<PAGE> 1
File No. 33-62282
811-1978
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
Pre-Effective Amendment No. / /
Post-Effective Amendment No. 15 /X/
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 /X/
Amendment No. / /
(Exact Name of Registrant)
OHIO NATIONAL VARIABLE ACCOUNT A
(Name of Depositor)
THE OHIO NATIONAL LIFE INSURANCE COMPANY
(Address of Depositor's Principal Executive Offices)
One Financial Way
Cincinnati, Ohio 45242
(Depositor's Telephone Number)
(513) 794-6100
(Name and Address of Agent for Service)
Ronald L. Benedict, Corporate Vice President, Counsel and Secretary
The Ohio National Life Insurance Company
P.O. Box 237
Cincinnati, Ohio 45201
Notice to:
W. Randolph Thompson, Esq.
Of Counsel
Jones & Blouch L.L.P.
Suite 405 West
1025 Thomas Jefferson Street, N.W.
Washington, D.C. 20007
Approximate Date of Proposed Public Offering: As soon after the effective date
of this amendment as is practicable.
It is proposed that this filing will become effective (check appropriate space):
immediately upon filing pursuant to paragraph (b)
---
X on May 1, 2000 pursuant to paragraph (b)
---
60 days after filing pursuant to paragraph (a)(i)
---
on (date) pursuant to paragraph (a)(i) of Rule 485
---
If appropriate, check the following box:
___ this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE> 2
OHIO NATIONAL VARIABLE ACCOUNT A
<TABLE>
<CAPTION>
N-4 Item Caption in Prospectus
- -------- ---------------------
<S> <C>
1 Cover Page
2 Glossary of Special Terms
3 Not applicable
4 Not applicable
5 The Ohio National Companies
6 Deductions and Expenses
7 Description of Variable Annuity Contracts
8 Annuity Period
9 Death Benefit
10 Accumulation Period
11 Surrender and Partial Withdrawal
12 Federal Tax Status
13 Not applicable
14 Table of Contents
Caption in Statement of Additional Information
----------------------------------------------
15 Cover Page
16 Table of Contents
17 Not applicable
18 Custodian
Independent Certified Public Accountants
19 See Prospectus (Distribution of Variable Annuity Contracts)
Loans Under Tax-Sheltered Annuities
20 Underwriter
21 Calculation of Money Market Subaccount Yield
Total Return
22 See Prospectus (Annuity Period)
23 Financial Statements
</TABLE>
<PAGE> 3
Caption in Part C
<TABLE>
<S> <C>
24 Financial Statements and Exhibits
25 Directors and Officers of the Depositor
26 Persons Controlled by or Under Common Control with the Depositor or
Registrant
27 Number of Contractowners
28 Indemnification
29 Principal Underwriter
30 Location of Accounts and Records
31 Not applicable
32 Undertakings and Representations
</TABLE>
<PAGE> 4
PART A
PROSPECTUS
<PAGE> 5
PROSPECTUS
SINGLE PURCHASE PAYMENT
INDIVIDUAL VARIABLE ANNUITY CONTRACTS
OHIO NATIONAL VARIABLE ACCOUNTS A AND B
THE OHIO NATIONAL LIFE INSURANCE COMPANY
One Financial Way
Montgomery, Ohio 45242
Telephone (800) 366-6654
This prospectus offers variable annuity contracts allowing you to accumulate
values and paying you benefits on a variable and/or fixed basis.
Variable annuities provide contract values and lifetime annuity payments that
vary with the investment results of the Funds you choose. You cannot be sure
that the contract value or annuity payments will equal or exceed your purchase
payments.
The variable annuity contracts are designed for:
- - annuity purchase plans adopted by public school systems and certain tax-exempt
organizations described in Section 501(c)(3) of the Internal Revenue Code (the
"Code"), qualifying for tax-deferred treatment pursuant to Section 403(b) of
the Code,
- - other employee pension or profit-sharing trusts or plans qualifying for
tax-deferred treatment under Section 401(a), 401(k) or 403(a) of the Code,
- - individual retirement annuities qualifying for tax-deferred treatment under
Section 408 or 408A of the Code,
- - state and municipal deferred compensation plans and
- - non-tax-qualified plans.
The minimum purchase payment is $10,000. We may limit your purchase payment to
$1,500,000.
You may direct the allocation of your purchase payment to one or more (but not
more than 10 variable) subaccounts of Ohio National Variable Account A ("VAA")
for tax-qualified contracts or Ohio National Variable Account B ("VAB") for
non-tax-qualified contracts. VAA and VAB are separate accounts of The Ohio
National Life Insurance Company. The assets of VAA and VAB are invested in
shares of the Funds. The Funds are portfolios of Ohio National Fund, Inc., The
Dow Target Variable Fund LLC, Goldman Sachs Variable Insurance Trust, Janus
Aspen Series, Lazard Retirement Series, Inc., PBHG Insurance Series Fund, Inc.,
Strong Variable Insurance Funds, Inc. and Variable Insurance Products Fund
(Fidelity). See page 3 for the list of available Funds. See also the
accompanying prospectuses of the Funds. The Fund prospectuses might also contain
information about other funds that are not available for these contracts.
You may withdraw all or part of the contract's value before annuity payments
begin. You might incur federal income tax penalties for those early withdrawals.
We may charge you a surrender charge up to 6% of the amount withdrawn. You may
withdraw up to 10% of the contract value each year without this charge. Your
exercise of contract rights may be subject to the terms of your qualified
employee trust or annuity plan. This prospectus contains no information
concerning your trust or plan.
You may revoke the contract without penalty, within 20 days of receiving it (or
a longer period if required by state law).
KEEP THIS PROSPECTUS FOR FUTURE REFERENCE. IT SETS FORTH THE INFORMATION ABOUT
VAA, VAB AND THE VARIABLE ANNUITY CONTRACTS THAT YOU SHOULD KNOW BEFORE
INVESTING. ADDITIONAL INFORMATION ABOUT VAA AND VAB HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IN A STATEMENT OF ADDITIONAL INFORMATION
DATED MAY 1, 2000. WE HAVE INCORPORATED THE STATEMENT OF ADDITIONAL INFORMATION
BY REFERENCE. IT IS AVAILABLE UPON REQUEST AND WITHOUT CHARGE BY WRITING OR
CALLING US AT THE ABOVE ADDRESS. THE TABLE OF CONTENTS FOR THE STATEMENT OF
ADDITIONAL INFORMATION IS ON THE BACK PAGE OF THIS PROSPECTUS.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Form V-4822 MAY 1, 2000
<PAGE> 6
TABLE OF CONTENTS
<TABLE>
<S> <C>
Available Funds.......................... 3
Fee Table................................ 4
Accumulation Unit Values................. 8
Financial Statements................... 12
Ohio National............................ 12
Ohio National Life..................... 12
Ohio National Variable Accounts A and
B................................... 12
The Funds.............................. 13
Mixed and Shared Funding............... 13
Voting Rights.......................... 13
Distribution of Variable Annuity
Contracts.............................. 14
Deductions and Expenses.................. 14
Surrender Charge....................... 14
Deduction for Administrative
Expenses............................ 15
Deduction for Risk Undertakings........ 15
Transfer Fee........................... 15
Deduction for State Premium Tax........ 15
Fund Expenses.......................... 15
Description of Variable Annuity
Contracts.............................. 16
Free Look.............................. 16
Accumulation Period...................... 16
Purchase Payment....................... 16
Accumulation Units..................... 16
Crediting Accumulation Units........... 16
Allocation of Purchase Payments........ 16
Accumulation Unit Value and Contract
Value............................... 16
Net Investment Factor.................. 17
Surrender and Partial Withdrawal....... 17
Transfers among Subaccounts............ 17
Scheduled Transfers (Dollar Cost
Averaging).......................... 18
TeleAccess............................. 18
Death Benefit.......................... 19
Guaranteed Account..................... 19
Ohio National Life Employee Discount... 19
Texas State Optional Retirement
Program............................. 20
Annuity Period........................... 20
Annuity Payout Date.................... 20
Annuity Options........................ 20
Determination of Amount of the First
Variable Annuity Payment............ 21
Annuity Units and Variable Payments.... 21
Transfers during Annuity Payout........ 22
Other Contract Provisions................ 22
Assignment............................. 22
Periodic Reports....................... 22
Substitution for Fund Shares........... 22
Contract Owner Inquiries................. 22
Performance Data....................... 23
Federal Tax Status....................... 23
Tax-Deferred Annuities................. 24
Qualified Pension or Profit-Sharing
Plans............................... 25
Individual Retirement Annuities
(IRA)............................... 26
Simplified Employee Pension Plans
(SEPPs)............................. 26
Withholding on Distribution............ 27
IRA Disclosure Statement................. 28
Free Look Period....................... 28
Eligibility Requirements............... 28
Contributions and Deductions........... 28
IRA for Non-working Spouse............. 29
Rollover Contribution.................. 29
Premature Distributions................ 30
Distribution at Retirement............. 30
Inadequate Distributions -- 50% Tax.... 30
Death Benefits......................... 30
Roth IRAs.............................. 30
Prototype Status....................... 31
Reporting to the IRS................... 31
Illustration of IRA Fixed
Accumulations.......................... 32
Statement of Additional Information
Contents............................... 33
</TABLE>
Form V-4822
2
<PAGE> 7
AVAILABLE FUNDS
<TABLE>
<S> <C>
OHIO NATIONAL FUND, INC. ADVISER (SUBADVISER)
Equity Portfolio (Legg Mason Fund Adviser, Inc.)
Money Market Portfolio Ohio National Investments, Inc.
Bond Portfolio Ohio National Investments, Inc.
Omni Portfolio (a flexible portfolio Ohio National Investments, Inc.
fund) (Federated Global Investment Management
International Portfolio Corp.)
International Small Company Portfolio (Federated Global Investment Management
Capital Appreciation Portfolio Corp.)
Small Cap Portfolio (Jennison Associates LLC)
Aggressive Growth Portfolio (Founders Asset Management LLC)
Core Growth Portfolio (Janus Capital Corporation)
Growth & Income Portfolio (Pilgrim Baxter & Associates, Ltd.)
Capital Growth Portfolio (RS Investment Management Co. LLC)
S&P 500 Index Portfolio (RS Investment Management Co. LLC)
Social Awareness Portfolio Ohio National Investments, Inc.
High Income Bond Portfolio Ohio National Investments, Inc.
Equity Income Portfolio (Federated Investment Counseling)
Blue Chip Portfolio (Federated Investment Counseling)
Nasdaq 100 Index Portfolio (Federated Investment Counseling)
Ohio National Investments, Inc.
</TABLE>
<TABLE>
<S> <C>
THE DOW(SM) TARGET VARIABLE FUND LLC
The Dow(SM) Target 10 Portfolios (First Trust Advisors L.P.)
The Dow(SM) Target 5 Portfolios (First Trust Advisors L.P.)
GOLDMAN SACHS VARIABLE INSURANCE TRUST
Goldman Sachs Growth and Income Fund Goldman Sachs Asset Management
Goldman Sachs CORE U.S. Equity Fund Goldman Sachs Asset Management
Goldman Sachs Capital Growth Fund Goldman Sachs Asset Management
JANUS ASPEN SERIES (SERVICE SHARES)
Growth Portfolio Janus Capital Corporation
Worldwide Growth Portfolio Janus Capital Corporation
Balanced Portfolio Janus Capital Corporation
LAZARD RETIREMENT SERIES, INC.
Small Cap Portfolio Lazard Asset Management
Emerging Markets Portfolio Lazard Asset Management
PBHG INSURANCE SERIES FUND, INC.
PBHG Technology & Communications
Portfolio Pilgrim Baxter & Associates, Ltd.
STRONG VARIABLE INSURANCE FUNDS, INC.
Strong Mid Cap Growth Fund II Strong Capital Management, Inc.
Strong Opportunity Fund II
(a mid cap/small cap fund) Strong Capital Management, Inc.
Strong Schafer Value Fund II Strong Capital Management, Inc.
VARIABLE INSURANCE PRODUCTS FUND SERVICE
CLASS 2 (FIDELITY)
VIP Contrafund(R) Portfolio Fidelity Management & Research Company
VIP Mid Cap Portfolio Fidelity Management & Research Company
VIP Growth Portfolio Fidelity Management & Research Company
</TABLE>
Form V-4822
3
<PAGE> 8
FEE TABLE
<TABLE>
<CAPTION>
CONTRACT YEAR
OF SURRENDER PERCENTAGE
CONTRACTOWNER TRANSACTION EXPENSES OR WITHDRAWAL CHARGED
---------------------------------- ------------- ----------
<S> <C> <C>
Deferred Sales Load (as a percentage of
amount withdrawn or surrendered) 1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7 and later 0%
Exchange (transfer) Fee $3 (currently no charge for the first
4 transfers per year)
</TABLE>
<TABLE>
<S> <C>
VAA AND VAB ANNUAL EXPENSES (as a percentage of
average account value)
Mortality and Expense Risk Fees*** 0.65%
Account Fees and Expenses 0.25%
----
Total VAA and VAB Annual Expenses 0.90%
</TABLE>
*** The Mortality and Expense risk fees may be changed at any time, but may not
be increased to more than 1.55%. We agree that the fees will not be increased on
any contract issued pursuant to this prospectus. See Deduction for Risk
Undertakings.
Neither the table nor the examples reflect any premium taxes that may apply to a
contract. These currently range from 0% to 3.5%. For further details, see
Deduction for State Premium Tax.
FUND ANNUAL EXPENSES (as a percentage of the Fund's average net assets)
<TABLE>
<CAPTION>
TOTAL FUND
EXPENSES TOTAL TOTAL FUND
WITHOUT WAIVERS EXPENSES
MANAGEMENT OTHER WAIVERS OR AND WITH WAIVERS
FEES EXPENSES REDUCTIONS REDUCTIONS* OR REDUCTIONS
---------- -------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
OHIO NATIONAL FUND, INC.:
Money Market* 0.30% 0.11% 0.41% 0.05% 0.36%
Equity 0.80% 0.12% 0.92% 0.00% 0.92%
Bond 0.60% 0.17% 0.77% 0.00% 0.77%
Omni 0.54% 0.13% 0.67% 0.00% 0.67%
S&P 500 Index 0.38% 0.11% 0.49% 0.00% 0.49%
International* 0.90% 0.36% 1.26% 0.05% 1.21%
International Small Company 1.00% 1.06% 2.06% 0.00% 2.06%
Capital Appreciation 0.80% 0.15% 0.95% 0.00% 0.95%
Small Cap 0.80% 0.09% 0.89% 0.00% 0.89%
Aggressive Growth 0.80% 0.15% 0.95% 0.00% 0.95%
Core Growth 0.95% 0.11% 1.06% 0.00% 1.06%
Growth & Income 0.85% 0.10% 0.95% 0.00% 0.95%
Capital Growth 0.90% 0.19% 1.09% 0.00% 1.09%
Social Awareness 0.60% 0.33% 0.93% 0.00% 0.93%
High Income Bond 0.75% 0.38% 1.13% 0.00% 1.13%
Equity Income 0.75% 0.53% 1.28% 0.00% 1.28%
Blue Chip 0.90% 0.45% 1.35% 0.00% 1.35%
Nasdaq 100 Index** 0.75% 0.20% 0.95% 0.00% 0.95%
</TABLE>
Form V-4822
4
<PAGE> 9
<TABLE>
<CAPTION>
TOTAL FUND
EXPENSES TOTAL TOTAL FUND
WITHOUT WAIVERS EXPENSES
MANAGEMENT OTHER WAIVERS OR AND WITH WAIVERS
FEES EXPENSES REDUCTIONS REDUCTIONS* OR REDUCTIONS
---------- -------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
DOW TARGET VARIABLE FUND LLC:
Dow Target 10* 0.60% 0.64% 1.24% 0.21% 1.03%
Dow Target 5* 0.60% 2.54% 3.14% 2.27% 0.87%
GOLDMAN SACHS VARIABLE INSURANCE TRUST:
Goldman Sachs Growth and Income* 0.75% 0.47% 1.22% 0.22% 1.00%
Goldman Sachs CORE U.S. Equity 0.70% 0.20% 0.90% 0.00% 0.90%
Goldman Sachs Capital Growth* 0.75% 0.94% 1.69% 0.69% 1.00%
JANUS ASPEN SERIES (SERVICE SHARES):
Growth** 0.65% 0.27% 0.92% 0.00% 0.92%
Worldwide Growth** 0.65% 0.30% 0.95% 0.00% 0.95%
Balanced** 0.65% 0.27% 0.92% 0.00% 0.92%
LAZARD RETIREMENT SERIES, INC.:
Small Cap* 0.75% 6.56% 7.31% 6.06% 1.25%
Emerging Markets* 1.00% 8.59% 9.59% 7.99% 1.60%
PBHG INSURANCE SERIES FUND, INC.:
PBHG Technology & Communications 0.85% 0.24% 1.09% 0.00% 1.09%
STRONG VARIABLE INSURANCE FUNDS, INC.:
Strong Mid Cap Growth II* 1.00% 0.17% 1.17% 0.02% 1.15%
Strong Opportunity II 1.00% 0.14% 1.14% 0.00% 1.14%
Strong Schafer Value II* 1.00% 0.57% 1.57% 0.37% 1.20%
VARIABLE INSURANCE PRODUCTS FUND
(FIDELITY):
VIP Contrafund 0.58% 0.37% 0.95% 0.00% 0.95%
VIP Mid Cap 0.57% 0.68% 1.25% 0.00% 1.25%
VIP Growth 0.58% 0.35% 0.93% 0.00% 0.93%
</TABLE>
EXAMPLE -- If you surrendered your contract at the end of the applicable time
period, you would pay the following aggregate expenses on a $1,000 investment in
each Fund, assuming 5% annual return:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
---- ----- ----- -----
<S> <C> <C> <C> <C>
OHIO NATIONAL FUND, INC.:
Money Market* $69 $ 80 $ 91 $152
Equity 74 97 120 214
Bond 73 93 112 198
Omni 72 90 107 187
S&P 500 Index 70 84 98 167
International* 77 105 134 244
International Small Company 85 130 176 328
Capital Appreciation 75 98 121 217
Small Cap 74 96 118 211
Aggressive Growth 75 98 121 217
Core Growth 76 101 127 229
Social Awareness 74 97 120 215
Growth & Income 75 98 121 217
Capital Growth 76 102 128 232
High Income Bond 76 103 130 236
Equity Income 78 107 138 251
Blue Chip 78 110 141 258
Nasdaq 100 Index** 75 98 121 217
</TABLE>
Form V-4822
5
<PAGE> 10
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
---- ----- ----- -----
<S> <C> <C> <C> <C>
DOW TARGET VARIABLE FUND LLC:
Dow Target 10* $75 $100 $125 $225
Dow Target 5* 74 95 117 208
GOLDMAN SACHS VARIABLE INSURANCE TRUST:
Goldman Sachs Growth and Income* 75 99 124 222
Goldman Sachs CORE U.S. Equity 74 96 119 212
Goldman Sachs Capital Growth* 75 99 124 222
JANUS ASPEN SERIES (SERVICE SHARES):
Growth** 74 97 120 214
Worldwide Growth** 75 98 121 217
Balanced** 74 97 120 214
LAZARD RETIREMENT SERIES, INC.:
Small Cap* 78 107 136 248
Emerging Markets* 81 117 153 284
PBHG INSURANCE SERIES FUND, INC.:
PBHG Technology & Communications 76 102 128 232
STRONG VARIABLE INSURANCE FUNDS, INC.:
Strong Mid Cap Growth II* 77 104 131 238
Strong Opportunity II 76 103 131 237
Strong Schafer Value II* 77 105 134 243
VARIABLE INSURANCE PRODUCTS FUND (FIDELITY):
VIP Contrafund 75 98 121 217
VIP Mid Cap 78 107 136 248
VIP Growth 74 97 120 215
</TABLE>
EXAMPLE -- If you do not surrender your contract or if you annuitize at the end
of the applicable time period, you would pay the following aggregate expenses on
the same investment:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
---- ----- ----- -----
<S> <C> <C> <C> <C>
OHIO NATIONAL FUND, INC.:
Money Market* $13 $40 $ 69 $152
Equity 18 57 99 214
Bond 17 53 91 198
Omni 16 50 86 187
S&P 500 Index 14 44 76 167
International* 21 66 113 244
International Small Company 30 92 156 328
Capital Appreciation 19 58 100 217
Small Cap 18 56 97 211
Aggressive Growth 19 58 100 217
Core Growth 20 62 106 229
Social Awareness 19 58 99 215
Growth & Income 19 58 100 217
Capital Growth 20 62 107 232
High Income Bond 21 64 109 236
Equity Income 22 68 117 251
Blue Chip 23 70 120 258
Nasdaq 100 Index** 19 58 100 217
DOW TARGET VARIABLE FUND LLC:
Dow Target 10* 20 61 104 225
Dow Target 5* 18 56 96 208
</TABLE>
Form V-4822
6
<PAGE> 11
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
---- ----- ----- -----
<S> <C> <C> <C> <C>
GOLDMAN SACHS VARIABLE INSURANCE TRUST:
Goldman Sachs Growth and Income* $19 $60 $103 $222
Goldman Sachs CORE U.S. Equity 18 57 97 212
Goldman Sachs Capital Growth* 19 60 103 222
JANUS ASPEN SERIES (SERVICE SHARES):
Growth** 18 57 99 214
Worldwide Growth** 19 58 100 217
Balanced** 18 57 99 214
LAZARD RETIREMENT SERIES, INC.:
Small Cap* 22 67 115 248
Emerging Markets* 25 78 133 284
PBHG INSURANCE SERIES FUND, INC.:
PBHG Technology & Communications 20 62 107 232
STRONG VARIABLE INSURANCE FUNDS, INC.:
Strong Mid Cap Growth II* 21 64 110 238
Strong Opportunity II 21 64 110 237
Strong Schafer Value II* 21 66 113 243
VARIABLE INSURANCE PRODUCTS FUND (FIDELITY):
VIP Contrafund 19 58 100 217
VIP Mid Cap 22 67 115 248
VIP Growth 19 58 99 215
</TABLE>
* The investment advisers of certain Funds are voluntarily waiving part or all
of their management fees and/or reimbursing certain Funds in order to reduce
total Fund expenses.
EXAMPLE -- Without the voluntary fee waivers or reimbursements by investment
advisers, if you surrendered your contract at the end of the applicable time
period, you would pay the following aggregate expenses on a $1,000 investment in
each of the following Funds, assuming 5% annual return:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
---- ----- ----- -----
<S> <C> <C> <C> <C>
OHIO NATIONAL FUND, INC.:
Money Market $ 70 $ 82 $ 93 $158
International 78 107 137 249
DOW TARGET VARIABLE FUND LLC:
Dow Target 10 77 106 136 247
Dow Target 5 95 160 226 424
GOLDMAN SACHS VARIABLE INSURANCE TRUST:
Goldman Sachs Growth and Income 77 106 135 245
Goldman Sachs Capital Growth 82 119 158 292
LAZARD RETIREMENT SERIES, INC.:
Small Cap 133 267 394 701
Emerging Markets 153 320 471 802
STRONG VARIABLE INSURANCE FUNDS, INC.:
Strong Mid Cap Growth II 77 104 132 240
Strong Schafer Value II 81 116 152 281
</TABLE>
Form V-4822
7
<PAGE> 12
EXAMPLE -- Without the voluntary fee waivers or reimbursements by investment
advisers, if you do not surrender your contract or if you annuitize at the end
of the applicable time period, you would pay the following aggregate expenses on
the same investment:
<TABLE>
<CAPTION>
1 3 5 10
YEAR YEARS YEARS YEARS
---- ----- ----- -----
<S> <C> <C> <C> <C>
OHIO NATIONAL FUND, INC.:
Money Market $ 13 $ 42 $ 72 $158
International 22 68 116 249
DOW TARGET VARIABLE FUND LLC:
Dow Target 10 22 67 115 247
Dow Target 5 41 123 207 424
GOLDMAN SACHS VARIABLE INSURANCE TRUST:
Goldman Sachs Growth and Income 22 66 114 245
Goldman Sachs Capital Growth 26 81 138 292
LAZARD RETIREMENT SERIES, INC.:
Small Cap 81 235 379 701
Emerging Markets 102 290 457 802
STRONG VARIABLE INSURANCE FUNDS, INC.:
Strong Mid Cap Growth II 21 65 111 240
Strong Schafer Value II 25 77 132 281
</TABLE>
** The "Other Expenses" (and accordingly, the Total Fund Expenses) for these
Funds are based on estimates.
The purpose of the above table is to help you to understand the costs and
expenses that you will bear directly or indirectly. THESE EXAMPLES SHOULD NOT BE
CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSE. ACTUAL EXPENSES MAY BE
GREATER OR LESS THAN THOSE SHOWN. For some funds, the "Other Expenses" include a
12b-1 fee. These fees do not exceed 0.25%. Note that the expense amounts shown
in the examples are aggregate amounts for the total number of years indicated.
In the examples, the annual fee is treated as if it were deducted as a
percentage of assets, based upon the average account value for all contracts,
including ones from which a portion of the contract fee may be paid from amounts
invested in the Guaranteed Account. The above table and examples reflect only
the charges for contracts currently offered by this prospectus and not other
contracts that we may offer.
ACCUMULATION UNIT VALUES
This series of variable annuity contracts began on October 7, 1993. The Capital
Appreciation and Small Cap funds began on May 1, 1994. The International Small
Company and Aggressive Growth funds began on March 31, 1995. The Core Growth,
Growth & Income, S&P 500 Index and Social Awareness funds began on January 3,
1997. The Ohio National Fund Capital Growth, High Income Bond, Equity Income and
Blue Chip funds, the Dow Target Variable funds, the Goldman Sachs funds, the
Janus Aspen (Institutional Shares) funds, the Lazard Retirement funds and the
Strong funds were made available in these contracts on November 1, 1999. The
Nasdaq 100 Index, Janus Aspen (Service Shares), PBHG Technology & Communications
and Variable Insurance Products funds were added on May 1, 2000. The Janus Aspen
(Institutional Shares) funds are not available on contracts issued after April
30, 2000.
EQUITY
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1993 $ 10.000000 $ 10.239365 25,900 20,283
1994 10.239365 10.173015 120,867 115,993
1995 10.173015 12.824740 301,147 239,825
1996 12.824740 15.042658 534,028 405,466
1997 15.042658 17.616774 709,738 488,396
1998 17.616774 18.458779 755,665 509,665
1999 18.458779 21.928573 669,138 480,965
</TABLE>
Form V-4822
8
<PAGE> 13
MONEY MARKET
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1993 $ 10.000000 $ 10.045964 5,554 1,204
1994 10.045964 10.354108 95,638 56,892
1995 10.354108 10.837896 136,205 34,285
1996 10.837896 11.296489 149,846 74,056
1997 11.296489 11.797028 179,630 72,534
1998 11.797028 12.321496 298,676 163,872
1999 12.321496 12.825076 203,404 109,471
</TABLE>
BOND
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1993 $ 10.000000 $ 9.910842 378 19,364
1994 9.910842 9.445623 10,472 75,521
1995 9.445623 11.130129 64,973 97,129
1996 11.130129 11.439849 82,917 101,403
1997 11.439849 12.390067 95,905 98,784
1998 12.390067 12.919987 163,496 133,933
1999 12.919987 12.878760 152,433 110,307
</TABLE>
OMNI
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1993 $ 10.000000 $ 10.143037 42,348 44,348
1994 10.143037 9.999661 150,263 109,853
1995 9.999661 12.165280 244,025 194,243
1996 12.165280 13.930650 511,033 342,379
1997 13.930650 16.311837 699,223 513,134
1998 16.311837 16.898733 811,017 558,183
1999 16.898733 18.649833 659,687 467,855
</TABLE>
INTERNATIONAL
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1993 $ 10.000000 $ 10.834626 34,538 15,210
1994 10.834626 11.604279 204,939 234,799
1995 11.604279 12.892796 384,682 330,279
1996 12.892796 14.628252 678,397 674,403
1997 14.628252 14.804324 876,940 770,712
1998 14.804324 15.241954 690,872 673,379
1999 15.241954 25.287344 457,106 462,283
</TABLE>
INTERNATIONAL SMALL COMPANY
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1995 $ 10.000000 $ 10.816003 47,134 21,621
1996 10.816003 12.015818 132,292 178,856
1997 12.015818 13.297985 180,385 216,928
1998 13.297985 13.644341 144,093 212,244
1999 13.644341 28.196610 120,355 140,283
</TABLE>
Form V-4822
9
<PAGE> 14
CAPITAL APPRECIATION
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1994 $ 10.000000 $ 10.390128 52,732 34,382
1995 10.390128 12.626458 211,756 136,612
1996 12.626458 14.484990 383,878 243,883
1997 14.484990 16.536198 454,490 333,645
1998 16.536198 17.357724 464,528 358,863
1999 17.357724 18.313827 386,713 304,647
</TABLE>
SMALL CAP
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1994 $ 10.000000 $ 12.053440 76,033 39,627
1995 12.053440 15.889068 198,048 123,612
1996 15.889068 18.535631 337,460 204,017
1997 18.535631 19.926004 377,837 238,023
1998 19.926004 21.836411 369,788 233,680
1999 21.836411 44.681338 343,325 220,471
</TABLE>
AGGRESSIVE GROWTH
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1995 $ 10.000000 $ 12.610012 41,681 39,115
1996 12.610012 12.592390 118,818 80,875
1997 12.592390 14.043267 139,155 110,592
1998 14.043267 15.009251 138,327 111,021
1999 15.009251 15.731920 98,740 108,828
</TABLE>
CORE GROWTH
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1997 $ 10.000000 $ 9.605255 133,806 77,677
1998 9.605255 10.359066 98,154 68,986
1999 10.359066 21.041443 110,748 79,742
</TABLE>
GROWTH & INCOME
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1997 $ 10.000000 $ 13.535914 150,510 142,565
1998 13.535914 14.365899 314,342 223,832
1999 14.365899 23.100411 408,286 283,664
</TABLE>
S&P 500 INDEX
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1997 $ 10.000000 $ 13.057227 156,778 116,679
1998 13.057227 16.823468 486,237 297,409
1999 16.823468 20.946479 682,513 508,584
</TABLE>
Form V-4822
10
<PAGE> 15
SOCIAL AWARENESS
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1997 $ 10.000000 $ 12.451138 18,947 15,468
1998 12.451138 9.574986 48,417 24,327
1999 9.574986 11.168486 26,824 15,602
</TABLE>
CAPITAL GROWTH
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 14.200260 11,597 3,806
</TABLE>
EQUITY INCOME
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.916683 179 0
</TABLE>
DOW TARGET 10, NOVEMBER
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.097329 660 720
</TABLE>
DOW TARGET 10, DECEMBER
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.009047 484 0
</TABLE>
DOW TARGET 5, NOVEMBER
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 9.963566 0 727
</TABLE>
DOW TARGET 5, DECEMBER
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.008355 792 0
</TABLE>
GOLDMAN SACHS GROWTH AND INCOME
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.505494 0 437
</TABLE>
GOLDMAN SACHS CORE U.S. EQUITY
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.928488 1,589 6,222
</TABLE>
JANUS GROWTH (INSTITUTIONAL SHARES)
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 11.661117 44,858 27,443
</TABLE>
Form V-4822
11
<PAGE> 16
JANUS WORLDWIDE GROWTH (INSTITUTIONAL SHARES)
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 13.229802 19,886 28,058
</TABLE>
JANUS BALANCED (INSTITUTIONAL SHARES)
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 11.029199 48,823 4,391
</TABLE>
LAZARD SMALL CAP
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.541450 299 0
</TABLE>
LAZARD EMERGING MARKETS
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 12.516246 0 157
</TABLE>
STRONG MID CAP GROWTH II
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 12.920972 5,045 2,140
</TABLE>
STRONG SCHAFER VALUE II
<TABLE>
<CAPTION>
YEAR ENDED UNIT VALUE AT UNIT VALUE AT VAA UNITS VAB UNITS
DECEMBER 31 BEGINNING OF YEAR END OF YEAR END OF YEAR END OF YEAR
- ----------- ----------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1999 $ 10.000000 $ 10.287746 1,392 1,392
</TABLE>
FINANCIAL STATEMENTS
The complete financial statements of VAA or VAB, and of Ohio National Life,
including the Independent Auditors' Reports for them, are included in the
Statements of Additional Information for VAA and VAB.
OHIO NATIONAL
OHIO NATIONAL LIFE
Ohio National Life was organized under the laws of Ohio on September 9, 1909 as
a stock life insurance company. We are now ultimately owned by a mutual holding
company (Ohio National Mutual Holdings, Inc.) with the majority ownership being
by our policyholders. We write life, accident and health insurance and annuities
in 47 states, the District of Columbia and Puerto Rico. Currently we have assets
in excess of $7.6 billion and equity in excess of $725 million. Our home office
is located at One Financial Way, Montgomery, Ohio 45242.
OHIO NATIONAL VARIABLE ACCOUNTS A AND B
We established VAA and VAB on August 1, 1969 as separate accounts under Ohio law
for the purpose of funding variable annuity contracts. Purchase payments for the
variable annuity contracts are allocated to one or more subaccounts of VAA or
VAB. However, contract values may not be allocated to more than 10 variable
subaccounts at any one time. Income, gains and losses, whether or not realized,
from assets allocated to VAA and VAB are credited to or charged against VAA or
VAB without regard to our other income, gains or losses. The assets maintained
in VAA and VAB will not be charged with any liabilities arising out of our other
business. Nevertheless, all obligations arising under the contracts, including
the commitment to make annuity payments, are
Form V-4822
12
<PAGE> 17
our general corporate obligations. Accordingly, all of our assets are available
to meet our obligations under the contracts. VAA and VAB are registered as unit
investment trusts under the Investment Company Act of 1940.
