: (a) any taxes paid or reserved for, arising from the income
and realized and unrealized capital gains on assets of the Fund, (b)
brokerage commissions and taxes, if any, in connection with the purchase or
sale of the Fund's portfolio securities, and (c) fees and expenses of the
Board of Managers, divided by
ii. The value of the total assets of the Fund as of the close of regular
trading on the New York Stock Exchange on the preceding Trading Day less
any assets set aside as a provision for taxes and accrued expenses
described in i. above.
The Net Investment Factor is equal to the sum of this Gross Investment Rate
and 1.0000000, less deductions from net assets at the following rates for each
day since the close of regular trading on the New York Stock Exchange on the
preceding Trading Day:
i. For deferred contracts: .00344% (1.2556% on an annual basis consisting
of .3066% for investment advisory services and .8395% for mortality risk
assumptions plus .1095% for expense risk assumptions made by the Company).
ii. For immediate contracts: .00274% (1.0001% on an annual basis
consisting of .3066% for investment advisory services and .5840% for
mortality risk assumptions plus .1095% for expense risk assumptions made by
the Company).
The Net Investment Factor may be less than 1.0000000.
EXPERTS
The financial statements of New England Variable Annuity Fund I included in
this Statement of Additional Information and the information in the Prospectus
concerning selected per unit data and ratios have been included in reliance on
the report of Deloitte & Touche, LLP, independent accountants, given on the
authority of that firm as experts in accounting and auditing. The financial
statements of Metropolitan Life Insurance Company ("MetLife"), included in
this Statement of Additional Information have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their reports appearing herein,
(whose reports express unqualified opinions and, with respect to MetLife,
includes an explanatory paragraph referring to the changes in the basis of
accounting), and are included in reliance upon such reports of such firm given
upon their authority as experts in auditing and accounting.
The statement of changes in net assets of New England Variable Annuity Fund
I, for the year ended December 31, 1996, and selected per unit data and ratios
for each of the four years in the period ended December 31, 1996, have been
incorporated herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
II-12
<PAGE>
NEW ENGLAND VARIABLE ANNUITY FUND I
PART C. OTHER INFORMATION
Item 28. Financial Statements and Exhibits
(a) Financial Statements
(1) The following financial statements of the Registrant are included in
Part B of this Post-Effective Amendment on Form N-3:
Statement of Assets and Liabilities as of December 31, 1998 (to be
filed by Amendment.
Statement of Operations for the year ended December 31, 1998 (to be
filed by Amendment).
Statement of Changes in Net Assets for the years ended December 31,
1998 and 1997 (to be filed by Amendment).
Statement of Supplementary Information - Selected Per Unit Data and
Ratios (to be filed by Amendment).
Notes to Financial Statements (to be filed by Amendment).
Schedule of Investments as of December 31, 1998 (to be filed by
Amendment).
(2) The following financial statements of the Company are included in
Part B of this Post-Effective Amendment on Form N-3:
Consolidated Balance Sheets as of December 31, 1998 and 1997 (to be
filed by Amendment).
Consolidated Statements of Earnings for the years ended December 31,
1998, 1997 and 1996 (to be filed by Amendment).
Consolidated Statements of Equity for the years ended December 31,
1998, 1997 and 1996 (to be filed by Amendment).
Consolidated Statements of Cash Flow for the years ended December 31,
1998, 1997 and 1996 (to be filed by Amendment).
Notes to Consolidated Financial Statements (to be filed by Amendment).
III-1
<PAGE>
(b) Exhibits
(1) (i) Resolutions of the Board of Directors of New England Mutual Life
Insurance Company establishing the Fund are incorporated herein by
reference to Registration Statement on Form N-3 (No. 333-11137) filed
on August 30, 1996.
(ii) Resolutions of the Board of Directors of the Company adopting the
Fund as a separate account are incorporated herein by reference to the
Registration Statement on Form N-3 (No. 333-11137) filed on August 30,
1996.
(2) Amended and Restated Rules and Regulations of the Fund are incorporated
herein by reference to Post-Effective Amendment No. 1 to the
Registration Statement on Form N-3 (File No. 333-11137) filed on April
30, 1997.
(3) Form of Safekeeping Agreement is incorporated herein by reference to
Post-Effective Amendment No. 3 to Registration Statement on Form N-3
(File No. 333-11137) filed on May 1, 1998.
Custodian Fee Schedule is incorporated herein by reference to Post-
Effective Amendment No. 3 to Registration Statement on Form N-3 (File
No. 333-11137) filed on May 1, 1998.
(4) Advisory Agreement is incorporated herein by reference to Registration
Statement on Form N-3 (File No. 333-11137) filed on August 30, 1996.
(5) Distribution Agreement is incorporated herein by reference to
Registration Statement on Form N-3 (File No. 333-11137) filed on August
30, 1996.
(6) (i) Form of variable annuity contract is incorporated herein by
reference to Post-Effective Amendment No. 3 to Registration Statement
on Form N-3 (File No. 333-11137) filed on May 1, 1998.
(ii) Additional forms of variable annuity contract.
(iii) Form of Endorsement: Tax-Sheltered Annuity.
(iv) Form of Endorsement: Individual Retirement Annuity.
(v) Form of Metropolitan Life Insurance Company Endorsement to New
England Mutual Life Insurance Company variable annuity contract is
incorporated herein by reference to the Registration Statement on Form
N-3 (No. 333-11137) filed on August 30, 1996.
(7) Forms of application.
III-2
<PAGE>
(8) (i) Charter and By-Laws of Metropolitan Life Insurance Company are
incorporated herein by reference to Registration Statement on Form N-3
(No. 333-11137) filed August 30, 1996.
(ii) By-Laws Amendment is incorporated herein by reference to the
Registration Statement on Form N-3 (File No. 333-11137) filed on August
30, 1996.
(9) None
(10) None
(11) (i) Form of Administrative Agreement is incorporated herein by
reference to Post-Effective Amendment No. 3 to Registration Statement
on Form N-3 (File No. 333-11137) filed on May 1, 1998.
(ii) Administrative Services Agreement is incorporated by reference to
the Registration Statement on Form N-3 (File No. 333-11137) filed
August 30, 1996.
(12) Opinion and Consent of Christopher P. Nicholas, Esq. (to be filed by
Amendment).
(13) (i) Consent of Deloitte & Touche LLP. (to be filed by Amendment).
(ii) Consent of Ropes & Gray (to be filed by Amendment).
(14) None.
(15) None.
(16) Schedule for computation of performance quotations is incorporated
herein by reference to Post-Effective Amendment No. 3 to Registration
Statement on Form N-3 (File No. 333-11137) filed on May 1, 1998.
(17) Powers of Attorney.
(i) Metropolitan Life Insurance Company. Powers of Attorney are
incorporated herein by reference to the Registration Statement on Form
N-3 (File No. 333-11137) filed on August 30, 1996, except for Gerald
Clark, Burton A. Dole and Charles M. Leighton whose powers of attorney
were filed with Post-Effective Amendment No. 1 to the Registration
Statement (File No. 333-11137) filed April 30, 1997 and Robert H.
Benmosche, Jon F. Danski and Stewart G. Nagler whose powers of attorney
were filed with Post-Effective
III-3
<PAGE>
Amendment No. 23 of the Registration Statement of Metropolitan Life
Separate Account E (File No. 2-90380) filed April 3, 1998.
(ii) Board of Managers of the Fund. Powers of Attorney are
incorporated herein by reference to Post-Effective Amendment No. 48 on
Form N-3 (File No. 2-34420) filed on March 29, 1996, except for John J.
Arena, John W. Flynn and John T. Ludes whose powers of attorney were
filed with Post-Effective Amendment No. 1 to the Registration Statement
(File No. 333-11137) filed April 30, 1997.
(27) Financial Data Schedule (to be filed by Amendment).
ITEM 29. DIRECTORS AND OFFICERS OF THE INSURANCE COMPANY
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with Positions and Offices
Business Address Insurance Company with Registrant
<S> <C> <C>
Curtis H. Barnette Director None
Chairman and Chief
Executive Officer
Bethlehem Steel Corporation
1170 Eighth Avenue
Martin Tower 2118
Bethlehem, PA 18016-7699
Robert H. Benmosche Chairman of the Board, None
Metropolitan Life Insurance President and Chief Executive
Company Officer
One Madison Avenue
New York, NY 10010
Gerald Clark Vice-Chairman of the Board and None
Metropolitan Life Insurance and Chief Investment Officer
Company
One Madison Avenue
New York, NY 10010
</TABLE>
III-4
<PAGE>
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with Positions and Offices
Business Address Insurance Company with Registrant
<S> <C> <C>
Joan Ganz Cooney Director None
Chairman, Executive Committee
Children's Television Workshop
One Lincoln Plaza
New York, NY 10023
Burton A. Dole, Jr. Director None
Retired Chairman, President and
Chief Executive Officer
Puritan Bennett
P.O. Box 208
Pauma Valley, CA 92061
James R. Houghton Director None
Retired Chairman of the Board
Corning Incorporated
80 East Market Street 2nd Floor
Corning, NY 14830
Harry P. Kamen Retired Chairman and Chief None
Metropolitan Life Insurance Executive Officer
Company
200 Park Avenue, Suite 5700
New York, NY 10166
Helene L. Kaplan Director None
Of Counsel, Skadden, Arps
Slate Meagher and Flom
919 Third Avenue
New York, NY 10022
</TABLE>
III-5
<PAGE>
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with Positions and Offices
Business Address Insurance Company with Registrant
<S> <C> <C>
Charles H. Leighton Director None
Retired Chairman of the Board
CML Group, Inc.
524 Main Street
Bolton, MA 01720
Allen E. Murray Director None
Retired Chairman of the Board
and Chief Executive Officer
Mobil Corporation
375 Park Avenue, Suite 2901
New York, NY 10152
Stewart G. Nagler Vice-Chairman of the Board None
Metropolitan Life Insurance and Chief Financial Officer
Company
One Madison Avenue
New York, NY 10010
John J. Phelan, Jr. Director None
Retired Chairman and Chief
Executive Officer
New York Stock Exchange, Inc.
P. O. Box 312
Mill Neck, NY 11765
Hugh B. Price Director None
President and Chief Executive
Officer
National Urban League, Inc.
120 Wall Street, 7th & 8th Floors
New York, NY 10005
</TABLE>
III-6
<PAGE>
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with Positions and Offices
Business Address Insurance Company with Registrant
<S> <C> <C>
Robert G. Schwartz Retired Chairman of the Board, None
Metropolitan Life Insurance President and Chief Executive
Company Officer
200 Park Avenue, Suite 5700
New York, NY 10166
Ruth J. Simmons, PH.D. Director None
President
Smith College
College Hall 20
North Hampton, MA 01063
William C. Steere, Jr. Director None
Chairman of the Board and Chief
Executive Officer
Pfizer, Inc.
235 East 42nd Street
New York, NY 10017
</TABLE>
Set forth below is a list of certain principal officers of Metropolitan Life.
The principal business address of each officer of Metropolitan Life is One
Madison Avenue, New York, New York 10010.
<TABLE>
<CAPTION>
Name Position with Company Position with Registrant
<S> <C> <C>
Robert H. Benmosche Chairman of the Board, President and None
Chief Executive Officer
Gary A. Beller Senior Executive Vice-President and None
General Counsel
Gerald Clark Vice-Chairman of the Board and Chief None
Investment Officer
Stewart C. Nagler Vice-Chairman of the Board and Chief None
Financial Officer
C. Robert Hendrickson Senior Executive Vice-President None
Catherine A. Rein Senior Executive Vice-President None
</TABLE>
III-7
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
William J. Toppeta Senior Executive Vice-President None
John H. Tweedie Senior Executive Vice-President None
Jeffrey J. Hodgman Executive Vice-President None
Terence I. Lennon Executive Vice-President None
David A. Levene Executive Vice-President None
Judy E. Weiss Executive Vice-President and Chief None
Actuary
James M. Benson President and Chief Executive Officer-- None
New England Life Insurance Company
Richard M. Blackwell Senior Vice-President None
Alexander D. Brunini Senior Vice-President None
Jon F. Danski Senior Vice-President and Controller None
James B. Digney Senior Vice-President None
William T. Friedewald, M.D. Senior Vice-President None
Ira Friedman Senior Vice-President None
Anne E. Hayden Senior Vice-President None
Sibyl C. Jacobson Senior Vice-President None
Joseph W. Jordan Senior Vice-President None
Kernan F. King Senior Vice-President None
Nicholas D. Latrenta Senior Vice-President None
Leland C. Launer, Jr. Senior Vice-President None
Gary E. Lineberry Senior Vice-President None
James L. Lipscomb Senior Vice-President None
William D. Livesey Senior Vice-President None
James M. Logan Senior Vice-President None
Eugene Marks, Jr. Senior Vice-President None
William R. Prueter Senior Vice-President None
Joseph A. Reali Senior Vice-President None
Vincent P. Reusing Senior Vice-President None
Felix Schirripa Senior Vice-President None
Robert E. Sollman, Jr. Senior Vice-President None
Thomas L. Stapleton Senior Vice-President & Tax Director None
James F. Stenson Senior Vice-President None
Stanley J. Talbi Senior Vice-President None
Richard R. Tartre Senior Vice-President None
James A. Valentino Senior Vice-President None
Lisa Weber Senior Vice-President None
William J. Wheeler Senior Vice-President and Treasurer None
Anthony J. Williamson Senior Vice-President None
Louis J. Ragusa Vice-President and Secretary None
</TABLE>
The principle occupation of each officer, except the following officers during
the last five years has been as an officer of MetLife or an affiliate thereof.
Gary A. Beller has been an officer of MetLife since November, 1994; prior
thereto, he was a Consultant and Executive Vice-President and General Counsel of
the American Express Company. Robert H. Benmosche has been an
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officer of MetLife since September, 1995; prior thereto, he was an Executive
Vice-President of Paine Webber. Terence I. Lennon has been an officer of MetLife
since March, 1994; prior thereto, he was Assistant Deputy Superintendent and
Chief Examiner of the New York State Department of Insurance. Richard R. Tartre
has been an officer of Metropolitan Life since January 13, 1997, prior thereto
he was President and CEO of Astra Management Corp. William J. Wheeler became an
officer of Metropolitan Life since October 13, 1997; prior thereto he was Senior
Vice-President, Investment Banking of Donaldson, Lufkin and Jenrette. Lisa Weber
has been an officer of Metropolitan Life since March 16, 1998; prior thereto she
was a Director of Diversity Strategy and Development and an Associate Director
of Human Resources of PaineWebber. Jon F. Danski has been an officer of
Metropolitan Life since March 25, 1998; prior thereto he was Senior Vice-
President, Controller and General Auditor at ITT Corporation. The business
address of each officer is One Madison Avenue, New York, New York 10010.
ITEM 30. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE INSURANCE
COMPANY OR REGISTRANT.
The registrant is a separate account of Metropolitan Life Insurance Company
under the New York Insurance law. Under said law the assets allocated to the
separate account are the property of Metropolitan Life Insurance Company. No
person has the direct or indirect power to control Metropolitan Life Insurance
Company. As a mutual life insurance company, Metropolitan Life Insurance Company
has no stockholders. Its Board of Directors is elected in accordance with New
York Insurance Law by Metropolitan's policyholders, whose policies or contracts
have been in force for at least one year. Each such policyholder has only one
vote, irrespective of the number of policies or contracts held and the amount
thereof. The following outline indicates those persons who are controlled by or
under common control with Metropolitan Life Insurance Company:
ORGANIZATIONAL STRUCTURE OF METROPOLITAN AND SUBSIDIARIES
AS OF DECEMBER 31, 1998
The following is a list of subsidiaries of Metropolitan Life Insurance Company
("Metropolitan") as of December 31, 1998. Those entities which are listed at
the left margin (labelled with capital letters) are direct subsidiaries of
Metropolitan. Unless otherwise indicated, each entity which is indented under
another entity is a subsidiary of such indented entity and, therefore, an
indirect subsidiary of Metropolitan. Certain inactive subsidiaries have been
omitted from the Metropolitan Organizational listing. The voting securities
(excluding directors' qualifying shares, if any) of the subsidiaries listed are
100% owned by their respective parent corporations, unless otherwise indicated.
The jurisdiction of domicile of each subsidiary listed is set forth in the
parenthetical following such subsidiary.
A. Metropolitan Tower Corp. (Delaware)
1. Metropolitan Property and Casualty Insurance Company (Rhode Island)
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a. Metropolitan Group Property and Casualty Insurance Company
(Rhode Island)
i. Metropolitan Reinsurance Company (U.K.) Limited
(Great Britain)
b. Metropolitan Casualty Insurance Company (Rhode Island)
c. Metropolitan General Insurance Company (Rhode Island)
d. Metropolitan Direct Property and Casualty Insurance Company
(Georgia)
e. Metropolitan P&C Insurance Services, Inc. (California)
f. Metropolitan Lloyds, Inc. (Texas)
g. Met P&C Managing General Agency, Inc. (Texas)
2. Metropolitan Insurance and Annuity Company (Delaware)
a. MetLife Europe I, Inc. (Delaware)
b. MetLife Europe II, Inc. (Delaware)
c. MetLife Europe III, Inc. (Delaware)
d. MetLife Europe IV, Inc. (Delaware)
e. MetLife Europe V, Inc. (Delaware)
3. MetLife General Insurance Agency, Inc. (Delaware)
a. MetLife General Insurance Agency of Alabama, Inc. (Alabama)
b. MetLife General Insurance Agency of Kentucky, Inc.
(Kentucky)
c. MetLife General Insurance Agency of Mississippi, Inc.
(Mississippi)
d. MetLife General Insurance Agency of Texas, Inc. (Texas)
e. MetLife General Insurance Agency of North Carolina, Inc.
(North Carolina)
f. MetLife General Insurance Agency of Massachusetts, Inc.
(Massachusetts)
4. Metropolitan Asset Management Corporation (Delaware)
(a.) MetLife Capital, Limited Partnership (Delaware)
Partnership interests in MetLife Capital, Limited Partnership are
held by Metropolitan (90%) and Metropolitan Asset Management
Corporation (10%).
(i.) MetLife Capital Credit L.P. (Delaware).
Partnership interests in MetLife Capital Credit L.P. are held
by Metropolitan (90%) and Metropolitan Asset Management
Corporation (10%).
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(1) MetLife Capital CFLI Holdings, LLC (DE)
(a.) MetLife Capital CFLI Leasing, LLC (DE)
b. MetLife Financial Acceptance Corporation (Delaware).
MetLife Capital Holdings, Inc. holds 100% of the voting
preferred stock of MetLife Financial Acceptance Corporation.
Metropolitan Property and Casualty Insurance Company holds 100%
of the common stock of MetLife Financial Acceptance Corporation.
c. MetLife Investments Limited (United Kingdom). 23rd Street
Investments, Inc. holds one share of MetLife Investments Limited.
d. MetLife Investments Asia Limited (Hong Kong). One share of
MetLife Investments Asia Limited is held by W&C Services, Inc.,
a nominee of Metropolitan Asset Management Corporation.
5. SSRM Holdings, Inc. (Delaware)
a. GFM Investments Limited (Delaware)
b. State Street Research & Management Company (Delaware). Is a sub-
investment manager for the Growth, Income, Diversified and Aggressive
Growth Portfolios of Metropolitan Series Fund, Inc.
i. State Street Research Investment Services, Inc.
(Massachusetts)
c. SSR Realty Advisors, Inc. (Delaware)
i. Metric Management Inc. (Delaware)
ii. Metric Property Management, Inc. (Delaware)
(1) Metric Realty (Delaware). SSR Realty Advisors, Inc. and
Metric Property Management, Inc. each hold 50% of the common
stock of Metric Realty.
(a) Metric Institutional Apartment Fund II, L.P. (California).
Metric Realty holds a 1% interest as general partner and
Metropolitan holds an approximately 14.6% limited
partnership interest in Metric Institutional Apartment Fund
II, L.P.
(2) Metric Colorado, Inc. (Colorado). Metric Property Management,
Inc. holds 80% of the common stock of Metric Colorado, Inc.
iii. Metric Capital Corporation (California)
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<PAGE>
iv. Metric Assignor, Inc. (California)
v. SSR AV, Inc. (Delaware)
6. MetLife Holdings, Inc. (Delaware)
a. MetLife Funding, Inc. (Delaware)
b. MetLife Credit Corp. (Delaware)
7. Metropolitan Tower Realty Company, Inc. (Delaware)
8. Met Life Real Estate Advisors, Inc. (California)
9. Security First Group, Inc. (DE)
a. Security First Life Insurance Company (DE)
b. Security First Insurance Agency, Inc. (MA)
c. Security First Insurance Agency, Inc. (NV)
d. Security First Group of Ohio, Inc. (OH)
e. Security First Financial, Inc. (DE)
f. Security First Investment Management Corporation (DE)
g. Security First Management Corporation (DE)
h. Security First Real Estate, Inc. (DE)
i. Security First Financial Agency, Inc. (TX)
10. Natiloportem Holdings, Inc. (Delaware)
B. Metropolitan Tower Life Insurance Company (Delaware)
C. MetLife Security Insurance Company of Louisiana (Louisiana)
D. MetLife Texas Holdings, Inc. (Delaware)
1. Texas Life Insurance Company (Texas)
a. Texas Life Agency Services, Inc. (Texas)
b. Texas Life Agency Services of Kansas, Inc. (Kansas)
E. MetLife Securities, Inc. (Delaware)
F. 23rd Street Investments, Inc. (Delaware)
G. Services La Metropolitaine Quebec, Inc. (Quebec, Canada)
H. Santander Met, S.A. (Spain). Shares of Santander Met, S.A. are held by
Metropolitan (50%)
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<PAGE>
and by an entity (50%) unaffiliated with Metropolitan.
1. Seguros Genesis, S.A. (Spain)
2. Genesis Seguros Generales, Sociedad Anomina de Seguros y Reaseguros
(Spain)
I. MetLife Saengmyoung Insurance Company Ltd. (Korea).
J. Metropolitan Life Seguros de Vida S.A. (Argentina)
K. Metropolitan Life Seguros de Retiro S.A. (Argentina).
L. MetLife Holdings Luxembourg (Luxembourg)
M. Metropolitan Life Holdings, Netherlands BV (Netherlands)
N. MetLife International Holdings, Inc. (Delaware)
O. Metropolitan Life Insurance Company of Hong Kong Limited (Hong Kong)
P. Metropolitan Marine Way Investments Limited (Canada)
Q. P.T. MetLife Sejahtera (Indonesia) Shares of P.T. MetLife Sejahtera are held
by Metropolitan (80%) and by an entity (20%) unaffiliated with Metropolitan.
R. Seguros Genesis S.A. (Mexico) Metropolitan holds 85.49%, Metropolitan Tower
Corp. holds 7.31% and Metropolitan Asset Management Corporation holds 7.20%
of the common stock of Seguros Genesis S.A.
S. Metropolitan Life Seguros de Vida S.A. (Uruguay). One share of Metropolitan
Life Seguros de Vida S.A. is held by Alejandro Miller Artola, a nominee of
Metropolitan Life Insurance Company.
T. Metropolitan Life Seguros E Previdencia Privada S.A. (Brazil)
U. Hyatt Legal Plans, Inc. (Delaware)
1. Hyatt Legal Plans of Florida, Inc. (Fl)
V. One Madison Merchandising L.L.C. (Connecticut) Ownership of membership
interests in One Madison Merchandising L.L.C. is as follows: Metropolitan
owns 99% and Metropolitan Tower Corp. owns 1%.