The assets of each subaccount of VAA and VAB are invested at net asset value in
Fund shares.
THE FUNDS
The Funds are mutual funds registered under the Investment Company Act of 1940.
Fund shares are sold only to insurance company separate accounts to fund
variable annuity contracts and variable life insurance policies and, in some
cases, to qualified plans. The value of each Fund's investments fluctuates daily
and is subject to the risk that Fund management may not anticipate or make
changes necessary in the investments to meet changes in economic conditions.
The Funds receive investment advice from their investment advisers. The Funds
pay each of the investment advisers a fee as shown in the fee table beginning on
page 4. In some cases, the investment adviser pays part of its fee to a
subadviser.
Affiliates of certain Funds may compensate us based upon a percentage of the
Fund's average daily net assets that are allocated to VAA or VAB. These
percentages vary by Fund. This is intended to compensate us for administrative
and other services we provide to the Funds and their affiliates.
For additional information concerning the Funds, including their investment
objectives, see the Fund prospectuses. Read them carefully before investing.
They may contain information about other funds that are not available as
investment options for these contracts. You cannot be sure that any Fund will
achieve its stated objectives and policies.
The investment policies, objectives and/or names of some of the Funds may be
similar to those of other investment companies managed by the same investment
adviser or subadviser. However, similar funds often do not have comparable
investment performance. The investment results of the Funds may be higher or
lower than those of the other funds.
MIXED AND SHARED FUNDING
In addition to being offered to VAA and VAB, certain Fund shares are offered to
our other separate accounts for variable annuity contracts and a separate
account of Ohio National Life Assurance Corporation for variable life insurance
contracts. Fund shares may also be offered to other insurance company separate
accounts and qualified plans. It is conceivable that in the future it may become
disadvantageous for one or more of variable life and variable annuity separate
accounts, or separate accounts of other life insurance companies, and qualified
plans, to invest in Fund shares. Although neither we nor any of the Funds
currently foresee any such disadvantage, the Board of Directors or Trustees of
each Fund will monitor events to identify any material conflict among different
types of owners and to determine if any action should be taken. That could
possibly include the withdrawal of VAA's and/or VAB's participation in a Fund.
Material conflicts could result from such things as:
- - changes in state insurance law;
- - changes in federal income tax law;
- - changes in the investment management of any Fund; or
- - differences in voting instructions given by different types of owners.
VOTING RIGHTS
We will vote Fund shares held in VAA and VAB at Fund shareholders meetings in
accordance with voting instructions received from contract owners. We will
determine the number of Fund shares for which you are entitled to give
instructions as described below. This determination will be within 90 days
before the shareholders meeting. Fund proxy material and forms for giving voting
instructions will be distributed to each owner. We will
Form V-4822
13
<PAGE> 18
vote Fund shares held in VAA and VAB, for which no timely instructions are
received, in proportion to the instructions that we do receive for each of VAA
and VAB.
Until annuity payments begin, the number of Fund shares for which you may
instruct us is determined by dividing your contract value in each Fund by the
net asset value of a share of that Fund as of the same date. After annuity
payments begin, the number of Fund shares for which you may instruct us is
determined by dividing the actuarial liability for your variable annuity by the
net asset value of a Fund share as of the same date. Generally, the number of
votes tends to decrease as annuity payments progress.
DISTRIBUTION OF VARIABLE ANNUITY CONTRACTS
The variable annuity contracts are sold by our insurance agents who are also
registered representatives (a) of The O.N. Equity Sales Company ("ONESCO"), a
wholly-owned subsidiary of ours, or (b) of other broker-dealers that have
entered into distribution agreements with Ohio National Equities, Inc. ("ONEQ"),
another wholly-owned subsidiary of ours. ONEQ is the principal underwriter of
the contracts. ONESCO, ONEQ and the other broker dealers are registered under
the Securities Exchange Act of 1934, and are members of the National Association
of Securities Dealers, Inc. We pay ONEQ 5.25% of purchase payments. ONEQ then
pays part of that amount to ONESCO and the other broker dealers. ONESCO and the
other broker-dealers pay their registered representatives from their own funds.
Purchase payments on which nothing is paid to registered representatives may not
be included in amounts on which we pay sales compensation to ONEQ. If our
surrender charge is not sufficient to recover the fee paid to ONEQ, any
deficiency will be made up from our general assets. These include, among other
things, any profit from the mortality and expense risk charges. The address of
ONESCO and ONEQ is One Financial Way, Montgomery, Ohio 45242.
DEDUCTIONS AND EXPENSES
SURRENDER CHARGE
There is no deduction from purchase payments to pay sales expense. We may assess
a surrender charge if you surrender the contract or withdraw part of its value.
The purpose of this charge is to defray expenses relating to the sale of the
contract, including compensation to sales personnel, cost of sales literature
and prospectuses, and other expenses related to sales activity. This surrender
charge is a percent of the amount withdrawn. This percent varies with the
contract year as follows:
<TABLE>
<CAPTION>
CONTRACT
YEARS PERCENTAGE
-------- ----------
<S> <C>
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7 and later 0%
</TABLE>
Once each contract year, you may make a partial withdrawal of not more than 10%
of the contract value (as of the first day of the contract year) without the
surrender charge. You may take this 10% annual free withdrawal in up to 12
installments. The surrender charge will not be imposed when the values of one or
more contracts owned by the trustee of a retirement plan qualifying under
Section 401, 403(b) or 457 of the Code are transferred to one of our group
annuity contracts. If you use values of at least $250,000 from an Ohio National
Life fixed annuity to provide the purchase payment for a contract offered by
this prospectus, this contract will be treated
Form V-4822
14
<PAGE> 19
(for purposes of determining the surrender charge) as if it were issued at the
same time as the fixed annuity and as if the purchase payments made for the
fixed annuity had been made for this contract.
DEDUCTION FOR ADMINISTRATIVE EXPENSES
At the end of each valuation period we deduct an amount equal to 0.25% on an
annual basis of the contract value. This deduction reimburses us for expenses
such as accounting, auditing, legal, contract owner services, reports to
regulatory authorities and contract owners, contract issue, etc.
DEDUCTION FOR RISK UNDERTAKINGS
We guarantee that until annuity payments begin the contract's value will not be
affected by any excess of sales and administrative expenses over the deductions
for them. We also guarantee to pay a death benefit in the event of the
annuitant's death before annuity payments begin. After annuity payments begin we
guarantee that variable annuity payments will not be affected by adverse
mortality experience or expenses.
For assuming these risks, when we determine the accumulation unit values and the
annuity unit values for each subaccount, we make a deduction from the applicable
investment results equal to 0.65% of the contract value on an annual basis. We
may decrease that deduction at any time and we may increase it not more often
than annually to not more than 1.55% on an annual basis. However, we agree that
the deduction for these risk undertakings for contracts purchased on and after
November 1, 1997 shall not be increased to more than the rate in effect at the
time the contract is issued. We may discontinue this limitation on our right to
increase the deduction, but only as to any contracts purchased after notice of
the discontinuance. The risk charge is an indivisible whole of the amount
currently being deducted. However, we believe that a reasonable allocation would
be 0.25% for mortality risk, and 0.40% for expense risk. We hope to realize a
profit from this charge. However, there will be a loss if the deduction fails to
cover the actual risks involved.
TRANSFER FEE
We may charge a transfer fee of $3 (which may be increased to $15) for each
transfer from one subaccount to another. The fee is charged against the
subaccount from which the transfer is made. Currently, we do not charge for your
first four transfers each year.
DEDUCTION FOR STATE PREMIUM TAX
Most states do not presently charge a premium tax for these contracts. Where a
tax applies, the rates for tax-qualified contracts are presently 0.5% in
California, 1.0% in Puerto Rico and West Virginia, 2.0% in Kentucky and 2.25% in
the District of Columbia. For non-tax-qualified contracts, the rates are 1.0% in
Puerto Rico, West Virginia and Wyoming, 1.25% in South Dakota, 2.0% in Kansas,
Kentucky and Maine, 2.25% the District of Columbia, 2.35% in California and 3.0%
in Nevada. The deduction for premium taxes will be made when incurred. Normally,
that is not until annuity payments begin. However, in Kansas, South Dakota and
Wyoming, they are presently being deducted from purchase payments.
FUND EXPENSES
There are deductions from, and expenses paid out of, the assets of the Funds.
These are described in the Fund prospectus.
Form V-4822
15
<PAGE> 20
DESCRIPTION OF VARIABLE ANNUITY CONTRACTS
FREE LOOK
You may revoke the contract at any time until the end of 20 days after you
receive the contract (or such longer period as may be required by your state
law) and get a refund of the entire purchase price. To revoke you must return
the contract to us within the free look period. In those states where required
by state law, the value of the contract as of the date of cancellation will be
returned in lieu of the entire purchase price in case of revocation during the
free look period.
ACCUMULATION PERIOD
PURCHASE PAYMENT
Your purchase payment must be at least $10,000. We may limit your purchase
payment to $1,500,000.
ACCUMULATION UNITS
Until the annuity payout date, the contract value is measured by accumulation
units. These units are credited to your contract when you make your purchase
payment. (See Crediting Accumulation Units, below). The number of units remains
constant, but their dollar value varies depending upon the investment results of
each Fund to which payments are allocated.
CREDITING ACCUMULATION UNITS
Your representative will send application forms or orders, together with your
purchase payment, to our home office for acceptance. Upon acceptance, we issue a
contract and we credit the purchase payment to the contract in the form of
accumulation units. If all information necessary for issuing a contract and
processing the purchase payment is complete, your purchase payment will be
credited within two business days after receipt. If we do not receive everything
within five business days, we will return the purchase payment to you
immediately unless you specifically consent to having us retain the purchase
payment until the necessary information is completed. After that, we will credit
the purchase payment within two business days.
ALLOCATION OF PURCHASE PAYMENT
You may allocate your purchase payment among up to 10 variable subaccounts of
VAA or VAB and the Guaranteed Account. The amount allocated to any Fund or the
Guaranteed Account must equal a whole percent.
ACCUMULATION UNIT VALUE AND CONTRACT VALUE
We set the accumulation unit value of each subaccount of VAA and VAB at $10 when
we allocated the first payments for these contracts. We determine the unit value
for any later valuation period by multiplying the unit value for the immediately
preceding valuation period by the net investment factor (described below) for
such later valuation period. We determine a contract's value by multiplying the
total number of units (for each subaccount) credited to the contract by the unit
value (for such subaccount) for the current valuation period.
Form V-4822
16
<PAGE> 21
NET INVESTMENT FACTOR
The net investment factor measures the investment results of each subaccount.
The net investment factor for each subaccount for any valuation period is
determined by dividing (a) by (b), then subtracting (c) from the result, where:
(a) is
(1) the net asset value the corresponding Fund share at the end of a
valuation period, plus
(2) the per share amount of any dividends or other distributions declared
for that Fund if the "ex-dividend" date occurs during the valuation
period, plus or minus
(3) a per share charge or credit for any taxes paid or reserved for the
maintenance or operation of that subaccount, (no federal income taxes
apply under present law.)
(b) is the net asset value of the corresponding Fund share at the end of the
preceding valuation period; and
(c) is the deduction for administrative and sales expenses and risk
undertakings.
SURRENDER AND PARTIAL WITHDRAWAL
Before annuity payments begin (and also after that in the case of annuity Option
1(e) described below), you may surrender (totally withdraw the value of) your
contract or you may elect a partial (at least $500) withdrawal. You may not make
a partial withdrawal that would reduce the contract value to less than $5,000.
The surrender charge may apply to these transactions. That charge is a percent
of the total amount withdrawn. For example, if a partial withdrawal of $500 is
requested, we would pay you $500, but the total amount deducted from the
accumulation value would be $531.91 (i.e., $531.91 x 6% = $31.91). Unless, you
specify otherwise, the withdrawal will be made pro-rata from your values in each
Fund. The amount you may withdraw is the contract value less any charge. We will
pay you within seven days after we receive your request. However, we may defer
payment as described below. Surrenders and partial withdrawals are limited or
not permitted in connection with certain tax-qualified retirement plans. For tax
consequences of a surrender or withdrawal, see Federal Tax Status.
If you request a surrender or partial withdrawal before your purchase payment
clears the banking system, we may delay mailing your proceeds until the check
for the purchase payment has cleared. We require the return of the contract in
the case of a complete surrender.
The right to withdraw may be suspended or the date of payment postponed:
- - for any period during which the New York Stock Exchange is closed (other than
customary weekend and holiday closings) or during which the Securities and
Exchange Commission has restricted trading on the Exchange;
- - for any period during which an emergency, as determined by the Commission,
exists as a result of which disposal of securities held in a Fund is not
reasonably practical, or it is not reasonably practical to determine the value
of a Fund's net assets; or
- - such other periods as the Commission may order to protect security holders.
TRANSFERS AMONG SUBACCOUNTS
You may transfer contract values from one Fund to another. You may make
transfers at any time before annuity payments begin. The amount of any transfer
must be at least $300 (or the entire contract value in a Fund, if less).
We may limit the number, frequency, method or amount of transfers. We may limit
transfers from any Fund on any one day to 1% of the previous day's total net
assets of that Fund if we or the Fund, in our discretion, believe
Form V-4822
17
<PAGE> 22
that the Fund might otherwise be damaged. In this case, some requested transfers
will not occur. In determining which requests to honor, scheduled transfers
(under a DCA program) will be made first, followed by mailed written requests in
the order postmarked and, lastly, telephone and facsimile requests in the order
received. We will notify you if your requested transfer is not made. Current SEC
rules preclude us from processing at a later date those requests that were not
made. Accordingly, you would need to submit a new transfer request in order to
make a transfer that was not made because of these limitations.
Certain third parties may offer you asset allocation or timing services for your
contract. We may choose to honor transfer requests from these third parties if
you give us a written power of attorney to do so. Fees you pay for such asset
allocation or timing services are in addition to any contract charges. WE DO NOT
ENDORSE, APPROVE OR RECOMMEND THESE SERVICES.
After annuity payments begin, you may make transfers among Funds only once each
calendar quarter. The transfer fee no longer applies then. Not more than 20% of
a contract's Guaranteed Account value (or $1,000, if greater) as of the
beginning of a contract year may be transferred to variable Funds during that
contract year.
SCHEDULED TRANSFERS (DOLLAR COST AVERAGING)
We administer a scheduled transfer ("DCA") program enabling you to preauthorize
automatic monthly or quarterly transfers of a specified dollar amount of at
least $300 each time. At least 12 DCA transfers must be scheduled. The transfers
may be from any variable Funds to any other Funds or to the Guaranteed Account.
Transfers may be made from the Guaranteed Account to any other Funds if the DCA
program is established at the time the contract is issued, the DCA program is
scheduled to begin within 6 months of contract issue and the term of the DCA
program does not exceed 2 years. For transfers from variable Funds, the DCA
program may not exceed 5 years. There is no transfer fee for DCA transfers. DCA
transfers do not count against your four free transfers per year. We may
discontinue the DCA program at any time. You may also discontinue further DCA
transfers by giving us written notice at least 7 business days before the next
scheduled transfer.
DCA generally has the effect of reducing the risk of purchasing at the top, and
selling at the bottom, of market cycles. DCA transfers from the Guaranteed
Account or from a Fund with a stabilized net asset value, such as the Money
Market Fund, will generally reduce the average total cost of indirectly
purchasing Fund shares because greater numbers of shares will be purchased when
the share prices are lower than when prices are higher. However, DCA does not
assure you of a profit, nor does it protect against losses in a declining
market. Moreover, for transfers from a variable Fund, DCA has the effect of
reducing the average price of the shares being redeemed. DCA might also be used
to systematically transfer contract values from variable Funds to the Guaranteed
Account in anticipation of retirement, reducing the risk of making a single
transfer during a low market.
TELEACCESS
If you give us a pre-authorization form, your contract and unit values and
interest rates can be checked and transfers may be made by telephoning us
between 7:00 a.m. and 7:00 p.m. (Eastern time) on days we are open for business,
at 1-800-366-6654, #8. You may only make one telephone transfer per day. We will
honor pre-authorized telephone transfer instructions from anyone who provides
the personal identifying information requested via TeleAccess. We will not honor
telephone transfer requests after we receive notice of your death. For added
security, we send the contract owner a written confirmation of all telephone
transfers on the next business day. However, if we cannot complete a transfer as
requested, our customer service representative will contact the contract owner
in writing sent within 48 hours of the TeleAccess request. YOU MAY THINK THAT
YOU HAVE LIMITED THIS ACCESS TO YOURSELF, OR TO YOURSELF AND YOUR
REPRESENTATIVE. HOWEVER, ANYONE GIVING US THE NECESSARY IDENTIFYING INFORMATION
CAN USE TELEACCESS ONCE YOU AUTHORIZE ITS USE.
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DEATH BENEFIT
If the annuitant (and any contingent annuitant) dies before annuity payments
begin, the contract pays a death benefit to a designated beneficiary. (This
death benefit is not available on any contract purchased through a bank in
Puerto Rico.) The amount of the death benefit will be determined as of the end
of the valuation period in which we receive written notice of death. The amount
of death benefit is the contract value or, if greater, your purchase payment
less any partial withdrawals.
GUARANTEED ACCOUNT
The Guaranteed Account guarantees a fixed return for a specified period of time
and guarantees the principal against loss. The Guaranteed Account is not
registered as an investment company. Interests in it are not subject to the
provisions or restrictions of federal securities laws. The staff of the
Securities and Exchange Commission has not reviewed disclosures regarding it.
The Guaranteed Account consists of all of our general assets other than those
allocated to a separate account. You may allocate purchase payments and contract
values between the Guaranteed Account and the Funds.
We will invest our general assets in our discretion as allowed by Ohio law. We
allocate the investment income from our general assets to those contracts having
guaranteed values.
The amount of investment income allocated to the contracts varies from year to
year in our sole discretion. However, we guarantee that we will credit interest
at a rate of not less than 3% per year, compounded annually, to contract values
allocated to the Guaranteed Account. We may credit interest at a rate in excess
of 3%, but any such excess interest credit will be in our sole discretion.
We guarantee that, before annuity payments begin, the guaranteed value of a
contract will never be less than:
- - the amount of purchase payments allocated to, and transfers into, the
Guaranteed Account, plus
- - interest credited at the rate of 3% per year compounded annually, plus
- - any additional excess interest we may credit to guaranteed values, minus
- - any partial withdrawals, loans and transfers from the guaranteed values, minus
- - any surrender charge on partial withdrawals, loan interest, state premium
taxes and transfer fees.
No deductions are made from the Guaranteed Account for administrative expenses
or risk undertakings.
Other than pursuant to a DCA (scheduled transfer) program, we may restrict
transfers of your Guaranteed Account value during a contract year to not more
than 20% of that value as of the beginning of a contract year (or $1,000, if
greater). As provided by state law, we may defer the payment of amounts to be
withdrawn from the Guaranteed Account for up to six months from the date we
receive written request for withdrawal.
OHIO NATIONAL LIFE EMPLOYEE DISCOUNT
We and our affiliated companies offer a credit on the purchase of contracts by
any of our employees, directors or retirees, or their spouse or the surviving
spouse of a deceased retiree, their minor children, or any of their children
ages 18 to 21 who is either (i) living in the purchaser's household or (ii) a
full-time college student being supported by the purchaser, or any of the
purchaser's minor grandchildren under the Uniform Gifts to Minors Act. This
credit counts as additional income under the contract. The amount of the credit
equals 3.5% of your purchase payment. We credit the Guaranteed Account in this
amount at the time the eligible person makes the purchase payment.
Form V-4822
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TEXAS STATE OPTIONAL RETIREMENT PROGRAM
Under the Texas State Optional Retirement Program (the "Program"), purchase
payments may be excluded from the gross income of state employees for federal
tax purposes to the extent that such purchase payments do not exceed the
exclusion allowance provided by the Code. The Attorney General of Texas has
interpreted the Program as prohibiting any participating state employee from
receiving the surrender value of a contract funding benefits under the Program
prior to termination of employment or the state employee's retirement, death or
total disability. Therefore, a participant in the Program may not make a
surrender or partial withdrawal until the first of these events occurs.
ANNUITY PERIOD
ANNUITY PAYOUT DATE
Annuity payments begin on the annuity payout date. You may select this date when
the contract is issued. It must be at least 30 days after the contract date. You
may change it from time to time so long as it is the first day of any month at
least 30 days after the date of such change. The contract restricts the annuity
payout date to not later than the first of the month following the annuitant's
90th birthday. This restriction may be modified by applicable state law or we
may agree to waive it.
The contracts include our guarantee that (except for Option 1(e), below) we will
pay annuity payments for the lifetime of the annuitant (and any joint annuitant)
in accordance with the contract annuity rates, no matter how long you live.
Other than in connection with annuity Option 1(e) described below, once annuity
payments begin, you may not surrender the contract for cash except that, upon
the death of the annuitant, the beneficiary may surrender the contract for the
commuted value of any remaining period-certain payments. You may make surrenders
and partial withdrawals from Option 1(e) at any time.
ANNUITY OPTIONS
You may elect one or more of the following annuity options. You may change the
election anytime before the annuity payout date.
Option 1(a): Life Annuity with installment payments for the lifetime of the
annuitant (the contract has no more value after annuitant's
death).
Option 1(b): Life Annuity with installment payments guaranteed for five years
and then continuing during the remaining lifetime of the
annuitant.
Option 1(c): Life Annuity with installment payments guaranteed for ten years
and then continuing during the remaining lifetime of the
annuitant.
Option 1(d): Installment Refund Life Annuity with payments guaranteed for a
period certain and then continuing during the remaining lifetime
of the annuitant. The number of period-certain payments is equal
to the amount applied under this option divided by the amount of
the first payment.
Option 1(e): Installment Refund Annuity with payments guaranteed for a fixed
number (up to thirty) of years. This option is available for
variable annuity payments only. (Although the deduction for risk
undertakings is taken from annuity unit values, we have no
mortality risk during the annuity payout period under this
option.)
Form V-4822
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Option 2(a): Joint & Survivor Life Annuity with installment payments during
the lifetime of the annuitant and then continuing during the
lifetime of a contingent annuitant (the contract has no more
value after the second annuitant's death).
Option 2(b): Joint & Survivor Life Annuity with installment payments guaranteed
for ten years and then continuing during the remaining lifetime of
the annuitant or a contingent annuitant.
We may agree to other settlement options.
Unless you direct otherwise, we will apply the contract value as of the annuity
payout date to provide annuity payments pro-rata from each Fund in the same
proportion as the contract values immediately before the annuity payout date.
If no election is in effect on the annuity payout date, we will apply the
contract value under Option 1(c) with the beneficiary as payee for any remaining
period-certain installments payable after the death of the annuitant. The
Pension Reform Act of 1974 might require certain contracts to provide a Joint
and Survivor Annuity. If the contingent annuitant is not related to the
annuitant, Options 2(a) and 2(b) are available only if we agree.
The Internal Revenue Service has not ruled on the tax treatment of a commutable
variable annuity. If you select Option 1(e), it is possible that the IRS could
determine that the entire value of the annuity is fully taxable at the time you
elect Option 1(e) or that variable annuity payments under this option should not
be taxed under the annuity rules (see Federal Tax Status). This could result in
your payments being fully taxable to you. Should the IRS so rule, we may have to
tax report up to the full value of the annuity as your taxable income.
DETERMINATION OF AMOUNT OF THE FIRST VARIABLE ANNUITY PAYMENT
To determine the first variable annuity payment, we apply the contract value for
each Fund in accordance with the contract's settlement option tables. The rates
in those tables depend upon the annuitant's (and any contingent annuitant's) age
and sex and the option selected. The annuitant's sex is not a factor in
contracts issued to plans sponsored by employers subject to Title VII of the
Civil Rights Act of 1964 or similar state statutes. We determine the value to be
applied at the end of a valuation period (selected by us and uniformly applied)
not more than 10 valuation periods before the annuity payout date.
If the amount that would be applied under an option is less than $5,000, we will
pay the contract value to the annuitant in a single sum. If the first periodic
payment under any option would be less than $25, we may change the frequency of
payments so that the first payment is at least $25.
ANNUITY UNITS AND VARIABLE PAYMENTS
After your first annuity payment, later variable annuity payments will vary to
reflect the investment performance of your Funds. The amount of each payment
depends on the number your annuity units. To determine the number of annuity
units for each Fund, divide the dollar amount of the first annuity payment from
each Fund by the value of that Fund's annuity unit. This number of annuity units
remains constant during the annuity payment period unless you transfer among
Funds.
The annuity unit value for each Fund was set at $10 for the valuation period
when the first variable annuity was calculated for these contracts. The annuity
unit value for each later valuation period equals the annuity unit value for the
immediately preceding valuation period multiplied by the net investment factor
for such later valuation period and by a factor (0.9998925 for a one-day
valuation period) to neutralize the 4% assumed interest rate discussed below.
The dollar amount of each later variable annuity payment equals your constant
number of annuity units for each Fund multiplied by the value of the annuity
unit for the valuation period.
Form V-4822
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The annuity rate tables contained in the contracts are based on the Progressive
Annuity Mortality Table with compound interest at the effective rate of 4% per
year. A higher interest assumption would mean a higher initial annuity payment
but a more slowly rising series of subsequent annuity payments if annuity unit
values were increasing (or a more rapidly falling series of subsequent annuity
payments if annuity unit values were decreasing). A lower interest assumption
would have the opposite effect. If the actual net investment rate were equal to
the assumed interest rate, annuity payments would stay level.
TRANSFERS DURING ANNUITY PAYOUT
After annuity payments have been made for at least 12 months, the annuitant can,
once each calendar quarter, change the Funds on which variable annuity payments
are based. On at least 30 days written notice to our home office, we will change
that portion of the periodic variable annuity payment as you direct to reflect
the investment results of different Funds. The annuity payment immediately after
a change will be the amount that would have been paid without the change. Later
payments will reflect the new mix of Funds.
OTHER CONTRACT PROVISIONS
ASSIGNMENT
Amounts payable in settlement of a contract may not be commuted, anticipated,
assigned or otherwise encumbered, or pledged as loan collateral to anyone other
than us. To the extent permitted by law, such amounts are not subject to any
legal process to pay any claims against an annuitant before annuity payments
begin. The owner of a tax-qualified contract may not, but the owner of a
non-tax-qualified contract may, collaterally assign the contract before the
annuity payout date. Ownership of a tax-qualified contract may not be
transferred except to:
- - the annuitant,
- - a trustee or successor trustee of a pension or profit-sharing trust which is
qualified under Section 401 of the Code,
- - the employer of the annuitant provided that the contract after transfer is
maintained under the terms of a retirement plan qualified under Section 403(a)
of the Code for the benefit of the annuitant, or
- - as otherwise permitted by laws and regulations governing plans for which the
contract may be issued.
PERIODIC REPORTS
Before the annuity payout date, we will send you semi-annual statements showing
(a) the number of units credited to the contract by Fund and (b) the value of
each unit as of the end of the last half year. In addition, as long as the
contract remains in effect, we will forward any periodic Fund reports.
SUBSTITUTION FOR FUND SHARES
If investment in a Fund is no longer possible or we believe it is inappropriate
to the purposes of the contract, we may substitute one or more other funds.
Substitution may be made as to both existing investments and the investment of
future purchase payments. However, no substitution will be made until we receive
any necessary approval of the Securities and Exchange Commission. We may also
add other Funds as eligible investments of VAA or VAB.
CONTRACT OWNER INQUIRIES
Direct any questions to Ohio National Life, Variable Annuity Administration,
P.O. Box 2669, Cincinnati, Ohio 45201; telephone 1-800-366-6654 (8:30 a.m. to
4:30 p.m., Eastern time).
Form V-4822
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PERFORMANCE DATA
We may advertise performance data for the various Funds showing the percentage
change in unit values based on the performance of the applicable Fund over a
period of time (usually a calendar year). We determine the percentage change by
dividing the increase (or decrease) in value for the unit by the unit value at
the beginning of the period. This percent reflects the deduction of any
asset-based contract charges but does not reflect the deduction of any
applicable contract administration charge or surrender charge. The deduction a
contract administration charge or surrender charge would reduce any percentage
increase or make greater any percentage decrease.
Advertising may also include average annual total return figures calculated as
shown in the Statement of Additional Information. The average annual total
return figures reflect the deduction of applicable contract administration
charges and surrender charges as well as applicable asset-based charges.
We may also distribute sales literature comparing separate account performance
to the Consumer Price Index or to such established market indexes as the Dow
Jones Industrial Average, the Standard & Poor's 500 Stock Index, IBC's Money
Fund Reports, Lehman Brothers Bond Indices, the Morgan Stanley Europe Australia
Far East Index, Morgan Stanley World Index, Russell 2000 Index, or other
variable annuity separate accounts or mutual funds with investment objectives
similar to those of the Funds.
FEDERAL TAX STATUS
The following discussion of federal income tax treatment of amounts received
under a variable annuity contract does not cover all situations or issues. It is
not intended as tax advice. Consult a qualified tax adviser to apply the law to
your circumstances. Tax laws can change, even for contracts that have already
been issued. Tax law revisions, with unfavorable consequences, could have
retroactive effect on previously issued contracts or on later voluntary
transactions in previously issued contracts.
We are taxed as a life insurance company under Subchapter L of the Internal
Revenue Code (the "Code"). Since the operations of VAA and VAB are a part of,
and are taxed with, our operations, VAA and VAB are not separately taxed as
"regulated investment companies" under Subchapter M of the Code.
As to tax-qualified contracts, the law does not now provide for payment of
federal income tax on dividend income or capital gains distributions from Fund
shares held in VAA or upon capital gains realized by VAA on redemption of Fund
shares. When a non-tax-qualified contract is issued in connection with a
deferred compensation plan or arrangement, all rights, discretions and powers
relative to the contract are vested in the employer and you must look only to
your employer for the payment of deferred compensation benefits. Generally, in
that case, an annuitant will have no "investment in the contract" and amounts
received by you from your employer under a deferred compensation arrangement
will be taxable in full as ordinary income in the years you receive the
payments.
The income and gains within an annuity contract are generally tax deferred.
Within a tax-qualified plan, the plan itself provides tax deferral. Therefore,
the tax-deferred treatment otherwise available to an annuity contract is not a
factor to consider when purchasing an annuity within a tax-qualified plan or
arrangement.
The contracts are considered annuity contracts under Section 72 of the Code,
which generally provides for taxation of annuities. Under existing provisions of
the Code, any increase in the contract value is not taxable to you as the owner
or annuitant until you receive it, either in the form of annuity payments, as
contemplated by the contract, or in some other form of distribution. The owner
of a non-tax qualified contract must be a natural person for this purpose. With
certain exceptions, where the owner of a non-tax qualified contract is a
non-natural person (corporation, partnership or trust) any increase in the
accumulation value of the contract attributable to a
Form V-4822
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purchase payment made after February 28, 1986 will be treated as ordinary income
received or accrued by the contract owner during the current tax year.
When annuity payments begin each payment is taxable under Section 72 of the Code
as ordinary income in the year of receipt if you have neither paid any portion
of the purchase payments nor previously been taxed on any portion of the
purchase payments. If any portion of your purchase payment has been paid from or
included in your taxable income, this aggregate amount will be considered your
"investment in the contract." You will be entitled to exclude from your taxable
income a portion of each annuity payment equal to your "investment in the
contract" divided by the period of expected annuity payments, determined by your
life expectancy and the form of annuity benefit. Once you recover your
"investment in the contract," all further annuity payments will be included in
your taxable income.
If you elect to receive the accumulated value in a single sum in lieu of annuity
payments, any amount you receive or withdraw in excess of the "investment in the
contract" will normally be taxed as ordinary income in the year received. A
partial withdrawal of contract values is taxable as income to the extent that
the accumulated value of the contract immediately before the payment exceeds the
"investment in the contract." Such a withdrawal is treated as a distribution of
earnings first and only second as a recovery of your "investment in the
contract." Any part of the value of the contract that you assign or pledge to
secure a loan will be taxed as if it had been a partial withdrawal and may be
subject to a penalty tax.
There is a penalty tax equal to 10% of any amount that must be included in gross
income for tax purposes. The penalty will not apply to a redemption that is:
- - received on or after the taxpayer reaches age 59 1/2;
- - made to a beneficiary on or after the death of the annuitant;
- - attributable to the taxpayer's becoming disabled;
- - made as a series of substantially equal periodic payments for the life of the
annuitant (or joint lives of the annuitant and beneficiary);
- - from a contract that is a qualified funding asset for purposes of a structured
settlement;
- - made under an annuity contract that is purchased with a single premium and
with an annuity payout date not later than a year from the purchase of the
annuity;
- - incident to divorce, or
- - taken from an IRA for a qualified first-time home purchase (up to $10,000) or
qualified education expenses.
If you elect not to have withholding apply to an early withdrawal or if an
insufficient amount is withheld, you may be responsible for payment of estimated
tax. You may also incur penalties under the estimated tax rules if the
withholding and estimated tax payments are not sufficient. If you fail to
provide your taxpayer identification number, any payments under the contract
will automatically be subject to withholding.
TAX-DEFERRED ANNUITIES
Under the provisions of Section 403(b) of the Code, employees may exclude from
their gross income purchase payments made for annuity contracts purchased for
them by public educational institutions and certain tax-exempt organizations
which are described in Section 501(c)(3) of the Code. You may make this
exclusion to the extent that the aggregate purchase payments plus any other
amounts contributed to purchase the contract and toward benefits under qualified
retirement plans do not exceed your exclusion allowance as determined in
Sections 403(b) and 415 of the Code. Employee contributions are, however,
subject to social security (FICA) tax withholding. All amounts you receive under
a contract, either in the form of annuity payments or cash
Form V-4822
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withdrawal, will be taxed under Section 72 of the Code as ordinary income for
the year received, except for exclusion of any amounts representing "investment
in the contract." Under certain circumstances, amounts you receive may be used
to make a "tax-free rollover" into one of the types of individual retirement
arrangements permitted under the Code. Amounts you receive that are eligible for
"tax-free rollover" will be subject to an automatic 20% withholding unless you
directly roll over such amounts from the tax-deferred annuity to the individual
retirement arrangement.
With respect to earnings accrued and purchase payments made after December 31,
1988, for a salary reduction agreement under Section 403(b) of the Code,
distributions may be paid only when the employee:
- - attains age 59 1/2,
- - separates from the employer's service,
- - dies,
- - becomes disabled as defined in the Code, or
- - incurs a financial hardship as defined in the Code.
In the case of hardship, cash distributions may not exceed the amount of your
purchase payments. These restrictions do not affect your right to transfer
investments among the Funds and do not limit the availability of transfers
between tax-deferred annuities.
QUALIFIED PENSION OR PROFIT-SHARING PLANS
Under present law, a purchase payment made by an employer or trustee, for a plan
or trust qualified under Section 401(a) or 403(a) of the Code, is generally
excludable from the employees gross income. Any purchase payment made by the
employee, or which is considered taxable income to the employee in the year such
payment is made, constitutes an "investment in the contract" under Section 72 of
the Code for the employee's annuity benefits. Salary reduction payments to a
profit sharing plan qualifying under Section 401(k) of the Code are generally
excludable from the employee's gross income.
The Code requires plans to prohibit any distribution to a plan participant prior
to age 59 1/2, except in the event of death, total disability or separation from
service (special rules apply for plan terminations). Distributions must begin no
later than April 1 of the calendar year following the year in which the
participant reaches age 70 1/2. Premature distribution of benefits or
contributions in excess of those permitted by the Code may result in certain
penalties under the Code.
If an employee, or one or more of the beneficiaries, receives the total amounts
payable with respect to an employee within one taxable year after age 59 1/2 on
account of the employee's death or separation from service of the employer, any
amount received in excess of the employee's "investment in the contract" may be
taxed under special 5-year forward averaging rules. Five-year averaging will no
longer be available after 1999 except for certain grandfathered individuals. You
can elect to have that portion of a lump-sum distribution attributable to years
of participation prior to January 1, 1974 given capital gains treatment. The
percentage of pre-74 distribution subject to capital gains treatment decreases
as follows: 100%, 1987; 95%, 1988; 75%, 1989; 50%, 1990; and 25%, 1991. For tax
years 1992 and later no capital gains treatment is available (except that
taxpayers who were age 50 before 1986 may still elect capital gains treatment).
If you receive such a distribution you may be able to make a "tax-free rollover"
of the distribution less your "investment in the contract" into another
qualified plan in which you are a participant or into one of the types of
individual retirement arrangements permitted under the Code. Your surviving
spouse receiving such a distribution may be able to make a tax-free rollover to
one of the types of individual retirement arrangements permitted under the Code.
Amounts received that are eligible for "tax-free rollover" will be subject to an
automatic 20% withholding unless such amounts are directly rolled over to
another qualified plan or individual retirement arrangement.
Form V-4822
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INDIVIDUAL RETIREMENT ANNUITIES (IRA)
Section 408(b) of the Code provides that you may invest an amount up to $2,000
per year of earned income in an IRA and claim it as a personal tax deduction if
you are not an "active participant" in an employer maintained qualified
retirement plan or you have adjusted gross income which does not exceed the
"applicable dollar limit." For a single taxpayer, the applicable dollar
limitation is $30,000, with the amount of IRA contribution which may be deducted
reduced proportionately for Adjusted Gross Income between $30,000-$40,000. For
married couples filing jointly, the applicable dollar limitation is $50,000,
with the amount of IRA contribution which may be deducted reduced
proportionately for Adjusted Gross Income between $50,000-$60,000. There is no
deduction allowed for IRA contributions when Adjusted Gross Income reaches
$40,000 for individuals and $60,000 for married couples filing jointly. In the
alternative, if you are otherwise qualified for an IRA you may elect to
contribute to an IRA for yourself and for your non-working spouse, with the
total deduction limited to $4,000.
You may make non-deductible IRA contributions to the extent you are ineligible
to make deductible IRA contributions. Any amount received from another qualified
plan (including another individual retirement arrangement) which is eligible as
a "tax-free rollover" may be invested in an IRA. This is not counted toward the
overall contribution limit. Earnings on nondeductible IRA contributions are not
subject to tax until they are withdrawn. The combined limit on designated
nondeductible and deductible contributions for a tax year is the lesser of 100%
of compensation or $2,000 ($4,000 in the case of an additional contribution to a
spousal IRA).
Generally, distributions (all or part) made prior to age 59 1/2 (except in the
case of death or disability) will result in a penalty tax of 10% plus ordinary
income tax treatment of the amount received. Additionally, there is an excise
tax of 6% of the amount you contributed in excess of either the deductible limit
or nondeductible limit, as indicated above, if you do not withdraw that amount
before filing your income tax return for the year of contribution or apply that
amount as an allowable contribution for a later year. The excise tax continues
to apply each year until the excess contribution is corrected. Distributions
after age 59 1/2 are treated as ordinary income at the time received.
Distributions must begin before April 1 following the year in which you reach
age 70 1/2. A 50% nondeductible excise tax is imposed on the excess in any tax
year of the amount that should have been distributed over the amount actually
distributed.
Section 408A of the Code provides for a special type of IRA called a Roth IRA.
No tax deduction is allowed for contributions to a Roth IRA, but assets grow on
a tax deferred basis. Under certain circumstances, withdrawals from a Roth IRA
can be excludable from income. Eligibility for a Roth IRA is based on adjusted
gross income and filing status. Special rules apply which allow traditional IRAs
to be rolled over or converted to a Roth IRA.
SIMPLIFIED EMPLOYEE PENSION PLANS (SEPPS)
Under Section 408 of the Code, employers may establish SEPPs for their
employees. Under these plans the employer may contribute on behalf of an
employee to an individual retirement account or annuity. The amount of the
contribution is excludable from the employee's income.
Certain employees who participate in a SEPP may elect to have the employer make
contributions to a SEPP on their behalf or to receive the contributions in cash.
If the employee elects to have contributions made on the employee's behalf to a
SEPP, it is not treated as current taxable income to the employee. Elective
deferrals under a SEPP are subject to an inflation-indexed limit which is
$10,000 for 1998. Salary-reduction SEPPs are available only if at least 50% of
the employees elect to have amounts contributed to the SEPP and if the employer
has 25 or fewer employees at all times during the preceding year. New salary
reduction SEPPs may not be established after 1996.
An employee may also take a deduction for individual contributions to the IRA,
subject to the limits applicable to IRAs in general. Withdrawals from the IRAs
to which the employer contributes must be permitted. These withdrawals, however,
are subject to the general rules with respect to withdrawals from IRAs.
Form V-4822
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<PAGE> 31
WITHHOLDING ON DISTRIBUTION
Distributions from tax-deferred annuities or qualified pension or profit sharing
plans that are eligible for "tax-free rollover" will be subject to an automatic
20% withholding unless such amounts are directly rolled over to an individual
retirement arrangement or another qualified plan. Federal income tax withholding
is required on annuity payments. However, recipients of annuity payments may
elect not to have the tax withheld. This election may be revoked at any time and
withholding would begin after that. If you do not give us your taxpayer
identification number any payments under the contract will automatically be
subject to withholding.
Form V-4822
27
<PAGE> 32
APPENDIX A
IRA DISCLOSURE STATEMENT
This statement is designed to help you understand the requirements of federal
tax law which apply to your individual retirement annuity (IRA), your Roth IRA,
your simplified employee pension IRA (SEPP-IRA) for employer contributions, your
Savings Incentive Match Plan for Employees (SIMPLE) IRA, or to one you purchase
for your spouse. You can obtain more information regarding your IRA either from
your sales representative or from any district office of the Internal Revenue
Service.
FREE LOOK PERIOD
The annuity contract offered by this prospectus gives you the opportunity to
return the contract for a full refund within 20 days after it is delivered. To
exercise this "free-look" provision write or call the address shown below:
The Ohio National Life Insurance Company
Variable Annuity Administration
P.O. Box 2669
Cincinnati, Ohio 45201
Telephone: 1-800-366-6654 -- 8:30 a.m. - 4:30 p.m. (Eastern time zone)
ELIGIBILITY REQUIREMENTS
IRAs are intended for all persons with earned compensation whether or not they
are covered under other retirement programs. Additionally if you have a
non-working spouse (and you file a joint tax return), you may establish an IRA
on behalf of your non-working spouse. A working spouse may establish his or her
own IRA. A divorced spouse receiving taxable alimony (and no other income) may
also establish an IRA.
CONTRIBUTIONS AND DEDUCTIONS
Contributions to your IRA will be deductible if you are not an "active
participant" in an employer maintained qualified retirement plan or you have
Adjusted Gross Income which does not exceed the "applicable dollar limit." IRA
(or SEPP-IRA) contributions must be made by no later than the time you file your
income tax return for that year. For a single taxpayer, the applicable dollar
limitation is $30,000, with the amount of IRA contribution which may be deducted
reduced proportionately for Adjusted Gross Income between $30,000-$40,000. For
married couples filing jointly, the applicable dollar limitation is $50,000,
with the amount of IRA contribution which may be deducted reduced
proportionately for Adjusted Gross Income between $50,000-$60,000. There is no
deduction allowed for IRA contributions when Adjusted Gross Income reaches
$40,000 for individuals and $60,000 for married couples filing jointly.
Contributions made by your employer to your SEPP-IRA are excludable from your
gross income for tax purposes in the calendar year for which the amount is
contributed. Certain employees who participate in a SEPP-IRA will be entitled to
elect to have their employer make contributions to their SEPP-IRA on their
behalf or to receive the contributions in cash. If the employee elects to have
contributions made on the employee's behalf to the SEPP, those funds are not
treated as current taxable income to the employee. Elective deferrals under a
SEPP-IRA are subject to an inflation-adjusted limit which is $10,000 for 1998.
Salary-reduction SEPP-IRAs (also called "SARSEPs") are available only if at
least 50% of the employees elect to have amounts contributed to the SEPP-IRA and
if the employer has 25 or fewer employees at all times during the preceding
year. New salary reduction SEPPs may not be established after 1996.
Form V-4822
28
<PAGE> 33
The IRA maximum annual contribution and your tax deduction is limited to the
lesser of: (1) $2,000 or (2) 100% of your earned compensation. Contributions in
excess of the deduction limits may be subject to penalty. See below.
Under a SEPP-IRA agreement, the maximum annual contribution which your employer
may make on your behalf to a SEPP-IRA contract which is excludable from your
income is the lesser of 15% of your salary or $24,000. An employee who is a
participant in a SEPP-IRA agreement may make after-tax contributions to the
SEPP-IRA contract, subject to the contribution limits applicable to IRAs in
general. Those employee contributions will be deductible subject to the
deductibility rules described above.
The maximum tax deductible annual contribution that a divorced spouse with no
other income may make to an IRA is the lesser of (1) $2,000 or (2) 100% of
taxable alimony.
If you or your employer should contribute more than the maximum contribution
amount to your IRA or SEPP-IRA, the excess amount will be considered an "excess
contribution". You are permitted to withdraw an excess contribution from your
IRA or SEPP-IRA before your tax filing date without adverse tax consequences.
If, however, you fail to withdraw any such excess contribution before your tax
filing date, a 6% excise tax will be imposed on the excess for the tax year of
contribution.
Once the 6% excise tax has been imposed, an additional 6% penalty for the
following tax year can be avoided if the excess is (1) withdrawn before the end
of the following year, or (2) treated as a current contribution for the
following year. (See Premature Distributions for penalties imposed on withdrawal
when the contribution exceeds $2,200).
IRA FOR NON-WORKING SPOUSE
If you establish an IRA for yourself, you may also be eligible to establish an
IRA for your "non-working" spouse. In order to be eligible to establish such a
spousal IRA, you must file a joint tax return with your spouse and if your
non-working spouse has compensation, his/her compensation must be less than your
compensation for the year. Contributions of up to $2,000 each may be made to
your IRA and the spousal IRA if the combined compensation of you and your spouse
is at least equal to the amount contributed. If requirements for deductibility
(including income levels) are met, you will be able to deduct an amount equal to
the least of (i) the amount contributed to the IRA's; (ii) $4,000; or (iii) 100%
of your combined gross income.
Contributions in excess of the contribution limits may be subject to penalty.
See above under "Contributions and Deductions." If you contribute more than the
allowable amount, the excess portion will be considered an excess contribution.
The rules for correcting it are the same as discussed above for regular IRAs.
Other than the items mentioned in this section, all of the requirements
generally applicable to IRAs are also applicable to IRAs established for
non-working spouses.
ROLLOVER CONTRIBUTION
Once every year, you are permitted to withdraw any portion of the value of your
IRA or SEPP-IRA and reinvest it in another IRA or bond. Withdrawals may also be
made from other IRAs and contributed to this contract. This transfer of funds
from one IRA to another is called a "rollover" IRA. To qualify as a rollover
contribution, the entire portion of the withdrawal must be reinvested in another
IRA within 60 days after the date it is received. You will not be allowed a
tax-deduction for the amount of any rollover contribution.
A similar type of rollover to an IRA can be made with the proceeds of a
qualified distribution from a qualified retirement plan or tax-sheltered
annuity. Properly made, such a distribution will not be taxable until you
receive payments from the IRA created with it. Unless you were a self-employed
participant in the distributing plan, you may later rollover such a contribution
to another qualified retirement plan as long as you have not mixed it with
Form V-4822
29
<PAGE> 34
IRA (or SEPP-IRA) contributions you have deducted from your income. (You may
roll less than all of a qualified distribution into an IRA, but any part of it
not rolled over will be currently includable in your income without any capital
gains treatment.)
PREMATURE DISTRIBUTIONS
At no time can your interest in your IRA or SEPP-IRA be forfeited. To insure
that your contributions will be used for your retirement, the federal tax law
does not permit you to use your IRA or SEPP-IRA as security for a loan.
Furthermore, as a general rule, you may not sell or assign your interest in your
IRA or SEPP-IRA to anyone. Use of an IRA (or SEPP-IRA) as security or assignment
of it to another will invalidate the entire annuity. It then will be includable
in your income in the year it is invalidated and will be subject to a 10%
penalty tax if you are not at least age 59 1/2 or totally disabled unless you
comply with special rules requiring distributions to be made at least annually
over your life expectancy.
The 10% penalty tax does not apply to the withdrawal of an excess contribution
as long as the excess is withdrawn before the due date of your tax return.
Withdrawals of excess contributions after the due date of your tax return will
generally be subject to the 10% penalty unless the excess contribution results
from erroneous information from a plan trustee making an excess rollover
contribution or unless you are over age 59 1/2 or are disabled.
DISTRIBUTION AT RETIREMENT
Once you have attained age 59 1/2 (or have become totally disabled), you may
elect to receive a distribution of your IRA (or SEPP-IRA) regardless of when you
actually retire. You may elect to receive the distribution in either one sum or
under any one of the periodic payment options available under the contract. The
distributions from your IRA under any one of the periodic payment options or in
one sum will be treated as ordinary income as you receive them.
INADEQUATE DISTRIBUTIONS -- 50% TAX
Your IRA or SEPP-IRA is intended to provide retirement benefits over your
lifetime. Thus, federal law requires that you either (1) receive a lump-sum
distribution of your IRA by April 1 of the year following the year in which you
attain age 70 1/2 or (2) start to receive periodic payments by that date. If you
elect to receive periodic payments, those payments must be sufficient to pay out
the entire value of your IRA during your life expectancy (or over the joint life
expectancies of you and your spouse). If the payments are not sufficient to meet
these requirements, an excise tax of 50% will be imposed on the amount of any
underpayment.
DEATH BENEFITS
If you, (or your surviving spouse) die before receiving the entire value of your
IRA (or SEPP-IRA), the remaining interest must be distributed to your
beneficiary (or your surviving spouse's beneficiary) in one lump-sum within 5
years of death, or applied to purchase an immediate annuity for the beneficiary.
This annuity must be payable over the life expectancy of the beneficiary
beginning within one year after your or your spouse's death. If your spouse is
the designated beneficiary, he or she is treated as the owner of the IRA. If
minimum required distributions have begun, the entire amount must be distributed
at least as rapidly as if the owner had survived. A distribution of the balance
of your IRA upon your death will not be considered a gift for federal tax
purposes, but will be included in your gross estate for purposes of federal
estate taxes.
ROTH IRAS
Section 408A of the Code permits eligible individuals to contribute to a type of
IRA known as a "Roth IRA." Contributions may be made to a Roth IRA by taxpayers
with adjusted gross incomes of less than $160,000 for
Form V-4822
30
<PAGE> 35
married individuals filing jointly and less than $100,000 for single
individuals. Married individuals filing separately are not eligible to
contribute to a Roth IRA. The maximum amount of contributions allowable for any
taxable year to all Roth IRAs maintained by an individual is generally the
lesser of $2,000 and 100% of compensation for that year (the $2,000 limit is
phased out for incomes between $150,000 and $160,000 for married and between
$95,000 and $110,000 for singles). The contribution limit is reduced by the
amount of any contributions made to a non-Roth IRA. Contributions to a Roth IRA
are not deductible.
For taxpayers with adjusted gross income of $100,000 or less, all or part of
amounts in a non-Roth IRA may be converted, transferred or rolled over to a Roth
IRA. Some or all of the IRA value will typically be includable in the taxpayer's
gross income. If such a rollover, transfer or conversion occurred before 1/1/99,
the portion of the amount includable in gross income must be included in income
ratably over the next four years beginning with the year in which the
transaction occurred. Provided a rollover contribution meets the requirements
for IRAs under Section 408(d)(3) of the Code, a rollover may be made from a Roth
IRA to another Roth IRA.
UNDER SOME CIRCUMSTANCES, IT MAY NOT BE ADVISABLE TO ROLL OVER, TRANSFER OR
CONVERT ALL OR PART OF A NON-ROTH IRA TO A ROTH IRA. PERSONS CONSIDERING A
ROLLOVER, TRANSFER OR CONVERSION SHOULD CONSULT THEIR OWN TAX ADVISOR.
"Qualified distributions" from a Roth IRA are excludable from gross income. A
"qualified distribution" is a distribution that satisfies two requirements: (1)
the distribution must be made (a) after the owner of the IRA attains age 59 1/2;
(b) after the owner's death; (c) due to the owner's disability; or (d) for a
qualified first time homebuyer distribution within the meaning of Section
72(t)(2)(F) of the Code; and (2) the distribution must be made in the year that
is at least five years after the first year for which a contribution was made to
any Roth IRA established for the owner or five years after a rollover, transfer
or conversion was made from a non-Roth IRA to a Roth IRA. Distributions from a
Roth IRA that are not qualified distributions will be treated as made first from
contributions and then from earnings, and taxed generally in the same manner as
distributions from a non-Roth IRA.
Distributions from a Roth IRA need not commence at age 70 1/2. However, if the
owner dies before the entire interest in a Roth IRA is distributed, any
remaining interest in the contract must be distributed by December 31 of the
calendar year containing the fifth anniversary of the owner's death subject to
certain exceptions.
PROTOTYPE STATUS
The Internal Revenue Service has been requested to review the format of your
SEPP, and to issue an opinion letter to Ohio National Life stating that your IRA
qualifies as a prototype SEPP.
REPORTING TO THE IRS
Whenever you are liable for one of the penalty taxes discussed above (6% for
excess contributions, 10% for premature distributions or 50% for under
payments), you must file Form 5329 with the Internal Revenue Service. The form
is to be attached to your federal income tax return for the tax year in which
the penalty applies. Normal contributions and distributions must be shown on
your income tax return for the year to which they relate.
Form V-4822
31
<PAGE> 36
ILLUSTRATION OF IRA FIXED ACCUMULATIONS
<TABLE>
<CAPTION>
AGE 60 AGE 65 AGE 70
GUARANTEED GUARANTEED GUARANTEED
SURRENDER VALUE SURRENDER VALUE SURRENDER VALUE
---------------------------- ---------------------------- ----------------------------
$2,000 $2,000 $2,000
$1,000 ONE TIME $1,000 ONE TIME $1,000 ONE TIME
CONTRACT ANNUAL LUMP SUM ANNUAL LUMP SUM ANNUAL LUMP SUM
ANNIVERSARY CONTRIBUTIONS CONTRIBUTION CONTRIBUTIONS CONTRIBUTION CONTRIBUTIONS CONTRIBUTION
- ----------- ------------- ------------ ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
1 $ 933 $ 1,895 $ 933 $ 1,895 $ 933 $ 1,895
2 1,917 1,955 1,917 1,955 1,917 1,955
3 2,933 2,006 2,933 2,006 2,933 2,006
4 3,990 2,058 3,990 2,058 3,990 2,058
5 5,089 2,116 5,089 2,116 5,089 2,116
6 6,234 2,177 6,234 2,177 6,234 2,177
7 7.435 2,240 7,435 2,240 7,435 2,240
8 8,686 2,306 8,686 2,306 8,868 2,306
9 10,069 2,529 10,069 2,529 10,069 2,529
10 11,506 2,600 11,506 2,600 11,506 2,600
15 19,604 3,001 19,604 3,001 19,604 3,001
20 29,456 3,489 29,456 3,489 29,456 3,489
25 41,442 4,082 41,442 4,082 41,442 4,082
30 56,026 4,804 56,026 4,804 56,026 4,804
35 73,769 5,683 73,769 5,683 73,769 5,683
40 95,356 6,751 95,356 6,751 95,356 6,751
45 121,620 8,051 121,620 8,051 121,620 8,051
50 153,574 9,633 153,574 9,633 153,574 9,633
55 192,451 11,558 192,451 11,558 192,451 11,558
60 239,751 13,900 239,751 13,900 239,751 13,900
65 297,298 16,748 297,298 16,748
70 367,313 20,215 367,313 20,215
</TABLE>
- - Guaranteed Interest Rate: 3.25% is applicable to each contract anniversary.
- - The Surrender Value is the Accumulation Values less the Contingent Deferred
Sales Charge.
Form V-4822
32
<PAGE> 37
STATEMENT OF ADDITIONAL INFORMATION CONTENTS
<TABLE>
<S> <C>
Custodian
Independent Certified Public Accountants
Underwriter
Calculation of Money Market Yield
Total Return
Loans under Tax-Sheltered Annuities (VAA only)
Financial Statements for Ohio National Life and VAA or VAB
</TABLE>
Form V-4822
33
<PAGE> 38
OHIO NATIONAL VARIABLE ACCOUNT A
AND
OHIO NATIONAL VARIABLE ACCOUNT B
OF
THE OHIO NATIONAL LIFE INSURANCE COMPANY
One Financial Way
Montgomery, Ohio 45242
Telephone (513) 794-6514
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 2000
This Statement of Additional Information is not a prospectus. Read it along with
the prospectus for Ohio National Variable Accounts A and B ("VAA" and "VAB")
single purchase payment individual variable annuity contracts dated May 1, 2000.
To get a free copy of the prospectus for VAA and VAB, write or call us at the
above address.
Table of Contents
<TABLE>
<CAPTION>
<S> <C>
Custodian ......................................................................... 2
Independent Certified Public Accountants .......................................... 2
Underwriter ....................................................................... 2
Calculation of Money Market Yield ................................................. 3
Total Return ...................................................................... 3
Loans Under Tax-sheltered Annuities ............................................... 4
Financial Statements .............................................................. 5
</TABLE>
"TOP PLUS"
<PAGE> 39
CUSTODIAN
We have a custody agreement with Firstar Bank, N.A., Cincinnati, Ohio, under
which Firstar holds custody of VAA's and VAB's assets. The agreement provides
for Firstar to purchase Fund shares at their net asset value determined as of
the end of the valuation period during which we receive the deposit. At our
instruction, Firstar redeems the Fund shares held by VAA and VAB at their net
asset value determined as of the end of the valuation period during which we
receive or make a redemption request. In addition, Firstar keeps appropriate
records of all of VAA's and VAB's transactions in Fund shares.
The custody agreement requires Firstar to always have aggregate capital, surplus
and undivided profit of not less than $2 million. It does not allow Firstar to
resign until (a) a successor custodian bank having the above qualifications has
agreed to serve as custodian, or (b) VAA and VAB have been completely liquidated
and the liquidation proceeds properly distributed. Subject to these conditions,
the custody agreement may be terminated by either us or Firstar upon sixty days
written notice. We pay Firstar a fee for its services as custodian.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The financial statements of VAA and VAB as of December 31, 1999 and for the
periods indicated and our consolidated financial statements as of December 31,
1999 and 1998 and for the periods indicated have been included or incorporated
by reference in reliance upon the reports of KPMG LLP, independent certified
public accountants, and upon that firm's authority as experts in accounting and
auditing.
UNDERWRITER
We offer the contracts continuously. Before May 1, 1997, The O. N. Equity Sales
Company ("ONESCO"), a wholly-owned subsidiary of ours, was the principal
underwriter of the contracts. Since May 1, 1997, the principal underwriter has
been Ohio National Equities, Inc. ("ONEQ"), another wholly-owned subsidiary of
ours. The aggregate amount of commissions paid to ONESCO and ONEQ for contracts
issued by VAA, and the amounts retained by ONESCO and ONEQ, for each of the last
three years have been:
<TABLE>
<CAPTION>
ONESCO ONEQ ONESCO ONEQ
Aggregate Aggregate Retained Retained
Year Commissions Commissions Commissions Commissions
- ---- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
1999 None $14,608,378 None $2,619,496
1998 None $6,658,441 None $827,720
1997 $ 903,146 2,997,646 $ 89,572 297,299
</TABLE>
For contracts issued by VAB, those amounts have been:
2
<PAGE> 40
<TABLE>
<CAPTION>
ONESCO ONEQ ONESCO ONEQ
Aggregate Aggregate Retained Retained
Year Commissions Commissions Commissions Commissions
- ---- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
1999 None $ 554,994 None $ 99,518
1998 None $ 934,575 None $116,178
1997 $ 330,599 1,097,297 $ 32,788 108,827
</TABLE>
CALCULATION OF MONEY MARKET YIELD
The annualized current yield of the Money Market subaccount for the seven days
ended on December 31, 1999, was 4.82%. This was calculated by determining the
net change, exclusive of capital changes, in the value of a hypothetical
pre-existing account having a balance of one Money Market accumulation unit at
the beginning of the seven-day period, dividing the net change in value by the
beginning value to obtain the seven-day return, and multiplying the difference
by 36-5/7. The result is rounded to the nearest hundredth of one percent.
TOTAL RETURN
The average annual compounded rate of return for a contract for each subaccount
over a given period is found by equating the initial amount invested to the
ending redeemable value using the following formula:
n
P(1 + T) = ERV
where: P = a hypothetical initial payment of $1,000,
T = the average annual total return,
n = the number of years, and
ERV = the ending redeemable value of a hypothetical $1,000
beginning-of-period payment at the end of the period (or
fractional portion thereof).
We will up-date standardized total return data based upon Fund performance in
the subaccounts within 30 days after each calendar quarter.
In addition, we may present non-standardized total return data, using the above
formula but based upon Fund performance before the date we first offered this
series of contracts (October 7, 1993). This will be presented as if the same
charges and deductions applying to these contracts had been in effect from the
inception of each Fund.
The average annual total returns for the contracts from the inception of each
Fund and for the one-, five- and ten-year periods ending on December 31, 1999
(assuming surrender of the contract then) are as follows:
<TABLE>
<CAPTION>
Returns Fund
One Five Ten From Fund in VAA* Inception
Year Years Years Inception and VAB* Date
---- ----- ----- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Ohio National Fund:
Money Market 4.09% 4.37% 4.04% 6.13% 6.13% 3-20-80
Equity 18.80% 16.60% 11.35% 10.18% 10.18% 1-14-71
Bond (0.32%) 6.40% 6.16% 7.04% 7.04% 11-2-82
Omni 10.36% 13.28% 10.10% 10.50% 10.50% 9-10-84
S&P 500 Index 24.51% N/A N/A 27.76% 27.76% 1-3-97
International 65.91% 16.86% N/A 17.32% 17.32% 4-30-93
International Small Company 106.05% N/A N/A 24.14% 24.14% 3-31-95
Capital Appreciation 5.51% 12.00% N/A 11.25% 11.25% 5-1-94
Small Cap 104.62% 29.96% N/A 30.21% 30.21% 5-1-94
Aggressive Growth 4.81% N/A N/A 9.99% 9.99% 3-31-95
Core Growth 103.12% N/A N/A 28.21% 28.21% 1-3-97
Growth & Income 60.80% N/A N/A 32.27% 32.27% 1-3-97
Capital Growth 199.68% N/A N/A 104.69% 104.69% 5-1-98
Social Awareness 16.64% N/A N/A 3.55% 3.55% 1-3-97
High Income Bond 1.04% N/A N/A 0.14% 0.14% 5-1-98
Equity Income 17.52% N/A N/A 14.41% 14.41% 5-1-98
Blue Chip 4.92% N/A N/A 4.20% 4.20% 5-1-98
Goldman Sachs Variable:
G.S. Growth & Income 4.47% N/A N/A 4.59% (3.56%) 1-2-98
G.S. CORE U.S. Equity 23.19% N/A N/A 19.73% 15.85% 1-2-98
G.S. Capital Growth 26.00% N/A N/A 23.44% 24.61% 1-2-98
Janus Aspen Series:
Growth 42.71% 28.73% N/A 23.18% 36.51% 9-13-93
Worldwide Growth 62.99% 32.41% N/A 28.56% 39.60% 9-13-93
Balanced 25.63% 23.57% N/A 19.55% 26.91% 9-13-93
Lazard Retirement Series:
Small Cap 3.90% N/A N/A (0.89%) 3.72% 11-4-97
Emerging Markets 47.90% N/A N/A 3.35% 41.46% 11-4-97
Strong Variable Insurance:
Mid Cap Growth II 88.19% N/A N/A 44.96% 60.59% 12-31-96
Opportunity II 33.70% 22.01% N/A 19.26% 17.01 5-8-92
Schafer Value II (3.92%) N/A N/A (1.78%) (4.82%) 10-10-97
</TABLE>
*The "Returns in VAA and VAB" are the standardized total returns from the time
these Funds were added to VAA or VAB through December 31, 1999. The Goldman
Sachs Variable, Janus Aspen Series, and Strong Variable Insurance Funds were
added May 1, 1998. The Lazard Retirement Series Funds were added May 1, 1999.
3
<PAGE> 41
LOANS UNDER TAX-SHELTERED ANNUITIES
Contracts issued as tax-sheltered annuities under plans qualifying under Section
403(b) of the Code, and allowing for voluntary contributions only, are eligible
for loans secured by a security interest in the contract. A loan must be for at
least $1,000 and may only be made from the Guaranteed Account. The loan amount
is limited by the maximum loan formula described in your contract.
We charge an annual effective rate of interest up to 7%. You must generally
repay your loans within 5 years (or 20 years if you use the loan to purchase
your primary home).
The amount of the death benefit, the amount payable on a full surrender and the
amount that will be applied to provide an annuity will all be reduced by your
loan balance, including accrued interest.
4
<PAGE> 42
<PAGE> 1
THE OHIO NATIONAL LIFE INSURANCE COMPANY
AND SUBSIDIARIES
(a wholly owned subsidiary of
Ohio National Financial Services, Inc.)
Consolidated Financial Statements
December 31, 1999 and 1998
With Independent Auditors' Report Thereon
<PAGE> 2
INDEPENDENT AUDITORS' REPORT
The Board of Directors
The Ohio National Life Insurance Company:
We have audited the accompanying consolidated balance sheets of The Ohio
National Life Insurance Company (a wholly owned subsidiary of Ohio National
Financial Services, Inc.) and subsidiaries (the Company) as of December 31,
1999 and 1998, and the related consolidated statements of income, equity
and cash flows for each of the years in the three-year period ended
December 31, 1999. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of The
Ohio National Life Insurance Company and subsidiaries as of December 31,
1999 and 1998, and the results of their operations and their cash flows for
each of the years in the three-year period ended December 31, 1999, in
conformity with generally accepted accounting principles.