W. Metropolitan Realty Management, Inc. (Delaware)
1. Edison Supply and Distribution, Inc. (Delaware)
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<PAGE>
2. Cross & Brown Company (New York)
a. CBNJ, Inc. (New Jersey)
X. MetPark Funding, Inc. (Delaware)
Y. 2154 Trading Corporation (New York)
Z. Transmountain Land & Livestock Company (Montana)
AA. Farmers National Company (Nebraska)
1. Farmers National Commodities, Inc. (Nebraska)
2. Farmers National Marketing Group, LLC (Iowa) Ownership of membership
interests in Farmers National Marketing Group, LLC is as follows:
Farmers National Company (50%) and an entity unaffiliated with
Metropolitan (50%).
A.B. MetLife Trust Company, National Association. (United States)
A.C. Benefit Services Corporation (Georgia)
A.D. G.A. Holding Corporation (MA)
A.E. TNE-Y, Inc. (DE)
A.F. CRH., Inc. (MA)
A.G. NELRECO Troy, Inc. (MA)
A.H. TNE Funding Corporation (DE)
A.I. L/C Development Corporation (CA)
A.J. Boylston Capital Advisors, Inc. (MA)
1. New England Portfolio Advisors, Inc. (MA)
A.K. CRB Co., Inc. (MA) AEW Real Estate Advisors, Inc. holds 49,000
preferred non-voting shares of CRB Co., Inc. AEW Advisors, Inc. holds
1,000 preferred non-voting shares of CRB Co., Inc.
A.L. New England Life Mortgage Funding Corporation (MA)
A.M. Mercadian Capital L.P. (DE). Metropolitan holds a 95% limited partner
interest and an unaffiliated third party holds 5% of Mercadian Capital
L.P.
A.N. Mercadian Funding L.P. (DE). Metropolitan holds a 95% limited partner
interest and an unaffiliated third party holds 5% of Mercadian Funding
L.P.
A.O. Tower Resources Group, Inc. (DE)
A.P. MetLife New England Holdings, Inc. (DE)
1. Fulcrum Financial Advisors, Inc. (MA)
2. New England Life Insurance Company (MA)
a. New England Life Holdings, Inc. (DE)
i. New England Securities Corporation (MA)
(1) Hereford Insurance Agency, Inc. (MA)
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<PAGE>
(2) Hereford Insurance Agency of Alabama, Inc. (AL)
(3) Hereford Insurance Agency of Minnesota, Inc. (MN)
(4) Hereford Insurance Agency of Ohio, Inc. (OH)
(5) Hereford Insurance Agency of New Mexico, Inc. (NM)
ii. TNE Advisers, Inc. (MA)
iii. TNE Information Services, Inc. (MA)
(1) First Connect Insurance Network, Inc. (DE)
(2) Interative Financial Solutions, Inc. (MA)
iv. N.L. Holding Corp. (Del)(NY)
(1) Nathan & Lewis Securities, Inc. (NY)
(2) Nathan & Lewis Associates, Inc. (NY)
(a) Nathan and Lewis Insurance Agency of Massachusetts, Inc.
(MA)
(b) Nathan and Lewis Associates of Texas, Inc. (TX)
(3) Nathan & Lewis Associates--Arizona, Inc. (AZ)
(4) Nathan & Lewis of Nevada, Inc. (NV)
(5) Nathan and Lewis Associates Ohio, Incorporated (OH)
b. Exeter Reassurance Company, Ltd. (MA)
c. Omega Reinsurance Corporation (AZ)
d. New England Pension and Annuity Company (DE)
e. Newbury Insurance Company, Limited (Bermuda)
3. Nvest Corporation (MA)
a. Nvest, L.P. (DE) Nvest Corporation holds a 1.69% general partnership
interest and MetLife New England Holdings, Inc. 3.19% general
partnership interest in Nvest, L.P.
b. Nvest Companies, L.P. (DE) Nvest Corporation holds a 0.0002% general
partnership interest in Nvest Companies, L.P. Nvest, L.P. holds a
14.64% general partnership interest in Nvest Companies, L.P.
Metropolitan holds a 46.23% limited partnership interest in Nvest
Companies, L.P.
i. Nvest Holdings, Inc. (DE)
(1) Back Bay Advisors, Inc. (MA)
(a) Back Bay Advisors, L.P. (DE)
Back Bay Advisors, Inc.
holds a 1% general partner interest and NEIC Holdings, Inc. holds
a 99% limited partner interest in Back Bay Advisors, L.P.
(2) R & T Asset Management, Inc. (MA)
(a) Reich & Tang Distributors, Inc. (DE)
(b) R & T Asset Management L.P.
R & T Asset Management, Inc.
holds a 0.5% general partner interest and
NEIC Holdings, Inc. hold a 99.5% limited
partner interest in R & T
Asset Management, L.P.
(c) Reich & Tang Services, Inc. (DE)
(3) Loomis, Sayles & Company, Inc. (MA)
(a) Loomis Sayles & Company, L.P. (DE)
Loomis Sayles & Company, Inc.
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<PAGE>
holds a 1% general partner interest and
R & T Asset Management, Inc. holds a 99%
limited partner interest in Loomis Sayles &
Company, L.P.
(4) Westpeak Investment Advisors, Inc. (MA)
(a) Westpeak Investment Advisors, L.P. (DE)
Westpeak Investment Advisors, Inc.
holds a 1% general partner interest and
Reich & Tang holds a 99% limited
partner interest in Westpeak Investment
Advisors, L.P.
(i) Westpeak Investment Advisors
Australia Limited Pty.
(5) Vaughan, Nelson Scarborough & McCullough (DE)
(a) Vaughan, Nelson Scarborough & McCullough, L.P. (DE)
VNSM, Inc. holds a 1% general partner interest and
Reich & Tang Asset Management, Inc. holds a 99%
limited partner interest in Vaughan, Nelson
Scarborough & McCullough, L.P.
(i) VNSM Trust Company
(6) MC Management, Inc. (MA)
(a) MC Management, L.P. (DE)
MC Management, Inc. holds a 1% general partner
interest and R & T Asset Management, Inc.
holds a 99% limited partner interest in MC
Management, L.P.
(7) Harris Associates, Inc. (DE)
(a) Harris Associates Securities L.P. (DE)
Harris Associates, Inc. holds a 1% general partner
interest and Harris Associates L.P. holds a
99% limited partner interest in Harris Associates
Securities, L.P.
(b) Harris Associates L.P. (DE)
Harris Associates, Inc. holds a 0.33% general
partner interest and NEIC Operating Partnership,
L.P. holds a 99.67% limited partner interest in
Harris Associates L.P.
(i) Harris Partners, Inc. (DE)
(ii) Harris Partners L.L.C. (DE)
Harris Partners, Inc. holds a 1%
membership interest and
Harris Associates L.P. holds a 99%
membership interest in Harris Partners L.L.C.
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<PAGE>
(1) Aurora Limited Partnership (DE)
Harris Partners L.L.C. holds a 1%
general partner interest
(2) Perseus Partners L.P. (DE) Harris Partners L.L.C. holds a 1%
general partner interest
(3) Pleiades Partners L.P. (DE) Harris
Partners L.L.C. holds a 1% general
partner interest
(4) Stellar Partners L.P. (DE)
Harris Partners L.L.C. holds a 1% general partner interest
(5) SPA Partners L.P. (DE) Harris Partners L.L.C. holds a 1%
general partner interest
(8) Graystone Partners, Inc. (MA)
(a) Graystone Partners, L.P. (DE)
Graystone Partners, Inc. holds a 1%
general partner interest and New England
NEIC Operating Partnership, L.P.
holds a 99% limited partner interest in
Graystone Partners, L.P.
(9) NEF Corporation (MA)
(a) New England Funds, L.P. (DE) NEF Corporation holds a
1% general partner interest and NEIC Operating
Partnership, L.P. holds a 99% limited
partner interest in New England Funds, L.P.
(b) New England Funds Management, L.P. (DE) NEF
Corporation holds a 1% general partner interest and
NEIC Operating Partnership, L.P. holds a 99%
limited partner interest in New England Funds
Management, L.P.
(10) New England Funds Service Corporation
(11) AEW Capital Management, Inc. (DE)
(a) AEW Securities, L.P. (DE) AEW Capital Management, Inc. holds
a 1% general partnership and AEW Capital Management, L.P.
holds a 99% limited partnership interest in AEW Securities, L.P.
ii. Nvest Associates, Inc.
iii. Snyder Capital Management, Inc.
(1) Snyder Capital Management, L.P. NEIC Operating
Partnership holds a 99.5% limited partnership
interest and Snyder Capital Management Inc. holds a
0.5% general partnership interest.
iv. Jurika & Voyles, Inc.
(1) Jurika & Voyles, L.P NEIC Operating Partnership,
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<PAGE>
L.P. holds a 99% limited partnership interest and
Jurika & Voyles, Inc. holds a 1% general partnership
interest.
v. Capital Growth Management, L.P. (DE)
NEIC Operating Partnership, L.P. holds a 50% limited partner interest
in Capital Growth Management, L.P.
vi. Nvest Partnerships, LLC ( )
vii. AEW Capital Management L.P. (DE)
New England Investment Companies, L.P. holds a 99% limited
partner interest and AEW Capital Management, Inc. holds a 1% general
partner interest in AEW Capital Management, L.P.
(1) AEW II Corporation ( )
(2) AEW Partners III, Inc. ( )
(3) AEW TSF, Inc. ( )
(4) AEW Exchange Management, LLC
(5) AEWPN, LLC ( )
(6) AEW Investment Group, Inc. (MA)
(a) Copley Public Partnership Holding, L.P. (MA)
AEW Investment Group, Inc. holds a 25% general partnership
interest and AEW Capital Management, L.P. holds a 75%
limited partnership interest in Copley Public Partnership
Holding, L.P.
(b) AEW Management and Advisors L.P. (MA)
AEW Investment Group, Inc. holds a 25% general partnership
interest and AEW Capital Management, L.P. holds a 75% limited
partnership interest in AEW Management and Advisors L.P.
ii. AEW Real Estate Advisors, Inc. (MA)
1. AEW Advisors, Inc. (MA)
2. Copley Properties Company, Inc. (MA)
3. Copley Properties Company II, Inc. (MA)
4. Copley Properties Company III, Inc. (MA)
5. Fourth Copley Corp. (MA)
6. Fifth Copley Corp. (MA)
7. Sixth Copley Corp. (MA)
8. Seventh Copley Corp. (MA).
9. Eighth Copley Corp. (MA).
10. First Income Corp. (MA).
11. Second Income Corp. (MA).
12. Third Income Corp. (MA).
13. Fourth Income Corp. (MA).
14. Third Singleton Corp. (MA).
15. Fourth Singleton Corp. (MA)
16. Fifth Singleton Corp. (MA)
17. Sixth Singleton Corp. (MA).
18. BCOP Associates L.P. (MA)
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<PAGE>
AEW Real Estate Advisors, Inc. holds a 1% general
partner interest in BCOP Associates L.P.
ii. CREA Western Investors I, Inc. (MA)
1. CREA Western Investors I, L.P. (DE)
CREA Western Investors I, Inc. holds a 24.28% general
partnership interest and Copley Public Partnership
Holding, L.P. holds a 57.62% limited partnership interest in CREA Western
Investors I, L.P.
iii. CREA Investors Santa Fe Springs, Inc. (MA)
(7) Copley Public Partnership Holding, L.P. (DE)
AEW Capital Management, L.P. holds a 75% limited partner interest and
AEW Investment Group, Inc. holds a 25% general partner interest and
CREA Western Investors I, L.P holds a 57.62% Limited Partnership
interest.
(8) AEW Real Estate Advisors, Limited Partnership (MA)
AEW Real Estate Advisors, Inc. holds a 25% general partnership interest
and AEW Capital Management, L.P. holds a 75% limited partnership
interest in AEW Real Estate Advisors, Limited Partnership.
(9) AEW Hotel Investment Corporation (MA)
(a.) AEW Hotel Investment, Limited Partnership (MA)
AEW Hotel Investment Corporation holds a 1% general
partnership interest and AEW Capital Management, L.P. holds a 99%
limited partnership interest in AEW Hotel Investment, Limited
Partnership.
(10) Aldrich Eastman Global Investment Strategies, LLC (DE)
AEW Capital Management, L.P. holds a 25% membership interest
and an unaffiliated third party holds a 75% membership interest in
Aldrich Eastman Global Investment Strategies, LLC.
In addition to the entities listed above, Metropolitan (or where indicated an
affiliate) also owns an interest in the following entities, among others:
1) CP&S Communications, Inc., a New York corporation, holds federal radio
communications licenses for equipment used in Metropolitan owned facilities and
airplanes. It is not engaged in any business.
2) Quadreal Corp., a New York corporation, is the fee holder of a parcel of
real property subject to a 999 year prepaid lease. It is wholly owned by
Metropolitan, having been acquired by a wholly owned subsidiary of Metropolitan
in 1973 in connection with a real estate investment and transferred to
Metropolitan in 1988.
3) Met Life International Real Estate Equity Shares, Inc., a Delaware
corporation, is a real estate investment trust. Metropolitan owns approximately
18.4% of the outstanding common stock of this company and has the right to
designate 2 of the 5 members of its Board of Directors.
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<PAGE>
4) Metropolitan Structures is a general partnership in which Metropolitan owns
a 50% interest.
5) Metropolitan owns, via its subsidiary, AFORE Genesis Metropolitan S.A. de
C.V., approximately 61.7% of SIEFORE Genesis S.A. de C.V., a mutual fund.
6) Metropolitan owns varying interests in certain mutual funds distributed by
its affiliates. These ownership interests are generally expected to decrease as
shares of the funds are purchased by unaffiliated investors.
7) Metropolitan Lloyds Insurance Company of Texas, an affiliated association,
provides homeowner and related insurance for the Texas market. It is an
association of individuals designated as underwriters. Metropolitan Lloyds,
Inc., a subsidiary of Metropolitan Property and Casualty Insurance Company ("MET
P&C"), serves as the attorney-in-fact and manages the association.
8) Metropolitan directly owns 100% of the non-voting preferred stock of Nathan
and Lewis Associates Ohio, Incorporated, an insurance agency. 100% of the voting
common stock of this company is held by an individual who has agreed to vote
such shares at the direction of N.L. Holding Corp. (DEL), an indirect wholly
owned subsidiary of Metropolitan.
9) 100% of the capital stock of Hereford Insurance Agency of Oklahoma, Inc.
(OK) is owned by an officer. New England Life Insurance Company controls the
issuance of additional stock and has certain rights to purchase such officer's
shares.
10) 100% of the capital stock of Fairfield Insurance Agency of Texas, Inc. (TX)
is owned by an officer. New England Life Insurance Company controls the issuance
of additional stock and has certain rights to purchase such officer's shares.
11) Mezzanine Investment Limited Partnerships ("MILPs"), Delaware limited
partnerships, are investment vehicles through which investments in certain
entities are held. A wholly owned subsidiary of Metropolitan serves as the
general partner of the limited partnerships and Metropolitan directly owns a 99%
limited partnership interest in each MILP. The MILPs have various ownership
interests in certain companies. The various MILPs own, directly or indirectly,
100% of the voting stock of the following company: Coating Technologies
International, Inc.
NOTE: THE METROPOLITAN LIFE ORGANIZATIONAL CHART DOES NOT INCLUDE REAL ESTATE
JOINT VENTURES AND PARTNERSHIPS OF WHICH METROPOLITAN LIFE AND/OR ITS
SUBSIDIARIES IS AN INVESTMENT PARTNER. IN ADDITION, CERTAIN INACTIVE
SUBSIDIARIES HAVE ALSO BEEN OMITTED.
Item 31. Number of Contractowners
As of March 31, 1999, there were ____ owners of tax-qualified contracts and ___
owners of non-qualified contracts offered by Registrant (to be supplied by
Amendment).
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<PAGE>
Item 32. Indemnification
Article IV of the Registrant's Amended and Restated Rules and Regulations
provides for the indemnification of its directors and officers as follows:
"The Fund shall indemnify each of the members its Board of Managers and officers
(including persons who serve at its request as directors, officers, or trustees
of another organization in which it has any interest, as a shareholder, creditor
or otherwise) against all liabilities and expenses, including but not limited to
amounts paid in satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees, reasonably incurred by him in connection with the
defense or disposition of any action, suit or other proceeding, whether civil or
criminal before any court or administrative or legislative body, in which he may
be or may have been involved as a party or otherwise or with which he may be or
may have been threatened, while in office or thereafter, by reason of any
alleged act or omission as a member or officer or by reason of his being or
having been such a member or officer, except with respect to any matter as to
which he shall have been finally adjudicated in any such action, suit or other
proceeding not to have acted in good faith in the reasonable belief that his
action was in the best interests of the Fund and except that no member or
officer shall be indemnified against any liability to the Fund or its
Contractholders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office. Expenses, including counsel fees, so
incurred by any such member or officer may be paid by the Fund in advance of the
final disposition of any such action, suit or proceeding on the condition that
the amounts so paid shall be repaid to the Fund if it is ultimately determined
that indemnification of such expenses is not authorized under this Article.
"As to any matter disposed of by a compromise payment by such member or officer,
pursuant to a consent decree or otherwise, no such indemnification either for
said payment or for any other expenses shall be provided unless such compromise
shall be approved as in the best interests of the Fund, after notice that it
involves such indemnification, (a) by a disinterested majority of the members of
the Board of Managers then in office; or (b) by a majority of the disinterested
members of the Board of Managers then in office; or (c) by any disinterested
person or persons to whom the question may be referred by the Board of Managers,
provided that in the case of approval pursuant to clause (b) or (c) there has
been obtained an opinion in writing of independent legal counsel to the effect
that such member or officer appears to have acted in good faith in the
reasonable belief that his action was in the best interests of the Fund and that
such indemnification would not protect such member or officer against any
liability to the Fund or its Contractholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office; or (d)
by the Contractholders holding a majority of the votes at the time entitled to
vote for members of the Board of Managers, exclusive of the votes of any
interested member or officer. Approval by the Board of Managers pursuant to
clause (a) or (b) or by any disinterested
III-21
<PAGE>
person or persons pursuant to clause (c) of this paragraph shall not prevent the
recovery from any officer or member of any amount paid to him in accordance with
either of such clauses as indemnification if such officer or member is
subsequently adjudicated by a court of competent jurisdiction not to have acted
in good faith in the reasonable belief that his action was in the best interests
of the Fund or to have been liable to the Fund or its Contractholders by reason
of willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office.
"The right of indemnification hereby provided shall not be exclusive of or
affect any other rights to which any member or officer of the Board of Managers
may be entitled. As used in this Article, the terms "member" and "officer"
include their respective heirs, executors and administrators, and "interested"
member or officer is one against whom the action, suit or other proceeding in
question or another action, suit or other proceeding on the same or similar
grounds is then or had been pending, and a "disinterested person" is a person
against whom none of such actions, suits or other proceedings or another action,
suit or other proceeding on the same or similar grounds is then or had been
pending. Nothing contained in this Article shall affect any rights to
indemnification to which Fund personnel other than members and officers may be
entitled by contract or otherwise under law."
In addition, the Registrant's investment adviser maintains a professional
liability insurance policy with maximum coverage of $15 million under which the
Registrant and its managers are named insureds.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted to managers, and affiliated persons of the Registrant, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification may be against public policy as expressed in the
Act and may be, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a manager or affiliated person of the
Registrant in the successful defense of any action, suit or proceeding) is
asserted by such manager or affiliated person in connection with securities
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 33. Business and Other Connections of Investment Adviser
Capital Growth Management Limited Partnership, the Registrant's investment
adviser, provides investment advice to other registered investment companies and
to other organizations and individuals. Such adviser's sole general partner,
Kenbob, Inc., has not engaged during the past two fiscal years in any other
businesses, professions, vocations or employments of a substantial nature.
III-22
<PAGE>
Item 34. Principal Underwriters
(a) New England Securities Corporation also serves as principal underwriter
for:
New England Zenith Fund
New England Life Retirement Investment Account
The New England Variable Account
New England Variable Life Separate Account
New England Variable Annuity Separate Account
(b) The directors and officers of the Registrant's principal underwriter,
New England Securities Corporation, and their addresses are as follows:
<TABLE>
<CAPTION>
Name Positions and Offices with Positions and Offices with
Principal Underwriter Registrant
<S> <C> <C>
Thomas W. McConnell* Director, President and CEO None
Frederick K. Zimmermann** Chairman of Board, Director Chairman of the Board,
President and Manager
Bradley W. Anderson* Vice President None
Molly M. Diggins** Assistant Clerk None
Mark A. Greco* Vice President and Chief None
Operating Officer
Anne M. Goggin** Vice President, General Manager
Counsel, Secretary and Clerk
Laura A. Hutner* Vice President None
Mitchell A. Karman** Vice President None
John Peruzzi* Assistant Vice President and None
Controller
Robert F. Regan*** Vice President None
Jonathan M. Rozek* Vice President None
Andrea M. Ruesch* Vice President None
Larry Thiel Vice President None
Michael E. Toland** Vice President, Chief
Compliance Officer, Chief
Financial Officer, Treasurer,
Assistant Secretary and
Assistant Clerk
</TABLE>
Principal Business Address: *399 Boylston Street, Boston, MA 02116
**501 Boylston Street, Boston, MA 02116
***500 Boylston Street, Boston, MA 02116
III-23
<PAGE>
<TABLE>
<CAPTION>
(c)
(1) (2) (3) (4) (5)
Net Underwriting
Name of Principal Discounts and Compensation
Underwriter Commissions Redemption or Brokerage Other Compensation
Annuitization Commissions
<S> <C> <C> <C> <C>
New England
Securities (to be supplied by 0 0 0
Corporation Amendment)
</TABLE>
Commissions are paid on behalf of New England Securities Corporation directly to
agents who are registered representatives of the principal underwriter.
Item 35. Location of Accounts and Records
The following companies will maintain possession of the documents required by
Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder:
(a) Registrant
(b) New England Life Insurance Company
501 Boylston Street
Boston, Massachusetts 02116
(c) State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
(d) New England Securities Corporation
399 Boylston Street
Boston, Massachusetts 02116
(e) Capital Growth Management Limited Partnership
One International Place
Boston, Massachusetts 02110
Item 36. Management Services
Not applicable
Item 37. Undertakings
Registrant hereby makes the following undertakings:
III-24
<PAGE>
(1) To file a post-effective amendment to this registration statement as
frequently as is necessary to ensure that the audited financial statements
contained in the registration statement are never more than 16 months old for so
long as payments under the variable annuity contracts may be accepted;
(2) To include either (a) 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 (b) a postcard or similar written
communication affixed to or included in the prospectus that the applicant can
remove to send for a Statement of Additional Information;
(3) To deliver a Statement of Additional Information and any financial
statements required to be made available under this Form N-3 promptly upon
written or oral request;
(4) To offer Contracts to participants in the Texas Optional Retirement Program
in reliance upon Rule 6c-7 of the Investment Company Act of 1940 and to comply
with paragraphs (a)-(d) of that Rule; and
(5) To comply with and rely upon the Securities and Exchange Commission No-
Action Letter to the American Council of Life Insurance, dated November 28,
1988, regarding Sections 22(e), 27(c)(1) and 27(d) of the Investment Company Act
of 1940.
Metropolitan Life Insurance Company represents that the fees and charges
deducted under the Contracts described in this Registration Statement, in the
aggregate, are reasonable in relation to the services rendered, the expenses to
be incurred, and the risks assumed by Metropolitan Life Insurance Company under
the Contracts.