/s/ KPMG LLP
Cincinnati, Ohio
January 28, 2000
<PAGE> 3
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Consolidated Balance Sheets
December 31, 1999 and 1998
(in thousands, except share amounts)
<TABLE>
<CAPTION>
ASSETS 1999 1998
---------- ---------
<S> <C> <C>
Investments (notes 5, 9 and 10):
Securities available-for-sale, at fair value:
Fixed maturities $2,644,846 2,834,274
Equity securities 71,640 90,207
Fixed maturities held-to-maturity, at amortized cost 829,214 749,528
Mortgage loans on real estate, net 1,274,156 1,245,180
Real estate, net 9,472 8,724
Policy loans 162,078 157,555
Other long-term investments 56,832 41,697
Short-term investments 139,341 106,627
---------- ---------
Total investments 5,187,579 5,233,792
Cash 9,411 11,300
Accrued investment income 66,323 64,396
Deferred policy acquisition costs 374,359 275,119
Reinsurance recoverable 95,291 78,265
Other assets 43,802 44,074
Assets held in Separate Accounts 1,741,620 1,154,576
---------- ---------
Total assets $7,518,385 6,861,522
========== =========
LIABILITIES AND EQUITY
Future policy benefits and claims (note 6) $4,806,594 4,643,507
Policyholders' dividend accumulations 60,827 73,782
Other policyholder funds 18,030 17,260
Note payable (net of unamortized discount of $679 in 1999
and $722 in 1998) (note 7) 84,321 84,278
Federal income taxes (note 8):
Current 12,834 21,383
Deferred 12,105 67,828
Other liabilities 148,245 137,827
Liabilities related to Separate Accounts 1,718,864 1,107,049
---------- ---------
Total liabilities $6,861,820 6,152,914
---------- ---------
Equity (notes 3 and 12):
Class A Common stock, $1 par value. 10,000,000 authorized,
issued and outstanding 10,000 10,000
Accumulated other comprehensive income 6,245 107,444
Retained earnings 640,320 591,164
---------- ---------
Total equity 656,565 708,608
Commitments and contingencies (notes 10 and 14)
---------- ---------
Total liabilities and equity $7,518,385 6,861,522
========== =========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 4
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Consolidated Statements of Income
Years ended December 31, 1999, 1998 and 1997
(in thousands)
<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
<S> <C> <C> <C>
Revenues:
Traditional life insurance premiums $131,279 121,900 117,960
Accident and health insurance premiums 25,530 25,183 23,921
Annuity premiums and charges 36,931 32,280 34,187
Universal life policy charges 66,189 59,743 50,991
Net investment income (note 5) 414,147 394,825 386,693
Net realized gains on investments (note 5) 26,484 1,903 12,500
Other income 14,527 13,160 12,804
-------- -------- --------
715,087 648,994 639,056
-------- -------- --------
Benefits and expenses:
Benefits and claims 415,907 400,662 391,906
Provision for policyholders' dividends on
participating policies (note 12) 27,582 27,659 25,332
Amortization of deferred policy acquisition costs 29,124 23,240 22,122
Other operating costs and expenses 92,096 91,522 94,870
-------- -------- --------
564,709 543,083 534,230
-------- -------- --------
Income before Federal income taxes 150,378 105,911 104,826
-------- -------- --------
Federal income taxes (note 8):
Current expense 43,334 40,337 41,564
Deferred expense (benefit) 7,888 (2,301) (3,825)
-------- -------- --------
51,222 38,036 37,739
-------- -------- --------
Net income $ 99,156 67,875 67,087
======== ======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 5
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Consolidated Statements of Equity
Years ended December 31, 1999, 1998 and 1997
(in thousands)
<TABLE>
<CAPTION>
ACCUMULATED
OTHER
COMMON COMPREHENSIVE RETAINED TOTAL
STOCK INCOME EARNINGS EQUITY
-------- ---------- -------- ---------
<S> <C> <C> <C> <C>
1997:
Balance, beginning of year $ -- 46,807 468,202 515,009
Comprehensive income:
Net income -- -- 67,087 67,087
Other comprehensive income (note 4) -- 56,149 -- 56,149
--------
Total comprehensive income 123,236
-------- -------- -------- --------
Balance, end of year $ -- 102,956 535,289 638,245
======== ======== ======== ========
1998:
Balance, beginning of year $ -- 102,956 535,289 638,245
Stock issuance 10,000 -- (10,000) --
Dividends paid -- -- (2,000) (2,000)
Comprehensive income:
Net income -- -- 67,875 67,875
Other comprehensive income (note 4) -- 4,488 -- 4,488
--------
Total comprehensive income 72,363
-------- -------- --------- --------
Balance, end of year $ 10,000 107,444 591,164 708,608
======== ======== ========= ========
1999:
Balance, beginning of year $ 10,000 107,444 591,164 698,608
Dividends paid -- -- (50,000) (50,000)
Comprehensive income:
Net income -- -- 99,156 99,156
Other comprehensive loss (note 4) -- (101,199) -- (101,199)
---------
Total comprehensive loss (2,043)
-------- -------- --------- --------
Balance, end of year $ 10,000 6,245 640,320 656,565
======== ======== ========= ========
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 6
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Consolidated Statements of Cash Flows
Years ended December 31, 1999, 1998 and 1997
(in thousands)
<TABLE>
<CAPTION>
1999 1998 1997
----------- ---------- ----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $ 99,156 67,875 67,087
Adjustments to reconcile net income to net cash
provided by operating activities:
Capitalization of deferred policy acquisition costs (63,521) (55,200) (48,507)
Amortization of deferred policy acquisition costs 29,124 23,240 22,122
Amortization and depreciation (75) (289) 4,342
Realized gains on invested assets, net (26,484) (1,903) (12,500)
Deferred Federal income tax expense (benefit) 7,888 (2,301) (3,825)
Increase in accrued investment income (1,927) (317) (1,740)
Increase in other assets (22,392) (19,113) (15,401)
Net (decrease) increase in separate accounts 24,770 (18,279) (16,011)
Increase in policyholder account balances 56,409 50,834 40,843
(Decrease) increase in policyholders' dividend
accumulations and other funds (12,185) 11,550 (243)
(Decrease) increase in current Federal income tax payable (8,549) 8,662 (2,149)
Increase in other liabilities 14,965 18,855 6,484
Other, net (3,875) (14,355) 4,656
----------- ---------- ----------
Net cash provided by operating activities 93,304 69,259 45,158
----------- ---------- ----------
Cash flows from investing activities:
Proceeds from maturity of fixed maturities available-for-sale 18,206 11,167 298,686
Proceeds from sale of fixed maturities available-for-sale 295,806 202,694 51,770
Proceeds from sale of equity securities 30,312 9,603 4,996
Proceeds from maturity of fixed maturities held-to-maturity 86,335 115,577 75,530
Proceeds from repayment of mortgage loans on real estate 183,514 198,464 180,745
Proceeds from sale of real estate 962 15,906 19,078
Cost of fixed maturities available-for-sale acquired (354,722) (345,266) (367,027)
Cost of equity securities acquired (5,001) (8,197) (7,205)
Cost of fixed maturities held-to-maturity acquired (162,049) (134,965) (110,982)
Cost of mortgage loans on real estate acquired (207,587) (212,924) (321,914)
Cost of real estate acquired (550) (846) (1,310)
Change in policy loans, net (4,523) (4,207) (620)
Change in other assets, net 140 5,253 312
----------- ---------- ----------
Net cash used in investing activities (119,157) (147,741) (177,941)
----------- ---------- ----------
Cash flows from financing activities:
Universal life and investment product account deposits 1,221,353 1,076,011 1,000,919
Universal life and investment product account withdrawals (1,114,675) (928,812) (884,395)
Dividends to shareholder (50,000) (2,000) --
Other, net -- (3,361) 80
----------- ---------- ----------
Net cash provided by financing activities 56,678 141,838 116,604
----------- ---------- ----------
Net increase (decrease) in cash and cash equivalents 30,825 63,356 (16,179)
Cash and cash equivalents, beginning of year 117,927 54,571 70,750
----------- ---------- ----------
Cash and cash equivalents, end of year $ 148,752 117,927 54,571
=========== ========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE> 7
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(1) ORGANIZATION, CONSOLIDATION POLICY AND BUSINESS DESCRIPTION
The Ohio National Life Insurance Company (ONLIC) is a stock life
insurance company. Ohio National Life Assurance Corporation (ONLAC) is a
wholly owned stock life insurance subsidiary included in the
consolidated financial statements. ONLIC and its subsidiaries are
collectively referred to as the "Company". All significant intercompany
accounts and transactions have been eliminated in consolidation.
On February 12, 1998, ONLIC's Board of Directors approved a plan of
reorganization for the Company under the provision of Sections 3913.25
to 3913.38 of the Ohio Revised Code relating to mutual insurance holding
companies. The plan of reorganization was approved by the Company's
policyholders and by the Ohio Department of Insurance and became
effective on August 1, 1998 (Effective Date). As part of the
reorganization (see footnote (1)(k)), ONLIC became a stock company 100%
owned by Ohio National Financial Services, Inc. (ONFS). ONFS is 100%
owned by Ohio National Mutual Holdings, Inc. (ONMH), an Ohio mutual
holding company.
ONLIC and ONLAC are life and health insurers licensed in 47 states, the
District of Columbia and Puerto Rico. The Company offers a full range of
life, health and annuity products through exclusive agents and other
distribution channels and is subject to competition from other insurers
throughout the United States. The Company is subject to regulation by
the Insurance Departments of states in which it is licensed and
undergoes periodic examinations by those departments.
The following is a description of the most significant risks facing life
and health insurers and how the Company mitigates those risks:
LEGAL/REGULATORY RISK is the risk that changes in the legal or
regulatory environment in which an insurer operates will create
additional expenses not anticipated by the insurer in pricing its
products. That is, regulatory initiatives designed to reduce
insurer profits, new legal theories or insurance company
insolvencies through guaranty fund assessments may create costs
for the insurer beyond those recorded in the consolidated
financial statements. The Company mitigates this risk by offering
a wide range of products and by operating throughout the United
States, thus reducing its exposure to any single product or
jurisdiction, and also by employing underwriting practices which
identify and minimize the adverse impact of this risk.
CREDIT RISK is the risk that issuers of securities owned by the
Company or mortgagors on mortgage loans on real estate owned by
the Company will default or that other parties, including
reinsurers, which owe the Company money, will not pay. The Company
minimizes this risk by adhering to a conservative investment
strategy, by maintaining sound reinsurance and credit and
collection policies and by providing for any amounts deemed
uncollectible.
6
<PAGE> 8
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
INTEREST RATE RISK is the risk that interest rates will change and
cause a decrease in the value of an insurer's investments. This
change in rates may cause certain interest-sensitive products to
become uncompetitive or may cause disintermediation. The Company
mitigates this risk by charging fees for non-conformance with
certain policy provisions, by offering products that transfer this
risk to the purchaser, and/or by attempting to match the maturity
schedule of its assets with the expected payouts of its
liabilities. To the extent that liabilities come due more quickly
than assets mature, an insurer would have to borrow funds or sell
assets prior to maturity and potentially recognize a gain or loss.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by the Company that
materially affect financial reporting are summarized below. The
accompanying consolidated financial statements have been prepared in
accordance with generally accepted accounting principles (GAAP) which
differ from statutory accounting practices prescribed or permitted by
regulatory authorities (see Note 3).
(a) VALUATION OF INVESTMENTS AND RELATED GAINS AND LOSSES
Fixed maturity securities are classified as held-to-maturity when
the Company has the positive intent and ability to hold the
securities to maturity and are stated at amortized cost. Fixed
maturity securities not classified as held-to-maturity and all
equity securities are classified as available-for-sale and are
stated at fair value, with the unrealized gains and losses, net of
adjustments to deferred policy acquisition costs and deferred
Federal income tax, reported as a separate component of equity
that would have been required as a charge or credit to operations
had such unrealized amounts been realized. The Company has no
securities classified as trading.
Mortgage loans on real estate are carried at the unpaid principal
balance less valuation allowances. The Company provides valuation
allowances for impairments of mortgage loans on real estate based
on a review by portfolio managers. The measurement of impaired
loans is based on the present value of expected future cash flows
discounted at the loan's effective interest rate or, at the fair
value of the collateral, if the loan is collateral dependent.
Loans in foreclosure and loans considered to be impaired as of the
balance sheet date are placed on non-accrual status and written
down to the fair value of the existing property to derive a new
cost basis. Cash receipts on non-accrual status mortgage loans on
real estate are included in interest income in the period
received.
Real estate is carried at cost less accumulated depreciation and
valuation allowances. Other long-term investments are carried on
the equity basis, adjusted for valuation allowances.
Realized gains and losses on the sale of investments are
determined on the basis of specific security identification, net
of associated deferred acquisition costs and capital gains
expenses. Any capital gains occurring in the Closed Block
portfolio are offset by increases in the deferred policyholder
obligation for that group of policies. Estimates for valuation
allowances and other than temporary declines are included in
realized gains and losses on investments.
7
<PAGE> 9
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(c) REVENUES AND BENEFITS
Traditional life insurance products include those products with
fixed and guaranteed premiums and benefits and consist primarily
of whole life, limited-payment life, term life and certain
annuities with life contingencies. Premiums for traditional life
insurance products are recognized as revenue when due and
collected. Benefits and expenses are associated with earned
premiums so as to result in recognition of profits over the life
of the contract. This association is accomplished by the provision
for future policy benefits and the deferral and amortization of
policy acquisition costs.
Universal life products include universal life, variable universal
life and other interest-sensitive life insurance policies.
Investment products consist primarily of individual and group
deferred annuities, annuities without life contingencies and
guaranteed investment contracts. Revenues for universal life and
investment products consist of net investment income and cost of
insurance, policy administration and surrender charges that have
been earned and assessed against policy account balances during
the period. Policy benefits and claims that are charged to expense
include benefits and claims incurred in the period in excess of
related policy account balances, maintenance costs and interest
credited to policy account balances.
Accident and health insurance premiums are recognized as revenue
in accordance with the terms of the policies. Policy claims are
charged to expense in the period that the claims are incurred.
(c) DEFERRED POLICY ACQUISITION COSTS
The costs of acquiring new business, principally commissions,
certain expenses of the policy issue and underwriting department
and certain variable agency expenses have been deferred. For
traditional non-participating life insurance products, these
deferred acquisition costs are predominantly being amortized with
interest over the premium paying period of the related policies in
proportion to premium revenue. Such anticipated premium revenue
was estimated using the same assumptions as were used for
computing liabilities for future policy benefits. For
participating life insurance products, deferred policy acquisition
costs are being amortized in proportion to gross margins of the
related policies. Gross margins are determined for each issue year
and are equal to premiums plus investment income less death
claims, surrender benefits, administrative costs, expected
policyholder dividends, and the increase in reserve for future
policy benefits. For universal life and investment products,
deferred policy acquisition costs are being amortized with
interest over the lives of the policies in relation to the present
value of the estimated future gross profits from projected
interest margins, cost of insurance, policy administration and
surrender charges. Deferred policy acquisition costs for
participating life and universal life business are adjusted to
reflect the impact of unrealized gains and losses on fixed
maturity securities available-for-sale (see note 2(a)).
8
<PAGE> 10
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(d) SEPARATE ACCOUNTS
Separate Account assets and liabilities represent contractholders'
funds which have been segregated into accounts with specific
investment objectives. The investment income and gains or losses
of these accounts accrue directly to the contractholders. The
activity of the Separate Accounts is not reflected in the
consolidated statements of income and cash flows except for the
fees the Company receives for administrative services and risks
assumed. Amounts provided by the Company to establish Separate
Account investment portfolios, seed money, are not included in
Separate Account liabilities.
(e) FUTURE POLICY BENEFITS
Future policy benefits for traditional life have been calculated
using a net level premium method based on estimates of mortality,
morbidity, investment yields and withdrawals which were used or
which were being experienced at the time the policies were issued,
rather than the assumptions prescribed by state regulatory
authorities (see note 6).
Future policy benefits for annuity policies in the accumulation
phase, universal life and variable universal life policies have
been calculated based on participants' aggregate account values.
(f) PARTICIPATING BUSINESS
Participating business represents approximately 39% of the
Company's ordinary life insurance in force in 1999. In 1998 and
1997, participating business represented approximately 41% and
42%, respectively, of the Company's ordinary life insurance in
force. The provision for policyholder dividends is based on
current dividend scales. Future dividends are provided for in
future policy benefits based on dividend scales in effect as of
December 31, 1999.
(g) REINSURANCE CEDED
Reinsurance premiums ceded and reinsurance recoveries on benefits
and claims incurred are deducted from the respective income and
expense accounts. Assets and liabilities related to reinsurance
ceded are reported on a gross basis.
(h) FEDERAL INCOME TAX
The Company is included as part of the consolidated Federal income
tax return of its ultimate parent, OHMH. The Company uses the
asset and liability method of accounting for income tax. Under the
asset and liability method, deferred tax assets and liabilities
are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases and
operating loss and tax credit carryforwards. Deferred tax assets
and liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. Under this
method, the effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that
includes the enactment date. Valuation allowances are established
when necessary to reduce the deferred tax assets to the amounts
expected to be realized.
9
<PAGE> 11
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(i) CASH EQUIVALENTS
For purposes of the consolidated statements of cash flows, the
Company considers all short-term investments with original
maturities of three months or less to be cash equivalents.
(j) USE OF ESTIMATES
In preparing the consolidated financial statements, management is
required to make estimates and assumptions that affect the
reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities as of the date of the
consolidated financial statements and revenues and expenses for
the reporting period. Actual results could differ significantly
from those estimates.
The estimates susceptible to significant change are those used in
determining deferred policy acquisition costs, the liability for
future policy benefits and claims, contingencies, and those used
in determining valuation allowances for mortgage loans on real
estate and real estate. Although some variability is inherent in
these estimates, management believes the amounts provided are
adequate.
(k) CLOSED BLOCK
The Reorganization contained an arrangement, known as a closed
block (the Closed Block), to provide for dividends on policies
that were in force on the Effective Date and were within classes
of individual policies for which the Company had a dividend scale
in effect at the time of the Reorganization. The Closed Block was
designed to give reasonable assurance to owners of affected
policies that assets will be available to support such policies,
including maintaining dividend scales in effect at the time of the
Reorganization, if the experience underlying such scales
continues. The assets, including revenue therefrom, allocated to
the Closed Block will accrue solely to the benefit of the owners
of policies included in the Closed Block until the Closed Block is
no longer in effect. The Company will not be required to support
the payment of dividends on Closed Block policies from its general
funds.
The financial information of the Closed Block, while prepared on a
GAAP basis, reflects its contractual provisions and not its actual
results of operations and financial position. Many expenses
related to the Closed Block operations are charges to operations
outside of the Closed Block; accordingly, the contribution from
the Closed Block does not represent the actual profitability of
the Closed Block operations. Operating costs and expenses outside
of the Closed Block are, therefore, disproportionate to the
business outside of the Closed Block.
10
<PAGE> 12
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
Summarized financial information of the Closed Block as of and for the year
ended December 31, 1999 is as follow:
<TABLE>
<S> <C>
Closed Block assets:
Fixed maturity securities available-for-sale,
at fair value (amortized cost of $238,405) $234,150
Fixed maturity securities held-to-maturity,
at amortized cost 72,826
Short-term investments, at fair value 10,583
Mortgage loans on real estate, net 93,698
Policy loans 115,932
Accrued investment income 6,101
Other assets 3,054
Reinsurance recoverable 1,979
Deferred policy acquisition costs 90,455
--------
$628,778
========
Closed Block liabilities:
Future policy benefits and claims $695,540
Other policyowner funds 3,768
Policyholders' dividend accumulations 16,345
--------
$715,653
========
Closed Block revenues and expenses:
Traditional life insurance premiums $ 74,269
Net investment income 44,230
Net realized gains on investments 33
Other expense (74)
Benefits and claims (71,806)
Amortization of deferred acquisition costs (4,433)
Other operating costs and expenses (5,100)
Provision for policyholders' dividends on participating policies (26,608)
--------
Income before Federal income taxes(1) $ 10,511
========
(1) Represents contribution from the Closed Block.
</TABLE>
11
<PAGE> 13
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(l) COMPREHENSIVE INCOME
Comprehensive income is the total of net income and all non-owner
changes in equity.
(m) EMERGING ACCOUNTING ISSUES
In June 1998, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 133, "Accounting
for Derivative Instruments and Hedging Activities" (SFAS 133).
SFAS 133 establishes accounting and reporting standards for
derivative instruments and for hedging activities. Contracts that
contain embedded derivatives, such as certain insurance contracts,
are also addressed by the Statement. SFAS 133 requires that an
entity recognize all derivatives as either assets or liabilities
in the statement of financial position and that those assets or
liabilities be measured at fair value. SFAS 133 is effective for
all fiscal quarters of fiscal years beginning after January 1,
2001, with earlier application permitted. The Company is currently
reviewing the requirements of this Statement and evaluating what,
if any, impact it will have on consolidated results of operations
and financial condition.
(n) RECLASSIFICATIONS
Certain amounts in the 1998 and 1997 consolidated financial
statements have been reclassified to conform with 1999
presentation.
(3) BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared in
accordance with GAAP which differs from statutory accounting practices
prescribed or permitted by regulatory authorities. Annual Statements for
ONLIC and ONLAC, insurance subsidiaries, filed with the Department of
Insurance of the State of Ohio, are prepared on a basis of accounting
practices prescribed or permitted by such regulatory authority.
Prescribed statutory accounting practices include a variety of
publications of the National Association of Insurance Commissioners
(NAIC), as well as state laws, regulations and general administrative
rules. Permitted statutory accounting practices encompass all accounting
practices not so prescribed. ONLIC and ONLAC have no material permitted
statutory accounting practices.
The statutory basis net income and capital and surplus of ONLIC and
ONLAC after intercompany eliminations included in the accompanying
consolidated financial statements was $91,163, $51,900 and $53,696 for
the years ended December 31, 1999, 1998 and 1997, respectively and
$430,869 and $408,928 as of December 31, 1999 and 1998, respectively.
12
<PAGE> 14
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(4) COMPREHENSIVE INCOME
The components of other comprehensive income, including the related
Federal tax amounts, were as follows for the years ended December 31:
<TABLE>
<CAPTION>
1999 1998 1997
--------- ------- -------
<S> <C> <C> <C>
Unrealized gains (losses) on securities
available-for-sale arising during the period:
Net of adjustment to deferred policy acquisition costs $(127,982) 11,418 86,670
Related Federal tax benefit (expense) 46,151 (4,003) (30,335)
--------- ------- -------
Net (81,831) 7,415 56,335
--------- ------- -------
Less:
Reclassification adjustment for net (gains) losses on securities
available-for-sale realized during the period:
Gross 29,798 4,504 287
Related Federal tax benefit (10,430) (1,577) (101)
--------- ------- -------
Net 19,368 2,927 186
--------- ------- -------
Total other comprehensive (loss) income $(101,199) 4,488 56,149
========= ======= =======
</TABLE>
13
<PAGE> 15
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(5) INVESTMENTS
An analysis of investment income and realized gains/(losses) by
investment type follows for the years ended December 31:
<TABLE>
<CAPTION>
REALIZED GAINS (LOSSES)
INVESTMENT INCOME ON INVESTMENTS
------------------------------------ -------------------------------
1999 1998 1997 1999 1998 1997
---------- ---------- ------------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Securities available-for-sale:
Fixed maturities $ 215,996 211,002 207,377 (1,184) (1,624) 3,041
Equity securities 3,495 3,530 2,441 16,830 178 38
Fixed maturities held-to-maturity 66,735 62,516 62,348 2,760 5,325 2,539
Mortgage loans on real estate 109,256 109,850 103,566 314 371 1,863
Real estate 1,371 2,334 6,123 (252) 2,416 4,418
Policy loans 10,988 10,298 9,834 -- -- --
Short-term 4,133 4,610 5,087 -- -- --
Other 17,782 6,553 6,612 9,481 (4,558) (387)
---------- ---------- ---------- ---------- -------- ---------
Total 429,756 410,693 403,388 27,949 2,108 11,512
Investment expenses (15,609) (15,868) (16,695)
Gains attributable to Closed Block (1,191) -- --
DAC amortization due to realized gains (218) (298) (985)
Change in valuation allowances:
Mortgage loans on real estate (56) 93 (63)
Real estate and other -- -- 2,036
---------- ---------- ---------- ---------- -------- ---------
(1,465) (205) 988
---------- -------- ---------
Net investment income 414,147 394,825 386,693
========== ========== ==========
Net realized gains on
investments $ 26,484 1,903 12,500
========== ======== =========
</TABLE>
14
<PAGE> 16
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
The amortized cost and estimated fair value of securities available-for-sale and
fixed maturities held-to-maturity were as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1999
--------------------------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED ESTIMATED
COST GAINS LOSSES FAIR VALUE
------------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Securities available-for-sale:
Fixed maturities:
U.S. Treasury securities and
obligations of U.S. government
operations and agencies $ 108,292 1,267 (1,908) 107,651
Obligations of states and political
subdivisions 79,236 571 (920) 78,887
Debt securities issued by foreign
governments 8,078 1,004 (850) 8,232
Corporate securities 1,666,057 29,519 (63,430) 1,632,146
Mortgage-backed securities 823,882 7,412 (13,364) 817,930
---------- ------- -------- ---------
Total fixed maturities $2,685,545 39,773 (80,472) 2,644,846
========== ======= ======== =========
Equity securities $ 35,635 39,212 (3,207) 71,640
========== ======= ======== =========
Fixed maturity securities held-to-maturity:
Obligations of states and political
subdivisions $ 13,596 355 (418) 13,533
Corporate securities 783,378 23,237 (16,426) 790,189
Mortgage-backed securities 32,240 746 (3,209) 29,777
---------- ------- -------- ---------
$ 829,214 24,338 (20,053) 833,499
========== ======= ======== =========
</TABLE>
15
<PAGE> 17
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
<TABLE>
<CAPTION>
DECEMBER 31, 1998
-----------------------------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED ESTIMATED
COST GAINS LOSSES FAIR VALUE
------------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Securities available-for-sale:
Fixed maturities:
U.S. Treasury securities and
obligations of U.S. government
operations and agencies $ 132,932 15,672 -- 148,604
Obligations of states and political
subdivisions 89,399 9,953 (47) 99,305
Debt securities issued by foreign
governments 8,078 2,057 -- 10,135
Corporate securities 1,720,789 137,373 (16,033) 1,842,129
Mortgage-backed securities 695,365 39,682 (946) 734,101
---------- -------- -------- ---------
Total fixed maturities $2,646,563 204,737 (17,026) 2,834,274
========== ======== ======== =========
Equity securities $ 41,795 51,454 (3,042) 90,207
========== ======== ======== =========
Fixed maturity securities held-to-maturity:
Obligations of states and political
subdivisions $ 10,265 825 (179) 10,911
Corporate securities 724,447 78,581 (529) 802,499
Mortgage-backed securities 14,816 1,233 -- 16,049
---------- -------- -------- ---------
$ 749,528 80,639 (708) 829,459
========== ======== ======== =========
</TABLE>
The components of unrealized gains on securities available-for-sale, net, were
as follows for the years ended December 31:
1999 1998
-------- --------
Gross unrealized (loss) gain $ (4,694) 236,123
Adjustment to deferred dividend liability -- (18,578)
Adjustment to deferred policy acquisition costs 16,226 (48,834)
Deferred Federal income tax (5,287) (61,267)
-------- --------
$ 6,245 107,444
======== ========
16
<PAGE> 18
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
The net unrealized gain on securities available-for-sale include a net
unrealized gain on equity securities of $23,403 in 1999 ($31,468 in 1998) and a
net unrealized loss on fixed maturities of $16,215 in 1999 ($76,621 in 1998).
An analysis of the change in gross unrealized gains (losses) on securities
available-for-sale and fixed maturities held-to-maturity follows for the years
ended December 31:
1999 1998 1997
--------- ------ ------
Securities available-for-sale:
Fixed maturities $(228,410) 25,125 91,601
Equity securities (12,407) 10,632 15,972
Fixed maturities held-to-maturity (75,646) 11,840 14,217
The amortized cost and estimated fair value of fixed maturity securities
available-for-sale and fixed maturity securities held-to-maturity as of December
31, 1999, by contractual maturity, are shown below. Expected maturities will
differ from contractual maturities because borrowers may have the right to call
or prepay obligations with or without call or prepayment penalties.
<TABLE>
<CAPTION>
FIXED MATURITY SECURITIES
----------------------------------------------------------------
AVAILABLE-FOR-SALE HELD-TO-MATURITY
----------------------------- ---------------------------
AMORTIZED ESTIMATED AMORTIZED ESTIMATED
COST FAIR VALUE COST FAIR VALUE
---------- --------- --------- ----------
<S> <C> <C> <C> <C>
Due in one year or less $ 67,057 68,013 22,817 23,011
Due after one year through five years 436,560 438,455 139,022 139,781
Due after five years through ten years 804,945 787,425 250,797 252,947
Due after ten years 1,376,983 1,350,953 416,578 417,760
---------- --------- ------- -------
$2,685,545 2,644,846 829,214 833,499
========== ========= ======= =======
</TABLE>
Proceeds from the sale of securities available-for-sale (excludes calls) during
1999, 1998 and 1997 were $158,661, $3,186, and $51,770, respectively. Gross
gains of $293 ($0 in 1998 and $203 in 1997) and gross losses of $4,131 ($38 in
1998 and $283 in 1997) were realized on those sales.
Investments with an amortized cost of $12,807 and $11,750 as of December 31,
1999 and 1998, respectively, were on deposit with various regulatory agencies as
required by law.
Real estate is presented at cost less accumulated depreciation of $1,855 in 1999
($1,730 in 1998) and valuation allowances of $0 in 1999 and 1998.
The Company generally initiates foreclosure proceedings on all mortgage loans on
real estate delinquent sixty days. There was one foreclosure of a mortgage loan
on real estate in 1999 and no mortgage loan, on real estate in process of
foreclosure as of December 31, 1999.
17
<PAGE> 19
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(6) FUTURE POLICY BENEFITS AND CLAIMS
The liability for future policy benefits for universal life insurance
policies and investment contracts (approximately 79% of the total
liability for future policy benefits as of December 31, 1999 and 1998)
has been established based on accumulated contract values without
reduction for surrender penalty provisions. The average interest rate
credited on investment product policies was 6.4%, 6.8% and 6.8% for the
years ended December 31, 1999, 1998 and 1997, respectively.
The liability for future policy benefits for traditional life policies
has been established based upon the net level premium method using the
following assumptions:
Interest rates: Interest rates vary as follows:
YEAR OF ISSUE INTEREST RATE
------------- -------------
1999, 1998 and 1997 4 - 5.5%
1996 and prior 2.25 - 6.0%
Withdrawals: Rates, which vary by issue age, type of coverage and
policy duration, are based on Company experience
Mortality: Mortality and morbidity rates are based on published tables,
guaranteed in insurance contracts.
(7) NOTES PAYABLE
On July 11, 1994, the Company issued $50,000, 8.875% surplus notes, due
July 15, 2004. On May 21, 1996, the Company issued $50,000, 8.5% surplus
notes, due May 15, 2026. Concurrent with the issue of the new notes,
$15,000 of the notes issued on July 11, 1994 were retired. Total
interest paid was $7,356 for each year during the years ended December
31, 1999, 1998 and 1997, respectively.
The notes have been issued in accordance with Section 3941.13 of the
Ohio Revised Code. Interest payments, scheduled semi-annually, must be
approved for payment by the Director of the Department of Insurance of
the State of Ohio. All issuance costs have been capitalized and are
being amortized over the terms of the notes.
18
<PAGE> 20
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(8) FEDERAL INCOME TAX
Prior to 1984, the Life Insurance Company Income Tax Act of 1959, as
amended by the Deficit Reduction Act of 1984 (DRA), permitted the
deferral from taxation of a portion of statutory income under certain
circumstances. In these situations, the deferred income was accumulated
in the Policyholders' Surplus Account (PSA). Management considers the
likelihood of distributions from the PSA to be remote; therefore, no
Federal income tax has been provided for such distributions in the
financial statements. The DRA eliminated any additional deferrals to the
PSA. Any distributions from the PSA, however, will continue to be
taxable at the then current tax rate. The pre-tax balance of the PSA is
approximately $5,257 as of December 31, 1999.
Total income taxes for the years ended December 31, 1999, 1998 and 1997
were allocated as follows:
1999 1998 1997
-------- ------ ------
Operations $ 51,222 38,036 37,739
Unrealized gains (loss) on securities
available for sale (56,581) 2,426 30,234
-------- ------ ------
$ (5,359) 40,462 67,973
======== ====== ======
Total Federal income tax expense for the years ended December 31, 1999,
1998 and 1997 differs from the amount computed by applying the U.S.
Federal income tax rate to income before tax as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------------ ---------------------- ------------------
AMOUNT % AMOUNT % AMOUNT %
--------- ------ ---------- ---------- ---------- ------
<S> <C> <C> <C> <C> <C> <C>
Computed (expected)
tax expense $ 52,632 35.0 37,069 35.0 36,689 35.0
Differential earnings (3,896) (2.6) 1,232 1.1 3,720 3.5
Dividends received
deduction and tax
exempt interest (1,492) (1.0) (1,279) (1.1) (1,406) (1.3)
Other, net $ 3,978 2.6 1,014 1.0 (1,264) (1.2)
========= ====== ========= ======= ========= ======
Total expense and
effective rate $ 51,222 34.0 38,036 37.1 37,739 37.3
========= ====== ========= ======= ========= ======
</TABLE>
Included in other, net in 1999 are non-deductible expenses related to
the reorganization to a mutual holding company structure.
Total Federal income tax paid was $51,773, $32,251 and $43,522 (net of
refunds of $66, $6,661 and $0) during the years ended December 31, 1999,
1998 and 1997, respectively.
19
<PAGE> 21
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
The tax effects of temporary differences between the financial statement
carrying amounts and tax basis of assets and liabilities that give rise
to significant components of the net deferred tax liability as of
December 31, 1999 and 1998 relate to the following:
<TABLE>
<CAPTION>
1999 1998
---------- ----------
<S> <S> <C>
Deferred tax assets:
Fixed maturity securities available-for-sale $ 14,262 --
Future policy benefits 59,251 59,651
Mortgage loans on real estate 2,529 2,529
Other assets and liabilities 34,830 24,161
---------- ----------
Total gross deferred tax assets 110,872 86,341
---------- ----------
Deferred tax liabilities:
Fixed maturity securities available-for-sale -- 65,618
Deferred policy acquisition costs 76,781 70,312
Other fixed maturities, equity securities and other
long-term investments 7,951 15,062
Other 38,245 3,177
---------- ----------
Total gross deferred tax liabilities 122,977 154,169
---------- ----------
Net deferred tax liability $ (12,105) (67,828)
========== ==========
</TABLE>
The Company has determined that a deferred tax asset valuation allowance
was not needed as of December 31, 1999 and 1998. In assessing the
realization of deferred tax assets, management considers whether it is
more likely than not that the deferred tax assets will be realized. The
ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during the periods in which those
temporary differences become deductible. Management considers primarily
the scheduled reversal of deferred tax liabilities and tax planning
strategies in making this assessment and believes it is more likely than
not the Company will realize the benefits of the deductible differences
remaining as of December 31, 1999.
20
<PAGE> 22
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998 and 1997
(in thousands)
(9) DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
Statement of Financial Accounting Standards No. 107, Disclosures about
Fair Value of Financial Instruments (SFAS 107) requires disclosure of
fair value information about existing on and off-balance sheet financial
instruments. SFAS 107 excludes certain assets and liabilities, including
insurance contracts, other than policies such as annuities that are
classified as investment contracts, from its disclosure requirements.
Accordingly, the aggregate fair value amounts presented do not represent
the underlying value of the Company. The tax ramifications of the
related unrealized gains and losses can have a significant effect on
fair value estimates and have not been considered in the estimates.
The following methods and assumptions were used by the Company in
estimating its fair value disclosures:
CASH, SHORT-TERM INVESTMENTS AND POLICY LOANS - The carrying
amount reported in the balance sheets for these instruments
approximate their fair value.
INVESTMENT SECURITIES - Fair value for equity securities and
fixed maturity securities are the same as market value. Market
value generally represents quoted market prices traded in the
public market place. For fixed maturity securities not actively
traded, or in the case of private placements, fair value is
estimated by discounting expected future cash flows using a
current market rate applicable to the yield, credit quality and
duration of investments.
SEPARATE ACCOUNT ASSETS AND LIABILITIES - The fair value of
assets held in Separate Accounts is based on quoted market
prices. The fair value of liabilities related to Separate
Accounts is the accumulated contract values in the Separate
Account portfolios.
MORTGAGE LOANS ON REAL ESTATE - The fair value for mortgage loans
on real estate is estimated using discounted cash flow analyses,
using interest rates currently being offered for similar loans to
borrowers with similar credit ratings. Loans with similar
characteristics are aggregated for purposes of the calculations.
DEFERRED AND IMMEDIATE ANNUITY AND INVESTMENT CONTRACTS - Fair
value for the Company's liabilities under investment type
contracts is disclosed using two methods. For investment
contracts without defined maturities, fair value is the amount
payable on demand. For investment contracts with known or
determined maturities, fair value is estimated using discounted
cash flow analysis. Interest rates used are similar to currently
offered contracts with maturities consistent with those remaining
for the contracts being valued.
NOTE PAYABLE - The fair value for the note payable was determined
by discounting the scheduled cash flows of the note using a
market rate applicable to the yield, credit quality and maturity
of a similar debt instrument.
POLICYHOLDERS' DIVIDEND ACCUMULATION AND OTHER POLICYHOLDER FUNDS
- The carrying amount reported in the consolidated balance sheets
for these instruments approximates their fair value.
21
<PAGE> 23
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
The carrying amount and estimated fair value of financial instruments
subject to SFAS 107 were as follows as of December 31:
<TABLE>
<CAPTION>
1999 1998
-------------------------------------------------------------------
CARRYING ESTIMATED CARRYING ESTIMATED
AMOUNT FAIR VALUE AMOUNT FAIR VALUE
---------- ---------- --------- ----------
<S> <C> <C> <C> <C>
ASSETS
Investments:
Securities available-for-sale:
Fixed maturities $2,644,846 2,644,846 2,834,274 2,834,274
Equity securities 71,640 71,640 90,107 90,107
Fixed maturities held-to-maturity 829,214 833,499 749,528 829,459
Mortgage loans on real estate 1,274,156 1,243,246 1,245,180 1,245,180
Policy loans 162,078 162,078 157,555 157,555
Short-term investments 139,341 139,341 106,627 106,627
Cash 9,411 9,411 11,300 11,300
Assets held in Separate Accounts 1,741,620 1,741,620 1,154,576 1,154,576
LIABILITIES
Guaranteed investment contracts $1,197,382 1,164,411 1,094,242 1,096,184
Individual contracts 1,061,053 1,040,355 1,076,504 1,063,799
Other annuity contracts 859,536 848,976 898,781 945,694
Note payable 84,321 80,142 84,278 92,732
Dividend accumulations and
other policyholder funds 78,857 78,857 91,042 91,042
Liability accounts 1,718,864 1,718,864 1,107,049 1,107,049
</TABLE>
(10) ADDITIONAL FINANCIAL INSTRUMENTS DISCLOSURE
(a) FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK
The Company is a party to financial instruments with
off-balance-sheet risk in a normal course of business through
management of its investment portfolio. The Company had
outstanding commitments to fund mortgage loans, bonds and venture
capital partnerships of approximately $74,000 and $229,000 as of
December 31, 1999 and 1998, respectively. These commitments
involve varying degrees, elements of credit and market risk in
excess of amounts recognized in the financial statements. The
credit risk of all financial instruments, whether on- or
off-balance sheet, is controlled through credit approvals, limits,
and monitoring procedures.
22
<PAGE> 24
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
(b) SIGNIFICANT CONCENTRATIONS OF CREDIT RISK
Mortgage loans are collateralized by the underlying properties.
Collateral must meet or exceed 125% of the loan at the time the
loan is made. The Company grants mainly commercial mortgage loans
to customers throughout the United States. The Company has a
diversified loan portfolio, and total loans in any state do not
exceed 10% of the total loan portfolio as of December 31, 1999.
The summary below depicts loan exposure of remaining principal
balances by type as of December 31, 1999 and 1998:
<TABLE>
<CAPTION>
1999 1998
---------- -----------
<S> <C> <C>
Mortgage assets by type:
Retail $ 393,543 381,044
Office 320,988 312,092
Apartment 304,106 285,643
Industrial 157,854 162,278
Other 107,372 113,725
----------- -----------
1,283,863 1,254,782
Less valuation allowances 9,707 9,602
----------- -----------
Total mortgage loans on real estate, net $1,274,156 1,245,180
=========== ===========
</TABLE>
(11) PENSIONS AND OTHER POSTRETIREMENT BENEFITS
The Company sponsors a funded pension plan covering all home office
employees. Retirement benefits are based on years of service and the
highest average earnings in five of the last ten years. The Company also
sponsors unfunded pension plans covering home office employees where
benefits exceed Code 401(a)(17) and Code 415 limits and covering general
agents. The general agents plan provides benefits based on years of
service and average compensation during the final five and ten years of
service
The Company currently offers eligible retirees the opportunity to
participate in a health plan. The Company has two health plans, one is
offered to home office employees, the other is offered to career agents.
HOME OFFICE EMPLOYEE HEALTH PLAN
The Company provides a declining service schedule. Only home office
employees hired prior to January 1, 1996, may become eligible for
these benefits provided that the employee meets the age and years of
service requirements. The plan states that an employee becomes
eligible as follows: age 55 with 20 years of credited service at
retirement, age 56 with 18 years of service, age 57 with 16 years of
service grading to age 64 with 2 years of service. The health plan is
contributory with retirees contributing approximately 15% of premium
for coverage.
23
<PAGE> 25
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
CAREER AGENTS HEALTH PLAN
Only career agents with contracts effective prior to January 1, 1996,
may become eligible for these benefits provided that the agent is at
least age 55 and has 15 years of credited service at retirement. The
health plan is contributory, with retirees contributing approximately
47% of medical costs.
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
----------------------- -----------------------
1999 1998 1999 1998
----------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at beginning of year $ 46,777 45,583 14,238 14,572
Service cost 2,634 2,520 300 258
Interest cost 3,282 3,131 399 333
Actuarial (loss) gain (4,341) 738 (619) (643)
Benefits paid (2,810) (5,195) (234) (282)
------------ ---------- ---------- ----------
Benefit obligation at end of year $ 45,542 46,777 14,084 14,238
============ ========== ========== ==========
CHANGE IN PLAN ASSETS
Fair value of assets at beginning of year $ 23,797 24,854
Actual return on plan assets 12,142 1,335
Employer contribution 1,410 701
Benefits paid (1,820) (3,093)
------------ ---------- ---------- ----------
Fair value of assets at end of year 35,529 23,797 -- --
============ ========== ========== ==========
CALCULATION OF FUNDED STATUS
Funded status $ (9,923) (22,980) (14,084) (14,238)
Unrecognized actuarial (gain) loss (6,222) 9,625 -- --
Unrecognized prior service cost (678) (745) -- --
------------ ---------- ---------- ----------
Net amount recognized $ (16,823) (14,100) (14,084) (14,238)
============ ========== ========== ==========
</TABLE>
24
<PAGE> 26
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
The following table shows the portions of the above values, in
aggregate, attributable to the pension plans whose Accumulated Benefit
Obligation exceeds Plan Assets.
PENSION BENEFITS
--------------------------------
1999 1998 1997
--------- -------- --------
Projected Benefit Obligation $ 19,941 18,708 18,299
Accumulated Benefit Obligation 15,981 13,864 14,307
Assets -- -- 257
Minimum Liability 15,981 13,864 14,050
Accrued Pension Cost (15,584) (10,829) (9,620)
Unrecognized Transition Obligation 2,329 2,620 2,911
WEIGHTED AVERAGE ASSUMPTIONS AS OF DECEMBER 31
PENSION BENEFITS OTHER BENEFITS
------------------ -----------------
1999 1998 1999 1998
--------- ------- ------- -------
Discount rate $ 6.90% 5.80% 7.65% 6.94%
Expected return on plan assets 10.50% 9.00% -- --
Rate of compensation increase 5.70% 5.70% -- --
For measurement purposes, a nine percent annual rate of increase in the
per capita cost of covered health care benefits was assumed for 2000. The
rate was assumed to decrease gradually to five percent for 2001 and
remain at that level thereafter.
COMPONENTS OF NET PERIODIC BENEFIT COST
<TABLE>
<CAPTION>
PENSION BENEFITS OTHER BENEFITS
-------------------------------------- -----------------------------------
1999 1998 1997 1999 1998 1997
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Service cost $ 2,634 2,520 2,221 300 258 301
Interest cost 3,411 3,131 3,072 399 333 468
Expected return on plan assets (2,404) (2,087) (2,037) -- -- --
Amortization of prior service cost (67) (67) (67) (504) (504) (367)
Recognized actuarial loss 549 564 300 (115) (139) (107)
------- ------ ------ ---- ---- ----
Net periodic benefit cost $ 4,123 4,061 3,489 80 (52) 295
======= ====== ====== ==== ==== ====
</TABLE>
25
<PAGE> 27
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
The health care cost trend rate assumption has a significant effect on
the amounts reported for the health care plan. A one percentage point
increase in the assumed health care cost trend rate would increase the
accumulated postretirement benefit obligation as of December 31, 1999 and
1998 by $274 and $236, respectively, and the net periodic postretirement
benefit cost for the years ended December 31, 1999 and 1998 by $17.
The Company also maintains a qualified contributory defined contribution
profit sharing plan covering substantially all employees. Company
contributions to the Profit Sharing Plan are based on the net earnings of
the Company and are payable at the sole discretion of management. The
expense reported for contributions to the plan for 1999, 1998, and 1997
were $1,917, $1,829 and $1,825, respectively.
The Company has other deferred compensation and supplemental pension
plans. The expenses for these plans in 1999, 1998 and 1997 were $8,962,
$6,277 and $5,245, respectively.
(12) REGULATORY RISK-BASED CAPITAL, RETAINED EARNINGS AND DIVIDEND
RESTRICTIONS
ONLIC and ONLAC exceed the minimum risk-based capital requirements as
established by the NAIC as of December 31, 1999.
The Company has designated a portion of retained earnings for separate
account contingencies and investment guarantees totaling $1,648 as of
December 31, 1999 and 1998.
The payment of dividends by the Company to its parent, ONFS, is limited
by Ohio law. As of December 31, 1999, $25,791 of retained earnings, as
presented in the accompanying financial statements, is restricted as to
dividend payments in 2000.
(13) BANK LINES OF CREDIT
As of December 31, 1999 and 1998, ONLIC had a $10,000 unsecured line of
credit which was not utilized during 1999 and 1998.
(14) CONTINGENCIES
The Company and its subsidiaries are defendants in various legal actions
arising in the normal course of business. While the outcome of such
matters cannot be predicted with certainty, management believes such
matters will be resolved without material adverse impact on the
financial condition of the Company.
26
<PAGE> 28
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
(15) REINSURANCE
The Company routinely enters into reinsurance transactions with other
insurance companies. This reinsurance involves either ceding certain
risks to or assuming risks from other insurance companies. The primary
purpose of ceded reinsurance is to protect the Company from potential
losses in excess of levels that it is prepared to accept. Reinsurance
does not discharge the Company from its primary liability to
policyholders and to the extent that a reinsurer should be unable to
meet its obligations, the Company would be liable to policyholders. The
Company has reinsurance recoverables of $95,291 and $78,265 at December
31, 1999 and 1998, respectively. Ceded premiums approximated 12% and 9%
of gross earned life and accident and health premiums during 1999 and
1998, respectively.
(16) SEGMENT INFORMATION
The Company conducts its business in three operating segments:
individual life insurance, pension and annuities, and other insurance.
Individual life insurance includes whole life, universal life, variable
universal life and term life. All products within this segment share
similar distribution systems and some degree of mortality (loss of life)
risk. Pension and annuities include fixed and variable deferred and
immediate annuities issued to individuals as well as guaranteed
investment and accumulated deposit contracts issued to groups. The
products in this segment are primarily designed for asset accumulation
and generation of investment returns. Other insurance includes
individual disability insurance along with group life and disability
insurance. These lines are viewed as "complementary" lines that allow us
to provide a broad portfolio of products to enhance sales in our two
primary operating segments. In addition to our operating segments,
certain assets not specifically allocated to support any product line,
along with various corporate expenses and liabilities, are assigned to
the corporate segment. All revenue, expense, asset and liability amounts
are allocated to one of the four segments. As such, the sum of the
financial information from these segments equals the information for the
Company as a whole.
27
<PAGE> 29
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED OR
AS OF DECEMBER 31, 1999
----------------------------------------------------------------------------
INDIVIDUAL PENSION
LIFE AND OTHER
INSURANCE ANNUITIES INSURANCE CORPORATE TOTAL
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Revenues:
Traditional life insurance premiums $ 101,019 $ -- $ 30,260 $ -- $ 131,279
Accident and health insurance premiums -- -- 25,530 -- 25,530
Annuity premiums and charges -- 36,931 -- -- 36,931
Universal life policy charges 66,189 -- -- -- 66,189
Net investment income 118,147 265,808 8,756 21,436 414,147
Net realized gains on investments -- -- -- 26,484 26,484
Other income 172 14,355 -- -- 14,527
----------------------------------------------------------------------------
285,527 317,094 64,546 47,920 715,087
Benefits and expenses:
Benefits and claims 160,284 206,575 49,048 -- 415,907
Provision for policyholder dividends 27,563 19 -- -- 27,582
Operating expenses 46,148 46,743 14,102 14,227 121,220
----------------------------------------------------------------------------
233,995 253,337 63,150 14,227 564,709
Income before federal income taxes $ 51,532 $ 63,757 $ 1,396 $ 33,693 $ 150,378
============================================================================
Total assets as of December 31, 1999 $2,145,787 $4,913,534 $159,131 $299,933 $7,518,385
============================================================================
</TABLE>
(1) Premiums, policy charges and investment income for life and other
insurance includes the net contribution from Closed Block for the
year ended December 31, 1999.
28
<PAGE> 30
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED OR
AS OF DECEMBER 31, 1998
----------------------------------------------------------------------------------
INDIVIDUAL PENSION
LIFE AND OTHER
INSURANCE ANNUITIES INSURANCE CORPORATE TOTAL
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Revenues:
Traditional life insurance premiums $ 91,565 $ -- $ 30,335 $ -- $ 121,900
Accident and health insurance premiums -- -- 25,183 -- 25,183
Annuity premiums and charges -- 32,280 -- -- 32,280
Universal life policy charges 59,743 -- -- -- 59,743
Net investment income 111,723 267,560 7,721 7,821 394,825
Net realized gains on investments -- -- -- 1,903 1,903
Other income (29) 13,189 -- -- 13,160
------------------------------------------------------------------------------
263,002 313,029 63,239 9,724 648,994
Benefits and expenses:
Benefits and claims 146,503 212,512 41,647 -- 400,662
Provision for policyholder dividends 27,635 24 -- -- 27,659
Operating expenses 41,814 39,963 16,440 16,545 114,762
------------------------------------------------------------------------------
215,952 252,499 58,087 16,545 543,083
Income before federal income taxes $ 47,050 $ 60,530 $ 5,152 $ (6,821) $ 105,911
==============================================================================
Total assets as of December 31, 1998 $1,994,834 $4,263,703 $161,577 $441,408 $6,861,522
==============================================================================
</TABLE>
(1) Premiums, policy charges and investment income for life and other
insurance includes the net contribution from Closed Block for the
year ended December 31, 1998.
29
<PAGE> 31
THE OHIO NATIONAL LIFE INSURANCE COMPANY AND SUBSIDIARIES
(a wholly owned subsidiary of Ohio National Financial Services, Inc.)
Notes to Consolidated Financial Statements
December 31, 1999, 1998, and 1997
(in thousands)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED OR
AS OF DECEMBER 31, 1998
--------------------------------------------------------------------------------
INDIVIDUAL PENSION
LIFE AND OTHER
INSURANCE ANNUITIES INSURANCE CORPORATE TOTAL
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Revenues:
Traditional life insurance premiums $ 91,758 $ -- $ 26,202 $ -- $ 117,960
Accident and health insurance premiums -- -- 23,921 -- 23,921
Annuity premiums and charges -- 34,187 -- -- 34,187
Universal life policy charges 50,991 -- -- -- 50,991
Net investment income 102,107 272,153 8,084 4,349 386,693
Net realized gains on investments -- -- -- 12,500 12,500
Other income (26) 12,830 -- -- 12,804
--------------------------------------------------------------------------------
244,830 319,170 58,207 16,849 639,056
Benefits and expenses:
Benefits and claims 133,850 222,283 35,773 -- 391,906
Provision for policyholder dividends 25,309 23 -- -- 25,332
Operating expenses 39,001 37,930 17,204 22,857 116,992
--------------------------------------------------------------------------------
198,160 260,236 52,977 22,857 534,230
Income before federal income taxes $ 46,670 $ 58,934 $ 5,230 $ (6,008) $ 104,826
================================================================================
Total assets as of December 31, 1997 $1,722,594 $4,033,860 $156,600 $417,508 $6,330,562
================================================================================
</TABLE>
30
<PAGE> 43
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF ASSETS AND CONTRACT OWNERS' EQUITY
December 31, 1999
<TABLE>
<CAPTION>
MONEY
EQUITY MARKET BOND OMNI INTERNATIONAL
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $149,442,731 $33,652,464 $11,170,875 $79,740,845 $ 58,005,163
============ =========== =========== =========== ============
Contract owners' equity
Contracts in accumulation period (note 3)............. $148,477,649 $33,546,854 $10,831,854 $79,597,729 $ 58,001,922
Annuity reserves for contract in payment period....... 965,082 105,610 339,021 143,116 3,241
------------ ----------- ----------- ----------- ------------
Total contract owners' equity........................... $149,442,731 $33,652,464 $11,170,875 $79,740,845 $ 58,005,163
============ =========== =========== =========== ============
<CAPTION>
CAPITAL
APPRECIATION SMALL CAP
SUBACCOUNT SUBACCOUNT
------------ -------------
<S> <C> <C>
Assets -- Investments at market value (note 2).......... $26,353,886 $58,427,116
=========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $26,314,978 $58,427,116
Annuity reserves for contract in payment period....... 38,908 0
----------- -----------
Total contract owners' equity........................... $26,353,886 $58,427,116
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL
SMALL AGGRESSIVE CORE GROWTH & S&P 500
COMPANY GROWTH GROWTH INCOME INDEX
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 12,018,104 $ 6,352,824 $ 9,625,081 $49,157,402 $101,435,703
============ =========== =========== =========== ============
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 12,018,104 $ 6,352,824 $ 9,625,081 $49,110,694 $101,427,640
Annuity reserves for contract in payment period....... 0 0 0 46,708 8,063
------------ ----------- ----------- ----------- ------------
Total contract owners' equity........................... $ 12,018,104 $ 6,352,824 $ 9,625,081 $49,157,402 $101,435,703
============ =========== =========== =========== ============
<CAPTION>
SOCIAL STRATEGIC
AWARENESS INCOME
SUBACCOUNT SUBACCOUNT
------------ -------------
<S> <C> <C>
Assets -- Investments at market value (note 2).......... $ 1,296,269 $ 1,247,783
=========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 1,296,269 $ 1,247,783
Annuity reserves for contract in payment period....... 0 0
----------- -----------
Total contract owners' equity........................... $ 1,296,269 $ 1,247,783
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
FIRSTAR
GROWTH & RELATIVE EQUITY HIGH INCOME
INCOME VALUE BLUE CHIP INCOME BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 1,211,235 $11,880,270 $ 2,817,745 $ 2,066,378 $ 2,552,152
============ =========== =========== ============ ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 1,211,235 $11,880,270 $ 2,817,745 $ 2,066,378 $ 2,552,152
============ =========== =========== ============ ===========
<CAPTION>
CAPITAL DOW TARGET 10
GROWTH JANUARY
SUBACCOUNT SUBACCOUNT
------------ -------------
<S> <C> <C>
Assets -- Investments at market value (note 2).......... $15,537,426 $ 351,081
=========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $15,537,426 $ 351,081
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
121
<PAGE> 44
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF ASSETS AND CONTRACT OWNERS' EQUITY
December 31, 1999
<TABLE>
<CAPTION>
DOW TARGET 10 DOW TARGET 10 DOW TARGET 10 DOW TARGET 10
FEBRUARY MARCH APRIL MAY
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $1,160,641 $1,015,921 $ 1,255,607 $ 716,463
========== ========== =========== ==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $1,160,641 $1,015,921 $ 1,255,607 $ 716,463
========== ========== =========== ==========
<CAPTION>
DOW TARGET 10 DOW TARGET 10 DOW TARGET 10
JUNE JULY AUGUST
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------- ------------- -------------
<S> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $1,156,960 $989,093 $ 804,346
========== ======== ==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $1,156,960 $989,093 $ 804,346
========== ======== ==========
</TABLE>
<TABLE>
<CAPTION>
DOW TARGET 10 DOW TARGET 10 DOW TARGET 10 DOW TARGET 10
SEPTEMBER OCTOBER NOVEMBER DECEMBER
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $1,466,806 $1,395,173 $ 1,326,480 $1,260,635
========== ========== =========== ==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $1,466,806 $1,395,173 $ 1,326,480 $1,260,635
========== ========== =========== ==========
<CAPTION>
DOW TARGET 5 DOW TARGET 5 DOW TARGET 5
SEPTEMBER OCTOBER NOVEMBER
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------- ------------- -------------
<S> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 80,810 $185,160 $ 103,570
========== ======== ==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 80,810 $185,160 $ 103,570
========== ======== ==========
</TABLE>
<TABLE>
<CAPTION>
FIDELITY INVESTMENTS
---------------------------------------------
DOW TARGET 5 VIP VIP EQUITY VIP HIGH
DECEMBER GROWTH INCOME INCOME BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 106,179 $11,693,784 $ 7,782,417 $2,659,367
========== =========== =========== ==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 106,179 $11,693,874 $ 7,782,417 $2,659,367
========== =========== =========== ==========
<CAPTION>
JP MORGAN
TRUST II
-------------
SMALL CO.
SUBACCOUNT
-------------
<S> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $2,648,148
==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $2,648,148
==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
122
<PAGE> 45
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF ASSETS AND CONTRACT OWNERS' EQUITY
December 31, 1999
<TABLE>
<CAPTION>
JANUS ASPEN SERIES
-------------------------------------------------------
INTERNATIONAL WORLDWIDE
GROWTH GROWTH GROWTH BALANCED
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $45,864,481 $7,924,891 $33,556,812 $40,498,569
=========== ========== =========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $45,864,481 $7,924,891 $33,556,812 $40,498,569
=========== ========== =========== ===========
<CAPTION>
SALOMON BROTHERS VARIABLE SERIES
------------------------------------
TOTAL
CAPITAL RETURN INVESTORS
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ----------
<S> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $1,109,850 $1,423,486 $451,956
========== ========== ========
Contract owners' equity
Contracts in accumulation period (note 3)............. $1,109,850 $1,423,486 $451,956
========== ========== ========
</TABLE>
<TABLE>
<CAPTION>
STRONG VARIABLE FUNDS
--------------------------------------
OPPORTUNITY SCHAFER MID-CAP
II VALUE II GROWTH II
SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ---------- -----------
<S> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 2,919,327 $ 525,492 $15,331,648
=========== ========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 2,919,327 $ 525,492 $15,331,648
=========== ========== ===========
<CAPTION>
MORGAN STANLEY UNIVERSAL FUNDS
--------------------------------------------------
FIXED US REAL EMERGING
INCOME ESTATE VALUE MKT. DEBT
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 4,183,630 $ 442,809 $ 904,003 $180,025
=========== ========== ========== ========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 4,183,630 $ 442,809 $ 904,003 $180,025
=========== ========== ========== ========
</TABLE>
<TABLE>
<CAPTION>
GOLDMAN SACHS
----------------------------------------------------
VIT GROWTH VIT CORE VIT GLOBAL VIT CAPITAL
& INCOME US EQUITY INCOME GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 2,770,444 $4,821,135 $ 762,833 $ 4,464,479
=========== ========== =========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 2,770,444 $4,821,135 $ 762,833 $ 4,464,479
=========== ========== =========== ===========
<CAPTION>
LAZARD RETIREMENT
-----------------------
EMERGING SMALL
MARKET CAP
SUBACCOUNT SUBACCOUNT
---------- ----------
<S> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $1,790,855 $ 136,940
========== ==========
Contract owners' equity
Contracts in accumulation period (note 3)............. $1,790,855 $ 136,940
========== ==========
</TABLE>
<TABLE>
<CAPTION>
SERIES TRUST PAINEWEBBER MUTUAL FUNDS
----------------------------------------------------
STRATEGIC GROWTH & TACTICAL
INCOME INCOME ALLOCATION SMALL CAP
CLASS I CLASS I CLASS I CLASS I
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Assets -- Investments at market value (note 2).......... $ 125,906 $ 609,888 $ 2,169,417 $ 128,789
=========== ========== =========== ===========
Contract owners' equity
Contracts in accumulation period (note 3)............. $ 125,906 $ 609,888 $ 2,169,417 $ 128,789
=========== ========== =========== ===========
<CAPTION>
<S> <C> <C>
Assets -- Investments at market value (note 2)..........
Contract owners' equity
Contracts in accumulation period (note 3).............
</TABLE>
The accompanying notes are an integral part of these financial statements.
123
<PAGE> 46
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
EQUITY MONEY MARKET BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------------------- -------------------------- -------------------------
1999 1998 1999 1998 1999 1998
------------ ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends.................. $ 367,500 $ 1,441,507 $ 1,207,425 $ 500,680 $ 724,583 $ 525,455
Risk & administrative expense (note
4)................................. (1,324,284) (1,251,708) (292,179) (110,522) (183,260) (87,915)
------------ ----------- ----------- ----------- ----------- ----------
Net investment activity.......... (956,784) 189,799 915,246 390,158 541,323 437,540
------------ ----------- ----------- ----------- ----------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains........... 57,345,763 2,181,204 0 0 0 0
Realized gain (loss)............... 5,346,789 2,970,607 (26,060) (14,941) (59,863) 17,380
Unrealized gain (loss)............. (40,259,498) (363,011) 0 0 (608,925) (152,308)
------------ ----------- ----------- ----------- ----------- ----------
Net gain (loss) on investments... 22,433,054 4,788,800 (26,060) (14,941) (668,788) (134,928)
------------ ----------- ----------- ----------- ----------- ----------
Net increase (decrease) in
contract owners' equity from
operations.................. $ 21,476,270 $ 4,978,599 $ 889,186 $ 375,217 $ (127,465) $ 302,612
============ =========== =========== =========== =========== ==========
<CAPTION>
OMNI
SUBACCOUNT
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends.................. $1,760,615 $2,270,073
Risk & administrative expense (note
4)................................. (909,948) (912,754)
---------- ----------
Net investment activity.......... 850,667 1,357,319
---------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains........... 2,739,976 13,227
Realized gain (loss)............... 3,764,411 1,000,905
Unrealized gain (loss)............. 348,570 (7,903)
---------- ----------
Net gain (loss) on investments... 6,852,957 1,006,229
---------- ----------
Net increase (decrease) in
contract owners' equity from
operations.................. $7,703,624 $2,363,548
========== ==========
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL CAPITAL APPRECIATION SMALL CAP
SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------------------- -------------------------- -------------------------
1999 1998 1999 1998 1999 1998
------------ ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends.................. $ 0 $ 2,090,475 $ 812,415 $ 579,186 $ 0 $ 0
Risk & administrative expense (note
4)................................. (452,341) (577,205) (303,792) (246,166) (389,759) (232,830)
------------ ----------- ----------- ----------- ----------- ----------
Net investment activity.......... (452,341) 1,513,270 508,623 333,020 (389,759) (232,830)
------------ ----------- ----------- ----------- ----------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains........... 0 2,018,195 2,454,070 1,968,462 14,914,361 339
Realized gain (loss)............... (385,838) (317,892) 87,464 115,918 1,152,116 78,725
Unrealized gain (loss)............. 23,896,749 (1,590,338) (1,676,010) (1,450,953) 13,526,439 2,368,444
------------ ----------- ----------- ----------- ----------- ----------
Net gain (loss) on investments... 23,510,911 109,965 865,524 633,427 29,592,916 2,447,508
------------ ----------- ----------- ----------- ----------- ----------
Net increase in contract
owners' equity from
operations.................. $ 23,058,570 $ 1,623,235 $ 1,374,147 $ 966,447 $29,203,157 $2,214,678
============ =========== =========== =========== =========== ==========
<CAPTION>
INTERNATIONAL
SMALL COMPANY
SUBACCOUNT
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends.................. $ 0 $ 161,217
Risk & administrative expense (note
4)................................. (75,308) (61,043)
---------- ----------
Net investment activity.......... (75,308) 100,174
---------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains........... 1,140,089 475,985
Realized gain (loss)............... 73,689 3,742
Unrealized gain (loss)............. 4,691,729 (490,547)
---------- ----------
Net gain (loss) on investments... 5,905,507 (10,820)
---------- ----------
Net increase in contract
owners' equity from
operations.................. $5,830,199 $ 89,354
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
124
<PAGE> 47
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH CORE GROWTH GROWTH & INCOME
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------- ---------------------- ------------------------
1999 1998 1999 1998 1999 1998
--------- --------- ---------- -------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 0 $ 0 $ 0 $ 0 $ 64,837 $ 153,872
Risk & administrative expense (note 4)...... (70,010) (65,184) (57,096) (36,181) (340,466) (157,261)
--------- --------- ---------- -------- ----------- ---------
Net investment activity................ (70,010) (65,184) (57,096) (36,181) (275,629) (3,389)
--------- --------- ---------- -------- ----------- ---------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 457,472 2,012,148 0 7,053,581 0
Realized gain (loss)..................... (107,513) 9,963 199,621 50,716 214,196 20,399
Unrealized gain (loss)................... 384,427 (56,102) 2,402,419 286,587 10,001,873 628,348
--------- --------- ---------- -------- ----------- ---------
Net gain on investments................ 276,914 411,333 4,614,188 337,303 17,269,650 648,747
--------- --------- ---------- -------- ----------- ---------
Net increase in contract owners'
equity from operations............ $ 206,904 $ 346,149 $4,557,092 $301,122 $16,994,021 $ 645,358
========= ========= ========== ======== =========== =========
<CAPTION>
S&P 500 INDEX
SUBACCOUNT
-------------------------
1999 1998
----------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends........................ $ 1,876,213 $ 562,393
Risk & administrative expense (note 4)...... (836,727) (218,142)
----------- ----------
Net investment activity................ 1,039,486 344,251
----------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 7,391,106 1,546,971
Realized gain (loss)..................... 526,448 67,888
Unrealized gain (loss)................... 7,917,365 3,394,871
----------- ----------
Net gain on investments................ 15,834,919 5,009,730
----------- ----------
Net increase in contract owners'
equity from operations............ $16,874,405 $5,353,981
=========== ==========
</TABLE>
<TABLE>
<CAPTION>
SOCIAL AWARENESS STRATEGIC INCOME FIRSTAR GROWTH & INCOME
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------- ---------------------- ------------------------
1999 1998 1999 1998 1999 1998
--------- --------- ---------- -------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 6,362 $ 10,934 $ 101,675 $120,659 $ 14,876 $ 40,131
Risk & administrative expense (note 4)...... (16,419) (21,454) (21,226) (22,771) (16,856) (15,173)
--------- --------- ---------- -------- ----------- ---------
Net investment activity................ (10,057) (10,520) 80,449 97,888 (1,980) 24,958
--------- --------- ---------- -------- ----------- ---------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 0 0 479 0 5,463
Realized gain (loss)..................... (356,428) (123,673) (81,875) (10,862) (5,429) (4,370)
Unrealized gain (loss)................... 524,015 (592,163) (91,767) (138,208) 14,492 (23,571)
--------- --------- ---------- -------- ----------- ---------
Net gain (loss) on investments......... 167,587 (715,836) (173,642) (148,591) 9,063 (22,478)
--------- --------- ---------- -------- ----------- ---------
Net (decrease) increase in contract
owners' equity from operations.... $ 157,530 $(726,356) $ (93,193) $(50,703) $ 7,083 $ 2,480
========= ========= ========== ======== =========== =========
<CAPTION>
RELATIVE VALUE
SUBACCOUNT
-------------------------
1999 1998
----------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends........................ $ 92,781 $ 82,693
Risk & administrative expense (note 4)...... (153,761) (95,392)
----------- ----------
Net investment activity................ (60,980) (12,699)
----------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 91,524
Realized gain (loss)..................... 241,198 66,563
Unrealized gain (loss)................... 434,077 1,016,582
----------- ----------
Net gain (loss) on investments......... 675,275 1,174,669
----------- ----------
Net (decrease) increase in contract
owners' equity from operations.... $ 614,295 $1,161,970
=========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
125
<PAGE> 48
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
BLUE CHIP EQUITY INCOME HIGH INCOME BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ------------------------ ------------------------
1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 9,165 $ 1,184 $ 10,011 $ 614 $103,449 $ 8,343
Risk & administrative expense (note 4)...... (20,719) (2,525) (11,030) (220) (18,210) (838)
-------- -------- -------- ------ -------- -------
Net investment activity................ (11,554) (1,341) (1,019) 394 85,239 7,505
-------- -------- -------- ------ -------- -------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 31,583 0 0 0 0 775
Realized gain (loss)..................... 46,166 532 4,306 215 (21,329) 378
Unrealized gain (loss)................... (21,821) 48,463 158,259 6,457 (67,091) (3,712)
-------- -------- -------- ------ -------- -------
Net gain (loss) on investments......... 55,928 48,995 162,565 6,672 (88,420) (2,559)
-------- -------- -------- ------ -------- -------
Net (decrease) increase in contract
owners' equity from operations.... $ 44,374 $ 47,654 $161,546 $7,066 $ (3,181) $ 4,946
======== ======== ======== ====== ======== =======
<CAPTION>
CAPITAL GROWTH
SUBACCOUNT
------------------------
1999 1998(a)
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends........................ $ 0 $ 0
Risk & administrative expense (note 4)...... (48,317) (294)
---------- ---------
Net investment activity................ (48,317) (294)
---------- ---------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 1,716,266 0
Realized gain (loss)..................... 957,003 (1,432)
Unrealized gain (loss)................... 2,785,132 30,958
---------- ---------
Net gain (loss) on investments......... 5,458,401 29,526
---------- ---------
Net (decrease) increase in contract
owners' equity from operations.... $5,410,084 $ 29,232
========== =========
</TABLE>
<TABLE>
<CAPTION>
DOW TARGET 10
----------------------------------------------------------------------------------
JANUARY FEBRUARY MARCH APRIL MAY JUNE
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------ ---------- ---------- ---------- ---------- ----------
1999(b) 1998(b) 1999(b) 1998(b) 1999(b) 1998(b)
------------ ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends...................... $ 6,866 $ 18,796 $ 12,528 $ 19,069 $ 8,029 $ 11,504
Risk & administrative expense (note 4).... (3,651) (14,891) (12,396) (15,328) (6,672) (8,946)
------------ -------- -------- --------- --------- ---------
Net investment activity.............. 3,215 3,905 132 3,741 1,357 2,558
------------ -------- -------- --------- --------- ---------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains............... 2,452 28,815 36,126 17,860 0 0
Realized gain (loss)................... 10,503 16,546 16,884 (43,006) (19,470) (7,729)
Unrealized gain (loss)................. (8,237) 10,023 (80,401) (132,892) (126,311) (151,575)
------------ -------- -------- --------- --------- ---------
Net gain (loss) on investments....... 4,718 55,384 (27,391) (158,038) (145,781) (159,304)
------------ -------- -------- --------- --------- ---------
Net (decrease) increase in
contract owners' equity from
operations...................... $ 7,933 $ 59,289 $(27,259) $(154,297) $(144,424) $(156,746)
============ ======== ======== ========= ========= =========
<CAPTION>
DOW TARGET 10
------------------------
JULY AUGUST
SUBACCOUNT SUBACCOUNT
---------- ----------
1999(b) 1998(b)
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends...................... $ 10,380 $ 8,259
Risk & administrative expense (note 4).... (6,227) (4,268)
---------- ---------
Net investment activity.............. 4,153 3,991
---------- ---------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains............... 0 0
Realized gain (loss)................... (12,827) (17,755)
Unrealized gain (loss)................. (123,094) (114,144)
---------- ---------
Net gain (loss) on investments....... (135,921) (131,899)
---------- ---------
Net (decrease) increase in
contract owners' equity from
operations...................... $ (131,768) $(127,908)
========== =========
</TABLE>
- ---------------
(a) Period from May 1, 1998 date of commencement of operations.