III-25
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant, New England Variable Annuity Fund I, has caused this
Amendment to the Registration Statement to be signed on its behalf, in the City
of Boston, and the Commonwealth of Massachusetts on the 16th day of February ,
1999.
NEW ENGLAND VARIABLE ANNUITY FUND I
By: Frederick K. Zimmermann+
------------------------
Frederick K. Zimmermann
Chairman of the Board of Managers
As required by the Securities Act of 1933, this Post-Effective Amendment to
the Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
Frederick K. Zimmermann+ Chairman of the Board of Managers; February 16, 1999
- ---------------------------------------- Principal Executive Officer
Frederick K. Zimmermann
John J. Arena* Member of the Board February 16, 1999
- ----------------------------------------
John J. Arena
John W. Flynn* Member of the Board February 16, 1999
- ----------------------------------------
John W. Flynn
Anne M. Goggin+ Member of the Board February 16, 1999
- ----------------------------------------
Anne M. Goggin
Nancy Hawthorne+ Member of the Board February 16, 1999
- ----------------------------------------
Nancy Hawthorne
Joseph M. Hinchey+ Member of the Board February 16, 1999
- ----------------------------------------
Joseph M. Hinchey
</TABLE>
III-26
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
Robert B. Kittredge+ Member of the Board February 16, 1999
- ----------------------------------------
Robert B. Kittredge
John T. Ludes* Member of the Board February 16, 1999
- ----------------------------------------
John T. Ludes
Dale Rogers Marshall+ Member of the Board February 16, 1999
- ----------------------------------------
Dale Rogers Marshall
</TABLE>
By: /s/ Marie C. Swift February 16, 1999
-------------------------------
Marie C. Swift
+ Executed by Marie C. Swift on behalf of those indicated pursuant to Powers-
of-attorney filed with Post-Effective Amendment No. 48 on Form N-3 (File No. 2-
34420) on March 29, 1996.
* Executed by Marie C. Swift on behalf of those indicated pursuant to Powers-
of-attorney filed with Post-Effective Amendment No. 1 on Form N-3 (File No. 333-
11137) on April 30, 1997.
III-27
<PAGE>
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, Metropolitan Life Insurance Company has caused this Amendment to the
Registration Statement to be signed on its behalf, in the City of Boston, and
the Commonwealth of Massachusetts on the 16th day of February, 1999.
Metropolitan Life Insurance Company
By: /s/ GARY A. BELLER
----------------------------------
GARY A. BELLER, ESQ.
SENIOR EXECUTIVE VICE PRESIDENT
AND GENERAL COUNSEL
Attest: /s/ Cheryl D. Martino
-------------------------
Cheryl D. Martino
Assistant Secretary
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDED
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE Title Date
<S> <C> <C>
* Chairman of the Board, President and February 16, 1999
- ------------------------------------------- Chief Executive Officer
ROBERT H. BENMOSCHE (Principal Executive Officer)
* Vice-Chairman and February 16, 1999
- ------------------------------------------- Chief Financial Officer (Principal
STEWART G. NAGLER Financial Officer)
* Senior Vice President and Controller February 16, 1999
- ------------------------------------------- (Principal Accounting Officer)
JON F. DANSKI
* Director February 16, 1999
- -------------------------------------------
CURTIS H. BARNETTE
</TABLE>
III-28
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE Title Date
<S> <C> <C>
* Vice Chairman and Chief Investment February 16, 1999
- ------------------------------- Officer
GERALD CLARK
* Director February 16, 1999
- -------------------------------
JOAN GANZ COONEY
* Director February 16, 1999
- -------------------------------
BURTON A. DOLE, JR.
* Director February 16, 1999
- -------------------------------
JAMES R. HOUGHTON
* Director February 16, 1999
- -------------------------------
HARRY P. KAMEN
* Director February 16, 1999
- -------------------------------
HELENE L. KAPLAN
* Director February 16, 1999
- -------------------------------
CHARLES H. LEIGHTON
* Director February 16, 1999
- -------------------------------
ALLEN E. MURRAY
* Director February 16, 1999
- -------------------------------
JOHN J. PHELAN, JR.
* Director February 16, 1999
- -------------------------------
HUGH B. PRICE
</TABLE>
III-29
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE Title Date
<S> <C> <C>
* Director February 16, 1999
- ------------------------------------
ROBERT G. SCHWARTZ
* Director February 16, 1999
- ------------------------------------
RUTH J. SIMMONS
Director February 16, 1999
- ------------------------------------
WILLIAM C. STEERE, JR.
February 16, 1999
/s/ CHRISTOPHER P. NICHOLAS
- ------------------------------------
CHRISTOPHER P. NICHOLAS, ESQ.
ATTORNEY-IN-FACT
</TABLE>
Metropolitan Life Insurance Company. Executed by Christopher P. Nicholas on
behalf of those indicated pursuant to Powers of Attorney. Powers of Attorney
are incorporated herein by reference to the Registration Statement on Form N-3
(File No. 333-11137) filed on August 30, 1996, except for Gerald Clark, Burton
A. Dole and Charles M. Leighton whose powers of attorney were filed with Post-
Effective Amendment No. 1 to the Registration Statement (File No. 333-11137)
filed April 30, 1997 and Robert H. Benmosche, Jon F. Danski and Stewart G.
Nagler whose powers of attorney were filed with the Post-Effective Amendment No.
23 of the Registration Statement of Metropolitan Life Separate Account E (File
No. 2-90380) filed April 3, 1998.
III-30
<PAGE>
Exhibit Index
-------------
(1) (i) Resolutions of the Board of Directors of New England Mutual Life
Insurance Company establishing the Fund are incorporated herein by
reference to Registration Statement on Form N-3 (No. 333-11137) filed
on August 30, 1996.
(ii) Resolutions of the Board of Directors of the Company adopting the
Fund as a separate account are incorporated herein by reference to the
Registration Statement on Form N-3 (No. 333-11137) filed on August 30,
1996.
(2) Amended and Restated Rules and Regulations of the Fund are incorporated
herein by reference to Post-Effective Amendment No. 1 to the
Registration Statement on Form N-3 (File No. 333-11137) filed on April
30, 1997.
(3) Form of Safekeeping Agreement is incorporated herein by reference to
Post-Effective Amendment No. 3 to Registration Statement on Form N-3
(File No. 333-11137) filed on May 1, 1998.
Custodian Fee Schedule is incorporated herein by reference to Post-
Effective Amendment No. 3 to Registration Statement on Form N-3 (File
No. 333-11137) filed on May 1, 1998.
(4) Advisory Agreement is incorporated herein by reference to Registration
Statement on Form N-3 (File No. 333-11137) filed on August 30, 1996.
(5) Distribution Agreement is incorporated herein by reference to
Registration Statement on Form N-3 (File No. 333-11137) filed on August
30, 1996.
(6) (i) Form of variable annuity contract is incorporated herein by
reference to Post-Effective Amendment No. 3 to Registration Statement
on Form N-3 (File No. 333-11137) filed on May 1, 1998.
(ii) Additional forms of variable annuity contract.
(iii) Form of Endorsement: Tax-Sheltered Annuity.
(iv) Form of Endorsement: Individual Retirement Annuity.
(v) Form of Metropolitan Life Insurance Company Endorsement to New
England Mutual Life Insurance Company variable annuity contract is
incorporated herein by reference to the Registration Statement on Form
N-3 (No. 333-11137) filed on August 30, 1996.
(7) Forms of application.
III-1
<PAGE>
(8) (i) Charter and By-Laws of Metropolitan Life Insurance Company are
incorporated herein by reference to Registration Statement on Form N-3
(No. 333-11137) filed August 30, 1996.
(ii) By-Laws Amendment is incorporated herein by reference to the
Registration Statement on Form N-3 (File No. 333-11137) filed on
August 30, 1996.
(9) None
(10) None
(11) (i) Form of Administrative Agreement is incorporated herein by
reference to Post-Effective Amendment No. 3 to Registration Statement
on Form N-3 (File No. 333-11137) filed on May 1, 1998.
(ii) Administrative Services Agreement is incorporated by reference to
the Registration Statement on Form N-3 (File No. 333-11137) filed
August 30, 1996.
(12) Opinion and Consent of Christopher P. Nicholas, Esq. (to be filed by
Amendment).
(13) (i) Consent of Deloitte & Touche LLP. (to be filed by Amendment).
(ii) Consent of Ropes & Gray (to be filed by Amendment).
(14) None.
(15) None.
(16) Schedule for computation of performance quotations is incorporated
herein by reference to Post-Effective Amendment No. 3 to Registration
Statement on Form N-3 (File No. 333-11137) filed on May 1, 1998.
(17) Powers of Attorney.
(i) Metropolitan Life Insurance Company. Powers of Attorney are
incorporated herein by reference to the Registration Statement on Form
N-3 (File No. 333-11137) filed on August 30, 1996, except for Gerald
Clark, Burton A. Dole and Charles M. Leighton whose powers of attorney
were filed with Post-Effective Amendment No. 1 to the Registration
Statement (File No. 333-11137) filed April 30, 1997 and Robert H.
Benmosche, Jon F. Danski and Stewart G. Nagler whose powers of attorney
were filed with Post-Effective Amendment No. 23 of the Registration
Statement of Metropolitan Life Separate Account E (File No. 2-90380) filed
April 3, 1998.
III-2
<PAGE>
(ii) Board of Managers of the Fund. Powers of Attorney are incorporated
herein by reference to Post-Effective Amendment No. 48 on Form N-3 (File
No. 2-34420) filed on March 29, 1996, except for John J. Arena, John W.
Flynn and John T. Ludes whose powers of attorney were filed with Post-
Effective Amendment No. 1 to the Registration Statement (File No.
333-11137) filed April 30, 1997.
(27) Financial Data Schedule (to be filed by Amendment).
III-3
<PAGE>
Exhibit 6(ii)
V1-70A
Ten Day Right to Return Policy. The Owner may return this Policy for any reason
within 10 days after its receipt by delivering it or mailing it to the Company
or to the agent through whom it was purchased. Immediately upon such delivery
or mailing the Policy will be deemed void from the beginning and any premium
paid will be refunded. P-638-75
New England Life-Chartered in 1835
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Agrees to Pay
A. Variable Annuity Payments to the ANNUITANT beginning on the MATURITY DATE,
if the ANNUITANT is then living, and continuing pursuant to the PAYMENT
OPTION specified below, the dollar amount of payments being determined as
set forth in this Contract; or
B. The Death Proceeds, determined in accordance with the Death Proceeds
provision of this Contract, to the BENEFICIARY on receipt of due proof that
the death of the ANNUITANT occurred before the MATURITY DATE.
CONTRACT NUMBER DATE OF ISSUE
ANNUITANT NORMAL ANNUAL CONTRIBUTION
DATE OF BIRTH MATURITY DATE
SEX PAYMENT OPTION
FUND BENEFICIARY
OWNER
ADDITIONAL BENEFITS PROVIDED BY SUPPLEMENTAL AGREEMENT
Premiums for any supplemental agreements are payable in addition to Purchase
Payments provided herein.
The provisions hereinafter set forth are hereby made a part of this Contract.
Signed at the Home Office, 501 Boylston Street, Boston, Massachusetts
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
/s/ Joseph T. McCullen, Jr. Secretary /s/ Edward E. Phillips President
CONTRACT SUMMARY
This Is a PARTICIPATING FLEXIBLE PAYMENT DEFERRED VARIABLE ANNUITY CONTRACT.
Values are payable at death before, or upon surrender on or before, the MATURITY
DATE. Purchase payments may be paid until the MATURITY DATE or until the prior
death of the ANNUITANT and may be changed from time to time.
ANNUITY PAYMENTS AND OTHER VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE
INVESTMENT PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE
NOT GUARANTEED AS A DOLLAR AMOUNT.
V1-70A
<PAGE>
BENEFITS FOR YOU
PURCHASE PAYMENTS: Choice of ways to make your payments to the Company.
Purchase payments are the amounts paid to the Company under this Contract,
exclusive of premiums for additional benefits, if any, provided by supplemental
agreement. An initial purchase payment of at least $10 is due and payable on the
Date of Issue. Thereafter, purchase payments of $10 or more may be paid at any
time while this Contract is in force until the Maturity Date or until the prior
death of the Annuitant. The total purchase payments for any contract year may
not exceed a maximum of three times the Normal Annual Contribution shown on the
first page of the Contract except with the consent of the Company, and payment
of less than the maximum shall not increase the maximum permissible for any
subsequent contract year.
If the total of the purchase payments paid in any contract year and its
grace period is less than $ 100, purchase payments shall be in default as of the
end of that contract year and this Contract shall continue in force as provided
by the Non-Forfeiture Provision. Notwithstanding the foregoing, purchase
payments shall not be deemed to be in default for the contract year of maturity
and for any preceding contract year ending within 31 days of the Maturity Date.
All payments to the Company are payable at the Home Office in exchange for
a receipt signed by the Secretary or an Assistant Secretary. The premium for any
additional benefit provided by supplemental agreement is payable in addition to
the purchase payments for the Contract.
GRACE PERIOD: For completion of purchase payments for contract year.
A grace period of 31 days shall be allowed at the end of each contract year
prior to the Maturity Date for payment, or completion of payment, of purchase
payments for that contract year, during which period the Contract shall continue
in force. Each such purchase payment shall be applied as of the date of receipt
of such purchase payment at the Home Office.
NON-FORFEITURE PROVISION: Continuation of the Contract as a paid-up annuity.
When purchase payments are in default this Contract continues in force
automatically, unless surrendered for its contract value. For the contract year
of default and for each subsequent contract year during which purchase payments
are in default, an annual deduction of $5 shall be made by an appropriate
reduction in the number of Accumulation Units, based upon the Accumulation Unit
Value as of the last day of the grace period. The benefits payable shall be as
defined in the Proceeds provision.
REINSTATEMENT: To resume purchase payments after default.
After default and while the Annuitant is living, unless this Contract has
been surrendered, purchase payments may be resumed at any time prior to the
Maturity Date by payment of a purchase payment of at least $10. Within five
years after default, if purchase payments have not previously been resumed, the
Contract may be reinstated by resumption of purchase payments in accordance with
the preceding sentence and by payment of a Reinstatement Amount. The Owner may
select as a Reinstatement Amount any amount not in excess of the sum of the
Normal Annual Contributions for the contract year of default and for each
subsequent contract year prior to the contract year of reinstatement, reduced by
any purchase payments paid in the contract year of default. The Reinstatement
Amount shall be applied as a purchase payment as of the date of receipt of such
amount at the Home Office. Upon resumption of purchase payments, reinstatement
of any supplemental agreement involving an insurance risk shall be subject to
evidence of insurability satisfactory to the Company and to the payment of
premiums for such supplemental agreement.
V1A New England Mutual Life Insurance Company Page 2
<PAGE>
FUND
The Fund, the title of which is specified on the first page of the
Contract, is a separate investment account established by the Company pursuant
to Massachusetts law. Values of the Contract prior to the Maturity Date and
amounts held or payable under the Variable Payment Options depend on the
investment performance of the Fund and are variable. The portion of the assets
of the Fund equal to the reserves and other contract liabilities with respect to
the Fund shall not be chargeable with liabilities arising out of any other
business the Company may conduct.
GUARANTEES
Neither annuity payments nor any other values under this Contract will be
adversely affected by actual expense and mortality experience.
DIVIDENDS: Distribution of surplus.
While in force prior to the Maturity Date, this Contract shall be credited
with such share of surplus, or dividend, if any, as may be apportioned thereto
annually at the end of the contract year by the Company. Any such dividends are
expected to accrue, if at all, in later contract years, as a result of more
favorable expense and mortality experience than assumed. It is anticipated that
any such dividends will be modest in amount. Each dividend shall be credited as
a net purchase payment in the form of additional Accumulation Units, unless
payment in cash is requested.
PERIODIC REPORTS
Except when a Fixed Payment Option is in effect, the Company will
periodically furnish the Owner a report containing such information as may be
required by applicable Federal or state laws, including, as of a date not more
than two months prior to the date of mailing, the number of Accumulation Units,
if any, credited to the Contract, the dollar value of each such Accumulation
Unit, and the investments held in the Fund. This information will be furnished
semi-annually after the first contract year, or more often as required by
applicable Federal or state laws.
VALUES OF THE CONTRACT
VALUATION DATE AND VALUATION PERIOD
A Valuation Date is each day that the New York Stock Exchange is open for
business and ends as of the close of trading on the New York Stock Exchange.
Each Valuation Date, together with any immediately preceding day or consecutive
days which are not Valuation Dates, shall constitute a Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor applicable to this Contract for any Valuation
Period shall be the sum of the gross investment rate for such period and
1.0000000, less a deduction of .0000344 for each day of the Valuation Period.
The gross investment rate for any Valuation Period shall be (a) divided by
(b) where
(a) is the investment income of the Fund for the Valuation Period, plus
capital gains minus capital losses for the period, whether realized or
unrealized, less deductions of: (1) any taxes which would be incurred
by all assets of the Fund irrespective of the source of such assets,
or amounts set aside by the Company as a reserve for such taxes,
arising from the income and realized and unrealized capital gains on
assets of the Fund, (2) brokerage commissions and taxes, if any, in
connection with the purchase or sale of securities for the account of
the Fund and chargeable to the Fund, and (3) fees and expenses of the
Board of Managers of the Fund, including the auditing of Fund assets
as required by the Investment Company Act of 1940; and
V1A New England Mutual Life Insurance Company Page 3
<PAGE>
(b) is the value of the total assets of the Fund at the beginning of the
Valuation Period less any assets set aside by the Company within the
Fund as a reserve for taxes described in (a) (1) above.
The gross investment rate may be positive or negative. The determination by
the Company of the gross investment rate will be conclusive upon the Owner of
this Contract, any assignee, the Annuitant and any Beneficiary or other payee
under this Contract.
NET PURCHASE PAYMENTS
The after-tax purchase payment is the amount of each purchase payment reduced by
any applicable state premium tax. The net purchase payment is the after-tax
purchase payment reduced by 9% of the first $46 plus 8% of any balance of such
after-tax purchase payment.
ACCUMULATION UNITS AND ACCUMULATION UNIT VALUE
Each net purchase payment will be credited in the form of Accumulation
Units as of the date of receipt of such purchase payment at the Home Office or,
if later, the date the application for the Contract is approved by the Company
at its Home Office. The number of Accumulation Units credited will be equal to
the amount of the net purchase payment divided by the Accumulation Unit Value as
of such date.
The Accumulation Unit Value was set at $1.00 on the date on which assets
were first placed in the Fund. The Accumulation Unit Value as of any Valuation
Date thereafter is determined by multiplying the Accumulation Unit Value as of
the immediately preceding Valuation Date by the Net Investment Factor for the
Valuation Period then ended. Accordingly, since Accumulation Unit Values depend
upon the investment performance of the Fund, they may increase or decrease from
Valuation Date to Valuation Date. The Accumulation Unit Value as of any date
other than a Valuation Date is equal to its value as of the next succeeding
Valuation Date.
CONTRACT VALUE
On or before the Maturity Date, the contract value shall be the number of
Accumulation Units standing to the credit of this Contract multiplied by the
applicable Accumulation Unit Value. The contract value shall not be increased by
any supplemental agreement issued by the Company unless so stipulated in the
supplemental agreement.
PROCEEDS: How to determine the amount payable.
Proceeds payable under this Contract are determined by the following
provisions. Payments under this Contract shall be made by the Company at its
Home Office.
Surrender Proceeds
At any time on or before the Maturity Date while the Annuitant is living,
this Contract may be surrendered for its contract value, effective as of the
Surrender Date. The Surrender Date is the date on which written request in
proper form for surrender and payment in one sum or under one of the Payment
Options is received at the Home Office of the Company, or, if payment is to be
made under a Payment Option, such later date as may be specified in the request.
A partial surrender may be made on the same basis, except that a partial
surrender which would result in a remaining contract value of less than $500
shall be permitted only with the consent of the Company. In connection with such
partial surrender, any Accumulation Units resulting from dividends shall first
be terminated, unless otherwise requested; then Accumulation Units resulting
from purchase payments shall be terminated, and for the purpose of determining
the amount of death proceeds the purchase payments attributable to such
Accumulation Units shall be determined as provided in the Death Proceeds
provision. One sum surrender proceeds will be paid within seven days after the
Surrender Date; provided, however, that the Company may defer such payment when
so permitted under applicable Federal laws, rules and regulations governing the
redemption of variable annuities.
V1A New England Mutual Life Insurance Company Page 4
<PAGE>
Death Proceeds
The proceeds payable upon death before the Maturity Date if the Contract
has not been surrendered shall be an amount equal to the greater of (a) the sum
of all purchase payments which were paid to the Company prior to the death of
the Annuitant, without interest, increased by the value of any existing
Accumulation Units resulting from dividends and reduced by purchase payments
attributable to any partial surrenders and by any deductions for contract years
during which purchase payments were in default as provided in the Non-Forfeiture
Provision, and (b) the contract value as of the Death Valuation Date. The Death
Valuation Date is the Valuation Date coincident with, or, if no Valuation Date
coincides, the Valuation Date next following, the later of (i) the date on which
due proof of death is received at the Home Office of the Company, and (ii) the
date on which a written election of payment in proper form in one sum or under
one of the Payment Options is first received at the Home Office of the Company;
provided that if no such written election has been received at the Home Office
by the end of a 90 day period following receipt at the Home Office of due proof
of death, payment in one sum shall be deemed to have been elected on the last
day of such period. For the purpose of determining the amount of death proceeds
as defined above the purchase payments attributable to a partial surrender shall
be (a) the sum of all purchase payments which were paid to the Company prior to
such partial surrender less purchase payments attributable to all previous
partial surrenders and any deductions for contract years during which purchase
payments were in default as provided in the Non-Forfeiture Provision, multiplied
by (b) a fraction of which the numerator is the partial surrender proceeds
exclusive of values resulting from dividends, and the denominator is the total
contract value as of the Surrender Date exclusive of values resulting from
dividends. The Company has the right to require surrender of the Contract at the
time of claim for the death proceeds. The death proceeds shall be paid in
accordance with the beneficiary provisions.
Maturity Proceeds
If the Annuitant is living on the Maturity Date and the Contract has not
been surrendered, the maturity proceeds shall then become payable. The maturity
proceeds shall be the contract value as of the Maturity Date. The maturity
proceeds will automatically be used to provide monthly payments pursuant to the
Payment Option specified on the first page of the Contract, with the Annuitant
as Payee, unless application of the proceeds under a different Payment Option
has been elected. Prior to the Maturity Date the Owner may change the election
of the Payment Option to become operative on the Maturity Date.
MATURITY DATE
The Maturity Date is that specified on the first page of the Contract,
except that prior to the Maturity Date the Owner may elect that it be deferred
to a date not later than the last day that the age of the Annuitant at nearest
birthday is 75.
PAYMENT OPTIONS
OPTIONS: When available.
The whole or part of the proceeds of this Contract may be made payable
under any one of the Options in accordance with the provisions hereinafter set
forth, except as may be otherwise agreed upon with the Company.
The Options shall be available only with the consent of the Company (a) if
the amount applicable thereto is less than $2,000 or (b) if an Option is elected
by, or if payments under an Option are to be made to, a corporation,
partnership, association or fiduciary, or (c) if the Contract is assigned other
than to the Company. If necessary to bring the amount of each periodic payment
to at least $20, the Company may change the period of payment to quarterly,
semi-annual or annual.
V1A New England Mutual Life Insurance Company Page 5
<PAGE>
VARIABLE PAYMENT OPTIONS
Option 1: Variable income for a specified period of years.
Variable monthly payments for a definite number of years, not exceeding 30.