(b) See Note 7. (continued)
The accompanying notes are an integral part of these financial statements.
126
<PAGE> 49
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
DOW TARGET 10 (CONTINUED) DOW TARGET 5
---------------------------------------------------- ------------------------
SEPTEMBER OCTOBER NOVEMBER DECEMBER SEPTEMBER OCTOBER
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ---------- ---------- ---------- ----------
1999(b) 1999(b) 1999(b) 1999(b) 1999(b) 1999(b)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 9,145 $ 9,194 $ 4,173 $ 832 $ 670 $ 1,297
Risk & administrative expense (note 4)...... (4,787) (3,484) (1,791) (589) (281) (580)
--------- --------- -------- ------- ---------- ----------
Net investment activity................ 4,358 5,710 2,382 243 389 717
--------- --------- -------- ------- ---------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 0 0 0 0 0
Realized gain (loss)..................... (8,391) 1,458 490 (1,437) (6,411) (1,590)
Unrealized gain (loss)................... (130,265) (78,580) (6,279) 9,617 (15,253) (30,000)
--------- --------- -------- ------- ---------- ----------
Net gain (loss) on investments......... (138,656) (77,122) (5,789) 8,180 (21,664) (31,590)
--------- --------- -------- ------- ---------- ----------
Net (decrease) increase in contract
owners' equity from operations.... $(134,298) $ (71,412) $ (3,407) $ 8,423 $ (21,275) $ (30,873)
========= ========= ======== ======= ========== ==========
<CAPTION>
DOW TARGET 5
------------------------
NOVEMBER DECEMBER
SUBACCOUNT SUBACCOUNT
---------- ----------
1999(b) 1999(b)
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends........................ $ 437 $ 202
Risk & administrative expense (note 4)...... (191) (49)
-------- --------
Net investment activity................ 246 153
-------- --------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 0
Realized gain (loss)..................... 326 (142)
Unrealized gain (loss)................... (1,347) 194
-------- --------
Net gain (loss) on investments......... (1,021) 52
-------- --------
Net (decrease) increase in contract
owners' equity from operations.... $ (775) $ 205
======== ========
</TABLE>
<TABLE>
<CAPTION>
MONTGOMERY ASSET FIDELITY INVESTMENTS
---------------------------------------------------- ------------------------
EMERGING MARKET SMALL CAP OPPORTUNITY VIP GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ------------------------ ------------------------
1999 1998 1999 1998(a) 1999 1998
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 0 $ 1,515 $ 0 $ 0 $ 9,480 $ 6,464
Risk & administrative expense (note 4)...... (10,872) (10,644) (1,053) (204) (107,075) (36,874)
--------- --------- -------- ------- ---------- ----------
Net investment activity................ (10,872) (9,129) (1,053) (204) (97,595) (30,410)
--------- --------- -------- ------- ---------- ----------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 0 0 0 596,051 169,084
Realized gain (loss)..................... (172,773) (105,907) 5,705 2,069 216,905 32,996
Unrealized gain (loss)................... 359,922 (288,678) (10,248) 10,248 2,075,658 805,443
--------- --------- -------- ------- ---------- ----------
Net gain (loss) on investments......... 187,149 (394,585) (4,543) 12,317 2,888,614 1,007,523
--------- --------- -------- ------- ---------- ----------
Net (decrease) increase in contract
owners' equity from operations.... $ 176,277 $(403,714) $ (5,596) $12,113 $2,791,019 $ 977,113
========= ========= ======== ======= ========== ==========
<CAPTION>
FIDELITY INVESTMENTS
------------------------
VIP EQUITY INCOME
SUBACCOUNT
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends........................ $ 87,245 $ 26,915
Risk & administrative expense (note 4)...... (95,378) (47,574)
-------- --------
Net investment activity................ (8,133) (20,659)
-------- --------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 192,859 95,785
Realized gain (loss)..................... 57,650 15,254
Unrealized gain (loss)................... (35,430) 217,112
-------- --------
Net gain (loss) on investments......... 215,079 328,151
-------- --------
Net (decrease) increase in contract
owners' equity from operations.... $206,946 $307,492
======== ========
</TABLE>
- ---------------
(a) Period from May 1, 1998 date of commencement of operations.
(b) See Note 7. (continued)
The accompanying notes are an integral part of these financial statements.
127
<PAGE> 50
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
FIDELITY INVESTMENTS (CONT.) JP MORGAN TRUST II
----------------------------- ----------------------
VIP HIGH INCOME BOND SMALL COMPANY
SUBACCOUNT SUBACCOUNT
----------------------------- ----------------------
1999 1998 1999 1998(a)
------------- ------------ ---------- --------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................... $ 282,297 $ 104,824 $ 1,039 $ 714
Risk & administrative expense (note 4)......... (43,888) (28,705) (18,307) (1,554)
---------- --------- ---------- --------
Net investment activity................... 238,409 76,119 (17,268) (840)
---------- --------- ---------- --------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains.................... 10,553 66,607 52,780 11,588
Realized gain (loss)........................ (143,416) (22,981) 44,699 (689)
Unrealized gain (loss)...................... 86,432 (301,337) 682,935 37,863
---------- --------- ---------- --------
Net gain (loss) on investments............ (46,431) (257,711) 780,414 48,762
---------- --------- ---------- --------
Net (decrease) increase in contract
owners' equity from operations....... $ 191,978 $(181,592) $ 763,146 $ 47,922
========== ========= ========== ========
<CAPTION>
JANUS ASPEN SERIES
-----------------------------------------------
GROWTH INTERNATIONAL GROWTH
SUBACCOUNT SUBACCOUNT
---------------------- ---------------------
1999 1998(a) 1999 1998(a)
---------- -------- ---------- -------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................... $ 54,963 $ 1,115 $ 2,289 $ 1,286
Risk & administrative expense (note 4)......... (210,236) (3,888) (29,968) (728)
---------- -------- ---------- -------
Net investment activity................... (155,273) (2,773) (27,679) 558
---------- -------- ---------- -------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains.................... 72,776 139 0 38
Realized gain (loss)........................ 909,173 46,760 2,562,214 14,859
Unrealized gain (loss)...................... 7,169,844 319,539 415,113 139
---------- -------- ---------- -------
Net gain (loss) on investments............ 8,151,793 366,438 2,977,327 15,036
---------- -------- ---------- -------
Net (decrease) increase in contract
owners' equity from operations....... $7,996,520 $363,665 $2,949,648 $15,594
========== ======== ========== =======
</TABLE>
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED) SALOMON VARIABLE FUND SERIES
------------------------------------------------- -----------------------------------------------
WORLDWIDE GROWTH BALANCED CAPITAL TOTAL RETURN
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------------------- ---------------------- ---------------------- ---------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- --------- ---------- -------- ---------- -------- ---------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends..... $ 20,230 $ 9,702 $ 620,194 $ 48,910 $ 5,231 $ 1,801 $ 36,491 $ 5,362
Risk & administrative
expense (note 4)...... (168,310) (7,118) (250,604) (10,847) (10,222) (402) (14,247) (825)
---------- --------- ---------- -------- ---------- -------- ---------- -------
Net investment
activity......... (148,080) 2,584 369,590 38,063 (4,991) 1,399 22,244 4,537
---------- --------- ---------- -------- ---------- -------- ---------- -------
Realized & Unrealized
gain (loss) on
investments:
Reinvested capital
gains............... 0 2,416 0 1,137 30,334 3,009 0 1,072
Realized gain
(loss).............. 3,244,178 36,214 80,815 8,538 22,197 762 (450) 829
Unrealized gain
(loss).............. 6,606,997 186,957 4,754,500 485,789 119,271 17,714 (44,241) 4,184
---------- --------- ---------- -------- ---------- -------- ---------- -------
Net gain (loss) on
investments...... 9,851,175 225,587 4,835,315 495,464 171,802 21,485 (44,691) 6,085
---------- --------- ---------- -------- ---------- -------- ---------- -------
Net (decrease)
increase in
contract
owners' equity
from
operations..... $9,703,095 $ 228,171 $5,204,905 $533,527 $ 166,811 $ 22,884 $ (22,447) $10,622
========== ========= ========== ======== ========== ======== ========== =======
</TABLE>
- ---------------
(a) Period from May 1, 1998 date of commencement of operations. (continued)
The accompanying notes are an integral part of these financial statements.
128
<PAGE> 51
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
SALOMON VARIABLE FUND
SERIES (CONTINUED) STRONG VARIABLE ANNUITY FUNDS
--------------------- --------------------------------------------------------------------
INVESTORS OPPORTUNITY SCHAFER VALUE MID-CAP GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------------- ------------------- ------------------- ----------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
--------- -------- -------- ------- -------- ------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends............ $ 2,294 $ 1,601 $ 0 $ 1,436 $ 3,663 $ 139 $ 2,045 $ 0
Risk & administrative expense
(note 4)..................... (6,571) (1,179) (20,474) (963) (3,312) (190) (56,288) (1,238)
--------- -------- -------- ------- -------- ------- ---------- --------
Net investment activity.... (4,277) 422 (20,474) 473 351 (51) (54,243) (1,238)
--------- -------- -------- ------- -------- ------- ---------- --------
Realized & Unrealized gain
(loss) on investments:
Reinvested capital gains..... 0 0 63,194 0 20,517 0 0 0
Realized gain (loss)......... 40,431 1,496 237,823 22,907 (18,877) 1,786 116,343 1,501
Unrealized gain (loss)....... 6,861 23,307 213,263 20,918 (21,364) 3,845 4,314,671 102,974
--------- -------- -------- ------- -------- ------- ---------- --------
Net gain (loss) on
investments............. 47,292 24,803 514,280 43,825 (19,724) 5,631 4,431,014 104,475
--------- -------- -------- ------- -------- ------- ---------- --------
Net (decrease) increase
in contract owners'
equity from
operations............ $ 43,015 $ 25,225 $493,806 $44,298 $(19,373) $ 5,580 $4,376,771 $103,237
========= ======== ======== ======= ======== ======= ========== ========
</TABLE>
<TABLE>
<CAPTION>
MORGAN STANLEY UNIVERSAL FUNDS
---------------------------------------------------------------------------------------------
FIXED INCOME US REAL ESTATE VALUE EMERGING MARKET DEBT
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
--------------------- ------------------- ------------------- ----------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
--------- -------- -------- ------- -------- ------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends............ $ 188,951 $ 14,820 $ 19,531 $ 1,946 $ 10,780 $ 5,516 $ 19,202 $ 841
Risk & administrative expense
(note 4)..................... (30,837) (836) (3,075) (256) (9,708) (1,037) (944) (14)
--------- -------- -------- ------- -------- ------- ---------- --------
Net investment activity.... 158,114 13,984 16,456 1,690 1,072 4,479 18,258 827
--------- -------- -------- ------- -------- ------- ---------- --------
Realized & Unrealized gain
(loss) on investments:
Reinvested capital gains..... 336 5,226 0 0 0 8,977 0 0
Realized gain (loss)......... (14,276) 13 1,866 (61) 705 1,409 3,051 42
Unrealized gain (loss)....... (190,943) (15,285) (27,171) (491) (52,452) (693) 3,666 (546)
--------- -------- -------- ------- -------- ------- ---------- --------
Net gain (loss) on
investments............. (204,883) (10,046) (25,305) (552) (51,747) 9,693 6,717 (504)
--------- -------- -------- ------- -------- ------- ---------- --------
Net (decrease) increase
in contract owners'
equity from
operations............ $ (46,769) $ 3,938 $ (8,849) $ 1,138 $(50,675) $14,172 $ 24,975 $ 323
========= ======== ======== ======= ======== ======= ========== ========
</TABLE>
- ---------------
(a) Period from May 1, 1998 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
129
<PAGE> 52
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
GOLDMAN SACHS VIT FUNDS
--------------------------------------------------------------------------------
GROWTH & INCOME CORE US EQUITY GLOBAL INCOME
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ------------------------ ------------------------
1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 29,841 $ 6,481 $ 14,688 $ 3,505 $ 23,995 $ 2,398
Risk & administrative expense (note 4)...... (22,196) (2,219) (30,364) (2,745) (5,394) (239)
-------- ------- -------- ------- -------- -------
Net investment activity................ 7,645 4,262 (15,676) 760 18,601 2,159
-------- ------- -------- ------- -------- -------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 0 51,295 0 3,816 644
Realized gain (loss)..................... 3,654 (1,956) 33,847 1,045 (1,803) 57
Unrealized gain (loss)................... 31,312 14,203 479,377 79,395 (28,302) (2,172)
-------- ------- -------- ------- -------- -------
Net gain (loss) on investments......... 34,966 12,247 564,519 80,440 (26,289) (1,471)
-------- ------- -------- ------- -------- -------
Net (decrease) increase in contract
owners' equity from operations.... $ 42,611 $16,509 $548,843 $81,200 $ (7,688) $ 688
======== ======= ======== ======= ======== =======
<CAPTION>
GOLDMAN SACHS VIT FUNDS
------------------------
CAPITAL GROWTH
SUBACCOUNT
------------------------
1999 1998(a)
---------- ----------
<S> <C> <C>
Investment activity:
Reinvested dividends........................ $ 3,552 $ 2,050
Risk & administrative expense (note 4)...... (32,824) (3,490)
-------- --------
Net investment activity................ (29,272) (1,440)
-------- --------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 101,678 0
Realized gain (loss)..................... 50,556 7,124
Unrealized gain (loss)................... 557,373 110,809
-------- --------
Net gain (loss) on investments......... 709,607 117,933
-------- --------
Net (decrease) increase in contract
owners' equity from operations.... $680,335 $116,493
======== ========
</TABLE>
<TABLE>
<CAPTION>
LAZARD RETIREMENT FUNDS SERIES TRUST PAINEWEBBER MUTUAL FUNDS
------------------------ ----------------------------------------------------
EMERGING STRATEGIC GROWTH TACTICAL
MARKET SMALL CAP INCOME & INCOME ALLOCATION SMALL CAP
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ---------- ---------- ---------- ----------
1999(c) 1999(c) 1999(c) 1999(c) 1999(c) 1999(c)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Reinvested dividends........................ $ 3,055 $ 164 $ 6,575 $ 2 $ 0 $ 4,148
Risk & administrative expense (note 4)...... (3,437) (237) (285) (1,688) (5,601) (199)
-------- ------- -------- ------- -------- -------
Net investment activity................ (382) (73) 6,290 (1,686) (5,601) 3,949
-------- ------- -------- ------- -------- -------
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains................. 0 1,772 0 0 139,770 0
Realized gain (loss)..................... 7,541 92 80 20 3,383 3,388
Unrealized gain (loss)................... 337,023 2,706 (6,631) 49,454 (8,939) 3,630
-------- ------- -------- ------- -------- -------
Net gain (loss) on investments......... 344,564 4,570 (6,551) 49,474 134,214 7,018
-------- ------- -------- ------- -------- -------
Net (decrease) increase in contract
owners' equity from operations.... $344,182 $ 4,497 $ (261) $47,788 $128,613 $10,967
======== ======= ======== ======= ======== =======
<CAPTION>
<S> <C> <C>
Investment activity:
Reinvested dividends........................
Risk & administrative expense (note 4)......
Net investment activity................
Realized & Unrealized gain (loss) on
investments:
Reinvested capital gains.................
Realized gain (loss).....................
Unrealized gain (loss)...................
Net gain (loss) on investments.........
Net (decrease) increase in contract
owners' equity from operations....
</TABLE>
- ---------------
(a) Period from May 1, 1998 date of commencement of operations.
(c) Period from July 1, 1999 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
130
<PAGE> 53
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
EQUITY MONEY MARKET BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------------- ---------------------------- --------------------------
1999 1998 1999 1998 1999 1998
------------ ------------ ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity........ $ (956,784) $ 189,799 $ 915,246 $ 390,158 $ 541,323 $ 437,540
Reinvested capital gains....... 57,345,763 2,181,204 0 0 0 0
Realized gain (loss)........... 5,346,789 2,970,607 (26,060) (14,941) (59,863) 17,380
Unrealized gain (loss)......... (40,259,498) (363,011) 0 0 (608,925) (152,308)
------------ ------------ ------------ ------------ ----------- -----------
Net increase (decrease) in
contract owners' equity
from operations........... 21,476,270 4,978,599 889,186 375,217 (127,465) 302,612
------------ ------------ ------------ ------------ ----------- -----------
Equity transactions:
Sales:
Contract purchase
payments.................. 25,012,069 11,458,073 29,651,922 15,381,429 2,622,195 3,493,444
Transfers from fixed & other
subaccounts............... 16,149,737 4,018,120 229,183,384 19,865,502 1,928,222 2,139,647
------------ ------------ ------------ ------------ ----------- -----------
41,161,806 15,476,193 258,835,306 35,246,931 4,550,417 5,633,091
------------ ------------ ------------ ------------ ----------- -----------
Redemptions:
Withdrawals & surrenders
(note 5).................. 14,754,754 9,328,210 2,370,561 696,570 1,303,792 537,227
Annuity & death benefit
payments.................. 904,996 1,139,548 219,008 76,055 160,389 34,162
Transfers to fixed & other
subaccounts............... 14,120,013 5,629,381 242,655,888 22,718,469 1,948,322 1,120,365
------------ ------------ ------------ ------------ ----------- -----------
29,779,763 16,097,139 245,245,457 23,491,094 3,412,503 1,691,754
------------ ------------ ------------ ------------ ----------- -----------
Net equity transactions... 11,382,043 (620,946) 13,589,849 11,755,837 1,137,914 3,941,337
------------ ------------ ------------ ------------ ----------- -----------
Net change in contract
owners' equity....... 32,858,313 4,357,653 14,479,035 12,131,054 1,010,449 4,243,949
Contract owners' equity:
Beginning of period............ 116,584,418 112,226,765 19,173,429 7,042,375 10,160,426 5,916,477
------------ ------------ ------------ ------------ ----------- -----------
End of period.................. $149,442,731 $116,584,418 $ 33,652,464 $ 19,173,429 $11,170,875 $10,160,426
============ ============ ============ ============ =========== ===========
<CAPTION>
OMNI
SUBACCOUNT
---------------------------
1999 1998
------------ -----------
<S> <C> <C>
Investment activity:
Net investment activity........ $ 850,667 $ 1,357,319
Reinvested capital gains....... 2,739,976 13,227
Realized gain (loss)........... 3,764,411 1,000,905
Unrealized gain (loss)......... 348,570 (7,903)
------------ -----------
Net increase (decrease) in
contract owners' equity
from operations........... 7,703,624 2,363,548
------------ -----------
Equity transactions:
Sales:
Contract purchase
payments.................. 5,481,016 14,036,874
Transfers from fixed & other
subaccounts............... 3,819,869 4,779,261
------------ -----------
9,300,885 18,816,135
------------ -----------
Redemptions:
Withdrawals & surrenders
(note 5).................. 8,012,870 5,537,165
Annuity & death benefit
payments.................. 910,200 690,280
Transfers to fixed & other
subaccounts............... 15,329,002 4,994,854
------------ -----------
24,252,072 11,222,299
------------ -----------
Net equity transactions... (14,951,187) 7,593,836
------------ -----------
Net change in contract
owners' equity....... (7,247,563) 9,957,384
Contract owners' equity:
Beginning of period............ 86,988,408 77,031,024
------------ -----------
End of period.................. $ 79,740,845 $86,988,408
============ ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
131
<PAGE> 54
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
INTERNATIONAL CAPITAL APPRECIATION SMALL CAP
SUBACCOUNT SUBACCOUNT SUBACCOUNT
-------------------------- -------------------------- --------------------------
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity............. $ (452,341) $ 1,513,270 $ 508,623 $ 333,020 $ (389,759) $ (232,830)
Reinvested capital gains............ 0 2,018,195 2,454,070 1,968,462 14,914,361 339
Realized gain (loss)................ (385,838) (317,892) 87,464 115,918 1,152,116 78,725
Unrealized gain (loss).............. 23,896,749 (1,590,338) (1,676,010) (1,450,953) 13,526,439 2,368,444
----------- ----------- ----------- ----------- ----------- -----------
Net increase in contract owners'
equity from operations......... 23,058,570 1,623,235 1,374,147 966,447 29,203,157 2,214,678
----------- ----------- ----------- ----------- ----------- -----------
Equity transactions:
Sales:
Contract purchase payments....... 1,774,337 4,212,543 3,312,067 6,782,541 2,591,619 4,808,408
Transfers from fixed & other
subaccounts.................... 11,377,983 1,579,613 4,910,798 2,789,751 8,478,358 2,315,389
----------- ----------- ----------- ----------- ----------- -----------
13,152,320 5,792,156 8,222,865 9,572,292 11,069,977 7,123,797
----------- ----------- ----------- ----------- ----------- -----------
Redemptions:
Withdrawals & surrenders (note
5)............................. 4,665,586 3,698,490 2,329,006 892,779 3,012,698 1,199,702
Annuity & death benefit
payments....................... 350,040 330,156 320,878 135,114 273,715 126,555
Transfers to fixed & other
subaccounts.................... 22,069,694 11,527,756 6,411,425 2,345,418 4,396,009 2,503,007
----------- ----------- ----------- ----------- ----------- -----------
27,085,320 15,556,402 9,061,309 3,373,311 7,682,422 3,829,264
----------- ----------- ----------- ----------- ----------- -----------
Net equity transactions........ (13,933,000) (9,764,246) (838,444) 6,198,981 3,387,555 3,294,533
----------- ----------- ----------- ----------- ----------- -----------
Net change in contract
owners' equity............ 9,125,570 (8,141,011) 535,703 7,165,428 32,590,712 5,509,211
Contract owners' equity:
Beginning of period................. 48,879,593 57,020,604 25,818,183 18,652,755 25,836,404 20,327,193
----------- ----------- ----------- ----------- ----------- -----------
End of period....................... $58,005,163 $48,879,593 $26,353,886 $25,818,183 $58,427,116 $25,836,404
=========== =========== =========== =========== =========== ===========
<CAPTION>
INTERNATIONAL
SMALL COMPANY
SUBACCOUNT
-------------------------
1999 1998
----------- ----------
<S> <C> <C>
Investment activity:
Net investment activity............. $ (75,308) $ 100,174
Reinvested capital gains............ 1,140,089 475,985
Realized gain (loss)................ 73,689 3,742
Unrealized gain (loss).............. 4,691,729 (490,547)
----------- ----------
Net increase in contract owners'
equity from operations......... 5,830,199 89,354
----------- ----------
Equity transactions:
Sales:
Contract purchase payments....... 402,014 949,147
Transfers from fixed & other
subaccounts.................... 2,068,639 458,945
----------- ----------
2,470,653 1,408,092
----------- ----------
Redemptions:
Withdrawals & surrenders (note
5)............................. 366,129 220,074
Annuity & death benefit
payments....................... 51,364 47,792
Transfers to fixed & other
subaccounts.................... 1,247,550 1,098,960
----------- ----------
1,665,043 1,366,826
----------- ----------
Net equity transactions........ 805,610 41,266
----------- ----------
Net change in contract
owners' equity............ 6,635,809 130,620
Contract owners' equity:
Beginning of period................. 5,382,295 5,251,675
----------- ----------
End of period....................... $12,018,104 $5,382,295
=========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
132
<PAGE> 55
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH CORE GROWTH GROWTH & INCOME
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ------------------------ --------------------------
1999 1998 1999 1998 1999 1998
---------- ---------- ---------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity............... $ (70,010) $ (65,184) $ (57,096) $ (36,181) $ (275,629) $ (3,389)
Reinvested capital gains.............. 0 457,472 2,012,148 0 7,053,581 0
Realized gain (loss).................. (107,513) 9,963 199,621 50,716 214,196 20,399
Unrealized gain (loss)................ 384,427 (56,102) 2,402,419 286,587 10,001,873 628,348
---------- ---------- ---------- ---------- ----------- -----------
Net increase in contract owners'
equity from operations........... 206,904 346,149 4,557,092 301,122 16,994,021 645,358
---------- ---------- ---------- ---------- ----------- -----------
Equity transactions:
Sales:
Contract purchase payments......... 922,072 2,103,790 436,211 704,175 6,305,080 9,635,432
Transfers from fixed & other
subaccounts...................... 639,013 622,026 2,922,566 636,425 12,102,960 6,544,063
---------- ---------- ---------- ---------- ----------- -----------
1,561,085 2,725,816 3,358,777 1,340,600 18,408,040 16,179,495
---------- ---------- ---------- ---------- ----------- -----------
Redemptions:
Withdrawals & surrenders (note
5)............................... 521,985 302,085 486,302 406,459 1,721,642 488,326
Annuity & death benefit payments... 35,016 49,662 39,021 63,396 259,601 150,793
Transfers to fixed & other
subaccounts...................... 1,642,407 751,284 1,182,255 1,249,355 3,620,882 3,265,077
---------- ---------- ---------- ---------- ----------- -----------
2,199,408 1,103,031 1,707,578 1,719,210 5,602,125 3,904,196
---------- ---------- ---------- ---------- ----------- -----------
Net equity transactions.......... (638,323) 1,622,785 1,651,199 (378,610) 12,805,915 12,275,299
---------- ---------- ---------- ---------- ----------- -----------
Net change in contract owners'
equity...................... (431,419) 1,968,934 6,208,291 (77,488) 29,799,936 12,920,657
Contract owners' equity:
Beginning of period................... 6,784,243 4,815,309 3,416,790 3,494,278 19,357,466 6,436,809
---------- ---------- ---------- ---------- ----------- -----------
End of period......................... $6,352,824 $6,784,243 $9,625,081 $3,416,790 $49,157,402 $19,357,466
========== ========== ========== ========== =========== ===========
<CAPTION>
S&P 500 INDEX
SUBACCOUNT
---------------------------
1999 1998
------------ -----------
<S> <C> <C>
Investment activity:
Net investment activity............... $ 1,039,486 $ 344,251
Reinvested capital gains.............. 7,391,106 1,546,971
Realized gain (loss).................. 526,448 67,888
Unrealized gain (loss)................ 7,917,365 3,394,871
------------ -----------
Net increase in contract owners'
equity from operations........... 16,874,405 5,353,981
------------ -----------
Equity transactions:
Sales:
Contract purchase payments......... 23,816,081 13,945,843
Transfers from fixed & other
subaccounts...................... 43,061,688 14,612,814
------------ -----------
66,877,769 28,558,657
------------ -----------
Redemptions:
Withdrawals & surrenders (note
5)............................... 4,523,095 623,902
Annuity & death benefit payments... 483,763 129,913
Transfers to fixed & other
subaccounts...................... 13,424,078 3,168,210
------------ -----------
18,430,936 3,922,025
------------ -----------
Net equity transactions.......... 48,446,833 24,636,632
------------ -----------
Net change in contract owners'
equity...................... 65,321,238 29,990,613
Contract owners' equity:
Beginning of period................... 36,114,465 6,123,852
------------ -----------
End of period......................... $101,435,703 $36,114,465
============ ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
133
<PAGE> 56
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
SOCIAL AWARENESS STRATEGIC INCOME FIRSTAR GROWTH & INCOME
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ------------------------ ------------------------
1999 1998 1999 1998 1999 1998
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity................. $ (10,057) $ (10,520) $ 80,449 $ 97,888 $ (1,980) $ 24,958
Reinvested capital gains................ 0 0 0 479 0 5,463
Realized gain (loss).................... (356,428) (123,673) (81,875) (10,862) (5,429) (4,370)
Unrealized gain (loss).................. 524,015 (592,163) (91,767) (138,208) 14,492 (23,571)
---------- ---------- ---------- ---------- ---------- ----------
Net (decrease) increase in contract
owners' equity from operations..... 157,530 (726,356) (93,193) (50,703) 7,083 2,480
---------- ---------- ---------- ---------- ---------- ----------
Equity transactions:
Sales:
Contract purchase payments........... 126,549 1,707,317 28,821 1,124,332 235,791 898,498
Transfers from fixed & other
subaccounts..................... 302,402 727,506 382,507 74,905 260,694 181,594
---------- ---------- ---------- ---------- ---------- ----------
428,951 2,434,823 411,328 1,199,237 496,485 1,080,092
---------- ---------- ---------- ---------- ---------- ----------
Redemptions:
Withdrawals & surrenders (note 5).... 124,968 23,700 55,267 38,754 69,547 21,647
Annuity & death benefit payments..... 5,827 21,559 57,609 14,604 13,173 5,443
Transfers to fixed & other
subaccounts........................ 1,123,518 509,184 832,057 295,666 555,385 321,246
---------- ---------- ---------- ---------- ---------- ----------
1,254,313 554,443 944,933 349,024 638,105 348,336
---------- ---------- ---------- ---------- ---------- ----------
Net equity transactions............ (825,362) 1,880,380 (533,605) 850,213 (141,620) 731,756
---------- ---------- ---------- ---------- ---------- ----------
Net change in contract owners'
equity........................ (667,832) 1,154,024 (626,798) 799,510 (134,537) 734,236
Contract owners' equity:
Beginning of period..................... 1,964,101 810,077 1,874,581 1,075,071 1,345,772 611,536
---------- ---------- ---------- ---------- ---------- ----------
End of period........................... $1,296,269 $1,964,101 $1,247,783 $1,874,581 $1,211,235 $1,345,772
========== ========== ========== ========== ========== ==========
<CAPTION>
RELATIVE VALUE
SUBACCOUNT
-------------------------
1999 1998
----------- ----------
<S> <C> <C>
Investment activity:
Net investment activity................. $ (60,980) $ (12,699)
Reinvested capital gains................ 0 91,524
Realized gain (loss).................... 241,198 66,563
Unrealized gain (loss).................. 434,077 1,016,582
----------- ----------
Net (decrease) increase in contract
owners' equity from operations..... 614,295 1,161,970
----------- ----------
Equity transactions:
Sales:
Contract purchase payments........... 2,071,554 5,754,162
Transfers from fixed & other
subaccounts..................... 1,479,471 851,753
----------- ----------
3,551,025 6,605,915
----------- ----------
Redemptions:
Withdrawals & surrenders (note 5).... 576,228 373,306
Annuity & death benefit payments..... 211,985 73,267
Transfers to fixed & other
subaccounts........................ 1,492,473 492,230
----------- ----------
2,280,686 938,803
----------- ----------
Net equity transactions............ 1,270,339 5,667,112
----------- ----------
Net change in contract owners'
equity........................ 1,884,634 6,829,082
Contract owners' equity:
Beginning of period..................... 9,995,636 3,166,554
----------- ----------
End of period........................... $11,880,270 $9,995,636
=========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
134
<PAGE> 57
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
BLUE CHIP EQUITY INCOME HIGH INCOME BOND CAPITAL GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------- ---------------------- ---------------------- -----------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- -------- ---------- -------- ---------- -------- ----------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment
activity............. $ (11,554) $ (1,341) $ (1,019) $ 394 $ 85,239 $ 7,505 $ (48,317) $ (294)
Reinvested capital
gains................ 31,583 0 0 0 0 775 1,716,266 0
Realized gain (loss).... 46,166 532 4,306 215 (21,329) 378 957,003 (1,432)
Unrealized gain
(loss)............... (21,821) 48,463 158,259 6,457 (67,091) (3,712) 2,785,132 30,958
---------- -------- ---------- -------- ---------- -------- ----------- --------
Net (decrease)
increase in
contract owners'
equity from
operations......... 44,374 47,654 161,546 7,066 (3,181) 4,946 5,410,084 29,232
---------- -------- ---------- -------- ---------- -------- ----------- --------
Equity transactions:
Sales:
Contract purchase
payments........... 1,044,152 628,613 1,192,132 28,016 1,574,944 386,877 5,496,463 75,300
Transfers from fixed
& other
subaccounts........ 2,159,098 194,014 1,155,324 80,100 1,812,439 58,490 15,764,744 72,481
---------- -------- ---------- -------- ---------- -------- ----------- --------
3,203,250 822,627 2,347,456 108,116 3,387,383 445,367 21,261,207 147,781
---------- -------- ---------- -------- ---------- -------- ----------- --------
Redemptions:
Withdrawals &
surrenders (note
5)................. 18,068 2,746 63,607 0 98,890 82 227,730 0
Annuity & death
benefit payments... 11,695 223 20,326 0 26,002 127 28,233 61
Transfers to fixed &
other
subaccounts........ 1,230,926 36,502 458,386 15,487 1,154,970 2,292 11,054,854 0
---------- -------- ---------- -------- ---------- -------- ----------- --------
1,260,689 39,471 542,319 15,487 1,279,862 2,501 11,310,817 61
---------- -------- ---------- -------- ---------- -------- ----------- --------
Net equity
transactions.... 1,942,561 783,156 1,805,137 92,629 2,107,521 442,866 9,950,390 147,720
---------- -------- ---------- -------- ---------- -------- ----------- --------
Net change in
contract
owners'
equity........ 1,986,935 830,810 1,966,683 99,695 2,104,340 447,812 15,360,474 176,952
Contract owners' equity:
Beginning of period..... 830,810 0 99,695 0 447,812 0 176,952 0
---------- -------- ---------- -------- ---------- -------- ----------- --------
End of period........... $2,817,745 $830,810 $2,066,378 $ 99,695 $2,552,152 $447,812 $15,537,426 $176,952
========== ======== ========== ======== ========== ======== =========== ========
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
135
<PAGE> 58
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
DOW TARGET 10
--------------------------------------------------------------------------------
JANUARY FEBRUARY MARCH APRIL MAY JUNE
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ---------- ---------- ---------- ----------
1999(b) 1999(b) 1999(b) 1999(b) 1999(b) 1999(b)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity.................... $ 3,215 $ 3,905 $ 132 $ 3,741 $ 1,357 $ 2,558
Reinvested capital gains................... 2,452 28,815 36,126 17,860 0 0
Realized gain (loss)....................... 10,503 16,546 16,884 (43,006) (19,470) (7,729)
Unrealized gain (loss)..................... (8,237) 10,023 (80,401) (132,892) (126,311) (151,575)
-------- ---------- ---------- ---------- -------- ----------
Net (decrease) increase in contract
owners' equity from operations........ 7,933 59,289 (27,259) (154,297) (144,424) (156,746)
-------- ---------- ---------- ---------- -------- ----------
Equity transactions:
Sales:
Contract purchase payments.............. 200,397 1,012,314 945,408 1,305,621 458,581 871,329
Transfers from fixed & other
subaccounts........................... 161,557 278,967 300,764 878,665 618,700 788,856
-------- ---------- ---------- ---------- -------- ----------
361,954 1,291,281 1,246,172 2,184,286 1,077,281 1,660,185
-------- ---------- ---------- ---------- -------- ----------
Redemptions:
Withdrawals & surrenders (note 5)....... 1,675 26,995 17,077 20,253 7,892 10,313
Annuity & death benefit payments........ 59 18,346 4,193 5,595 63 6,076
Transfers to fixed & other
subaccounts........................... 17,072 144,588 181,722 748,534 208,439 330,090
-------- ---------- ---------- ---------- -------- ----------
18,806 189,929 202,992 774,382 216,394 346,479
-------- ---------- ---------- ---------- -------- ----------
Net equity transactions............... 343,148 1,101,352 1,043,180 1,409,904 860,887 1,313,706
-------- ---------- ---------- ---------- -------- ----------
Net change in contract owners'
equity........................... 351,081 1,160,641 1,015,921 1,255,607 716,463 1,156,960
Contract owners' equity:
Beginning of period........................ 0 0 0 0 0 0
-------- ---------- ---------- ---------- -------- ----------
End of period.............................. $351,081 $1,160,641 $1,015,921 $1,255,607 $716,463 $1,156,960
======== ========== ========== ========== ======== ==========
<CAPTION>
DOW TARGET 10
------------------------
JULY AUGUST
SUBACCOUNT SUBACCOUNT
---------- ----------
1999(b) 1999(b)
---------- ----------
<S> <C> <C>
Investment activity:
Net investment activity.................... $ 4,153 $ 3,991
Reinvested capital gains................... 0 0
Realized gain (loss)....................... (12,827) (17,755)
Unrealized gain (loss)..................... (123,094) (114,144)
-------- --------
Net (decrease) increase in contract
owners' equity from operations........ (131,768) (127,908)
-------- --------
Equity transactions:
Sales:
Contract purchase payments.............. 501,575 367,266
Transfers from fixed & other
subaccounts........................... 1,014,887 731,632
-------- --------
1,516,462 1,098,898
-------- --------
Redemptions:
Withdrawals & surrenders (note 5)....... 7,691 9,986
Annuity & death benefit payments........ 3,453 5,854
Transfers to fixed & other
subaccounts........................... 384,457 150,804
-------- --------
395,601 166,644
-------- --------
Net equity transactions............... 1,120,861 932,254
-------- --------
Net change in contract owners'
equity........................... 989,093 804,346
Contract owners' equity:
Beginning of period........................ 0 0
-------- --------
End of period.............................. $989,093 $804,346
======== ========
</TABLE>
- ---------------
(b) See Note 7. (continued)
The accompanying notes are an integral part of these financial statements.