The proceeds applied will be held in the Fund as a decreasing number of
Accumulation Units. The initial number of Accumulation Units will be equal to
the proceeds applied divided by the Accumulation Unit Value as of the date of
such application. As each payment is made, a number of Accumulation Units will
be terminated such that the value thereof is equal to such payment.
Option 2: Variable life income.
Variable monthly payments (a) during the lifetime of the Payee; or (b) for
a certain period of 10 or 20 years, as may be elected, and thereafter during the
lifetime of the Payee.
Option 3: Variable life income with special certain period.
Variable monthly payments for a certain period of the nearest whole number
of months equal to the amount applied under this Option divided by the dollar
amount of the initial monthly payment, and thereafter during the lifetime of the
Payee.
Option 4: Investment Option.
The proceeds applied will be held in the Fund as a fixed number of
Accumulation Units during the lifetime of the Payee or such other period as may
be agreed upon with the Company. The number of Accumulation Units will be equal
to the proceeds applied divided by the Accumulation Unit Value as of the date of
such application. At the death of the Payee, or at the end of the period agreed
upon, the value shall be paid in one sum.
Option 5: Specified amount of income until proceeds exhausted.
The proceeds applied will be held in the Fund as a decreasing number of
Accumulation Units and payments will be made in such amounts and at such times
as may be agreed upon with the Company, continuing until the amount held is
exhausted, the final payment being for the balance only. The initial number of
Accumulation Units will be equal to the proceeds applied divided by the
Accumulation Unit Value as of the date of such application. As each payment is
made, a number of Accumulation Units will be terminated such that the value
thereof is equal to such payment.
Option 6: Variable life income based on two lives.
Variable monthly payments (a) during the joint lifetime of two Payees with
two-thirds of the amount of monthly income that would be payable if both Payees
were living continuing during the balance of the lifetime of the survivor; or
(b) during the joint lifetime of two Payees and continuing during the balance of
the lifetime of the survivor; or (c) during the joint lifetime of two Payees and
continuing during the balance of the lifetime of the survivor, but in any event
until payments have been made under this Option for 10 years.
AMOUNT OF MONTHLY INCOME: Variable Payment Options 1, 2, 3 and 6.
Rates for the initial monthly payment under Variable Payment Option I shall
be based on the applicable Assumed Interest Rate. Under Variable Payment Options
2, 3 and 6, rates for the initial monthly payments thereunder shall be based on
the applicable Assumed Interest Rate and the mortality assumptions which are in
use by the Company at the time the proceeds are applied to such Option, but in
no event shall such initial monthly payment be less than that based on the
mortality assumptions specified in the table on page 6 and the applicable
Assumed Interest Rate. The dollar amount of the initial monthly payment is
determined by dividing the proceeds applied by 1,000 and multiplying the result
by the monthly payment per $1,000 shown in the table. The dollar amount of the
second and each subsequent monthly payment is variable and is determined by
multiplying the applicable number of Annuity Units by the Annuity Unit Value as
of the latest Valuation Date which is at least 14 days prior to the date such
payment is due.
V1A New England Mutual Life Insurance Company Page 6
<PAGE>
Annuity Units and Annuity Unit Value
The number of Annuity Units credited under Options 1, 2, 3 and 6 is
determined by dividing the amount of the initial monthly payment under the
Option by the applicable Annuity Unit Value as of the date of the initial
monthly payment. This number of Annuity Units remains fixed thereafter during
the annuity payment period, except that at the death of the first Payee under
Option 6(a), the number of Annuity Units decreases to two-thirds of the number
previously credited.
The Annuity Unit Value depends on the Assumed Interest Rate elected and on
the Net Investment Factor. The Annuity Unit Values were set at $1.00 on the date
on which assets were first placed in the Fund. An Annuity Unit Value as of any
Valuation Date thereafter is equal to the corresponding Annuity Unit Value as of
the immediately preceding Valuation Date multiplied by the Net Investment Factor
for the Valuation Period then ended, and further multiplied by the Assumed
Interest Factor for each day of the Valuation Period. Accordingly, since Annuity
Unit Values depend upon the investment performance of the Fund, they may
increase or decrease from Valuation Date to Valuation Date. The Annuity Unit
Value as of any date other than a Valuation Date is equal to its value as of the
next succeeding Valuation Date.
The Assumed Interest Rate and the Assumed Interest Factor which is derived
therefrom are specified on page 6, except that if such Assumed Interest Rate
would result in a larger initial monthly payment than is permitted under
applicable state law or regulation, the Company will select a lower Assumed
Interest Rate and corresponding Assumed Interest Factor to be applicable in
order to comply with such law or regulation. Subject to the consent of the
Company and if permitted under applicable state law, a different Assumed
Interest Rate and corresponding Assumed Interest Factor not in excess of 5% per
annum compounded annually may be elected.
DIVIDENDS: Distribution of surplus.
Variable Payment Options shall be credited with any dividends apportioned
thereto by the Company. It is anticipated that any such dividends will be modest
in amount.
FIXED PAYMENT OPTIONS
In lieu of the Variable Payment Options set forth herein, the whole or part
of the proceeds may be made payable under guaranteed Payment Options which do
not participate in the investment performance of the Fund. Such Fixed Payment
Options shall be based on the provisions and rates offered by the Company on the
Date of Issue of this Contract under fixed contracts issued to a similar class
of annuitants. The amount applied under a Fixed Payment Option will be
transferred from the Fund to the Company's general assets, and the Company will
make payments thereunder out of its general assets pursuant to the Fixed Payment
Option elected.
GENERAL PROVISIONS
Payment options becoming operative by application of the surrender
proceeds, death proceeds or maturity proceeds shall become operative on the
Surrender Date, Death Valuation Date or Maturity Date respectively. The initial
payment under Options 1, 2. 3 and 6 shall become due when the Option becomes
operative.
Payments under Options 2, 3 and 6 shall be based upon the sex of the Payee
and the age of the Payee when the Option becomes operative and shall be subject
to satisfactory proof of the age of the Payee. When payment is contingent upon
survival of the Payee, the Company may defer any payment until the Company has
been furnished with satisfactory evidence that such Payee is living.
V1A New England Mutual Life Insurance Company Page 7
<PAGE>
If the Payee under Option 2 or 3, or one of the Payees under Option 6, dies
within 30 days after the Option becomes operative, there shall become due and
payable the amount applied to said Option less any payment made thereunder, and
such amount shall be payable in such manner as may then be agreed upon (a) to
the surviving Payee in the case of Option 6, or (b) to the next succeeding Payee
in the case of Option 2 or 3, provided that if no such Payee be designated, the
payment shall be made to the executors or administrators of the original Payee.
The provisions which apply to change of beneficiary shall also apply to any
election or change of election of an Option. An Option may be elected to become
operative if the death of the Annuitant occurs prior to the Maturity Date, but
if no such election is in effect, the beneficiary entitled to the proceeds may
then make the election for his or her own benefit.
After an Option becomes operative it may not be changed to another Option
unless otherwise agreed upon with the Company at the time of election. However,
if Option 1, 4 or 5 is operative, such Option may be terminated by written
request to the Home Office of the Company, and the value of any remaining
Accumulation Units may be paid in one sum or, if the one sum value is at least
$2,000, may be made payable under one of the other Payment Options.
Except as otherwise provided, (a) at the death of the Payee under Option 4
or 5, the value of any remaining Accumulation Units shall be paid in one sum,
and (b) at the death of the Payee under Option 1, 2 or 3 or of the surviving
Payee under Option 6, any unpaid certain payments shall be paid, as they become
due, to the next succeeding Beneficiary or other Payee, provided that if no such
Payee be designated, the value of any remaining Accumulation Units under Option
1 or the then present value of any unpaid certain payments under Option 2, 3 or
6 shall be paid in one sum to the executors or administrators of the last
survivor of all Payees. Following the death of the Payee under Option 1, 2 or 3
or of the surviving Payee under Option 6, any Payee designated to receive any
unpaid certain payments shall have the right, while entitled to payment, to
receive in one sum the value of any remaining Accumulation Units under Option 1
or the then present value of all remaining unpaid certain payments under Option
2, 3 or 6.
Any unpaid certain payments under Option 2, 3 or 6 shall be commuted at the
Assumed Interest Rate with each remaining payment being assumed to be equal to
the number of Annuity Units multiplied by the applicable Annuity Unit Value.
The amount of a one sum payment payable by reason of the death of the Payee
shall be determined as of the date on which due proof of death is received at
the Home Office of the Company. The amount of any other one sum payment shall be
determined as of the date the request therefor is received and will be paid
within seven days thereafter; provided, however, that the Company may defer such
payment when so permitted under applicable Federal laws, rules and regulations
governing the redemption of variable annuities.
When payment is contingent upon the survival of the Payee, the liability of
the Company shall terminate with the last payment due prior to the death (a) of
the Payee under Option 2 or 3, or (b) of the surviving Payee under Option 6. The
payment in one sum of the value of any remaining Accumulation Units under Option
1, 4 or 5 or of the present value of any unpaid certain payments under Option 2,
3 or 6 shall terminate the liability of the Company.
V1A New England Mutual Life Insurance Company Page 8
<PAGE>
ADJUSTMENT OF BENEFIT IN CASE OF INCORRECT AGE OR SEX
If either the age or sex of any Payee under Option 2, 3 or 6 is incorrect,
the amount payable by the Company hereunder shall be that which the proceeds
would have provided for the correct age and sex. Any overpayments by the Company
on account of such error, with interest thereon at the rate of five per cent per
annum compounded annually, shall be charged against the current and next
succeeding payment or payments to be made by the Company, and any underpayments
by the Company shall be adjusted in like manner and credited with the next
succeeding payment.
ANTICIPATION OR ALIENATION
Except to the extent provided in this Contract or prescribed by law or
otherwise agreed upon with the Company, no Payee shall have any right to assign,
alienate, anticipate or commute any payments under this Contract, to make
withdrawals of proceeds or to make any change in the provisions elected; and
except as otherwise prescribed by law, no payment shall be subject to the debts,
contracts or engagements of any Payee nor to any judicial process to levy upon
or attach the same for the payment thereof.
DOLLAR AMOUNT OF THE INITIAL MONTHLY PAYMENT FOR EACH $1000 OF PROCEEDS APPLIED
OPTION 1
Variable income for a specified period of years
<TABLE>
<CAPTION>
Years Payment Years Payment Years Payment years Payment Years Payment Years Payment
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 84.65 6 15.35 11 9.09 16 6.76 21 5.56 26 4.84
2 43.05 7 13.38 12 8.46 17 6.47 22 5.39 27 4.73
1 29.19 8 11.90 13 7.94 18 6.20 23 5.24 28 4.63
4 22.27 9 10.75 14 7.49 19 5.97 24 5.09 29 4.53
5 18.12 10 9.83 15 7.10 20 5.75 25 4.96 30 4.45
</TABLE>
OPTION 2 OPTION 3
Variable Life Income Variable life income with special certain period
<TABLE>
<CAPTION>
Age of Payee (b)Certain Age of Payee Certain
Nearest Period Nearest Period
Birthday Birthday
Male Female (a) Life 10 Years 20 Years Male Female Payment Years Months
Annuity
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
50 55 4.63 4.59 4.44 50 55 4.46 18 8
51 56 4.72 4.66 4.50 51 56 4.52 18 5
52 57 4.81 4.75 4.56 52 57 4.61 18 1
53 58 4.90 4.84 4.63 53 58 4.69 17 9
54 59 5.00 4.93 4.69 54 59 4.76 17 6
55 60 5.11 5.03 4.76 55 60 4.85 17 2
56 61 5.22 5.13 4.83 56 61 4.95 16 10
57 62 5.35 5.24 4.90 57 62 5.05 16 6
58 63 5.48 5.35 4.97 58 63 5.15 16 2
59 64 5.62 5.47 5.04 59 64 5.26 15 10
60 65 5.76 5.60 5.11 60 65 5.38 15 6
61 66 5.92 5.74 5.18 61 66 5.49 15 2
62 67 6.10 5.88 5.25 62 67 5.62 14 10
</TABLE>
V1A New England Mutual Life Insurance Company Page 9
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
63 68 6.28 6.03 5.31 63 68 5.75 14 6
64 69 6.48 6.19 5.37 64 69 5.92 14 1
65 70 6.70 6.36 5.43 65 70 6.06 13 9
66 71 6.93 6.53 5.48 66 71 6.21 13 5
67 72 7.19 6.72 5.52 67 72 6.41 13 0
68 73 7.46 6.91 5.57 68 73 6.58 12 8
69 74 7.76 7.10 5.60 69 74 6.80 12 3
70 75 8.08 7.30 5.63 70 75 6.99 11 11
71 76 8.44 7.51 5.66 71 76 7.25 11 6
72 77 8.83 7.72 5.68 72 77 7.46 11 2
73 78 9.26 7.92 5.70 73 78 7.75 10 9
74 79 9.72 8.12 5.71 74 79 8.00 10 5
75 80 10.23 8.32 5.72 75 80 8.32 10 0
</TABLE>
OPTION 6
Variable life income based on two lives
<TABLE>
<S> <C> <C>
(a) Joint life income with (b) Joint life income with (c) Joint life income with
2/3 to survivor full amount to survivor 10 year certain period
</TABLE>
<TABLE>
<CAPTION>
Age Age Age
Nearest Age Nearest Birthday Nearest Age Nearest Birthday Nearest Age Nearest Birthday
Birthday Male Birthday Male Birthday Male
Female Female Female
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
55 60 65 70 75 55 60 65 70 75 55 60 65 70 75
50 4.43 4.61 4.81 5.03 5.28 50 4.05 4.12 4.17 4.21 4.23 50 4.04 4.11 4.16 4.20 4.22
55 4.63 4.85 5.09 5.35 5.63 55 4.25 4.36 4.45 4.52 4.57 55 4.24 4.35 4.44 4.51 4.55
60 4.87 5.13 5.42 5.73 6.08 60 4.45 4.63 4.78 4.90 4.99 60 4.44 4.62 4.77 4.89 4.96
65 5.13 5.44 5.81 6.21 6.64 65 4.63 4.90 5.16 5.37 5.53 65 4.62 4.89 5.14 5.34 5.48
70 5.42 5.81 6.27 6.79 7.36 70 4.78 5.16 5.55 5.92 6.22 70 4.77 5.14 5.52 5.86 6.12
75 5.73 6.21 6.79 7.48 8.26 75 4.90 5.37 5.92 6.50 7.05 75 4.89 5.34 5.86 6.39 6.84
80 6.08 6.64 7.36 8.26 9.34 80 4.99 5.53 6.22 7.05 7.94 80 4.96 5.48 6.12 6.84 7.51
</TABLE>
The rates shown above are based on the Assumed Interest Rate of 3.5% per annum
and, with respect to Options 2, 3 and 6, on mortality according to the Male
Group Annuity Table for 1951 with Projection on Scale C to the year 2000 and
with female ages set back 5 years. Based on the specified Assumed Interest
Rate, the Assumed Interest Factor is .9999058. Rates for a different Assumed
Interest Rate, or for ages not shown, or for two males or two females under
Option 6, will be furnished by the Company upon request.
GENERAL PROVISIONS
BENEFICIARY AND OWNERSHIP PROVISIONS
The following provisions shall determine the rights of Beneficiaries and
Owners, except as otherwise specifically provided.
An individual, a fiduciary, a partnership or a corporation may be named as
Beneficiary or as Owner of this Contract. No individual named as Beneficiary
shall be entitled to receive payments unless he shall survive the Annuitant. The
interest as Beneficiary or as Owner of a fiduciary, partnership or corporation
shall inure to the successors or assigns thereof.
V1A New England Mutual Life Insurance Company Page 10
<PAGE>
Naming your Beneficiary.
A numbered sequence may be used to name successive Beneficiaries. The
Beneficiary entitled to receive payment at the death of the Annuitant shall be
that surviving Beneficiary designated in the lowest number of the sequence. If
more than one individual is named as Beneficiary under a number of the sequence,
or without a numbered sequence, whether such designation be by name or as a
class or both, those Beneficiaries surviving the Annuitant shall be entitled to
receive payment in equal shares. If the Annuitant dies before the Maturity Date
and no Beneficiary then entitled to payment survives the Annuitant, the proceeds
of the Contract shall be payable to the Owner, or, if the Annuitant was the
Owner, to his executors or administrators. Every request for change of
Beneficiary must be in written form satisfactory to the Company and shall take
effect as of the date of such request, but only upon receipt of the request at
the Home Office of the Company whether or not the Annuitant be then living;
provided that the liability of the Company shall be discharged to the extent of
any payment made prior to such receipt and shall not be increased by reason of
such change.
The rights of the Owner - Transferring ownership.
The Owner shall have the right, before the Maturity Date and prior to the
death of the Annuitant, to assign the Contract as collateral security, to sell,
assign and transfer the Contract, and to receive every benefit, and to exercise
every right or option created by the Contract or permitted by the Company,
including the right to designate in writing a payee other than the Annuitant to
receive the income payments; and the rights of the Annuitant and of any
Beneficiary shall be subject to any interest so created. The Owner shall also
have the right to change the Beneficiary at any time prior to the death of the
Annuitant. A numbered sequence may be used to name successive Owners. The Owner
from time to time shall be the surviving Owner designated in the lowest number
of the sequence. Upon the death of the last surviving designated Owner, the
Owner shall be the executors or administrators of such survivor. If more than
one individual is named as Owner under a number of the sequence or without a
numbered sequence, whether such designation be by name or as a class or both,
the Owner from time to time shall be the surviving Owners or Owner so
designated, jointly if more than one. Upon the death of the last surviving joint
Owner, the Owner in the absence of a designation in a higher number of the
sequence shall be the executors or administrators of such survivor. Transfer of
Ownership may be made by assignment or by request, as well as by enumeration of
successive Owners. Such transfer by assignment shall revoke the designation of
all Beneficiaries and Owners previously named, and the assignee shall be the
Beneficiary and Owner. No assignment shall be binding on the Company unless in
writing nor until the original or a duplicate thereof is received at the Home
Office of the Company. No responsibility for the validity or effect of
assignments will be assumed by the Company. Every request for transfer must be
in written form satisfactory to the Company and shall take effect as of the date
of such request, but only upon receipt of the request at the Home Office of the
Company, whether or not the Owner or the Annuitant be then living; provided that
the liability of the Company shall be discharged to the extent of any payment
made prior to such receipt and shall not be increased by reason of such
transfer.
The foregoing paragraph notwithstanding, if this Contract is issued in
connection with (i) a plan or trust qualifying under Section 401 or 403 (a), or
(ii) an annuity purchase plan adopted pursuant to Section 403(b), of the
Internal Revenue Code, the ownership provisions are restricted as follows.
Ownership of this Contract may not be changed and the Contract may not be sold,
assigned or pledged as collateral for a loan or for any other purpose, to any
person other than the Company except by an Owner who is either the trustee of a
trust described in Section 401 (a) and exempt from tax under Section 501(a) of
the Internal Revenue Code or the custodian of a custodian account treated as
such a trust. However, an Owner who is the trustee or administrator of any plan
or trust under (i) above may assign the Contract to an employee upon termination
of employment. As used in this paragraph, references to sections of the Internal
Revenue Code mean such sections as now or hereafter amended, or any
corresponding provisions of prior or subsequent Federal revenue laws.
V1A New England Mutual Life Insurance Company Page 11
<PAGE>
Definitions of words used.
The term "children" in the designation of Beneficiaries shall mean only lawful
children of a person. The term "issue" in the designation of Beneficiaries shall
mean only lawful children of a person and lawful children of such children. In
all cases, posthumous and legally adopted children shall be included. The phrase
"provision for issue" in the designation of Beneficiaries shall mean that if the
Beneficiary so designated does not survive the Annuitant, the payment to which
he would have been entitled if living shall be made to his then living issue in
equal shares per stirpes. Unless otherwise indicated by the context, any
relationship descriptive of a Beneficiary or Owner shall be the relationship to
the Annuitant. In determining the identity of any Beneficiaries or Owners
designated as a class, the Company shall be entitled to rely on an affidavit of
any Beneficiary, Owner or other responsible person.
CONTRACT
This Contract is issued in consideration of the application and of the payment
of an initial purchase payment. The first contract year begins on the Date of
Issue, and each successive contract year begins on the anniversary of this date.
Contract months are computed from the first day of each contract year.
This Contract and the application, a copy of which is attached to and made
a part of this Contract, constitute the entire contract between the parties. All
statements made by or in behalf of the Annuitant shall be deemed representations
and not warranties; and no such statement shall be used in defense to a claim
unless contained in the application and unless a copy of such application is
attached to this Contract when issued. No endorsement or alteration of this
Contract and no waiver of any of its provisions shall be valid unless made in
writing by the Company and signed by its President, Vice-President, Secretary or
Assistant Secretary; and no other person shall have authority to bind the
Company in any manner.
INCONTESTABILITY
This Contract shall be incontestable after two years from its Date of Issue
for misrepresentations in the application for the Contract.
ENDORSEMENTS
To be made only by the Company at its Home Office
V1S.C. New England Mutual Life Insurance Company Page 12
<PAGE>
This is a PARTICIPATING FLEXIBLE PAYMENT DEFERRED VARIABLE ANNUITY CONTRACT.
Values are payable at death before, or upon surrender on or before, the MATURITY
DATE. Purchase payments may be paid until the MATURITY DATE or until the prior
death of the ANNUITANT and may be changed from time to time.
ANNUITY PAYMENTS AND OTHER VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE
INVESTMENT PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
V1-70A
Voting Rights
The Owner of this Contract has the right to vote, either in person or by proxy,
at meetings of the owners of variable annuity contracts which depend on the
investment performance of the Fund. Information as to the number of votes
attributable to this Contract will be supplied in advance of each meeting.
The Owner of this Contract is also a member of the New England Mutual Life
Insurance Company and is entitled to one vote, either in person or by proxy, at
any and all meetings of said Company. The Annual Meetings of the Company are
held at its Home Office on the third Wednesday of March, in each year, at eleven
o'clock A.M.
U:\V1-70A.DOC
<PAGE>
V3-70A
New England Life Chartered in 1835
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Agrees to Pay
Variable Annuity Payments to the ANNUITANT beginning on the FIRST PAYMENT DATE,
if the ANNUITANT is then living, and continuing thereafter during the lifetime
of the ANNUITANT, the dollar amount of payments being determined as set forth in
this Contract. The liability of the Company shall terminate with the last
payment due prior to the death of the ANNUITANT, and no payment shall fall due
hereunder if the ANNUITANT dies before the FIRST PAYMENT DATE.
CONTRACT NUMBER DATE OF ISSUE
ANNUITANT SINGLE PURCHASE PAYMENT
DATE OF BIRTH NUMBER OF ANNUITY UNITS
SEX FIRST PAYMENT DATE
FUND FREQUENCY OF PAYMENT
OWNER ASSUMED INTEREST RATE
ASSUMED INTEREST FACTOR
The provisions hereinafter set forth are hereby made a part of this Contract.
Signed at the Home Office, 501 Boylston Street, Boston, Massachusetts
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
/s/ Edward E. Phillips Secretary /s/ Abram T. Collier President
CONTRACT SUMMARY
THIS IS A PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE ANNUITY
CONTRACT WITHOUT REFUND.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS A DOLLAR AMOUNT.
V3-70A
<PAGE>
PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue and is payable to
the Company at the Home Office in exchange for a receipt signed by the Secretary
or an Assistant Secretary.
FUND
The Fund, the title of which is specified on the first page of the
Contract, is a separate investment account established by the Company pursuant
to Massachusetts law. Annuity payments payable under the Contract depend on the
investment performance of the Fund and are variable. The portion of the assets
of the Fund equal to the reserves and other contract liabilities with respect to
the Fund shall not be chargeable with liabilities arising out of any other
business the Company may conduct.