136
<PAGE> 59
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
DOW TARGET 10 (CONTINUED) DOW TARGET 5
---------------------------------------------------- ------------------------
SEPTEMBER OCTOBER NOVEMBER DECEMBER SEPTEMBER OCTOBER
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ---------- ---------- ---------- ----------
1999(b) 1999(b) 1999(b) 1999(b) 1999(b) 1999(b)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity.................... $ 4,358 $ 5,710 $ 2,382 $ 243 $ 389 $ 717
Reinvested capital gains................... 0 0 0 0 0 0
Realized gain (loss)....................... (8,391) 1,458 490 (1,437) (6,411) (1,590)
Unrealized gain (loss)..................... (130,265) (78,580) (6,279) 9,617 (15,253) (30,000)
---------- ---------- ---------- ---------- -------- --------
Net (decrease) increase in contract
owners' equity from operations........ (134,298) (71,412) (3,407) 8,423 (21,275) (30,873)
---------- ---------- ---------- ---------- -------- --------
Equity transactions:
Sales:
Contract purchase payments.............. 379,565 282,149 209,621 198,309 87,966 176,832
Transfers from fixed & other
subaccounts........................... 1,323,662 1,229,320 1,154,415 1,081,715 14,629 39,265
---------- ---------- ---------- ---------- -------- --------
1,703,227 1,511,469 1,364,036 1,280,024 102,595 216,097
---------- ---------- ---------- ---------- -------- --------
Redemptions:
Withdrawals & surrenders (note 5)....... 1,883 632 115 102 0 58
Annuity & death benefit payments........ 465 28 22 434 0 6
Transfers to fixed & other
subaccounts........................... 99,775 44,224 34,012 27,276 510 0
---------- ---------- ---------- ---------- -------- --------
102,123 44,884 34,149 27,812 510 64
---------- ---------- ---------- ---------- -------- --------
Net equity transactions............... 1,601,104 1,466,585 1,329,887 1,252,212 102,085 216,033
---------- ---------- ---------- ---------- -------- --------
Net change in contract owners'
equity........................... 1,466,806 1,395,173 1,326,480 1,260,635 80,810 185,160
Contract owners' equity:
Beginning of period........................ 0 0 0 0 0 0
---------- ---------- ---------- ---------- -------- --------
End of period.............................. $1,466,806 $1,395,173 $1,326,480 $1,260,635 $ 80,810 $185,160
========== ========== ========== ========== ======== ========
<CAPTION>
DOW TARGET 5
------------------------
NOVEMBER DECEMBER
SUBACCOUNT SUBACCOUNT
---------- ----------
1999(b) 1999(b)
---------- ----------
<S> <C> <C>
Investment activity:
Net investment activity.................... $ 246 $ 153
Reinvested capital gains................... 0 0
Realized gain (loss)....................... 326 (142)
Unrealized gain (loss)..................... (1,347) 194
-------- --------
Net (decrease) increase in contract
owners' equity from operations........ (775) 205
-------- --------
Equity transactions:
Sales:
Contract purchase payments.............. 61,551 50,081
Transfers from fixed & other
subaccounts........................... 42,794 68,548
-------- --------
104,345 118,629
-------- --------
Redemptions:
Withdrawals & surrenders (note 5)....... 0 0
Annuity & death benefit payments........ 0 7
Transfers to fixed & other
subaccounts........................... 0 12,648
-------- --------
0 12,655
-------- --------
Net equity transactions............... 104,345 105,974
-------- --------
Net change in contract owners'
equity........................... 103,570 106,179
Contract owners' equity:
Beginning of period........................ 0 0
-------- --------
End of period.............................. $103,570 $106,179
======== ========
</TABLE>
- ---------------
(b) See Note 7.
The accompanying notes are an integral part of these financial statements.
137
<PAGE> 60
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
MONTGOMERY ASSET FIDELITY INVESTMENTS
------------------------------------------------- -------------------------
EMERGING MARKET SMALL CAP OPPORTUNITY VIP GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------------------- ---------------------- -------------------------
1999 1998 1999 1998(a) 1999 1998
---------- --------- --------- --------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity..................... $ (10,872) $ (9,129) $ (1,053) $ (204) $ (97,595) $ (30,410)
Reinvested capital gains.................... 0 0 0 0 596,051 169,084
Realized gain (loss)........................ (172,773) (105,907) 5,705 2,069 216,905 32,996
Unrealized gain (loss)...................... 359,922 (288,678) (10,248) 10,248 2,075,658 805,443
---------- --------- -------- -------- ----------- ----------
Net (decrease) increase in contract
owners' equity from operations......... 176,277 (403,714) (5,596) 12,113 2,791,019 977,113
---------- --------- -------- -------- ----------- ----------
Equity transactions:
Sales:
Contract purchase payments............... 161,704 328,559 33,949 91,968 2,938,186 2,574,916
Transfers from fixed & other
subaccounts............................ 624,789 383,220 132,949 15,485 3,414,568 662,152
---------- --------- -------- -------- ----------- ----------
786,493 711,779 166,898 107,453 6,352,754 3,237,068
---------- --------- -------- -------- ----------- ----------
Redemptions:
Withdrawals & surrenders (note 5)........ 16,290 5,958 1,328 0 182,126 54,773
Annuity & death benefit payments......... 2,227 1,979 595 16,664 11,538 12,293
Transfers to fixed & other subaccounts... 1,669,125 407,864 249,840 12,441 1,779,405 638,827
---------- --------- -------- -------- ----------- ----------
1,687,642 415,801 251,763 29,105 1,973,069 705,893
---------- --------- -------- -------- ----------- ----------
Net equity transactions................ (901,149) 295,978 (84,865) 78,348 4,379,685 2,531,175
---------- --------- -------- -------- ----------- ----------
Net change in contract owners'
equity............................ (724,872) (107,736) (90,461) 90,461 7,170,704 3,508,288
Contract owners' equity:
Beginning of period......................... 724,872 832,608 90,461 0 4,523,170 1,014,882
---------- --------- -------- -------- ----------- ----------
End of period............................... $ 0 $ 724,872 $ 0 $ 90,461 $11,693,874 $4,523,170
========== ========= ======== ======== =========== ==========
<CAPTION>
FIDELITY INVESTMENTS
------------------------
VIP EQUITY INCOME
SUBACCOUNT
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Investment activity:
Net investment activity..................... $ (8,133) $ (20,659)
Reinvested capital gains.................... 192,859 95,785
Realized gain (loss)........................ 57,650 15,254
Unrealized gain (loss)...................... (35,430) 217,112
---------- ----------
Net (decrease) increase in contract
owners' equity from operations......... 206,946 307,492
---------- ----------
Equity transactions:
Sales:
Contract purchase payments............... 2,272,614 3,306,327
Transfers from fixed & other
subaccounts............................ 1,607,105 668,846
---------- ----------
3,879,719 3,975,173
---------- ----------
Redemptions:
Withdrawals & surrenders (note 5)........ 304,666 71,218
Annuity & death benefit payments......... 48,489 3,399
Transfers to fixed & other subaccounts... 1,440,670 390,802
---------- ----------
1,793,825 465,419
---------- ----------
Net equity transactions................ 2,085,894 3,509,754
---------- ----------
Net change in contract owners'
equity............................ 2,292,840 3,817,246
Contract owners' equity:
Beginning of period......................... 5,489,577 1,672,331
---------- ----------
End of period............................... $7,782,417 $5,489,577
========== ==========
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations. (continued)
The accompanying notes are an integral part of these financial statements.
138
<PAGE> 61
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
FIDELITY INVESTMENTS (CONT.) JP MORGAN TRUST II JANUS ASPEN SERIES
---------------------------- ---------------------- -------------------------
VIP HIGH INCOME BOND SMALL COMPANY GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------------- ---------------------- -------------------------
1999 1998 1999 1998(a) 1999 1998(a)
------------ ------------ ---------- -------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity.................. $ 238,409 $ 76,119 $ (17,268) $ (840) $ (155,273) $ (2,773)
Reinvested capital gains................. 10,553 66,607 52,780 11,588 72,776 139
Realized gain (loss)..................... (143,416) (22,981) 44,699 (689) 909,173 46,760
Unrealized gain (loss)................... 86,432 (301,337) 682,935 37,863 7,169,844 319,539
---------- ---------- ---------- -------- ----------- ----------
Net (decrease) increase in contract
owners' equity from operations...... 191,978 (181,592) 763,146 47,922 7,996,520 363,665
---------- ---------- ---------- -------- ----------- ----------
Equity transactions:
Sales:
Contract purchase payments............ 806,818 1,709,242 872,645 539,440 20,214,291 1,505,041
Transfers from fixed & other
subaccounts......................... 348,330 333,556 1,135,507 73,249 34,106,267 1,737,064
---------- ---------- ---------- -------- ----------- ----------
1,155,148 2,042,798 2,008,152 612,689 54,320,558 3,242,105
---------- ---------- ---------- -------- ----------- ----------
Redemptions:
Withdrawals & surrenders (note 5)... 59,847 26,465 21,266 609 377,238 61
Annuity & death benefit payments...... 7,397 791 39,267 116 163,408 185
Transfers to fixed & other
subaccounts......................... 1,717,401 125,389 719,119 3,384 18,329,315 1,188,160
---------- ---------- ---------- -------- ----------- ----------
1,784,645 152,645 779,652 4,109 18,869,961 1,188,406
---------- ---------- ---------- -------- ----------- ----------
Net equity transactions............. (629,497) 1,890,153 1,228,500 608,580 35,450,597 2,053,699
---------- ---------- ---------- -------- ----------- ----------
Net change in contract owners'
equity......................... (437,519) 1,708,561 1,991,646 656,502 43,447,117 2,417,364
Contract owners' equity:
Beginning of period...................... 3,096,886 1,388,325 656,502 0 2,417,364 0
---------- ---------- ---------- -------- ----------- ----------
End of period............................ $2,659,367 $3,096,886 $2,648,148 $656,502 $45,864,481 $2,417,364
========== ========== ========== ======== =========== ==========
<CAPTION>
JANUS ASPEN SERIES
--------------------------
INTERNATIONAL GROWTH
SUBACCOUNT
--------------------------
1999 1998(a)
------------ ----------
<S> <C> <C>
Investment activity:
Net investment activity.................. $ (27,679) $ 558
Reinvested capital gains................. 0 38
Realized gain (loss)..................... 2,562,214 14,859
Unrealized gain (loss)................... 415,113 139
------------ ----------
Net (decrease) increase in contract
owners' equity from operations...... 2,949,648 15,594
------------ ----------
Equity transactions:
Sales:
Contract purchase payments............ 1,992,870 119,362
Transfers from fixed & other
subaccounts......................... 126,717,473 4,506,289
------------ ----------
128,710,343 4,625,651
------------ ----------
Redemptions:
Withdrawals & surrenders (note 5)... 13,013 59
Annuity & death benefit payments...... 7,005 16,112
Transfers to fixed & other
subaccounts......................... 123,940,423 4,399,733
------------ ----------
123,960,441 4,415,904
------------ ----------
Net equity transactions............. 4,749,902 209,747
------------ ----------
Net change in contract owners'
equity......................... 7,699,550 225,341
Contract owners' equity:
Beginning of period...................... 225,341 0
------------ ----------
End of period............................ $ 7,924,891 $ 225,341
============ ==========
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations. (continued)
The accompanying notes are an integral part of these financial statements.
139
<PAGE> 62
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
------------------------------------------------------
WORLDWIDE GROWTH BALANCED
SUBACCOUNT SUBACCOUNT
------------------------- -------------------------
1999 1998(a) 1999 1998(a)
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Investment activity:
Net investment activity.................... $ (148,080) $ 2,584 $ 369,590 $ 38,063
Reinvested capital gains................... 0 2,416 0 1,137
Realized gain (loss)....................... 3,244,178 36,214 80,815 8,538
Unrealized gain (loss)..................... 6,606,997 186,957 4,754,500 485,789
----------- ---------- ----------- ----------
Net (decrease) increase in contract
owners' equity from operations........ 9,703,095 228,171 5,204,905 533,527
----------- ---------- ----------- ----------
Equity transactions:
Sales:
Contract purchase payments.............. 11,893,823 1,786,575 17,278,295 2,648,081
Transfers from fixed & other
subaccounts........................... 67,372,289 3,425,697 18,879,362 1,383,055
----------- ---------- ----------- ----------
79,266,112 5,212,272 36,157,657 4,031,136
----------- ---------- ----------- ----------
Redemptions:
Withdrawals & surrenders (note 5)....... 241,675 30,747 465,955 18,758
Annuity & death benefit payments........ 101,164 252 411,693 6,210
Transfers to fixed & other
subaccounts........................... 57,781,886 2,697,114 4,231,505 294,535
----------- ---------- ----------- ----------
58,124,725 2,728,113 5,109,153 319,503
----------- ---------- ----------- ----------
Net equity transactions............... 21,141,387 2,484,159 31,048,504 3,711,633
----------- ---------- ----------- ----------
Net change in contract owners'
equity........................... 30,844,482 2,712,330 36,253,409 4,245,160
Contract owners' equity:
Beginning of period........................ 2,712,330 0 4,245,160 --
----------- ---------- ----------- ----------
End of period.............................. $33,556,812 $2,712,330 $40,498,569 $4,245,160
=========== ========== =========== ==========
<CAPTION>
SALOMON VARIABLE FUND SERIES
------------------------------------------------
CAPITAL TOTAL RETURN
SUBACCOUNT SUBACCOUNT
---------------------- ----------------------
1999 1998(a) 1999 1998(a)
---------- -------- ---------- --------
<S> <C> <C> <C> <C>
Investment activity:
Net investment activity.................... $ (4,991) $ 1,399 $ 22,244 $ 4,537
Reinvested capital gains................... 30,334 3,009 0 1,072
Realized gain (loss)....................... 22,197 762 (450) 829
Unrealized gain (loss)..................... 119,271 17,714 (44,241) 4,184
---------- -------- ---------- --------
Net (decrease) increase in contract
owners' equity from operations........ 166,811 22,884 (22,447) 10,622
---------- -------- ---------- --------
Equity transactions:
Sales:
Contract purchase payments.............. 361,765 233,419 694,967 232,678
Transfers from fixed & other
subaccounts........................... 443,408 42,434 819,204 151,291
---------- -------- ---------- --------
805,173 275,853 1,514,171 383,969
---------- -------- ---------- --------
Redemptions:
Withdrawals & surrenders (note 5)....... 15,782 0 28,332 0
Annuity & death benefit payments........ 6,995 107 10,605 0
Transfers to fixed & other
subaccounts........................... 137,987 0 403,922 19,970
---------- -------- ---------- --------
160,764 107 442,859 19,970
---------- -------- ---------- --------
Net equity transactions............... 644,409 275,746 1,071,312 363,999
---------- -------- ---------- --------
Net change in contract owners'
equity........................... 811,220 298,630 1,048,865 374,621
Contract owners' equity:
Beginning of period........................ 298,630 0 374,621 0
---------- -------- ---------- --------
End of period.............................. $1,109,850 $298,630 $1,423,486 $374,621
========== ======== ========== ========
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations. (continued)
The accompanying notes are an integral part of these financial statements.
140
<PAGE> 63
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
SALOMON VARIABLE
FUND SERIES (CONTINUED) STRONG VARIABLE ANNUITY FUNDS
------------------------ ------------------------------------------------------------------------
INVESTORS OPPORTUNITY SCHAFER VALUE MID-CAP GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------------ ---------------------- ------------------- -----------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- ---------- ---------- -------- -------- ------- ----------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment
activity.............. $ (4,277) $ 422 $ (20,474) $ 473 $ 351 $ (51) $ (54,243) $ (1,238)
Reinvested capital
gains................. 0 0 63,194 0 20,517 0 0 0
Realized gain (loss)..... 40,431 1,496 237,823 22,907 (18,877) 1,786 116,343 1,501
Unrealized gain (loss)... 6,861 23,307 213,263 20,918 (21,364) 3,845 4,314,671 102,974
-------- -------- ---------- --------- -------- ------- ----------- --------
Net (decrease)
increase in contract
owners' equity from
operations.......... 43,015 25,225 493,806 44,298 (19,373) 5,580 4,376,771 103,237
-------- -------- ---------- --------- -------- ------- ----------- --------
Equity transactions:
Sales:
Contract purchase
payments............ 129,273 333,783 999,849 234,597 348,609 35,791 5,761,739 360,069
Transfers from fixed &
other subaccounts... 498,295 36,621 21,109,585 1,443,032 217,227 24,309 6,524,833 158,068
-------- -------- ---------- --------- -------- ------- ----------- --------
627,568 370,404 22,109,434 1,677,629 565,836 60,100 12,286,572 518,137
-------- -------- ---------- --------- -------- ------- ----------- --------
Redemptions:
Withdrawals &
surrenders (note
5).................. 8,362 272 11,226 0 2,212 0 79,426 0
Annuity & death
benefit payments.... 76,442 186 2,830 15,648 3,462 0 42,880 0
Transfers to fixed &
other subaccounts... 526,995 1,999 20,445,637 930,499 65,566 15,411 1,821,107 9,656
-------- -------- ---------- --------- -------- ------- ----------- --------
611,799 2,457 20,459,693 946,147 71,240 15,411 1,943,413 9,656
-------- -------- ---------- --------- -------- ------- ----------- --------
Net equity
transactions..... 15,769 367,947 1,649,741 731,482 494,596 44,689 10,343,159 508,481
-------- -------- ---------- --------- -------- ------- ----------- --------
Net change in
contract
owners'
equity......... 58,784 393,172 2,143,547 775,780 475,223 50,269 14,719,930 611,718
Contract owners' equity:
Beginning of period...... 393,172 0 775,780 0 50,269 0 611,718 0
-------- -------- ---------- --------- -------- ------- ----------- --------
End of period............ $451,956 $393,172 $2,919,327 $775,780 $525,492 $50,269 $15,331,648 $611,718
======== ======== ========== ========= ======== ======= =========== ========
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
141
<PAGE> 64
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
MORGAN STANLEY UNIVERSAL FUNDS
---------------------------------------------------------------------------------------------
FIXED INCOME US REAL ESTATE VALUE EMERGING MARKET DEBT
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------- ------------------- -------------------- --------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- -------- -------- ------- -------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity......... $ 158,114 $ 13,984 $ 16,456 $ 1,690 $ 1,072 $ 4,479 $ 18,258 $ 827
Reinvested capital gains........ 336 5,226 0 0 0 8,977 0 0
Realized gain (loss)............ (14,276) 13 1,866 (61) 705 1,409 3,051 42
Unrealized gain (loss).......... (190,943) (15,285) (27,171) (491) (52,452) (693) 3,666 (546)
---------- -------- -------- ------- -------- -------- -------- ------
Net (decrease) increase in
contract owners' equity
from operations............ (46,769) 3,938 (8,849) 1,138 (50,675) 14,172 24,975 323
---------- -------- -------- ------- -------- -------- -------- ------
Equity transactions:
Sales:
Contract purchase payments... 1,146,361 315,893 35,746 58,605 322,933 264,759 45,177 6,757
Transfers from fixed & other
subaccounts................ 4,467,822 335,255 459,951 27,072 461,168 146,186 122,702 519
---------- -------- -------- ------- -------- -------- -------- ------
5,614,183 651,148 495,697 85,677 784,101 410,945 167,879 7,276
---------- -------- -------- ------- -------- -------- -------- ------
Redemptions:
Withdrawals & surrenders
(note 5)................... 98,815 253 2,487 0 51,732 0 0 0
Annuity & death benefit
payments................... 52,395 49 2,062 0 2,834 137 15 0
Transfers to fixed & other
subaccounts................ 1,775,199 112,159 126,136 169 196,885 2,952 20,413 0
---------- -------- -------- ------- -------- -------- -------- ------
1,926,409 112,461 130,685 169 251,451 3,089 20,428 0
---------- -------- -------- ------- -------- -------- -------- ------
Net equity transactions.... 3,687,774 538,687 365,012 85,508 532,650 407,856 147,451 7,276
---------- -------- -------- ------- -------- -------- -------- ------
Net change in contract
owners' equity........ 3,641,005 542,625 356,163 86,646 481,975 422,028 172,426 7,599
Contract owners' equity:
Beginning of period............. 542,625 0 86,646 0 422,028 0 7,599 0
---------- -------- -------- ------- -------- -------- -------- ------
End of period................... $4,183,630 $542,625 $442,809 $86,646 $904,003 $422,028 $180,025 $7,599
========== ======== ======== ======= ======== ======== ======== ======
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
142
<PAGE> 65
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
GOLDMAN SACHS VIT FUNDS
---------------------------------------------------------------------------------------------------
GROWTH & INCOME CORE US EQUITY GLOBAL INCOME CAPITAL GROWTH
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------------------- ---------------------- ------------------- ------------------------
1999 1998(a) 1999 1998(a) 1999 1998(a) 1999 1998(a)
---------- -------- ---------- -------- -------- ------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity... $ 7,645 $ 4,262 $ (15,676) $ 760 $ 18,601 $ 2,159 $ (29,272) $ (1,440)
Reinvested capital
gains.................. 0 0 51,295 0 3,816 644 101,678 0
Realized gain (loss)...... 3,654 (1,956) 33,847 1,045 (1,803) 57 50,556 7,124
Unrealized gain (loss).... 31,312 14,203 479,377 79,395 (28,302) (2,172) 557,373 110,809
---------- -------- ---------- -------- -------- ------- ---------- ----------
Net increase (decrease)
in contract owners'
equity from
operations........... 42,611 16,509 548,843 81,200 (7,688) 688 680,335 116,493
---------- -------- ---------- -------- -------- ------- ---------- ----------
Equity transactions:
Sales:
Contract purchase
payments............. 963,704 668,643 1,977,906 760,740 334,572 75,695 1,266,179 781,171
Transfers from fixed &
other subaccounts.... 1,701,472 92,384 1,876,140 74,272 526,733 6,926 2,113,668 213,959
---------- -------- ---------- -------- -------- ------- ---------- ----------
2,665,176 761,027 3,854,046 835,012 861,305 82,621 3,379,847 995,130
---------- -------- ---------- -------- -------- ------- ---------- ----------
Redemptions:
Withdrawals &
surrenders (note
5)................... 30,748 150 90,270 249 16,154 0 31,676 9,036
Annuity & death benefit
payments............. 24,514 150 7,318 24,187 6,233 0 24,551 3,393
Transfers to fixed &
other subaccounts.... 629,714 29,603 333,627 42,315 150,940 766 598,356 40,314
---------- -------- ---------- -------- -------- ------- ---------- ----------
684,976 29,903 431,215 66,751 173,327 766 654,583 52,743
---------- -------- ---------- -------- -------- ------- ---------- ----------
Net equity
transactions...... 1,980,200 731,124 3,422,831 768,261 687,978 81,855 2,725,264 942,387
---------- -------- ---------- -------- -------- ------- ---------- ----------
Net change in
contract owners'
equity.......... 2,022,811 747,633 3,971,674 849,461 680,290 82,543 3,405,599 1,058,880
Contract owners' equity:
Beginning of period....... 747,633 0 849,461 0 82,543 0 1,058,880 0
---------- -------- ---------- -------- -------- ------- ---------- ----------
End of period............. $2,770,444 $747,633 $4,821,135 $849,461 $762,833 $82,543 $4,464,479 $1,058,880
========== ======== ========== ======== ======== ======= ========== ==========
</TABLE>
- ---------------
(a) Period From May 1, 1998 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
143
<PAGE> 66
OHIO NATIONAL VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
LAZARD RETIREMENT FUNDS SERIES TRUST PAINEWEBBER MUTUAL FUNDS
------------------------ ----------------------------------------------------
EMERGING STRATEGIC GROWTH TACTICAL
MARKET SMALL CAP INCOME & INCOME ALLOCATION SMALL CAP
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ---------- ---------- ---------- ----------
1999(c) 1999(c) 1999(c) 1999(c) 1999(c) 1999(c)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment activity:
Net investment activity...................... $ (382) $ (73) $ 6,290 $ (1,686) $ (5,601) $ 3,949
Reinvested capital gains..................... 0 1,772 0 0 139,770 0
Realized gain (loss)......................... 7,541 92 80 20 3,383 3,388
Unrealized gain (loss)....................... 337,023 2,706 (6,631) 49,454 (8,939) 3,630
---------- -------- -------- ---------- ---------- --------
Net increase (decrease) in contract
owners' equity from operations........... 344,182 4,497 (261) 47,788 128,613 10,967
---------- -------- -------- ---------- ---------- --------
Equity transactions:
Sales:
Contract purchase payments................ 60,799 37,710 62,640 452,561 1,012,466 76,544
Transfers from fixed & other
subaccounts.............................. 1,583,671 94,733 67,127 110,944 1,067,505 41,922
---------- -------- -------- ---------- ---------- --------
1,644,470 132,443 129,767 563,505 2,079,971 118,466
---------- -------- -------- ---------- ---------- --------
Redemptions:
Withdrawals & surrenders (note 5)......... 4,104 0 3,600 0 15,983 0
Annuity & death benefit payments.......... 399 0 0 1,405 2,089 120
Transfers to fixed & other subaccounts.... 193,294 0 0 0 21,095 524
---------- -------- -------- ---------- ---------- --------
197,797 0 3,600 1,405 39,167 644
---------- -------- -------- ---------- ---------- --------
Net equity transactions................. 1,446,673 132,443 126,167 562,100 2,040,804 117,822
---------- -------- -------- ---------- ---------- --------
Net change in contract owners'
equity............................. 1,790,855 136,940 125,906 609,888 2,169,417 128,789
Contract owners' equity:
Beginning of period.......................... 0 0 0 0 0 0
---------- -------- -------- ---------- ---------- --------
End of period................................ $1,790,855 $136,940 $125,906 $ 609,888 $2,169,417 $128,789
========== ======== ======== ========== ========== ========
</TABLE>
- ---------------
(c) Period From July 1, 1999 date of commencement of operations.