GUARANTEES
Annuity payments under this Contract will not be adversely affected by
actual expense and mortality experience.
PERIODIC REPORTS
The Company will periodically furnish the Owner a report containing such
information as may be required by applicable Federal or state laws, including,
as of a date not more than two months prior to the date of mailing, the
investments held in the Fund. This information will be furnished semi-annually
after the first contract year, or more often as required by applicable Federal
or state laws.
VALUATION DATE AND VALUATION PERIOD
A Valuation Date is each day that the New York Stock Exchange is open for
business and ends as of the close of trading on the New York Stock Exchange.
Each Valuation Date, together with any immediately preceding day or consecutive
days which are not Valuation Dates, shall constitute a Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor applicable to this Contract for any Valuation
Period shall be the sum of the gross investment rate for such period and
1.0000000 less a deduction of .0000274 for each day of the Valuation Period.
The gross investment rate for any Valuation Period shall be (a) divided by
(b) where
V3 New England Mutual Life Insurance Company Page 2
<PAGE>
(a) is the investment income of the Fund for the Valuation Period, plus
capital gains minus capital losses for the period, whether realized or
unrealized, less deductions of: (1) any taxes which would be incurred
by all assets of the Fund irrespective of the source of such assets,
or amounts set aside by the Company as a reserve for such taxes,
arising from the income and realized and unrealized capital gains on
assets of the Fund, (2) brokerage commissions and taxes, if any, in
connection with the purchase or sale of securities for the account of
the Fund and chargeable to the Fund and (3) fees and expenses of the
Board of Managers of the Fund, including the auditing of Fund assets
as required by the Investment Company Act of 1940; and
(b) is the value of the total assets of the Fund at the beginning of the
Valuation Period less any assets set aside by the Company within the
Fund as a reserve for taxes described in (a) (1) above.
The gross investment rate may be positive or negative. The determination
by the Company of the gross investment rate will be conclusive upon the Owner of
this Contract, any assignee, the Annuitants and any other payee under this
Contract.
NET PURCHASE PAYMENT
The after-tax purchase payment is the amount of the Single Purchase reduced
by any applicable state premium tax. The net purchase payment is the after-tax
purchase payment reduced by 8% of the first $5,000, plus 4% of the next $95,000,
plus 2% of any balance of such after-tax purchase payment.
ANNUITY UNITS AND ANNUITY UNIT VALUE
The net purchase payment shall be credited in the form of Annuity Units as
of the date of receipt of the Single Purchase Payment at the Home Office or, if
later, the date the application for the Contract is approved by the Company at
its Home Office. The basis of such credit shall be rates determined according
to the Male Group Annuity Table for 1951, with Projection on Scale C to the year
1970 and with female ages set back 5 years, and interest at the Assumed Interest
Rate specified on the first page of the Contract. The number of Annuity Units
so credited is specified on the first page of the Contract and remains fixed
thereafter during the annuity payment period. The dollar amount of any annuity
payment or payments due less than 14 days following the date as of which the net
purchase payment is so credited is determined by multiplying the number of
Annuity Units by the Annuity Unit Value on such date. The dollar amount of each
subsequent annuity payment is variable and is determined by multiplying the
number of Annuity Units by the Annuity Unit Value as of the latest Valuation
Date which is at least 14 days prior to the date such payment is due. If
necessary to bring the amount of each payment to at least $20, the Company may
change the period of payment to quarterly, semi-annual or annual.
V3 New England Mutual Life Insurance Company Page 3
<PAGE>
The Annuity Unit Value depends on the Assumed Interest Rate, which is
specified on the first page of the Contract, and on the Net Investment Factor.
The Annuity Unit Values were set at $1.00 on the date on which assets were first
placed in the Fund. An Annuity Unit Value as of any Valuation Date thereafter
is equal to the corresponding Annuity Unit Value as of the immediately preceding
Valuation Date multiplied by the Net Investment Factor for the Valuation Period
then ended, and further multiplied for each day of the Valuation Period by the
Assumed Interest Factor, which is based on the Assumed Interest Rate and is
specified on the first page of the Contract. Accordingly, since Annuity Unit
Values depend upon the investment performance of the Fund, they may increase or
decrease from Valuation Date to Valuation Date. The value of an Annuity Unit as
of any date other than a Valuation Date is equal to its value as of the next
succeeding Valuation Date.
DIVIDENDS: Distribution of surplus.
This contract shall be credited with any dividends apportioned thereto by
the Company. Any such dividends are expected to accrue, if at all, in later
contract years, as a result of more favorable expense and mortality experience
than assumed. It is anticipated that any such dividends will be modest in
amount.
ADJUSTMENT OF BENEFIT IN CASE OF INCORRECT AGE OR SEX
The issue of this Contract is based upon the date of birth and sex of the
Annuitants as shown on the first page. If either the date of birth or sex is
incorrect, the amount payable by the Company hereunder shall be that which the
next purchase payment would have provided for the correct date of birth and sex.
Any over-payments by the Company on account of such error, with interest thereon
at the rate of five per cent per annum compounded annually, shall be charged
against the current and next succeeding payment or payments to be made by the
Company, and any under-payments by the Company shall be adjusted in like manner
and credited with the next succeeding payment. The Company may defer any
payment until the Company has been furnished with satisfactory evidence that the
Annuitant is living.
OWNERSHIP
The Owner has the right to exercise any right, option or benefit permitted
by the Company.
ASSIGNMENTS
There shall be no right to assign, alienate or commute this Contract or any
payment hereunder, nor to anticipate any benefits; and, except as otherwise
prescribed by law, no payment whatsoever under this Contract shall be subject to
the debts, contracts or engagements of the Annuitant or of any other payee, or
to any legal process to levy upon or attach the same for payment thereof. In
the event of any attempted assignment or other transfer of any rights hereunder,
the Company shall not be charged with notice thereof unless such attempted
V3 New England Mutual Life Insurance Company Page 4
<PAGE>
assignment or transfer is in writing and unless the original or a duplicate
thereof is filed at the Home Office; and the Company shall have the right, in
its sole discretion, to make each payment, as it falls due, to the joint order
of the purported assignee or transferee and of the payee who but for the
attempted assignment or instrument would be entitled to the same. No
responsibility for the validity of any assignment or other transfer will be
assumed by the Company.
CONTRACT
This Contract is issued in consideration of the application and of the
payment of the Single Purchase Payment. Payments under this Contract shall be
made by the Company at the Home Office.
This Contract and the application, a copy of which is attached to and made
a part of this Contract, constitute the entire contract between the parties.
All statements made by or in behalf of the Annuitant shall be deemed
representations and not warranties; and no such statement shall be used in
defense to a claim unless contained in the application and unless a copy of such
application is attached to this Contract when issued. No endorsement or
alteration of this Contract and no waiver of any of its provisions shall be
valid unless made in writing by the Company and signed by its President, Vice
President, Secretary or Assistant Secretary; and no other person shall have
authority to bind the Company in any manner.
ENDORSEMENTS
To be made only by the Company at its Home Office
THIS IS A PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE LIFE ANNUITY
CONTRACT WITHOUT REFUND.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V3-70
<PAGE>
Voting Rights
The Owner of this Contract has the right to vote, either in person or by proxy,
at meetings of the owners of variable annuity contracts which depend on the
investment performance of the Fund. Information as to the number of votes
attributable to this Contract will be supplied in advance of each meeting.
The Owner of this Contract is also a member of the New England Mutual Life
Insurance Company and is entitled to one vote, either in person or by proxy, at
any and all meetings of said Company. The Annual Meetings of the Company are
held at its Home Office on the third Wednesday of March, in each year, at eleven
o'clock A.M.
<PAGE>
V4-70A
New England Life Chartered in 1835
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Agrees to Pay
Variable Annuity Payments to the ANNUITANT beginning on the FIRST PAYMENT DATE
if the ANNUITANT is then living and continuing thereafter during the lifetime of
the ANNUITANT, the dollar amount of payments being determined as set forth in
this Contract. Upon receipt of due proof of the death of the ANNUINTANT before
payments have been made for the CERTAIN PERIOD specified below, payments, each
on its due date, shall be continued to the BENEFICIARY for the balance of the
CERTAIN PERIOD. When a payment is contingent upon the survival of the
ANNUITANT, the liability of the Company shall terminate with the last payment
due prior to the death of the ANNUITANT.
CONTRACT NUMBER DATE OF ISSUE
ANNUITANT SINGLE PURCHASE PAYMENT
DATE OF BIRTH NUMBER OF ANNUITY UNITS
SEX CERTAIN PERIOD
FUND FIRST PAYMENT DATE
OWNER FREQUENCY OF PAYMENT
ASSUMED INTEREST RATE
ASSUMED INTEREST FACTOR
BENEFICIARY
The provisions hereinafter set forth are hereby made a part of this Contract.
Signed at the Home Office, 501 Boylston Street, Boston, Massachusetts
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
/s/ Edward E. Phillips Secretary /s/ Abram T. Collier President
CONTRACT SUMMARY
THIS IS A PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE LIFE ANNUITY
CONTRACT WITH CERTAIN PERIOD.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS A DOLLAR AMOUNT.
V4-70A
<PAGE>
PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue and is payable
to the Company at the Home Office in exchange for a receipt signed by the
Secretary or an Assistant Secretary.
FUND
The Fund, the title of which is specified on the first page of the
Contract, is a separate investment account established by the Company pursuant
to Massachusetts law. Annuity payments payable under the Contract depend on the
investment performance of the Fund and are variable. The portion of the assets
of the Fund equal to the reserves and other contract liabilities with respect to
the Fund shall not be chargeable with liabilities arising out of any other
business the Company may conduct.
GUARANTEES
Annuity payments under this Contract will not be adversely affected by
actual expense and mortality experience.
PERIODIC REPORTS
The Company will periodically furnish the Owner a report containing
such information as may be required by applicable Federal or state laws,
including, as of a date not more than two months prior to the date of mailing,
the investments held in the Fund. This information will be furnished semi-
annually after the first contract year, or more often as required by applicable
Federal or state laws.
VALUATION DATE AND VALUATION PERIOD
A Valuation Date is each day that the New York Stock Exchange is open
for business and ends as of the close of trading on the New York Stock Exchange.
Each Valuation Date, together with any immediately preceding day or consecutive
days which are not Valuation Dates, shall constitute a Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor applicable to this Contract for any
Valuation Period shall be the sum of the gross investment rate for such period
and 1.0000000 less a deduction of .0000274 for each day of the Valuation Period.
The gross investment rate for any Valuation Period shall be (a)
divided by (b) where
V4 New England Mutual Life Insurance Company Page 2
<PAGE>
(a) is the investment income of the Fund for the Valuation Period, plus
capital gains minus capital losses for the period, whether realized or
unrealized, less deductions of: (1) any taxes which would be incurred
by all assets of the Fund irrespective of the source of such assets,
or amounts set aside by the Company as a reserve for such taxes,
arising from the income and realized and unrealized capital gains on
assets of the Fund, (2) brokerage commissions and taxes, if any, in
connection with the purchase or sale of securities for the account of
the Fund and chargeable to the Fund and (3) fees and expenses of the
Board of Managers of the Fund, including the auditing of Fund assets
as required by the Investment Company Act of 1940; and
(b) is the value of the total assets of the Fund at the beginning of the
Valuation Period less any assets set aside by the Company within the
Fund as a reserve for taxes described in (a) (1) above.
The gross investment rate may be positive or negative. The determination
by the Company of the gross investment rate will be conclusive upon the Owner of
this Contract, any assignee, the Annuitant and any other payee under this
Contract.
NET PURCHASE PAYMENT
The after-tax purchase payment is the amount of the Single Purchase payment
reduced by any applicable state premium tax. The net purchase payment is the
after-tax purchase payment reduced by 8% of the first $5,000, plus 4% of the
next $95,000, plus 2% of any balance of such after-tax purchase payment.
ANNUITY UNITS AND ANNUITY UNIT VALUE
The net purchase payment shall be credited in the form of Annuity Units as
of the date of receipt of the Single Purchase Payment at the Home Office or, if
later, the date the application for the Contract is approved by the Company at
its Home Office. The basis of such credit shall be rates determined according to
the Male Group Annuity Table for 1951, with Projection on Scale C to the year
1970 and with female ages set back 5 years, and interest at the Assumed Interest
Rate specified on the first page of the Contract. The number of Annuity Units so
credited is specified on the first page of the Contract and remains fixed
thereafter during the annuity payment period. The dollar amount of any annuity
payment or payments due less than 14 days following the date as of which the net
purchase payment is so credited is determined by multiplying the number of
Annuity Units by the Annuity Unit Value on such date. The dollar amount of each
subsequent annuity payment is variable and is determined by multiplying the
number of Annuity Units by the Annuity Unit Value as of the
V4 New England Mutual Life Insurance Company Page 3
<PAGE>
latest Valuation Date which is at least 14 days prior to the date such payment
is due. If necessary to bring the amount of each payment to at least $20, the
Company may change the period of payment to quarterly, semi-annual or annual.
The Annuity Unit Value depends on the Assumed Interest Rate, which is
specified on the first page of the Contract, and on the Net Investment Factor.
The Annuity Unit Values were set at $1.00 on the date on which assets were first
placed in the Fund. An Annuity Unit Value as of any Valuation Date thereafter
is equal to the corresponding Annuity Unit Value as of the immediately preceding
Valuation Date multiplied by the Net Investment Factor for the Valuation Period
then ended, and further multiplied for each day of the Valuation Period by the
Assumed Interest Factor, which is based on the Assumed Interest Rate and is
specified on the first page of the Contract. Accordingly, since Annuity Unit
Values depend upon the investment performance of the Fund, they may increase or
decrease from Valuation Date to Valuation Date. The value of an Annuity Unit as
of any date other than a Valuation Date is equal to its value as of the next
succeeding Valuation Date.
DIVIDENDS: Distribution of surplus.
This contract shall be credited with any dividends apportioned thereto by
the Company. Any such dividends are expected to accrue, if at all, in later
contract years, as a result of more favorable expense and mortality experience
than assumed. It is anticipated that any such dividends will be modest in
amount.
ADJUSTMENT OF BENEFIT IN CASE OF INCORRECT AGE OR SEX
The issue of this Contract is based upon the date of birth and sex of the
Annuitant as shown on the first page. If either the date of birth or sex is
incorrect, the amount payable by the Company hereunder shall be that which the
net purchase payment would have provided for the correct date of birth and sex.
Any over-payments by the Company on account of such error, with interest thereon
at the rate of five per cent per annum compounded annually, shall be charged
against the current and next succeeding payment or payments to be made by the
Company, and any under-payments by the Company shall be adjusted in like manner
and credited with the next succeeding payment. When payment is contingent upon
survival of the Annuitant, the Company may defer any payment until the Company
has been furnished with satisfactory evidence that such Annuitant is living.
BENEFICIARY AND OWNERSHIP PROVISIONS
The following provisions shall determine the rights of Beneficiaries and of
the Owner, except as otherwise specifically provided.
A numbered sequence may be used to name successive Beneficiaries. The
Beneficiary from time to time entitled to receive payment shall be that
surviving Beneficiary designated in
V4 New England Mutual Life Insurance Company Page 4
<PAGE>
the lowest number of the sequence at the time any payment is due. If more than
one individual is named as Beneficiary under a number of the sequence, or
without a numbered sequence, whether such designation be by name or as a class
or both, those surviving Beneficiaries at the time a payment is due shall be
entitled to receive payment in equal shares.
Following the death of the Annuitant, any Beneficiary designated to receive
any unpaid certain payments shall have the right, while entitled to payment, to
receive in one sum the then present value of all remaining unpaid certain
payments.
If the last survivor of the Annuitant and all Beneficiaries dies before all
certain payments provided by the Contract shall have been paid, the then present
value of any unpaid certain payments shall be paid in one sum to the executors
or administrators of such last survivor.
Any unpaid certain payments shall be commuted at the Assumed Interest Rate
with each remaining payment being assumed to be equal to the number of Annuity
Units multiplied by the applicable Annuity Unit Value.
The amount of a one sum payment payable by reason of the death of the last
survivor of the Annuitant and all Beneficiaries shall be determined as of the
date on which due proof of such death is received at the Home Office of the
Company. The amount of any other one sum payment shall be determined as of the
date the request therefor is received and will be paid within seven days
thereafter; provided, however, that the Company may defer such payment when so
permitted under applicable Federal laws, rules and regulations governing the
redemption of variable annuities.
The Owner shall have the right to change the Beneficiary and to exercise
any right, option or benefit permitted by the Company and the rights of any
Beneficiary shall be subject to any interest so created. Every request for
change of Beneficiary must be in written form satisfactory to the Company and
shall take effect as of the date of such request but only upon receipt of the
request at the Home Office of the Company whether or not the Owner or the
Annuitant be then living; provided that the liability of the Company shall be
discharged to the extent of any payment made prior to such receipt and shall not
be increased by reason of such change.
ASSIGNMENTS
Subject to the Beneficiary and Ownership Provisions, there shall be no
right to assign, alienate or commute this Contract or any payment hereunder, nor
to anticipate any benefits; and, except as otherwise prescribed by law, no
payment whatsoever under this Contract shall be subject to the debts, contracts
or engagements of either Annuitant or of any other payee, or to any legal
process to levy upon or attach the same for the payment thereof. In the event
of any attempted assignment or other transfer of any rights hereunder, the
Company shall not be charged with notice thereof unless such attempted
assignment or transfer is in writing and
V4 New England Mutual Life Insurance Company Page 5
<PAGE>
unless the original or a duplicate thereof is filed at the Home Office; and the
Company shall have the right, in its sole discretion, to make each payment, as
it falls due, to the joint order of the purported assignee or transferee and of
the payee who but for the attempted assignment or instrument would be entitled
to the same. No responsibility for the validity of any assignment or other
transfer will be assumed by the Company.
CONTRACT
This Contract is issued in consideration of the application and of the
payment of the Single Purchase Payment. Payments under this Contract shall be
made by the Company at the Home Office.
This Contract and the application, a copy of which is attached to and made
a part of this Contract, constitute the entire contract between the parties.
All statements made by or in behalf of the Annuitant shall be deemed
representations and not warranties; and no such statement shall be used in
defense to a claim unless contained in the application and unless a copy of such
application is attached to this Contract when issued. No endorsement or
alteration of this Contract and no waiver of any of its provisions shall be
valid unless made in writing by the Company and signed by its President, Vice
President, Secretary or Assistant Secretary; and no other person shall have
authority to bind the Company in any manner.
V3 New England Mutual Life Insurance Company Page 6
<PAGE>
ENDORSEMENTS
To be made only by the Company at its Home Office
THIS IS A PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE LIFE ANNUITY
CONTRACT WITH CERTAIN PERIOD.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V4-70
Voting Rights
The Owner of this Contract has the right to vote, either in person or by proxy,
at meetings of the owners of variable annuity contracts which depend on the
investment performance of the Fund. Information as to the number of votes
attributable to this Contract will be supplied in advance of each meeting.
The Owner of this Contract is also a member of the New England Mutual Life
Insurance Company and is entitled to one vote, either in person or by proxy, at
any and all meetings of said Company. The Annual Meetings of the Company are
held at its Home Office on the third Wednesday of March, in each year, at eleven
o'clock A.M.
<PAGE>
V5-70A
New England Life - Chartered in 1835
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Agrees to Pay
Variable Annuity Payments to the PRIMARY ANNUITANT beginning on the FIRST
PAYMENT DATE and continuing during the joint lifetime of the ANNUITANTS with
two-thirds of the amount that would be payable if both ANNUITANTS were living
payable to the survivor during the balance of the lifetime of the survivor, the
dollar amount of payments being determined as set forth in this Contract. When
a payment is contingent upon survival of an ANNUITANT, the liability of the
Company shall terminate with the last payment due prior to the death of such
ANNUITANT, and no payment shall fall due hereunder if such death occurs before
the FIRST PAYMENT DATE.
CONTRACT NUMBER DATE OF ISSUE
PRIMARY ANNUITANT SINGLE PURCHASE PAYMENT
DATE OF BIRTH NUMBER OF ANNUITY UNITS
SEX FIRST PAYMENT DATE
SECONDARY ANNUITANT FREQUENCY OF PAYMENT
DATE OF BIRTH ASSUMED INTEREST RATE
SEX ASSUMED INTEREST FACTOR
FUND
OWNER
The provisions hereinafter set forth are hereby made a part of this Contract.
Signed at the Home Office, 501 Boylston Street, Boston, Massachusetts
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
/s/ Edward E. Phillips Secretary /s/ Abram T. Collier President
CONTRACT SUMMARY
This is a PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE JOINT AND
SURVIVORSHIP ANNUITY CONTRACT with TWO-THIRDS of the VARIABLE ANNUITY PAYMENTS
continuing to the SURVIVOR.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V5-70A
<PAGE>
PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue and is payable to
the Company at the Home Office in exchange for a receipt signed by the Secretary
or an Assistant Secretary.
FUND
The Fund, the title of which is specified on the first page of the
Contract, is a separate investment account established by the Company pursuant
to Massachusetts law. Annuity payments payable under the Contract depend on the
investment performance of the Fund and are variable. The portion of the assets
of the Fund equal to the reserves and other contract liabilities with respect to
the Fund shall not be chargeable with liabilities arising out of any other
business the Company may conduct.
GUARANTEES
Annuity payments under this Contract will not be adversely affected by
actual expense and mortality experience.
PERIODIC REPORTS
The Company will periodically furnish the Owner a report containing such
information as may be required by applicable Federal or state laws, including,
as of a date not more than two months prior to the date of mailing, the
investments held in the Fund. This information will be furnished semi-annually
after the first contract year, or more often as required by applicable Federal
or state laws.
VALUATION DATE AND VALUATION PERIOD
A Valuation Date is each day that the New York Stock Exchange is open for
business and ends as of the close of trading on the New York Stock Exchange.
Each Valuation Date, together with any immediately preceding day or consecutive
days which are not Valuation Dates, shall constitute a Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor applicable to this Contract for any Valuation
Period shall be the sum of the gross investment rate for such period and
1.0000000 less a deduction of .0000274 for each day of the Valuation Period.
The gross investment rate for any Valuation Period shall be (a) divided by
(b) where
(a) is the investment income of the Fund for the Valuation Period, plus
capital gains minus capital losses for the period, whether realized or
unrealized, less deductions of: (1) any taxes which would be incurred
by all assets of the Fund irrespective of the source of such assets,
or amounts set aside by the Company as a reserve for
V5 New England Mutual Life Insurance Company Page 2
<PAGE>
such taxes, arising from the income and realized and unrealized
capital gains on assets of the Fund, (2) brokerage commissions and
taxes, if any, in connection with the purchase or sale of securities
for the account of the Fund and chargeable to the Fund and (3) fees
and expenses of the Board of Managers of the Fund, including the
auditing of Fund assets as required by the Investment Company Act of
1940; and
(b) is the value of the total assets of the Fund at the beginning of the
Valuation Period less any assets set aside by the Company within the
Fund as a reserve for taxes described in (a) (1) above.
The gross investment rate may be positive or negative. The determination
by the Company of the gross investment rate will be conclusive upon the Owner of
this Contract, any assignee, the Annuitants and any other payee under this
Contract.
NET PURCHASE PAYMENT
The after-tax purchase payment is the amount of the Single Purchase payment
reduced by any applicable state premium tax. The net purchase payment is the
after-tax purchase payment reduced by 8% of the first $5,000, plus 4% of the
next $95,000, plus 2% of any balance of such after-tax purchase payment.
ANNUITY UNITS AND ANNUITY UNIT VALUE
The net purchase payment shall be credited in the form of Annuity Units as
of the date of receipt of the Single Purchase Payment at the Home Office or, if
later, the date the application for the Contract is approved by the Company at
its Home Office. The basis of such credit shall be rates determined according
to the Male Group Annuity Table for 1951, with Projection on Scale C to the year
1970 and with female ages set back 5 years, and interest at the Assumed Interest
Rate specified on the first page of the Contract. The number of Annuity Units
so credited is specified on the first page of the Contract and remains fixed
thereafter during the joint lifetime of the Annuitants, reducing to two-thirds
of such number during the balance of the lifetime of the survivor. The dollar
amount of any annuity payment or payments due less than 14 days following the
date as of which the net purchase payment is so credited is determined by
multiplying the number of Annuity Units by the Annuity Unit Value on such date.
The dollar amount of each subsequent annuity payment is variable and is
determined by multiplying the number of Annuity Units by the Annuity Unit Value
as of the latest Valuation Date which is at least 14 days prior to the date such
payment is due. If necessary to bring the amount of each payment to at least
$20, the Company may change the period of payment to quarterly, semi-annual or
annual.
The Annuity Unit Value depends on the Assumed Interest Rate, which is
specified on the first page of the Contract, and on the Net Investment Factor.
The Annuity Unit Values were set at $1.00 on the date on which assets were first
placed in the Fund. An Annuity Unit Value as of any Valuation Date thereafter is
equal to the corresponding Annuity Unit Value as of the
V5 New England Mutual Life Insurance Company Page 3
<PAGE>
immediately preceding Valuation Date multiplied by the Net Investment Factor for
the Valuation Period then ended, and further multiplied for each day of the
Valuation Period by the Assumed Interest Factor, which is based on the Assumed
Interest Rate and is specified on the first page of the Contract. Accordingly,
since Annuity Unit Values depend upon the investment performance of the Fund,
they may increase or decrease from Valuation Date to Valuation Date. The value
of an Annuity Unit as of any date other than a Valuation Date is equal to its
value as of the next succeeding Valuation Date.
DIVIDENDS: Distribution of surplus.
This contract shall be credited with any dividends apportioned thereto by
the Company. Any such dividends are expected to accrue, if at all, in later
contract years, as a result of more favorable expense and mortality experience
than assumed. It is anticipated that any such dividends will be modest in
amount.
ADJUSTMENT OF BENEFIT IN CASE OF INCORRECT AGE OR SEX
The issue of this Contract is based upon the dates of birth and sexes of
the Annuitants as shown on the first page. If any of these statements is
incorrect, the amount payable by the Company hereunder shall be that which the
net purchase payment would have provided on the correct basis. Any over-
payments by the Company on account of such error, with interest thereon at the
rate of five per cent per annum compounded annually, shall be charged against
the current and next succeeding payment or payments to be made by the Company,
and any under-payments by the Company shall be adjusted in like manner and
credited with the next succeeding payment. When payment is contingent upon
survival of an Annuitant, the Company may defer any payment until the Company
has been furnished with satisfactory evidence that such Annuitant is living.
OWNERSHIP
The Owner has the right to exercise any right, option or benefit permitted
by the Company.
ASSIGNMENTS
There shall be no right to assign, alienate or commute this Contract or any
payment hereunder, nor to anticipate any benefits; and, except as otherwise
prescribed by law, no payment whatsoever under this Contract shall be subject to
the debts, contracts or engagements of either Annuitant or of any other payee,
or to any legal process to levy upon or attach the same for the payment thereof.
In the event of any attempted assignment or other transfer of any rights
hereunder, the Company shall not be charged with notice thereof unless such
attempted assignment or transfer is in writing and unless the original or a
duplicate thereof is filed at the Home Office; and the Company shall have the
right, in its sole discretion, to make each payment, as it falls due, to the
joint order of the purported assignee or transferee and of the payee who but for
the attempted assignment or instrument would be entitled to the same. No
responsibility for the validity of any assignment or other transfer will be
assumed by the Company.
V5 New England Mutual Life Insurance Company Page 4
<PAGE>
CONTRACT
This Contract is issued in consideration of the application and of the
payment of the Single Purchase Payment. Payments under this Contract shall be
made by the Company at the Home Office.
This Contract and the application, a copy of which is attached to and made
a part of this Contract, constitute the entire contract between the parties.
All statements made by or in behalf of the Annuitants shall be deemed
representations and not warranties; and no such statement shall be used in
defense to a claim unless contained in the application and unless a copy of such
application is attached to this Contract when issued. No endorsement or
alteration of this Contract and no waiver of any of its provisions shall be
valid unless made in writing by the Company and signed by its President, Vice
President, Secretary or Assistant Secretary; and no other person shall have
authority to bind the Company in any manner.
V5 New England Mutual Life Insurance Company Page 5
<PAGE>
ENDORSEMENTS
To be made only by the Company at its Home Office
This is a PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE JOINT AND
SURVIVORSHIP ANNUITY CONTRACT with TWO-THIRDS of the VARIABLE ANNUITY PAYMENTS
continuing to the SURVIVOR.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V5-70
Voting Rights
The Owner of this Contract has the right to vote, either in person or by proxy,
at meetings of the owners of variable annuity contracts which depend on the
investment performance of the Fund. Information as to the number of votes
attributable to this Contract will be supplied in advance of each meeting.
The Owner of this Contract is also a member of the New England Mutual Life
Insurance Company and is entitled to one vote, either in person or by proxy, at
any and all meetings of said Company. The Annual Meetings of the Company are
held at its Home Office on the third Wednesday of March, in each year, at eleven
o'clock A.M.
<PAGE>
V6-70A
New England Life Chartered in 1835
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Agrees to Pay
Variable Annuity Payments to the PRIMARY ANNUITANT beginning on the FIRST
PAYMENT DATE and continuing during the joint lifetime of the ANNUITANTS with
payments continuing to the survivor during the balance of the lifetime of the
survivor, the dollar amount of payments being determined as set forth in this
Contract. When a payment is contingent upon survival of an ANNUITANT, the
liability of the Company shall terminate with the last payment due prior to the
death of such ANNUITANT, and no payment shall fall due hereunder if such death
occurs before the FIRST PAYMENT DATE.
CONTRACT NUMBER DATE OF ISSUE
PRIMARY ANNUITANT SINGLE PURCHASE PAYMENT
DATE OF BIRTH NUMBER OF ANNUITY UNITS
SEX FIRST PAYMENT DATE
SECONDARY ANNUITANT FREQUENCY OF PAYMENT
DATE OF BIRTH ASSUMED INTEREST RATE
SEX ASSUMED INTEREST FACTOR
FUND
OWNER
The provisions hereinafter set forth are hereby made a part of this Contract.
Signed at the Home Office, 501 Boylston Street, Boston, Massachusetts
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
/s/ Edward E. Phillips Secretary /s/ Abram T. Collier President
CONTRACT SUMMARY
This is a PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE JOINT AND
SURVIVORSHIP ANNUITY CONTRACT with FULL VARIABLE ANNUITY PAYMENTS continuing to
the SURVIVOR.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V6-70A
<PAGE>
PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue and is payable to
the Company at the Home Office in exchange for a receipt signed by the Secretary
or an Assistant Secretary.
FUND
The Fund, the title of which is specified on the first page of the
Contract, is a separate investment account established by the Company pursuant
to Massachusetts law. Annuity payments payable under the Contract depend on the
investment performance of the Fund and are variable. The portion of the assets
of the Fund equal to the reserves and other contract liabilities with respect to
the Fund shall not be chargeable with liabilities arising out of any other
business the Company may conduct.
GUARANTEES
Annuity payments under this Contract will not be adversely affected by
actual expense and mortality experience.
PERIODIC REPORTS
The Company will periodically furnish the Owner a report containing such
information as may be required by applicable Federal or state laws, including,
as of a date not more than two months prior to the date of mailing, the
investments held in the Fund. This information will be furnished semi-annually
after the first contract year, or more often as required by applicable Federal
or state laws.
VALUATION DATE AND VALUATION PERIOD
A Valuation Date is each day that the New York Stock Exchange is open for
business and ends as of the close of trading on the New York Stock Exchange.
Each Valuation Date, together with any immediately preceding day or consecutive
days which are not Valuation Dates, shall constitute a Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor applicable to this Contract for any Valuation
Period shall be the sum of the gross investment rate for such period and
1.0000000 less a deduction of .0000274 for each day of the Valuation Period.
The gross investment rate for any Valuation Period shall be (a) divided by
(b) where
(a) is the investment income of the Fund for the Valuation Period, plus
capital gains minus capital losses for the period, whether realized or
unrealized, less deductions of: (1) any taxes which would be incurred
by all assets of the Fund irrespective of
V6 New England Mutual Life Insurance Company Page 2
<PAGE>
the source of such assets, or amounts set aside by the Company as a
reserve for such taxes, arising from the income and realized and
unrealized capital gains on assets of the Fund, (2) brokerage
commissions and taxes, if any, in connection with the purchase or sale
of securities for the account of the Fund and chargeable to the Fund,
and (3) fees and expenses of the Board of Managers of the Fund,
including the auditing of Fund assets as required by the Investment
Company Act of 1940; and
(b) is the value of the total assets of the Fund at the beginning of the
Valuation Period less any assets set aside by the Company within the
Fund as a reserve for taxes described in (a) (1) above.
The gross investment rate may be positive or negative. The determination
by the Company of the gross investment rate will be conclusive upon the Owner of
this Contract, any assignee, the Annuitant and any other payee under this
Contract.
NET PURCHASE PAYMENT
The after-tax purchase payment is the amount of the Single Purchase payment
reduced by any applicable state premium tax. The net purchase payment is the
after-tax purchase payment reduced by 8% of the first $5,000, plus 4% of the
next $95,000, plus 2% of any balance of such after-tax purchase payment.
ANNUITY UNITS AND ANNUITY UNIT VALUE
The net purchase payment shall be credited in the form of Annuity Units as
of the date of receipt of the Single Purchase Payment at the Home Office or, if
later, the date the application for the Contract is approved by the Company at
its Home Office. The basis of such credit shall be rates determined according
to the Male Group Annuity Table for 1951, with Projection on Scale C to the year
1970 and with female ages set back 5 years, and interest at the Assumed Interest
Rate specified on the first page of the Contract. The number of Annuity Units
so credited is specified on the first page of the Contract and remains fixed
thereafter during the annuity payment period. The dollar amount of any annuity
payment or payments due less than 14 days following the date as of which the net
purchase payment is so credited is determined by multiplying the number of
Annuity Units by the Annuity Unit Value on such date. The dollar amount of each
subsequent annuity payment is variable and is determined by multiplying the
number of Annuity Units by the Annuity Unit Value as of the latest Valuation
Date which is at least 14 days prior to the date such payment is due. If
necessary to bring the amount of each payment to at least $20, the Company may
change the period of payment to quarterly, semi-annual or annual.
The Annuity Unit Value depends on the Assumed Interest Rate, which is shown
on the first page of the Contract, and on the Net Investment Factor. The
Annuity Unit Values were set at $1.00 on the date on which assets were first
placed in the Fund. An Annuity Unit Value as of any Valuation Date thereafter
is equal to the corresponding Annuity Unit Value as of the immediately preceding
Valuation Date multiplied by the Net Investment Factor for the Valuation
V6 New England Mutual Life Insurance Company Page 3
<PAGE>
Period then ended, and further multiplied for each day of the Valuation Period
by the Assumed Interest Factor, which is based on the Assumed Interest Rate and
is specified on the first page of the Contract. Accordingly, since Annuity Unit
Values depend upon the investment performance of the Fund, they may increase or
decrease from Valuation Date to Valuation Date. The value of an Annuity Unit as
of any date other than a Valuation Date is equal to its value as of the next
succeeding Valuation Date.
DIVIDENDS: Distribution of surplus.
This contract shall be credited with any dividends apportioned thereto by
the Company. Any such dividends are expected to accrue, if at all, in later
contract years, as a result of more favorable expense and mortality experience
than assumed. It is anticipated that any such dividends will be modest in
amount.
ADJUSTMENT OF BENEFIT IN CASE OF INCORRECT AGE OR SEX
The issue of this Contract is based upon the dates of birth and sexes of
the Annuitants as shown on the first page. If any of these statements is
incorrect, the amount payable by the Company hereunder shall be that which the
net purchase payment would have provided on the correct basis. Any over-
payments by the Company on account of such error, with interest thereon at the
rate of five per cent per annum compounded annually, shall be charged against
the current and next succeeding payment or payments to be made by the Company,
and any under-payments by the Company shall be adjusted in like manner and
credited with the next succeeding payment. When payment is contingent upon
survival of an Annuitant, the Company may defer any payment until the Company
has been furnished with satisfactory evidence that such Annuitant is
living.
OWNERSHIP
The Owner has the right to exercise any right, option or benefit permitted
by the Company.
ASSIGNMENTS
There shall be no right to assign, alienate or commute this Contract or any
payment hereunder, nor to anticipate any benefits; and, except as otherwise
prescribed by law, no payment whatsoever under this Contract shall be subject to
the debts, contracts or engagements of either Annuitant or of any other payee,
or to any legal process to levy upon or attach the same for the payment thereof.
In the event of any attempted assignment or other transfer of any rights
hereunder, the Company shall not be charged with notice thereof unless such
attempted assignment or transfer is in writing and unless the original or a
duplicate thereof is filed at the Home Office; and the Company shall have the
right, in its sole discretion, to make each payment, as it falls due, to the
joint order of the purported assignee or transferee and of the payee who but for
the attempted assignment or instrument would be entitled to the same. No
responsibility for the validity of any assignment or other transfer will be
assumed by the Company.
V6 New England Mutual Life Insurance Company Page 4
<PAGE>
CONTRACT
This Contract is issued in consideration of the application and of the
payment of the Single Purchase Payment. Payments under this Contract shall be
made by the Company at the Home Office.
This Contract and the application, a copy of which is attached to and made
a part of this Contract, constitute the entire contract between the parties.
All statements made by or in behalf of the Annuitants shall be deemed
representations and not warranties; and no such statement shall be used in
defense to a claim unless contained in the application and unless a copy of such
application is attached to this Contract when issued. No endorsement or
alteration of this Contract and no waiver of any of its provisions shall be
valid unless made in writing by the Company and signed by its President, Vice
President, Secretary or Assistant Secretary; and no other person shall have
authority to bind the Company in any manner.
ENDORSEMENTS
To be made only by the Company at its Home Office
This is a PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE JOINT AND
SURVIVORSHIP ANNUITY CONTRACT with FULL VARIABLE ANNUITY PAYMENTS continuing to
the SURVIVOR.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V6-70A
<PAGE>
Voting Rights
The Owner of this Contract has the right to vote, either in person or by proxy,
at meetings of the owners of variable annuity contracts which depend on the
investment performance of the Fund. Information as to the number of votes
attributable to this Contract will be supplied in advance of each meeting.
The Owner of this Contract is also a member of the New England Mutual Life
Insurance Company and is entitled to one vote, either in person or by proxy, at
any and all meetings of said Company. The Annual Meetings of the Company are
held at its Home Office on the third Wednesday of March, in each year, at eleven
o'clock A.M.
u:\V6
<PAGE>
V7-70A
New England Life Chartered in 1835
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Agrees to Pay
Variable Annuity Payments to the PRIMARY ANNUITANT beginning on the FIRST
PAYMENT DATE and continuing during the joint lifetime of the ANNUITANTS with
payments continuing to the survivor during the balance of the lifetime of the
survivor, the dollar amount of payments being determined as set forth in this
Contract. Upon receipt of due proof of the death of both ANNUITANTS before
payments have been made for a Certain Period of 10 Years, payments, each on its
due date, shall be continued to the BENEFICIARY for the balance of such period.
When a payment is contingent upon survival of an ANNUITANT, the liability of the
Company shall terminate with the last payment due prior to the death of such
ANNUITANT.
CONTRACT NUMBER DATE OF ISSUE
PRIMARY ANNUITANT SINGLE PURCHASE PAYMENT
DATE OF BIRTH NUMBER OF ANNUITY UNITS
SEX FIRST PAYMENT DATE
SECONDARY ANNUITANT FREQUENCY OF PAYMENT
DATE OF BIRTH ASSUMED INTEREST RATE
SEX ASSUMED INTEREST FACTOR
FUND BENEFICIARY
OWNER
The provisions hereinafter set forth are hereby made a part of this Contract.
Signed at the Home Office, 501 Boylston Street, Boston, Massachusetts
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
/s/ Edward E. Phillips Secretary /s/ Abram T. Collier President
CONTRACT SUMMARY
This is a PARTICIPATING SINGLE PURCHASE PAYMENT IMMEDIATE VARIABLE JOINT AND
SURVIVORSHIP ANNUITY CONTRACT with CERTAIN PERIOD OF 10 YEARS.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V7-70A
<PAGE>
PURCHASE PAYMENT
The Single Purchase Payment is due on the Date of Issue and is payable to
the Company at the Home Office in exchange for a receipt signed by the Secretary
or an Assistant Secretary.
FUND
The Fund, the title of which is specified on the first page of the
Contract, is a separate investment account established by the Company pursuant
to Massachusetts law. Annuity payments payable under the Contract depend on the
investment performance of the Fund and are variable. The portion of the assets
of the Fund equal to the reserves and other contract liabilities with respect to
the Fund shall not be chargeable with liabilities arising out of any other
business the Company may conduct.
GUARANTEES
Annuity payments under this Contract will not be adversely affected by
actual expense and mortality experience.
PERIODIC REPORTS
The Company will periodically furnish the Owner a report containing such
information as may be required by applicable Federal or state laws, including,
as of a date not more than two months prior to the date of mailing, the
investments held in the Fund. This information will be furnished semi-annually
after the first contract year, or more often as required by applicable Federal
or state laws.
VALUATION DATE AND VALUATION PERIOD
A Valuation Date is each day that the New York Stock Exchange is open for
business and ends as of the close of trading on the New York Stock Exchange.
Each Valuation Date, together with any immediately preceding day or consecutive
days which are not Valuation Dates, shall constitute a Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor applicable to this Contract for any Valuation
Period shall be the sum of the gross investment rate for such period and
1.0000000 less a deduction of .0000274 for each day of the Valuation Period.
The gross investment rate for any Valuation Period shall be (a) divided by
(b) where
(a) is the investment income of the Fund for the Valuation Period plus
capital gains minus capital losses for the period, whether realized or
unrealized, less deductions of: (1) any taxes, which would be incurred
by all assets of the Fund irrespective of the source of such assets,
or amounts set aside by the Company as a reserve for
V7 New England Mutual Life Insurance Company Page 2
<PAGE>
such taxes, arising from the income and realized and unrealized
capital gains on assets of the Fund, (2) brokerage commissions and
taxes, if any, in connection with the purchase or sale of securities
for the account of the Fund and chargeable to the Fund and (3) fees
and expenses of the Board of Managers of the Fund, including the
auditing of Fund assets as required by the Investment Company Act of
1940; and
(b) is the value of the total assets of the Fund at the beginning of the
Valuation Period less any assets set aside by the Company within the
Fund as a reserve for taxes described in (a) (1) above.
The gross investment rate may be positive or negative. The determination
by the Company of the gross investment rate will be conclusive upon the Owner of
this Contract, any assignee, the Annuitants and any other payee under this
Contract.
NET PURCHASE PAYMENT
The after-tax purchase payment is the amount of the Single Purchase payment
reduced by any applicable state premium tax. The net purchase payment is the
after-tax purchase payment reduced by 8% of the first $5,000, plus 4% of the
next $95,000, plus 2% of any balance of such after-tax purchase payment.
ANNUITY UNITS AND ANNUITY UNIT VALUE
The net purchase payment shall be credited in the form of Annuity Units as
of the date of receipt of the Single Purchase Payment at the Home Office or, if
later, the date the application for the Contract is approved by the Company at
its Home Office. The basis of such credit shall be rates determined according
to the Male Group Annuity Table for 1951, with Projection on Scale C to the year
1970 and with female ages set back 5 years, and interest at the Assumed Interest
Rate specified on the first page of the Contract. The number of Annuity Units
so credited is specified on the first page of the Contract and remains fixed
thereafter during the annuity payment period. The dollar amount of any annuity
payment or payments due less than 14 days following the date as of which the net
purchase payment is so credited is determined by multiplying the number of
Annuity Units by the Annuity Unit Value on such date. The dollar amount of each
subsequent annuity payment is variable and is determined by multiplying the
number of Annuity Units by the Annuity Unit Value as of the latest Valuation
Date which is at least 14 days prior to the date such payment is due. If
necessary to bring the amount of each payment to at least $20, the Company may
change the period of payment to quarterly, semi-annual or annual.
V7 New England Mutual Life Insurance Company Page 3
<PAGE>
The Annuity Unit Value depends on the Assumed Interest Rate, which is
specified on the first page of the Contract, and on the Net Investment Factor.
The Annuity Unit Values were set at $1.00 on the date on which assets were first
placed in the Fund. An Annuity Unit Value as of any Valuation Date thereafter
is equal to the corresponding Annuity Unit Value as of the immediately preceding
Valuation Date multiplied by the Net Investment Factor for the Valuation Period
then ended, and further multiplied for each day of the Valuation Period by the
Assumed Interest Factor, which is based on the Assumed Interest Rate and is
specified on the first page of the Contract. Accordingly, since Annuity Unit
Values depend upon the investment performance of the Fund, they may increase or
decrease from Valuation Date to Valuation Date. The value of an Annuity Unit as
of any date other than a Valuation Date is equal to its value as of the next
succeeding Valuation Date.
DIVIDENDS: Distribution of surplus.
This contract shall be credited with any dividends apportioned thereto by
the Company. Any such dividends are expected to accrue, if at all, in later
contract years, as a result of more favorable expense and mortality experience
than assumed. It is anticipated that any such dividends will be modest in
amount.
ADJUSTMENT OF BENEFIT IN CASE OF INCORRECT AGE OR SEX
The issue of this Contract is based upon the dates of birth and sexes of
the Annuitants as shown on the first page. If any of these statements is
incorrect, the amount payable by the Company hereunder shall be that which the
net purchase payment would have provided on the correct basis. Any over-
payments by the Company on account of such error, with interest thereon at the
rate of five per cent per annum compounded annually, shall be charged against
the current and next succeeding payment or payments to be made by the Company,
and any under-payments by the Company shall be adjusted in like manner and
credited with the next succeeding payment. When payment is contingent upon
survival of an Annuitant, the Company may defer any payment until the Company
has been furnished with satisfactory evidence that such Annuitant is
living.
BENEFICIARY AND OWNERSHIP PROVISIONS
The following provisions shall determine the rights of Beneficiaries and of
the Owner, except as otherwise specifically provided. A numbered sequence may
be used to name successive Beneficiaries. The Beneficiary from time to time
entitled to receive payment shall be that surviving Beneficiary designated in
the lowest number of the sequence at the time any payment is due. If more than
one individual is named as Beneficiary under a number of the sequence, or
without a numbered sequence, whether such designation be by name or as a class
or both, those surviving Beneficiaries at the time a payment is due shall be
entitled to receive payments in equal shares.
V7 New England Mutual Life Insurance Company Page 4
<PAGE>
Following the death of both Annuitants, any Beneficiary designated to
receive any unpaid certain payments shall have the right, while entitled to
payment, to receive in one sum the then present value of all remaining certain
payments.
If the last survivor of both Annuitants and all Beneficiaries dies before
all certain payments provided by the Contract shall have been paid, the then
present value of any unpaid certain payments shall be paid in one sum to the
executors or administrators of such last survivor.
Any unpaid certain payments shall be commuted at the Assumed Interest Rate
with each remaining payment being assumed to be equal to the number of Annuity
Units multiplied by the applicable Annuity Unit Value.
The amount of a one sum payment payable by reason of the death of the last
survivor of both Annuitants and all Beneficiaries shall be determined as of the
date on which due proof of such death is received at the Home Office of the
Company. The amount of any other one sum payment shall be determined as of the
date the request therefor is received and will be paid within seven days
thereafter; provided, however, that the Company may defer such payment when so
permitted under applicable Federal laws, rules and regulations governing the
redemption of variable annuities.
The Owner shall have the right to change the Beneficiary and to exercise
any right, option or benefit permitted by the Company and the rights of any
Beneficiary shall be subject to any interest so created. Every request for
change of Beneficiary must be in written form satisfactory to the Company and
shall take effect as of the date of such request but only upon receipt of the
request at the Home Office of the Company whether or not the Owner or either
Annuitant be then living; provided that the liability of the Company shall be
discharged to the extent of any payment made prior to such receipt and shall not
be increased by reason of such change.
ASSIGNMENTS
Subject to the Beneficiary and Ownership Provisions, there shall be no
right to assign, alienate or commute this Contract or any payment hereunder, nor
to anticipate any benefits; and, except as otherwise prescribed by law, no
payment whatsoever under this Contract shall be subject to the debts, contracts
or engagements of either Annuitant or of any other payee, or to any legal
process to levy upon or attach the same for the payment thereof. In the event
of any attempted assignment or other transfer of any rights hereunder, the
Company shall not be charged with notice thereof unless such attempted
assignment or transfer is in writing and unless the original or a duplicate
thereof is filed at the Home Office; and the Company shall have the right, in
its sole discretion, to make each payment, as it falls due, to the joint order
of the purported assignee or transferee and of the payee who but for the
attempted assignment or instrument would be entitled to the same. No
responsibility for the validity of any assignment or other transfer will be
assumed by the Company.
V7 New England Mutual Life Insurance Company Page 5
<PAGE>
CONTRACT
This Contract is issued in consideration of the application and of the
payment of the Single Purchase Payment. Payments under this Contract shall be
made by the Company at the Home Office.
This Contract and the application, a copy of which is attached to and made
a part of this Contract, constitute the entire contract between the parties.
All statements made by or in behalf of the Annuitants shall be deemed
representations and not warranties; and no such statement shall be used in
defense to a claim unless contained in the application and unless a copy of such
application is attached to this Contract when issued. No endorsement or
alteration of this Contract and no waiver of any of its provisions shall be
valid unless made in writing by the Company and signed by its President, Vice
President, Secretary or Assistant Secretary; and no other person shall have
authority to bind the Company in any manner.
ENDORSEMENTS
To be made only by the Company at its Home Office
This is a Participating Single Purchase Payment Immediate Variable Joint and
Survivorship Annuity Contract with Certain Period of 10 Years.
ANNUITY PAYMENTS PROVIDED BY THIS CONTRACT, WHICH ARE BASED ON THE INVESTMENT
PERFORMANCE OF A SEPARATE INVESTMENT ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
V7-70
Voting Rights
The Owner of this Contract has the right to vote, either in person or by proxy,
at meetings of the owners of variable annuity contracts which depend on the
investment performance of the Fund. Information as to the number of votes
attributable to this Contract will be supplied in advance of each meeting.
The Owner of this Contract is also a member of the New England Mutual Life
Insurance Company and is entitled to one vote, either in person or by proxy, at
any and all meetings of said Company. The Annual Meetings of the Company are
held at its Home Office on the third Wednesday of March, in each year, at eleven
o'clock A.M.
<PAGE>
Exhibit (6)(iii)
P-955-88
Endorsement: Tax-Sheltered Annuity
As of the Date of Issue of this Contract, this Endorsement is added to the
Contract.
In order to qualify this Contract as a Tax-Sheltered Annuity under Section
403(b) of the Internal Revenue Code, (the "Code"), the following restrictions
apply.
1. The Owner of the Contract is the Annuitant; and the Owner of the Contract
CANNOT be changed.
2. Unless otherwise notified by you or your Tax-Sheltered Annuity sponsor, the
Company will treat the purchase payments made to this Contract as
contributions within the permissible limitations of Sections 403(b)(2) and
(10) of the code.
3. The Company will accept Purchase Payments resulting from qualified
rollovers and transfers from other tax-sheltered annuities.
4. The entire interest of the Owner must be distributed to the Owner not later
than the first day of April following the calendar year in which the Owner
attains age 70 1/2; or it must be applied not later than the first day of
April following the calendar year in which the Owner attains age 70 1/2 to
the First, Second, Third or Sixth Payment Option of the Contract for:
a. The life of the Owner or the lives of the Owner and named Payee: or
b. A period which is not longer than the life expectancy of the Owner or
the joint life and last survivor expectancy of the Owner and the named
Payee.
If the Owner is an employee under a church plan, distribution can begin on
the date the Owner retires even if it is later than the first day of April
following the calendar year in which the Owner attains age 70 1/2.
Life expectancy means the relevant factor in Table V of Section 1.72-9 of
the regulations of the Code; and, joint and last survivor expectancy means
the relevant factor Table VI of Section 1.72-9 of the regulations of the
Code.
In no event will the payments under the Payment Option selected by the
Owner be less than the minimum distribution amount and/or the incidental
benefit amount required under Section 401(a)(9) of the Code is applied to
tax-sheltered annuities.
5. If none of the above Payment Options is elected, the Owner can request a
systematic withdrawal from the Contract except that such annual withdrawal
<PAGE>
amount must be at least an amount equal to the Contract Value divided by
the life expectancy of the Owner or the joint life and last survivor
expectancy of the Owner and named Payee.
6. If the Owner dies before distribution of his or her interest starts, the
Death Proceeds must be distributed in accordance with one of the following
rules.
a. The Death Proceeds must be paid within 5 years after the death of the
Owner; or
b. If the Beneficiary is an individual, the Beneficiary can elect a lump
sum payment or any Payment Option listed in 4 above, with an Option
Date not later than 1 year after the death of the Owner; or
c. If the Beneficiary is the surviving spouse of the Owner, the
Beneficiary: can elect payments under (b); or can elect the Fourth
Payment Option for a period which ends prior to the date on which the
Owner would have attained age 70 1/2; and can elect any Payment Option
listed in 4 above, with an Option Date not later than the date on
which the Owner would have attained age 70 1/2; or effect an
individual Retirement Annuity rollover.
<PAGE>
P-958-88
Endorsement: Tax-Sheltered Annuity
As of January 1, 1989, this Endorsement is added to the Contract.
In order to qualify this Contract as a Tax-Sheltered Annuity under Section
403(b) of the Internal Revenue Code, (the "Code"), the following restrictions
apply.
1. The Owner of the Contract is the Annuitant; and the Owner of the Contract
CANNOT be changed.
2. Unless otherwise notified by you or your Tax-Sheltered Annuity sponsor, the
Company will treat the purchase payments made to this Contract as
contributions within the permissible limitations of Sections 403(b)(2) and
(10) of the code.
3. The Company will accept Purchase Payments resulting from qualified
rollovers and transfers from other tax-sheltered annuities.
4. The entire interest of the Owner must be distributed to the Owner not later
than the first day of April following the calendar year in which the Owner
attains age 70 1/2; or it must be applied not later than the first day of
April following the calendar year in which the Owner attains age 70 1/2 to
the First, Second, Third or Sixth Payment Option of the Contract for:
a. The life of the Owner or the lives of the Owner and named Payee: or
b. A period which is not longer than the life expectancy of the Owner or
the joint life and last survivor expectancy of the Owner and the named
Payee.
If the Owner is an employee under a church plan or a governmental plan,
distribution can begin on the date the Owner retires even if it is later
than the first day of April following the calendar year in which the Owner
attains age 70 1/2.
Life expectancy means the relevant factor in Table V of Section 1.72-9 of
the regulations of the Code; and, joint and last survivor expectancy means
the relevant factor Table VI of Section 1.72-9 of the regulations of the
Code.
In no event will the payments under the Payment Option selected by the
Owner be less than the minimum distribution amount and/or the incidental
benefit amount required under Section 401(a)(9) of the Code as applied to
tax-sheltered annuities.
5. If none of the above Payment Options is elected, the Owner can request a
systematic withdrawal from the Contract except that such annual withdrawal
amount must be at least an amount equal to the Contract Value divided by
the life
<PAGE>
expectancy of the Owner or the joint life and last survivor expectancy of
the Owner and named Payee.
6. If the Owner dies before distribution of his or her interest starts, the
Death Proceeds must be distributed in accordance with one of the following
rules.
a. The Death Proceeds must be paid within 5 years after the death of the
Owner; or
b. If the Beneficiary is an individual, the Beneficiary can elect a lump
sum payment or any Payment Option listed in 4 above, with an Option
Date not later than 1 year after the death of the Owner; or
c. If the Beneficiary is the surviving spouse of the Owner, the
Beneficiary: can elect payments under (b); or can elect the Fourth
Payment Option for a period which ends prior to the date on which the
Owner would have attained age 70 1/2, and can elect any Payment Option
listed in 4 above, with an Option Date not later than the date on
which the Owner would have attained age 70 1/2, or effect an
individual Retirement Annuity rollover.
<PAGE>
Exhibit (6)(iv)
P-624-88
Endorsement: Individual Retirement Annuity
As of the Date of Issue of this Contract, this Endorsement is added to the
Contract. In the event of a conflict between this Endorsement and the Contract,
the provisions of the Endorsement will control.
In order to qualify this contract as an Individual Retirement Annuity under
Section 408(b) of the Internal Revenue Code, (the "Code"), the following
restrictions apply.
1. The Owner of the Contract is the Annuitant; and the Owner of the CANNOT be
changed. The Contract is for the exclusive benefit of the Owner or the
named Beneficiary.
2. Although this Contract in a Flexible Purchase Payment Contract, total
purchase payments for any taxable year CANNOT exceed $2,000, except in the
case of a rollover as permitted by the Code or a purchase payment in
accordance with a Simplified Employee Pension Program as described in
Section 408(k) of the Code. Purchase payments must be in cash.
3. The payment of dividends, if any, will be applied to the purchase of
additional benefits before the end of the calendar year following the
declaration of dividends under this Contract. Any refund of purchase
payments (other than those attributable to excess contributions) will be
applied, before the close of the calendar year following the year of the
refund, toward the payment or future purchase payments or the purchase of
additional benefits.
4. The entire interest of the Owner must be distributed to the Owner not later
than the first day of April following the calendar year in which the Owner
attains age 70 1/2; or it must be applied not later than the first day of
April following the calendar year in which the Owner attains age 70 1/2 to
the First, Second, Third or Sixth Payment Option of the Contract for:
(a) The life of the Owner or the lives of the Owner and named Payee; or
(b) A period which is not longer than the life expectancy of the Owner or
the Joint and last survivor expectancy of the Owner and the named
Payee.
Life expectancy and joint and last survivor expectancy are computed by use
of the return multiples contained in section 1.72-9 of the Income Tax
Regulations. For purposes of this computation, the Owner's life expectancy
may be recalculated no more frequently than annually; however, the life
expectancy of a non-spouse Beneficiary may not be recalculated.
<PAGE>
In no event will the payments under the Payment Option selected by the
Owner be less than the minimum distribution amount and/or the incidental
benefit amount required under Section 401(a)(9) of the Code as applied to
individual retirement annuities.
5. If the Owner's entire interest is to be distributed in other than a lump
sum, then the amount to be distributed each year (commencing with the
required beginning date and each year thereafter) must be at least an
amount equal to the quotient obtained by dividing the Owner's entire
interest by the life expectancy of the Owner or joint and last survivor
expectancy of the Owner and Beneficiary.
6. If the Owner dies before distribution of his or her interest starts, the
Death Proceeds must be distributed in accordance with one of the following
rules:
(a) The Death Proceeds must be paid within 5 years after the death of the
Owner; or
(b) If the Owner's interest is payable to a Beneficiary designated by the
Owner and the Owner has not elected (a) above, then the entire
interest will be distributed in substantially equal installments over
the life or life expectancy of the Beneficiary commencing no later
than one (1) year after the date of the Owner's death. The
Beneficiary may elect at any time to receive greater payments. If the
Beneficiary is an individual, the Beneficiary can elect any Payment
Option listed in 4 above, with an option Date not later than 1 year
after the death of the Owner; or
(c) If the Beneficiary is the Owner's surviving spouse, the spouse may
elect within the five year period commencing with the Owner's date of
death to receive equal or substantially equal payments over the life
or life expectancy of the surviving spouse a commencing at any date
prior to the date on which the deceased Owner would have attained age
70 1/2. The surviving spouse may accelerate these payments at any
time by increasing the frequency or amount of such payments. If the
Beneficiary is the surviving spouse of the Owner, the Beneficiary:
can elect the Fourth Payment Option for a period which ends prior to
the date on which the Owner would have attained age 70 1/2; and can
elect any Payment Option listed in 4 above, with an Option Date not
later than the date on which the Owner would have attained age 70 1/2.
(d) If the Beneficiary is the surviving spouse of the Owner, the
Beneficiary can treat the Contract as his or her own individual
retirement arrangement by making a rollover from the contract.
-1-
<PAGE>
(e) If the surviving spouse of the Owner is not the Beneficiary the
method of distribution selected must assure that at least 50% of the
present value of the amount available for distribution is paid within
the life expectancy of the Owner.
Payments will be calculated by use of the return multiples specified in
section 1.72-9 of the Income Tax Regulations. (Life expectancy of a
surviving spouse may be recalculated annually.) In the case of any other
Beneficiary, life expectancy will be calculated at the time payment first
commences and payments for any period of 12 consecutive months will be
based on such life expectancy minus the number of whole years passed since
distribution first commenced.
Any amount paid to a child of the Owner will be treated as if it had been
paid to the surviving spouse if the remainder of the interest becomes
payable to the surviving spouse when the child reaches the age of majority.
7. It the Owner dies after distribution of his or her interest has commenced,
the remaining portion of such interest will continue to be distributed at
least as rapidly as under the method of distribution being used prior to
the Owner's death.
8. The entire interest of the Owner is nonforfeitable and nontransferable.
9. The Company will furnish annual calendar year reports concerning the status
of this Contract.
10. In order to continue to qualify this Contract under Section 408(b) of the
Code, the Company can amend this Endorsement to reflect changes in the
provisions of the Code and related regulations by sending an amendment to
the Owner.
New England Mutual Life Insurance Company
501 Boylston Street, Boston, Massachusetts
President Secretary
-2-
<PAGE>
Exhibit 7
Part I - Application to New England Mutual Life Insurance Company for a Variable
Annuity
(Type A) __ Flexible Payment Deferred
(Type B) __ Single Purchase Payment Deferred
(Type C) __ Single Purchase Payment Immediate
On the Life of ________________________________________________
(Print name of Annuitant clearly as it should
appear in the contract)
Social Security No.
________________
1. Residence Address
(Street and Number) (City) (State and Zip Code)
________________________________________________________________________________
2. Business Address
(Street and Number) (City) (State and Zip Code)
________________________________________________________________________________
3. Place of Birth
(City) (State or Country)
________________________________
4. Citizen of
________________________________
5. Marital Status
__ Married
__ Single
__ Widowed
__ Divorced
__ Separated
6. Date of Birth
(Month) (Day) (Year)
__________________
(In Printed form this application will appear entirely on one sheet)
--------------------------------------------------------------------
<PAGE>
-2-
7. Sex
__ Male
__ Female
8. Is this variable annuity contract intended to replace, or result in the
change of, any mutual fund shares or any existing insurance policy or
annuity contract in this or any other company? (If YES, give details in
separate memo, including name of company)
__ YES __ NO
9. Basis of Variable Annuity Plan
__ Tax-Deferred Annuity for 501(c)(3) Organization
__ Tax-Deferred Annuity for Public School System
__ H.R.10 (Keogh Act)
__ Qualified Corporate Pension or Profit Sharing Plan
__ Non-Qualified Corporate Pension or Profit Sharing Plan
__ None of the above
10. Frequency of notices of purchase payment to be paid to Company
(Complete for Type A) __ Annual __ Semi-Annual __ Quarterly __ Monthly
__ Other (specify)
11. Amount
__ Amount to be paid to the Company according to the frequency
specified in Item No. 10 (purchase payment including any applicable
state premium tax plus premiums for any supplemental agreements
applied for) $ ________ (Type A)
__ Single Purchase Payment (including any applicable state
premium tax) $________ (Type B or C)
12. Maturity Date (Type A or B) or date of first payment to Annuitant (Type C)
___________________________________
13. Variable Payment Option (To Annuitant)
__ Life Income, Non-Refund
__ Life Income, ___ Years Certain (specify 10 or 20)
__ Life Income, Certain Period of number of months equal to net amount
applied under this option divided by amount of first monthly payment
__ Joint Income (specify only if Type C) with
__ Two-thirds income to survivor, Non-Refund
__ Full income to survivor, Non-Refund
__ Full income to survivor, 10 Years Certain
<PAGE>
-3-
NOTE: Payments to Annuitant to be monthly with an assumed interest rate of
3 1/2%, unless otherwise specified in Item No. 20. For Type A or B,
Variable Payment Option to be Life Income, 10 Years Certain, unless
otherwise specified above.
14. Address for Payments to Annuitant (Complete for Type C only)
__ Annuitant at residence __ Annuitant at business
15. Secondary Annuitant
(Complete only for Type C with a Joint Variable Payment Option)
Name Relationship to Primary Annuitant
(Print name clearly as it should appear in the contract)
Date of Birth Sex Social Security Number
__________________ ____ ______________________
(Month) (Day) (Year)
16. Disability benefit supplemental agreement (available for Type A only)
__ Check if desired and answer questions below with respect to Annuitant:
a. Are any other negotiations for disability insurance pending or
contemplated? (If YES, give details in separate memo) __ YES __ NO
b. Does Annuitant plan any travel or residence outside U.S.A.? (If YES,
give details in separate memo) __ YES __ NO
c. Has Annuitant within 5 years participated in scuba-diving, skydiving,
any form of motor racing, or any other hazardous avocations, or does
he plan to take part in such activities? (If YES, complete Avocation
Questionnaire) __ YES __ NO
d. Occupation (be explicit)
17. Beneficiary (Do not complete for Type C with a Non-Refund Payment Option)
Name Relationship to Annuitant
(1) Primary
(2) Secondary
__ Issue-with "Provision for Issue" of each deceased
Class ______________ beneficiary. This provision
(Insert 1 or 2)
will be effective only if the box is checked.
<PAGE>
-4-
18. Is Annuitant to own the contract? __ YES __ NO
If NO, complete for owner:
Name Social Security or
Employer Ident. No.
_______________________
Address
(Street and Number) (City) (State and Zip Code)
_______________________________________________________________
19. Address for purchase payment notices. (Complete for Type A
only)
__ Annuitant at residence __ Annuitant at business __ Owner
__ Other (Give name and address)
20. Special Requests
21. Reserve for Home Office Use for Additions and Amendments
22. Amount paid with this application $ ________________ (Including premium
for any supplemental agreements applied for)
The undersigned agree as follows: (1) the foregoing information is true and
complete and is correctly recorded to our best knowledge and belief; (2) this
application, including Part II if required (in which event the date of this
application shall be the latest of Part I and Part II of the Application and the
Report of the Medical Examiner), a copy of which shall be attached to the
contract when issued, shall become a part of any contract issued hereunder; (3)
acceptance of the contract shall constitute ratification of any and all changes
noted by the Company under "Additions and Amendments", except that, in those
jurisdictions where written consent is required by statute or regulation, no
change shall be made as to type of annuity, amount, benefits or rate
classification unless agreed to in writing by the undersigned; (4) the variable
annuity contract including all supplemental agreements applied for shall take
effect on the latest of the date of this application, the date the initial
purchase payment and the initial premium for any such supplemental agreements
are paid, and such date of issue as may be requested, provided that as of the
date of this application the contract including all supplemental agreements can
be issued as applied for according to the underwriting rules of the Company and
provided with respect to any such supplemental agreements involving an insurance
risk that as of the date of such payment there has been no change in the
insurability of the Annuitant since the date of this application; (5) the
initial purchase payment shall be credited as of the latest of the date of
receipt thereof at the Home Office, the date this application is approved by the
Home Office, and such date of issue as may be requested.
<PAGE>
-5-
IT IS UNDERSTOOD THAT ANNUITY PAYMENTS AND ANY OTHER VALUES PROVIDED BY THE
CONTRACT, WHEN BASED ON THE INVESTMENT PERFORMANCE OF A SEPARATE INVESTMENT
ACCOUNT, ARE VARIABLE AND ARE NOT GUARANTEED AS TO DOLLAR AMOUNT.
I acknowledge receipt of a prospectus dated _____________________ offering the
variable annuity contract applied for.
Signed at ____________________________ Date ________ 19___
(City and State)
Agent _______________________________________________
_____________________________________________________ Annuitant
Sign name in full
_____________________________________________________ Applicant
Sign name in full (If other than Annuitant)
RECEIPT - DO NOT DESTROY
RECEIVED ______________________ dollars in connection with an application to New
England Mutual Life Insurance Company for a variable annuity contract on the
life of ____________________________________.
The Company will refund the amount of this receipt if (1) the applicant so
requests before the issuance of the contract; or (2) outstanding requirements
prevent the Company from completing its underwriting within 60 days of the date
of the application; or (3) the application is declined by the Company.
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Countersigned _________________ 19__
_______________________ ____________________________
Agent Secretary
VARIABLE ANNUITY SUITABILITY QUESTIONNAIRE
Agents and brokers are required by the regulatory authorities to make inquiries
relating to the financial condition and retirement resources of annuitants under
variable annuity contracts in order that the Company may make an informed
judgment as to the suitability for a particular annuitant of the variable
annuity applied for.
These questions are to be answered by the Annuitant only.
<PAGE>
-6-
1. Assets:
Stocks, Mutual Funds, etc. $
Cash, Bonds, Savings $
Variable annuity cash values $
Fixed annuity and life insurance cash
values $
Homes, Other Real Estate $
Other $
2. Amount of Life Insurance: $
3. Earned Annual Income: $
4. Other annual income (including income of dependents):
$ Source:
$ Source:
$ Source:
5. Liabilities:
Mortgage $
Bank Loans $
Other $
6. Dependents:
Age Relationship
7. Purpose of variable annuity contract applied for:
__ Retirement Income
__ Other (specify)
8. Is the variable annuity contract to be purchased by proceeds of an
insurance policy or annuity contract? (If YES, give details in separate
memo) __ YES __ NO
9. Retirement Income:
Monthly fixed dollar income at retirement (including Social Security,
employee pensions, annuities, permanent life insurance): $_______________
Total yearly purchase payments for any variable annuities (excluding
contract applied for under this application): $__________________
<PAGE>
-7-
10. Is the Applicant employed by or associated with a member of the National
Association of Securities Dealers, Inc. (NASD) __ YES __ NO
11. Remarks:
EVIDENCE OF DATE OF BIRTH
No payment will be made under payment options involving life contingencies until
satisfactory evidence of date of birth of the payee(s) has been provided. The
best time to obtain such evidence is when the application is taken. Single
payment immediate contracts (Type C) will not be issued without such evidence.
The following items, listed in order of preference, may be presented as evidence
of date of birth. Indicate enclosures for the Annuitant in column (1) and for
the Secondary Annuitant, if any, in column (2).
(1) (2)
___ ___ A certificate of birth recorded within one year of birth.
___ ___ A certificate of infant baptism recorded within one year of birth.
Special Affidavit Form UND-55 and one of the following:
---
___ ___ A certificate of birth recorded later than one year after birth.
___ ___ A certificate of infant baptism recorded later than one year after
birth.
___ ___ A certified copy of the page of the family register or birth which
is frequently kept in the family Bible.
___ ___ A school record made at an early age.
___ ___ A confirmation record.
___ ___ A naturalization record.
___ ___ A passport at least five years old.
___ ___ A military or naval discharge paper.
___ ___ A life insurance record under a policy issued at least five years
ago.
___ ___ Where none of the foregoing are available, an old record or an
affidavit from an older member of the immediate family.
AGENT'S CERTIFICATE
1. Expected Purchase Payments:
First taxable year $_____________
Subsequent taxable years $_____________
<PAGE>
-8-
2. Annuitant's annual salary from "qualified" employer (after any salary
reduction agreement) $______________
3. Total employer contributions to TSA or other retirement plans excludable
from employee's gross income:
Current year $__________
Prior years $__________
4. If tax deferred annuity for public school system or 501(c)(3) organization:
Date Hired ____________________
Expected Retirement Date ___________________
Maximum Level Annual Exclusion Allowance, if known: $_______________
5. Does Annuitant appear to be in good health and to be mentally competent?
(If NO, give details in separate memo) __ YES __ NO
6. Do you have knowledge or reason to believe that replacement of any security
or any existing insurance or annuity may be involved? __ YES __ NO
7. Sale resulted from
__ NEL Policyholder
__ Referred Lead
__ Direct Mail Reply
__ Other (specify)
8. Education
__ High School
__ Attended College
__ College Graduate
__ Graduate School
9. Mortgage on Home?
__ YES
__ NO
__ Renter
10. Occupation (Be specific)
11. County of Residence
<PAGE>
-9-
12. Are you licensed to sell variable annuities in the state in which this
application was written?
___ Through NELESCO
___ Through Other Broker-Dealer (Complete the following)
___________________________ _________________________________
Name of Broker-Dealer Signature of Registered Principal
I certify that a prospectus was delivered and that no written sales materials
were used in connection with the solicitation of this application other than
those furnished by NELESCO.
_____________ ____________________________
Date Signature of Agent
Accepted for the Company at the Home Office
By: __________________ Date: __________
AGENT'S IDENTIFICATION PLATE
Primary Agent's Name Agent's Code Number %
_________
Agency Code No. Agent's Classif. Non-Med. Priv.
Date of Contract Type of Contract
%
_________
Other Agents (if any)
%
_________
If not a N.E.L. agent, please distinguish under Agent's Classification between
broker and agent of other company using Code 4 for broker and Code 5 for A.O.C.
<PAGE>
Exhibit 7
Part I - Application to New England Mutual Life Insurance Company for a Variable
Annuity
(Type A) __ Flexible Payment Deferred
(Type B) __ Single Purchase Payment Deferred
(Type C) __ Single Purchase Payment Immediate
On the Life of ________________________________________________
(Print name of Annuitant clearly as it should
appear in the contract)
Social Security No.
___________________
1. Residence Address
(Street and Number) (City) (State and Zip Code)
________________________________________________________________________________
2. Business Address
(Street and Number) (City) (State and Zip Code)
________________________________________________________________________________
3. Place of Birth
(City) (State or Country)
_____________________________________________
4. Citizen of
_____________________________________________
5. Marital Status
__ Married
__ Single
__ Widowed
__ Divorced
__ Separated
6. Date of Birth
(Month) (Day) (Year)
______________________________
(In printed form this application will appear entirely on one sheet)
--------------------------------------------------------------------
<PAGE>
-2-
7. Sex
__ Male
__ Female
8. Is this variable annuity contract intended to replace, or result in the
change of, any mutual fund shares or any existing insurance policy or
annuity contract in this or any other company? (If YES, give details in
separate memo, including name of company)
__ YES __ NO
9. Basis of Variable Annuity Plan
__ Tax-Deferred Annuity for 501(c)(3) Organization
__ Tax-Deferred Annuity for Public School System
__ H.R.10 (Keogh Act)
__ Qualified Corporate Pension or Profit Sharing Plan
__ Non-Qualified Corporate Pension or Profit Sharing Plan
__ None of the above
10. Frequency of notices of purchase payment to be paid to Company (Complete
for Type A)
__ Annual __ Semi-Annual __ Quarterly __ Monthly
__ Other (specify)
11. Amount
__ Amount to be paid to the Company according to the frequency
specified in Item No. 10 (purchase payment including any applicable
state premium tax plus premiums for any supplemental agreements
applied for)
$ ________ (Type A)
__ Single Purchase Payment (including any applicable state premium tax)
$________ (Type B or C)
12. Maturity Date (Type A or B) or date of first payment to Annuitant
(Type C)
____________________________________
13. Variable Payment Option (To Annuitant)
__ Life Income, Non-Refund
__ Life Income, ___ Years Certain (specify 10 or 20)
__ Life Income, Certain Period of number of months equal to net amount
applied under this option divided by amount of first monthly payment
__ Joint Income (specify only if Type C) with
__ Two-thirds income to survivor, Non-Refund
__ Full income to survivor, Non-Refund
__ Full income to survivor, 10 Years Certain
<PAGE>
-3-
NOTE: Payments to Annuitant to be monthly with an assumed interest rate
of 3 1/2%, unless otherwise specified in Item No. 20. For Type A or B,
Variable Payment Option to be Life Income, 10 Years Certain, unless
otherwise specified above.
14. Address for Payments to Annuitant (Complete for Type C only)
__ Annuitant at residence __ Annuitant at business
15. Secondary Annuitant
(Complete only for Type C with a Joint Variable Payment Option)
Name Relationship to Primary Annuitant
(Print name clearly as it should appear in the contract)
Date of Birth Sex Social Security Number
____________________ ____ ______________________
(Month) (Day) (Year)
16. Disability benefit supplemental agreement (available for Type A only)
__ Check if desired and answer questions below with respect to Annuitant:
a. Are any other negotiations for disability insurance pending or
contemplated?
(If YES, give details in separate memo) __ YES __ NO
b. Does Annuitant plan any travel or residence outside U.S.A.?
(If YES, give details in separate memo) __ YES __ NO
c. Has Annuitant within 5 years participated in scuba-diving,
skydiving, any form of motor racing, or any other hazardous
avocations, or does he plan to take part in such activities?
(If YES, complete Avocation Questionnaire) __ YES __ NO
d. Occupation (be explicit)
17. Beneficiary (Do not complete for Type C with a Non-Refund Payment Option)
Name Relationship to Annuitant
(1) Primary
(2) Secondary
__ Issue-with "Provision for Issue" of each deceased
Class _______________ beneficiary. This provision
(Insert 1 or 2)
will be effective only if the box is checked.
<PAGE>
-4-
18. Is Annuitant to own the contract? __ YES __ NO
If NO, complete for owner:
Name Social Security or
Employer Ident. No.
Address ____________________________
(Street and Number) (City) (State and Zip Code)
____________________________________________________________
19. Address for purchase payment notices. (Complete for Type A only)
__ Annuitant at residence __ Annuitant at business __ Owner
__ Other (Give name and address)
20. Special Requests
21. Reserve for Home Office Use for Additions and Amendments
22. Amount paid with this application $ ________________
(Including premium for any supplemental agreements applied for)
The undersigned agree as follows: (1) the foregoing information is true and
complete and is correctly recorded to our best knowledge and belief; (2) this
application, including Part II if required (in which event the date of this
application shall be the latest of Part I and Part II of the Application and the
Report of the Medical Examiner), a copy of which shall be attached to the
contract when issued, shall become a part of any contract issued hereunder; (3)
acceptance of the contract shall constitute ratification of any and all changes
noted by the Company under "Additions and Amendments", except that, in those
jurisdictions where written consent is required by statute or regulation, no
change shall be made as to type of annuity, amount, benefits or rate
classification unless agreed to in writing by the undersigned; (4) the variable
annuity contract including all supplemental agreements applied for shall take
effect on the latest of the date of this application, the date the initial
purchase payment and the initial premium for any such supplemental agreements
are paid, and such date of issue as may be requested, provided that as of the
date of this application the contract including all supplemental agreements can
be issued as applied for according to the underwriting rules of the Company and
provided with respect to any such supplemental agreements involving an insurance
risk that as of the date of such payment there has been no change in the
insurability of the Annuitant since the date of this application; (5) the
initial purchase payment shall be credited as of the latest of the date of
receipt thereof at the Home Office, the date this application is approved by the
Home Office, and such date of issue as may be requested.
<PAGE>
-5-
IT IS UNDERSTOOD THAT ANNUITY PAYMENTS AND ANY OTHER VALUES PROVIDED BY THE
CONTRACT, WHEN BASED ON THE INVESTMENT PERFORMANCE OF A SEPARATE INVESTMENT
ACCOUNT, ARE VARIABLE AND ARE NOT GUARANTEED AS TO DOLLAR AMOUNT.
I acknowledge receipt of a prospectus dated _____________________ offering the
variable annuity contract applied for.
Signed at ____________________________ Date ________ 19___
(City and State)
Agent _______________________________________________
_______________________________________________ Annuitant
Sign name in full
_______________________________________________ Applicant
Sign name in full (If other than Annuitant)
RECEIPT - DO NOT DESTROY
RECEIVED ______________________ dollars in connection with an application to New
England Mutual Life Insurance Company for a variable annuity contract on the
life of ____________________________________.
NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY
Countersigned _________________ 19__
___________________________ ___________________________
Agent Secretary
VARIABLE ANNUITY SUITABILITY QUESTIONNAIRE
Agents and brokers are required by the regulatory authorities to make inquiries
relating to the financial condition and retirement resources of annuitants under
variable annuity contracts in order that the Company may make an informed
judgment as to the suitability for a particular annuitant of the variable
annuity applied for.
These questions are to be answered by the Annuitant only.
<PAGE>
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1. Assets:
Stocks, Mutual Funds, etc. $
Cash, Bonds, Savings $
Variable annuity cash values $
Fixed annuity and life insurance cash
values $
Homes, Other Real Estate $
Other $
2. Amount of Life Insurance: $
3. Earned Annual Income: $
4. Other annual income (including income of dependents):
$ Source:
$ Source:
$ Source:
5. Liabilities:
Mortgage $
Bank Loans $
Other $
6. Dependents:
Age Relationship
7. Purpose of variable annuity contract applied for:
__ Retirement Income
__ Other (specify)
8. Is the variable annuity contract to be purchased by proceeds of an
insurance policy or annuity contract? (If YES, give details in separate
memo) __ YES __ NO
9. Retirement Income:
Monthly fixed dollar income at retirement (including Social Security,
employee pensions, annuities, permanent life insurance): $ ______________
Total yearly purchase payments for any variable annuities (excluding
contract applied for under this application): ): $ ___________________
<PAGE>
-7-
10. Is the Applicant employed by or associated with a member of the National
Association of Securities Dealers, Inc. (NASD) __ YES __ NO
11. Remarks:
EVIDENCE OF DATE OF BIRTH
No payment will be made under payment options involving life contingencies until
satisfactory evidence of date of birth of the payee(s) has been provided. The
best time to obtain such evidence is when the application is taken. Single
payment immediate contracts (Type C) will not be issued without such evidence.
The following items, listed in order of preference, may be presented as evidence
of date of birth. Indicate enclosures for the Annuitant in column (1) and for
the Secondary Annuitant, if any, in column (2).
(1) (2)
__ __ A certificate of birth recorded within one year of birth.
__ __ A certificate of infant baptism recorded within one year of birth.
Special Affidavit Form UND-55 and one of the following:
---
__ __ A certificate of birth recorded later than one year after birth.
__ __ A certificate of infant baptism recorded later than one year after
birth.
__ __ A certified copy of the page of the family register or birth which is
frequently kept in the family Bible.
__ __ A school record made at an early age.
__ __ A confirmation record.
__ __ A naturalization record.
__ __ A passport at least five years old.
__ __ A military or naval discharge paper.
__ __ A life insurance record under a policy issued at least five years ago.
__ __ Where none of the foregoing are available, an old record or an
affidavit from an older member of the immediate family.
AGENT'S CERTIFICATE
1. Expected Purchase Payments:
First taxable year $_____________
Subsequent taxable years $_____________
<PAGE>
-8-
2. Annuitant's annual salary from "qualified" employer (after any salary
reduction agreement) $_________
3. Total employer contributions to TSA or other retirement plans excludable
from employee's gross income:
Current year $_____________
Prior years $_____________
4. If tax deferred annuity for public school system or 501(c)(3)
organization:
Date Hired ____________________
Expected Retirement Date ___________________
Maximum Level Annual Exclusion Allowance, if known: $_______________
5. Does Annuitant appear to be in good health and to be mentally competent?
(If NO, give details in separate memo) __ YES __ NO
6. Do you have knowledge or reason to believe that replacement of any
security or any existing insurance or annuity may be involved?
__ YES __ NO
7. Sale resulted from
__ NEL Policyholder
__ Referred Lead
__ Direct Mail Reply
__ Other (specify)
8. Education
__ High School
__ Attended College
__ College Graduate
__ Graduate School
9. Mortgage on Home?
__ YES
__ NO
__ Renter
10. Occupation (Be specific)
11. County of Residence
<PAGE>
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12. Are you licensed to sell variable annuities in the state in which this
application was written?
__ Through NELESCO
__ Through Other Broker-Dealer (Complete the following)
_____________________ _________________________________
Name of Broker-Dealer Signature of Registered Principal
I certify that a prospectus was delivered and that no written sales materials
were used in connection with the solicitation of this application other than
those furnished by NELESCO.
_________________ ___________________________________
Date Signature of Agent
Accepted for the Company at the Home Office
By: _________________________ Date: _____________
AGENT'S IDENTIFICATION PLATE
Primary Agent's Name Agent's Code Number
_________%
Agency Code No. Agent's Classif. Non-Med. Priv.
Date of Contract Type of Contract
_________%
Other Agents (if any)
_________%
If not a N.E.L. agent, please distinguish under Agent's Classification between
broker and agent of other company using Code 4 for broker and Code 5 for A.O.C.
<PAGE>
Exhibit 7
Part I - Application to New England Mutual Life Insurance Company for a Variable
Annuity
(Type A) __ Flexible Payment Deferred
(Type B) __ Single Purchase Payment Deferred
(Type C) __ Single Purchase Payment Immediate
On the Life of ________________________________________________
(Print name of Annuitant clearly as it should
appear in the contract)
Social Security No.
________________
1. Residence Address
(Street and Number) (City) (State and Zip Code)
________________________________________________________________________________
2. Business Address
(Street and Number) (City) (State and Zip Code)
________________________________________________________________________________
3. Place of Birth
(City) (State or Country)
________________________________
4. Citizen of
________________________________
5. Marital Status
__ Married
__ Single
__ Widowed
__ Divorced
__ Separated
6. Date of Birth
(Month) (Day) (Year)
__________________
<PAGE>
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7. Sex
__ Male
__ Female
8. Is this variable annuity contract to replace any existing insurance policy
or annuity contract in this or any other company? (If YES, give name of
company)
__ YES __ NO
9. Is this Variable Annuity Contract to be purchased by proceeds of insurance
in this or any other Company? (If YES, give name of company)
YES ____ NO _____
10. Basis of Variable Annuity Plan
__ Tax-Deferred Annuity for 501(c)(3) Organization
__ Tax-Deferred Annuity for Public School System
__ H.R.10 (Keogh Act)
__ Qualified Corporate Pension
__ Non-Qualified Corporate Pension
__ None of the above
11. Is Contract to be made non-transferable except to N.E. Life?
___Yes ___NO
12. Amount of purchase payments to Company (excluding rider premiums)
Normal Annual Contribution _____________(Type A)
Single Payment ______________________(Type B or C)
13. Frequency of purchase payment notices (Complete for Type A)
__ Annual __ Semi-Annual __ Quarterly __ Monthly
__ Other (Specify)
14. Date of First Payment to Annuitant (Type C) or Maturity Date (Type A or B)
_______________________
15. Variable Payment Option (To Annuitant)
__ Life Income, Non-Refund
__ Life Income, ___ Years Certain
__ Life Income, Certain Period of number of months equal to net
amount applied under this option divided by amount of first
monthly payment
__ Joint Income (specify only if Type C) with
__ Two-thirds income to survivor, Non-Refund
__ Full income to survivor, Non-Refund
__ Full income to survivor, 10 Years Certain
__ Other (Specify)
<PAGE>
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16. Frequency of payments to Annuitant to be monthly and Assumed Interest Rate
to be 3 1/2% unless otherwise specified in Item No. 23.
17. Secondary Annuitant
(Complete only for Type C with a Joint Variable Payment Option)
Name
___________________________________________________________
(Print name clearly as it should appear in the contract)
Date of Birth Sex Social Security Number
__________________ ____ ___________________
(Month) (Day) (Year)
18. Disability waiver (available for Type A only)
__ Check if desired and answer questions below:
a. Occupation (be explicit)
b. Are any other negotiations for disability pending or contemplated? (If
YES, give details in separate memo) __ YES __ NO
c. Does proposed Annuitant plan any travel or residence outside U.S.A.?
(If YES, give details in separate memo) __ YES __ NO
d. Has proposed Annuitant within 5 years participated in scuba-diving,
skindiving, any form of motor racing, or any other hazardous
avocations, or does he plan to take part in such activities? (If YES,
complete Avocation Questionnaire) ___ YES ___ NO
19. Beneficiary (Do not complete for Type C with a Non-Refund Variable Payment
Option)
Name Relationship to Annuitant
(1) Primary:
(2) Secondary:
__ Issue-with "Provision for Issue" of each deceased
Class ______________ beneficiary. This provision
(Insert 1or 2)
will be effective only if the box is checked.
<PAGE>
-4-
20. Is Annuitant to own the contract? __ YES __ NO
If not, complete for owner:
Name Social Security or
Employer Ident. No.
Address
_____________________
(Street and Number) (City) (State and Zip Code)
__________________________________________________________
21. Address for purchase payment notices. (Complete for Type A only)
__ Annuitant at residence __ Annuitant at business __ Owner
__ Other (Give name and address)
22. Address for annuity payments (Complete for Type C only)
__ Annuitant at Residence ___ Annuitant at Business
23. Special Requests
24. Reserve for Home Office Use for Additions and Amendments
25. $ _______________ paid Agent on ____________________
Date
The foregoing information is true and complete and is correctly recorded to the
best knowledge and belief of the applicant(s). It is hereby agreed that this
application, including all Parts II if required, a copy of which shall be
attached to the contract when issued, shall become part of any contract issued
hereunder; that acceptance of the contract shall constitute ratification of any
and all changes noted by the Company under "Additions and Amendments," except
that, in those jurisdictions where written consent is required by statute or
insurance department regulation, no change shall be made as to type of annuity,
amount, benefit or rate classification unless agreed to in writing by the
applicant(s); that the variable annuity and any rider applied for shall take
effect only upon payment of the first purchase payment and the premium for any
such rider and provided that at the time of such payment this application has
been approved by the Company at its Home Office and, provided that, if any rider
is applied for, there has been no change in the insurability of the annuitant
since the date hereof.
It is understood that all payments and values provided by the contract, when
based on the investment performance of a separate investment account, are
variable and are not guaranteed as to dollar amount
<PAGE>
-5-
I acknowledge receipt of a prospectus dated _____________________ for an
Individual variable annuity contract.
Signed at ____________________________ ___________________________ Annuitant
(City and State) Sign name in full
Date ________________________ ______________________________ Applicant
Sign name in full (If other than
Annuitant)
Variable Annuity Suitability Questionnaire
Agents and brokers are required to make inquiries relative to the financial
condition and retirement resources of annuitants who purchase variable annuity
contracts in order that the Company may make an informed judgment as to the
suitability of the variable annuity for each Annuitant. Annuitants are urged to
supply such information, but they are not required to do so. Those who do not
choose to answer such inquiries must sign item 10 below.
1. Other family members or dependents
Relationship Date of Birth
Name
2. Annuitant's Annual Earned Income
3. Annuitant's other income (amount and source)
4. Assets (show total dollar amounts):
__ Checking or Savings Acct.
__ Amount of Life Insurance
__ Savings Bonds
__ Stocks
__ Car
__ Home
5. Total Debts
6. Income of other family members (Describe)
7. Is Annuitant eligible for federal social security retirement benefits?
__ YES __ NO
8. Other retirement resources (include annuities, permanent life insurance and
pensions)
<PAGE>
-6-
9. Remarks
10. I understand that the agent is required to make inquiries in order that the
company may make an informed judgment as to the suitability of the variable
annuity as a medium for investment for retirement purposes. However, I do
not wish to answer such inquiries.
________________ ___________________________
(Date) (Signature of Annuitant)
Agent's Certificate
1. Does Annuitant appear to be in good health and to be mentally competent?
(If No, give details in separate memo) __ YES __ NO
2. Is this annuity contract to replace any existing insurance policy or
annuity contract? If Yes, give details in separate memo) __ YES __ NO
3. Are you licensed to sell variable annuities in the state in which this
application was written?
__ Through NELESCO
__ Other Broker-Dealer (Complete the following)
_____________________ ____________________________________
Name of Broker-Dealer Signature of Registered Principal
4. Sale resulted from
__ NEL Policyholder
__ Referred Lead
__ Direct Mail Reply
__ Other (specify)
5. Education
__ High School
__ Attended College
__ College Graduate
__ Graduate School
<PAGE>
-7-
6. Mortgage on Home?
__ YES
__ NO
__ Renter
7. Occupation (Be specific)
8. County of Residence
_____________ _______________
9. I certify that a prospectus was delivered and that no written sales
materials were used in connection with the solicitation of this application
other than those furnished by New England Life.
_________________ ___________________________________
Date Signature of Agent
Accepted for the Company at the Home Office
By: _________________________ Date: _____________
EVIDENCE OF DATE OF BIRTH
No payment will be made under payment options involving life contingencies until
satisfactory evidence of date of birth of the payee(s) has been provided. The
best time to obtain such evidence is when the application is taken. Single
payment immediate contracts (Type C) will not be issued without such evidence.
The following items, listed in order of preference, may be presented as evidence
of date of birth. Indicate enclosures for the Annuitant in column (1) and for
the Secondary Annuitant (shown in Item No. 17 of the Application) in column (2).
(1) (2)
__ __ A certificate of birth recorded within one year of birth.
__ __ A certificate of infant baptism recorded within one year of birth.
Special Affidavit Form UND-55 and one of the following:
---
__ __ A certificate of birth recorded later than one year after birth.
__ __ A certificate of infant baptism recorded later than one year after
birth.
__ __ A certified copy of the page of the family register of birth which is
frequently kept in the family Bible.
__ __ A school record made at an early age.
__ __ A confirmation record.
<PAGE>
-8-
__ __ A naturalization record.
__ __ A passport at least five years old.
__ __ A military or naval discharge paper.
__ __ A life insurance record under a policy issued at least five years
ago.
__ __ Where none of the foregoing are available, an old record or an
affidavit from an older member of the immediate family.
AGENT'S IDENTIFICATION PLATE
Primary Agent's Name Agent's Code Number
_________%
Date of Type of
Agency Code No. Agent's Classif. Non-Med. Priv. Contract Contract
_________%
Other Agents (if any)
_________%
If not a N.E.L. agent, please distinguish under Agent's Classification between
broker and agent of other company using Code 4 for broker and Code 5 for A.O.C.
u:\APPVAF-4.doc