The accompanying notes are an integral part of these financial statements.
144
<PAGE> 67
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS
(1) BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Ohio National Variable Account A (the Account) is a separate account of The
Ohio National Life Insurance Company (ONLIC) and all obligations arising
under variable annuity contracts are general corporate obligations of ONLIC.
The account has been registered as a unit investment trust under the
Investment Company Act of 1940.
Assets of the Account are invested in portfolio shares of Ohio National Fund,
Inc., Fidelity Variable Insurance Products Fund, J. P. Morgan Series Trust
II, Janus Aspen Series, Salomon Brothers Variable Series Fund, Inc., Strong
Variable Insurance Funds, Inc., Morgan Stanley Universal Funds, Inc., Goldman
Sachs Variable Insurance Trust, Lazard Retirement Funds and Series Trust
PaineWebber Mutual Funds (collectively the Funds). The Funds are diversified
open-end management investment companies. The Funds' investments are subject
to varying degrees of market, interest and financial risks; the issuers'
abilities to meet certain obligations may be affected by economic
developments in their respective industries.
Annuity reserves are computed for currently payable contracts according to
the Progressive Annuity Mortality Table. The assumed interest rate is 3.5 or
4.0 percent depending on the contract selected by the annuitant. Charges to
annuity reserves for adverse mortality and express risk experience are
reimbursed to the Account by ONLIC. Such amounts are included in risk and
administrative expenses.
Investments are valued at the net asset value of fund shares held at December
31, 1999. Share transactions are recorded on the trade date. Income and
capital gain distributions are recorded on the ex-dividend date. Net realized
capital gains and losses are determined on the basis of average cost.
ONLIC performs investment advisory services on behalf of the Ohio National
Fund, Inc. in which the Account invests. For these services, the Company
receives fees from the mutual funds. These fees are paid to an affiliate of
the Company.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
(2) INVESTMENTS
At December 31, 1999 the aggregate cost and number of shares of the
underlying funds owned by the respective subaccounts were:
<TABLE>
<CAPTION>
MONEY
EQUITY MARKET BOND OMNI INTERNATIONAL
OHIO NATIONAL FUNDS SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------- ------------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Aggregate Cost.......................... $154,799,612 $33,652,464 $11,799,222 $61,404,722 $ 38,371,658
Number of Shares........................ 5,644,247 3,365,246 1,124,170 3,536,807 2,695,783
<CAPTION>
CAPITAL
APPRECIATION SMALL CAP
OHIO NATIONAL FUNDS SUBACCOUNT SUBACCOUNT
------------------- ------------ -----------
<S> <C> <C>
Aggregate Cost.......................... $27,977,115 $40,286,206
Number of Shares........................ 2,176,748 1,848,024
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL AGGRESSIVE CORE GROWTH & S&P 500
SMALL CO. GROWTH GROWTH INCOME INDEX
OHIO NATIONAL FUNDS SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------- ------------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Aggregate Cost.......................... $ 7,801,451 $ 5,828,880 $ 6,951,119 $38,362,750 $ 90,295,159
Number of Shares........................ 593,604 538,786 566,882 2,617,958 6,274,632
<CAPTION>
SOCIAL STRATEGIC
AWARENESS INCOME
OHIO NATIONAL FUNDS SUBACCOUNT SUBACCOUNT
------------------- ------------ -----------
<S> <C> <C>
Aggregate Cost.......................... $ 1,422,857 $ 1,478,903
Number of Shares........................ 125,754 150,571
</TABLE>
<TABLE>
<CAPTION>
FIRSTAR
GROWTH & RELATIVE EQUITY HIGH INCOME
INCOME VALUE BLUE CHIP INCOME BOND
OHIO NATIONAL FUNDS SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------- ------------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Aggregate Cost.......................... $ 1,205,576 $10,213,912 $ 2,791,103 $ 1,901,662 $ 2,622,955
Number of Shares........................ 114,095 743,307 264,428 166,980 276,836
<CAPTION>
CAPITAL
GROWTH
OHIO NATIONAL FUNDS SUBACCOUNT
------------------- ------------
<S> <C> <C>
Aggregate Cost.......................... $12,721,337
Number of Shares........................ 554,651
</TABLE>
<TABLE>
<CAPTION>
DOW TARGET DOW TARGET DOW TARGET DOW TARGET DOW TARGET
10 JANUARY 10 FEBRUARY 10 MARCH 10 APRIL 10 MAY
DOW TARGET 10 FUNDS SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------- ------------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Aggregate Cost.......................... $ 359,318 $ 1,150,617 $ 1,096,322 $ 1,388,499 $ 842,774
Number of Shares........................ 34,996 113,200 104,272 125,235 86,217
<CAPTION>
DOW TARGET
10 JUNE
DOW TARGET 10 FUNDS SUBACCOUNT
------------------- ------------
<S> <C> <C>
Aggregate Cost.......................... $ 1,308,535
Number of Shares........................ 129,168
</TABLE>
(continued)
145
<PAGE> 68
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
THE OHIO NATIONAL LIFE INSURANCE COMPANY/CINCINNATI
A MUTUAL LIFE INSURANCE COMPANY INCORPORATED UNDER THE LAWS OF OHIO
- --------------------------------------------------------------------------------
<S> <C>
- ------------------------------- -----------------------------
ENTERPRISE PARK, INC. OHIO NATIONAL EQUITIES INC.
A GEORGIA CORPORATION A BROKER/DEALER
REAL ESTATE DEVELOPMENT COMPANY CAPITALIZED BY ONLI @ $30,000
CAPITALIZED BY ONLI $50,000
- ------------------------------- ---------------------------------------------
Pres. & Dir. M. Stohler Chm. & Dir. D. O'Maley
V.P. & Dir. J. Brom Pres. & Dir. J. Palmer
Secy. & Dir. J. Fischer VP & Dir. T. Backus
Treas. & Dir. D. Taney VP & Dir. J. Miller
Sr. VP T. Barefield
Secretary & Dir. R. Benedict
Treasurer & Compliance Officer B. Turner
Asst. Secy. M. Haverkamp
- ------------------------------- --------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
THE OHIO NATIONAL LIFE INSURANCE COMPANY/CINCINNATI
A MUTUAL LIFE INSURANCE COMPANY INCORPORATED UNDER THE LAWS OF OHIO
- -------------------------------------------------------------------------------------------------------------------
S E P A R A T E A C C O U N T S
--------------------------------
A B C D E F
--------------------------------
<S> <C> <C>
- ------------------------------- ---------------------------------------------- -------------------------------------
OHIO NATIONAL INVESTMENTS, INC. THE O.N. EQUITY SALES COMPANY OHIO NATIONAL LIFE
ASSURANCE CORPORATION
AN INVESTMENT ADVISER AN OHIO CORPORATION AN OHIO CORPORATION
CAPITALIZED BY ONLI @ $10,000 A BROKER/DEALER A STOCK LIFE INSURANCE COMPANY
CAPITALIZED BY ONLI @ $790,000 CAPITALIZED BY ONLI @ $32,000,000
INCORPORATED UNDER THE LAWS OF OHIO
- ------------------------------- ---------------------------------------------- ------------------------------------
Chm. & Dir. D. O'Maley Chm./Pres/.CEO & Dir. D. O'Maley
Pres. & Dir. J. Brom Sr. VP & Dir. R. Dolan
Pres. & Dir. J. Palmer Sr. VP & Dir. J. Palmer
VP & Dir. M. Boedeker Sr. VP & Dir. S. Summers
V.P. & Dir. M. Haverkamp Sr. VP & Dir. J. Brom
VP & Dir. M. Stohler Sr. Vice Pres. T. Barefield
Secy. & Dir. R. Benedict Sr. Vice Pres. A. Bowen
VP & Dir. C. Carlson Sr. Vice Pres. D. Cook
Treasurer & Compliance Director B. Turner Sr. Vice Pres. G. Smith
Treasurer D. Taney Vice Pres. & Treas. R. Broadwell
Vice President M. Boedeker
Secretary R. Benedict Vice President T. Backus
Vice President G. Pearson
VP K. Hanson Vice President M. Stohler
Vice President D. Twarogowski
Vice Pres. J. Houser
VP D. Hundley Vice Pres & Secy. R. Benedict
Asst. Secy. J. Fischer
VP J. Martin Asst. Actuary K. Flischel
- ------------------------------- ------------------------------ -------------------------------------
SEPARATE ACCOUNT
-------------------------------------
R
---
<CAPTION>
= Advisor to Advisor to =
--------------------------------------------------------
<S> <C> <C>
- ----------------------------- -------------------------------- --------------------------------
ONE FUND, INC. O.N. INVESTMENT MANAGEMENT CO. OHIO NATIONAL FUND
A MARYLAND CORPORATION AN OHIO CORPORATION A MARYLAND CORPORATION
AN OPEN END DIVERSIFIED A FINANCIAL ADVISORY SERVICE AN OPEN END DIVERSIFIED
MANAGEMENT INVESTMENT COMPANY CAPITALIZED BY ONESCO @ $145,000 MANAGEMENT INVESTMENT COMPANY
- ----------------------------- -------------------------------- --------------------------------
Pres. & Dir. J. Palmer Pres. & Dir. J. Palmer Pres. & Dir. J. Palmer
Vice. Pres. M. Boedeker ----- Vice President M. Boedeker
Vice Pres. J. Brom VP & Dir. G. Smith Vice President J. Brom
Vice Pres. T. Barefield
Treasurer D. Taney
Treasurer D. Taney -------- Secy. & Dir. R. Benedict
Secy. & Dir. R. Benedict Treasurer B. Turner Director R. Love
Director R. Love Director G. Castrucci
Director G. Castrucci Secretary & Dir. M. Haverkamp Director G. Vredeveld
Director G. Vredeveld Sr. Vice Pres. T. Barefield
- --------------------------------- -------------------------------- ---------------------------------
</TABLE>
146
<PAGE> 69
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(3) CONTRACTS IN ACCUMULATION PERIOD
At December 31, 1999 the accumulation units and value per unit of the
respective subaccounts and products were:
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
EQUITY SUBACCOUNT
Combination............................................... 22,199.2511 165.193487 $ 3,667,172
Back Load................................................. 12,091.7675 92.649498 $ 1,120,296
Top I..................................................... 131,062.9630 74.150642 $ 9,718,403
Top Tradition............................................. 1,219,723.6309 63.810576 $77,831,267
Top Plus.................................................. 669,137.8655 21.928573 $14,673,239
Investar Vision........................................... 66,790.5089 14.295961 $ 954,835
Top Spectrum.............................................. 172,339.5334 14.295961 $ 2,463,759
Top Explorer.............................................. 434,985.3579 14.631033 $ 6,364,285
Oncore Flex............................................... 219,592.1347 10.796756 $ 2,370,883
Oncore Value.............................................. 743,492.8286 10.828904 $ 8,051,212
Oncore Premier............................................ 1,844,641.0473 10.802093 $19,925,984
Oncore Xtra............................................... 103,022.6272 10.802093 $ 1,112,860
Firstar Oncore Flex....................................... 5,591.0312 10.796756 $ 60,365
Firstar Oncore Value...................................... 3,452.8887 10.828904 $ 37,391
Firstar Oncore Premier.................................... 11,636.4486 10.802093 $ 125,698
MONEY MARKET SUBACCOUNT
VIA....................................................... 13,700.6031 29.394756 $ 402,726
Top I..................................................... 19,340.2021 22.273016 $ 430,765
Top Tradition............................................. 241,774.3690 19.846031 $ 4,798,261
Top Plus.................................................. 203,403.8299 12.825076 $ 2,608,669
Investar Vision........................................... 14,445.6480 11.182556 $ 161,539
Top Spectrum.............................................. 88,645.8194 11.182556 $ 991,287
Top Explorer.............................................. 405,403.8835 11.110127 $ 4,504,089
Oncore Flex............................................... 549,557.1660 10.606650 $ 5,828,961
Oncore Value.............................................. 482,255.4251 10.712095 $ 5,165,966
Oncore Premier............................................ 499,522.8606 10.624086 $ 5,306,974
Oncore Xtra............................................... 16,673.1519 10.624086 $ 177,137
Firstar Oncore Flex....................................... 31,390.5899 10.606650 $ 332,949
Firstar Oncore Value...................................... 5,626.0703 10.712095 $ 60,267
Firstar Oncore Premier.................................... 261,412.0405 10.624086 $ 2,777,264
BOND SUBACCOUNT
Top I..................................................... 18,331.0173 31.073387 $ 569,607
Top Tradition............................................. 115,711.6390 28.103600 $ 3,251,913
Top Plus.................................................. 152,433.1192 12.878760 $ 1,963,149
Investar Vision........................................... 54,573.4271 11.106666 $ 606,129
Top Spectrum.............................................. 31,151.3413 11.106666 $ 345,988
Top Explorer.............................................. 171,923.5035 11.176431 $ 1,921,491
Oncore Flex............................................... 2,370.7814 10.118406 $ 23,989
Oncore Value.............................................. 24,571.5807 10.219005 $ 251,097
Oncore Premier............................................ 84,867.0134 10.135054 $ 860,132
Firstar Oncore Flex....................................... 964.0847 10.118406 $ 9,755
Firstar Oncore Value...................................... 10,005.1815 10.219005 $ 102,243
Firstar Oncore Premier.................................... 91,401.6837 10.135054 $ 926,361
</TABLE>
(continued)
147
<PAGE> 70
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
OMNI SUBACCOUNT
Top I..................................................... 105,728,6917 44.721902 $ 4,728,388
Top Tradition............................................. 1,081,115.0680 44.619627 $48,238,951
Top Plus.................................................. 659,687.1543 18.649833 $12,303,055
Investar Vision........................................... 60,224.4934 13.141868 $ 791,462
Top Spectrum.............................................. 198,651.9109 13.141868 $ 2,610,657
Top Explorer.............................................. 615,889.6081 13.301816 $ 8,192,450
Oncore Flex............................................... 263.8439 10.283878 $ 2,713
Oncore Value.............................................. 69,067.7826 10.386121 $ 717,347
Oncore Premier............................................ 163,287.1967 10.300804 $ 1,681,990
Firstar Oncore Value...................................... 2,628.9892 10.386121 $ 27,305
Firstar Oncore Premier.................................... 29,455.0794 10.300804 $ 303,411
INTERNATIONAL SUBACCOUNT
Top I..................................................... 63,487.2893 28.609795 $ 1,816,358
Top Tradition............................................. 1,299,713.2342 28.609795 $37,184,529
Top Plus.................................................. 457,105.5723 25.287344 $11,558,985
Investar Vision........................................... 23,903.6867 17.107592 $ 408,935
Top Spectrum.............................................. 66,159.4896 17.107592 $ 1,131,829
Top Explorer.............................................. 255,314.7486 16.724379 $ 4,269,981
Oncore Flex............................................... 62,642.6234 15.413858 $ 965,565
Oncore Value.............................................. 5,655.0111 15.566909 $ 88,031
Oncore Premier............................................ 34,631.4387 15.439196 $ 534,682
Oncore Xtra............................................... 1,661.9389 15.439196 $ 25,659
Firstar Oncore Premier.................................... 1,124.9290 15.439196 $ 17,368
CAPITAL APPRECIATION SUBACCOUNT
Top I..................................................... 28,664.3419 16.361968 $ 469,005
Top Tradition............................................. 536,418.7191 16.361968 $ 8,776,866
Top Plus.................................................. 386,713.4574 18.313827 $ 7,082,203
Investar Vision........................................... 56,716.0246 12.464184 $ 706,919
Top Spectrum.............................................. 111,546.4445 12.464184 $ 1,390,336
Top Explorer.............................................. 318,046.5338 12.529034 $ 3,984,816
Oncore Flex............................................... 16,305.1798 10.310477 $ 168,114
Oncore Value.............................................. 86,824.8899 10.412976 $ 904,105
Oncore Premier............................................ 243,692.9690 10.327441 $ 2,516,725
Oncore Xtra............................................... 3,443.1569 10.327441 $ 35,559
Firstar Oncore Flex....................................... 2,324.3348 10.310477 $ 23,965
Firstar Oncore Value...................................... 1,865.3649 10.412976 $ 19,424
Firstar Oncore Premier.................................... 22,942.8568 10.327441 $ 236,941
SMALL CAP SUBACCOUNT
Top I..................................................... 47,967.0784 34.040041 $ 1,632,802
Top Tradition............................................. 776,054.7071 34.040041 $26,416,934
Top Plus.................................................. 343,324.8170 44.681338 $15,340,212
Investar Vision........................................... 72,280.4890 24.101318 $ 1,742,055
Top Spectrum.............................................. 76,021.6223 24.101318 $ 1,832,221
Top Explorer.............................................. 404,960.9957 28.306164 $11,462,892
</TABLE>
(continued)
148
<PAGE> 71
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
INTERNATIONAL SMALL COMPANY
Top I..................................................... 231.0028 26.188124 $ 6,049
Top Tradition............................................. 157,346.9200 26.188124 $ 4,120,621
Top Plus.................................................. 120,355.3194 28.196610 $ 3,393,612
Investar Vision........................................... 7,695.9074 23.172470 $ 178,333
Top Spectrum.............................................. 21,886.1016 23.172470 $ 507,155
Top Explorer.............................................. 164,036.4555 22.624490 $ 3,711,241
Oncore Flex............................................... 107.5086 15.087923 $ 1,622
Oncore Value.............................................. 5,266.9779 15.117443 $ 79,623
Oncore Premier............................................ 1,315.0321 15.092821 $ 19,848
AGGRESSIVE GROWTH SUBACCOUNT
Top Tradition............................................. 191,691.5942 12.995269 $ 2,491,084
Top Plus.................................................. 98,740.1647 15.731920 $ 1,553,372
Investar Vision........................................... 45,289.6168 12.368283 $ 560,155
Top Spectrum.............................................. 46,464.0777 12.368283 $ 574,681
Top Explorer.............................................. 85,202.1169 13.773504 $ 1,173,532
CORE GROWTH SUBACCOUNT
Top I..................................................... 782.9558 14.122842 $ 11,057
Top Tradition............................................. 202,849.2709 20.917283 $ 4,243,056
Top Plus.................................................. 110,748.2657 21.041443 $ 2,330,303
Top Spectrum.............................................. 1,003.2042 14.116011 $ 14,161
Top Explorer.............................................. 122,648.8349 24.676170 $ 3,026,504
GROWTH & INCOME SUBACCOUNT
Top I..................................................... 1,629.5810 13.191296 $ 21,497
Top Tradition............................................. 756,197.0985 22.964177 $17,365,444
Top Plus.................................................. 408,286.0826 23.100411 $ 9,431,576
Investar Vision........................................... 240.2768 14.870514 $ 3,573
Top Explorer.............................................. 617,635.0271 23.168879 $14,309,911
Oncore Flex............................................... 6,942.7025 14.846078 $ 103,072
Oncore Value.............................................. 125,615.4096 14.993591 $ 1,883,426
Oncore Premier............................................ 368,539.1782 14.870514 $ 5,480,367
Oncore Xtra............................................... 2,199.1170 14.870514 $ 32,702
Firstar Oncore Flex....................................... 1,509.3549 14.846078 $ 22,408
Firstar Oncore Value...................................... 4,277.2275 14.993591 $ 64,131
Firstar Oncore Premier.................................... 26,400.3652 14.870514 $ 392,587
</TABLE>
(continued)
149
<PAGE> 72
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
S&P 500 INDEX SUBACCOUNT
Top I..................................................... 4,722.4921 11.093933 $ 52,391
Top Tradition............................................. 1,516,466.2322 20.822980 $31,577,346
Top Plus.................................................. 682,512.8159 20.946479 $14,296,240
Investar Vision........................................... 120,329.4683 14.189120 $ 1,707,369
Top Spectrum.............................................. 204,487.9076 14.189120 $ 2,901,503
Top Explorer.............................................. 1,108,627.0983 20.224865 $22,421,833
Oncore Flex............................................... 152,919.5982 13.777077 $ 2,106,785
Oncore Value.............................................. 362,073.4946 13.913990 $ 5,037,887
Oncore Premier............................................ 1,239,736.3041 13.799740 $17,108,039
Oncore Xtra............................................... 19,198.0429 13.799740 $ 264,928
Firstar Oncore Flex....................................... 16,048.0340 13.777077 $ 221,095
Firstar Oncore Value...................................... 20,350.5968 13.913990 $ 283,158
Firstar Oncore Premier.................................... 249,937.0278 13.799740 $ 3,449,066
SOCIAL AWARENESS SUBACCOUNT
Top Tradition............................................. 25,583.6255 11.102565 $ 284,044
Top Plus.................................................. 26,823.5962 11.168486 $ 299,579
Top Explorer.............................................. 60,486.5340 11.781890 $ 712,646
STRATEGIC INCOME SUBACCOUNT
Investar Vision........................................... 76,570.0134 9.787698 $ 749,444
Top Spectrum.............................................. 33,039.0715 9.787698 $ 323,376
Firstar Oncore Flex....................................... 1,370.0386 9.306326 $ 12,750
Firstar Oncore Premier.................................... 17,414.7043 9.314702 $ 162,213
FIRSTAR GROWTH & INCOME SUBACCOUNT
Investar Vision........................................... 88,531.2834 11.020029 $ 975,617
Top Spectrum.............................................. 11,303.1927 11.020029 $ 124,562
Firstar Oncore Flex....................................... 3,708.7039 9.964343 $ 36,955
Firstar Oncore Value...................................... 1,820.4364 10.018395 $ 18,238
Firstar Oncore Premier.................................... 5,601.2747 9.973311 $ 55,863
RELATIVE VALUE SUBACCOUNT
Investar Vision........................................... 591,807.6008 15.956711 $ 9,443,303
Top Spectrum.............................................. 38,383.0847 15.956711 $ 612,468
Firstar Oncore Flex....................................... 10,856.7359 10.614952 $ 115,244
Firstar Oncore Value...................................... 39,249.6897 10.672522 $ 418,893
Firstar Oncore Premier.................................... 121,451.5170 10.624504 $ 1,290,362
BLUE CHIP SUBACCOUNT
Top I..................................................... 699.2021 10.358691 $ 7,243
Oncore Flex............................................... 17,594.8811 10.580255 $ 186,158
Oncore Value.............................................. 57,832.0614 10.685458 $ 617,962
Oncore Premier............................................ 182,178.0098 10.597676 $ 1,930,664
Firstar Oncore Flex....................................... 178.2566 10.580255 $ 1,886
Firstar Oncore Value...................................... 779.6577 10.685458 $ 8,331
Firstar Oncore Premier.................................... 6,180.6947 10.597676 $ 65,501
</TABLE>
(continued)
150
<PAGE> 73
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
EQUITY INCOME SUBACCOUNT
Top Tradition............................................. 1,549.5123 10.913281 $ 16,910
Top Plus.................................................. 179.1173 10.916683 $ 1,956
Top Explorer.............................................. 389.7263 10.909733 $ 4,252
Oncore Flex............................................... 6,537.5828 12.266014 $ 80,190
Oncore Value.............................................. 18,877.0369 12.387932 $ 233,847
Oncore Premier............................................ 116,891.7176 12.286197 $ 1,436,155
Firstar Oncore Flex....................................... 386.1890 12.266014 $ 4,737
Firstar Oncore Value...................................... 4,384.4283 12.387932 $ 54,314
Firstar Oncore Premier.................................... 19,047.1470 12.286197 $ 234,017
HIGH INCOME BOND SUBACCOUNT
Top Tradition............................................. 1,172.5307 10.285653 $ 12,060
Oncore Flex............................................... 12,614.0371 9.935713 $ 125,330
Oncore Value.............................................. 39,226.8291 10.034493 $ 393,621
Oncore Premier............................................ 184,858.1910 9.952059 $ 1,839,720
Oncore Xtra............................................... 3,057.6587 9.952059 $ 30,430
Firstar Oncore Flex....................................... 242.3580 9.935713 $ 2,408
Firstar Oncore Value...................................... 4,725.8990 10.034493 $ 47,422
Firstar Oncore Premier.................................... 10,164.8312 9.952059 $ 101,161
CAPITAL GROWTH SUBACCOUNT
Top I..................................................... 247.1413 14.195676 $ 3,508
Top Tradition............................................. 14,664.6816 14.195676 $ 208,175
Top Plus.................................................. 11,597.0845 14.200260 $ 164,682
Investar Vision........................................... 843.1787 30.942431 $ 26,090
Top Spectrum.............................................. 479.9235 30.942431 $ 14,850
Top Explorer.............................................. 9,169.6502 14.191098 $ 130,127
Oncore Flex............................................... 7,636.6292 30.891708 $ 235,909
Oncore Value.............................................. 93,895.6043 31.198097 $ 2,929,364
Oncore Premier............................................ 303,977.5456 30.942431 $ 9,405,804
Oncore Xtra............................................... 15,448.2368 30.942431 $ 478,006
Firstar Oncore Flex....................................... 26,333.5391 30.891708 $ 813,488
Firstar Oncore Value...................................... 3,335.4919 31.198097 $ 104,061
Firstar Oncore Premier.................................... 33,073.0963 30.942431 $ 1,023,362
DOW TARGET 10 JANUARY SUBACCOUNT
Oncore Flex............................................... 127.7672 10.154375 $ 1,297
Oncore Value.............................................. 21,069.8577 10.214066 $ 215,209
Oncore Premier............................................ 13,239.9717 10.164283 $ 134,575
DOW TARGET 10 FEBRUARY SUBACCOUNT
Oncore Flex............................................... 38,068.4590 10.538202 $ 401,174
Oncore Value.............................................. 14,604.7362 10.595352 $ 154,742
Oncore Premier............................................ 45,898.9474 10.547674 $ 484,127
Firstar Oncore Premier.................................... 11,433.6109 10.547674 $ 120,598
DOW TARGET 10 MARCH SUBACCOUNT
Oncore Flex............................................... 12,835.8989 10.096966 $ 129,603
Oncore Value.............................................. 10,785.0043 10.147105 $ 109,437
Oncore Premier............................................ 75,897.2123 10.105289 $ 766,963
Firstar Oncore Premier.................................... 981.4662 10.105289 $ 9,918
</TABLE>
(continued)
151
<PAGE> 74
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
DOW TARGET 10 APRIL SUBACCOUNT
Oncore Flex............................................... 884.2933 10.162000 $ 8,986
Oncore Value.............................................. 13,146.5142 10.207320 $ 134,191
Oncore Premier............................................ 103,816.9033 10.169517 $ 1,055,768
Firstar Oncore Value...................................... 3,373.5594 10.207320 $ 34,435
Firstar Oncore Premier.................................... 2,185.6495 10.169517 $ 22,227
DOW TARGET 10 MAY SUBACCOUNT
Oncore Flex............................................... 1,438.0558 8.314354 $ 11,957
Oncore Value.............................................. 5,995.1960 8.347547 $ 50,045
Oncore Premier............................................ 63,444.7734 8.319856 $ 527,851
Firstar Oncore Value...................................... 2,300.4363 8.347547 $ 19,203
Firstar Oncore Premier.................................... 12,909.7186 8.319856 $ 107,407
DOW TARGET 10 JUNE SUBACCOUNT
Oncore Flex............................................... 1,643.9210 8.965064 $ 14,737
Oncore Value.............................................. 13,889.1281 8.996165 $ 124,949
Oncore Premier............................................ 99,994.4823 8.970220 $ 896,973
Firstar Oncore Value...................................... 4,883.6365 8.996165 $ 43,934
Firstar Oncore Premier.................................... 8,513.3921 8.970220 $ 76,367
DOW TARGET 10 JULY SUBACCOUNT
Oncore Flex............................................... 228.7927 8.841905 $ 2,023
Oncore Value.............................................. 28,049.1275 8.868269 $ 248,747
Oncore Premier............................................ 69,698.4928 8.846278 $ 616,572
Firstar Oncore Value...................................... 2,237.5280 8.868269 $ 19,843
Firstar Oncore Premier.................................... 11,519.8731 8.846278 $ 101,908
DOW TARGET 10 AUGUST SUBACCOUNT
Oncore Flex............................................... 2,888.8557 8.907985 $ 25,734
Oncore Value.............................................. 9,506.7369 8.930326 $ 84,899
Oncore Premier............................................ 67,579.8599 8.911699 $ 602,251
Firstar Oncore Value...................................... 1,942.8182 8.930326 $ 17,350
Firstar Oncore Premier.................................... 8,316.2593 8.911699 $ 74,112
DOW TARGET 10 SEPTEMBER SUBACCOUNT
Oncore Flex............................................... 9,967.2466 8.789882 $ 87,611
Oncore Value.............................................. 77,832.1797 8.807215 $ 685,485
Oncore Premier............................................ 64,943.2943 8.792764 $ 571,031
Firstar Oncore Flex....................................... 573.2728 8.789882 $ 5,039
Firstar Oncore Value...................................... 1,750.8372 8.807215 $ 15,420
Firstar Oncore Premier.................................... 11,625.4684 8.792764 $ 102,220
DOW TARGET 10 OCTOBER SUBACCOUNT
Oncore Flex............................................... 13,448.1146 9.232746 $ 124,163
Oncore Value.............................................. 60,898.7628 9.246429 $ 563,096
Oncore Premier............................................ 60,045.8544 9.235010 $ 554,524
Firstar Oncore Flex....................................... 745.6070 9.232746 $ 6,884
Firstar Oncore Value...................................... 2,718.5630 9.246429 $ 25,137
Firstar Oncore Premier.................................... 13,142.2706 9.235010 $ 121,369
</TABLE>
(continued)
152
<PAGE> 75
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
DOW TARGET 10 NOVEMBER SUBACCOUNT
Top Tradition............................................. 2,102.4403 10.093952 $ 21,222
Top Plus.................................................. 660.3492 10.097329 $ 6,668
Top Explorer.............................................. 332.4929 10.090668 $ 3,355
Oncore Flex............................................... 4,234.1802 10.087394 $ 42,712
Oncore Value.............................................. 61,898.0895 10.097239 $ 625,000
Oncore Premier............................................ 54,376.6379 10.089029 $ 548,607
Firstar Oncore Value...................................... 1,305.5054 10.097239 $ 13,182
Firstar Oncore Premier.................................... 6,515.3941 10.089029 $ 65,734
DOW TARGET 10 DECEMBER SUBACCOUNT
Top Tradition............................................. 7.2611 10.007412 $ 73
Top Plus.................................................. 484.1448 10.009047 $ 4,846
Oncore Flex............................................... 726.5836 10.004157 $ 7,269
Oncore Value.............................................. 61,341.2462 10.009047 $ 613,967
Oncore Premier............................................ 55,848.8491 10.004968 $ 558,766
Oncore Xtra............................................... 1,047.1778 10.004968 $ 10,477
Firstar Oncore Value...................................... 1,653.1044 10.009047 $ 16,546
Firstar Oncore Premier.................................... 4,866.6822 10.004968 $ 48,691
DOW TARGET 5 SEPTEMBER SUBACCOUNT
Oncore Value.............................................. 1,002.8667 7.498869 $ 7,520
Oncore Premier............................................ 9,789.5370 7.486547 $ 73,290
DOW TARGET 5 OCTOBER SUBACCOUNT
Oncore Value.............................................. 945.5992 8.510857 $ 8,048
Oncore Premier............................................ 20,566.0291 8.500346 $ 174,818
Firstar Oncore Premier.................................... 269.8714 8.500346 $ 2,294
DOW TARGET 5 NOVEMBER SUBACCOUNT
Top Tradition............................................. 60.2390 9.960325 $ 600
Top Explorer.............................................. 1,151.1721 9.957083 $ 11,462
Oncore Value.............................................. 1,906.6407 9.963566 $ 18,997
Oncore Premier............................................ 6,840.9733 9.955465 $ 68,105
Firstar Oncore Premier.................................... 442.5710 9.955465 $ 4,406
DOW TARGET 5 DECEMBER SUBACCOUNT
Top Tradition............................................. 532.4209 10.006724 $ 5,328
Top Plus.................................................. 791.7667 10.008355 $ 7,924
Top Explorer.............................................. 124.0258 10.005092 $ 1,241
Oncore Value.............................................. 261.8501 10.008355 $ 2,621
Oncore Premier............................................ 4,715.5920 10.004277 $ 47,176
Oncore Xtra............................................... 2,906.1570 10.004277 $ 29,074
Firstar Oncore Premier.................................... 1,280.9521 10.004277 $ 12,815
FIDELITY VIP GROWTH SUBACCOUNT
Top Explorer.............................................. 501,352.0110 23.324677 $11,693,874
FIDELITY VIP EQUITY INCOME SUBACCOUNT
Top Explorer.............................................. 538,074.3966 14.463459 $ 7,782,417
FIDELITY VIP HIGH INCOME BOND SUBACCOUNT
Top Explorer.............................................. 225,514.1729 11.792460 $ 2,659,367
</TABLE>
(continued)
153
<PAGE> 76
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
JP MORGAN TRUST II SMALL COMPANY SUBACCOUNT
Oncore Flex............................................... 7,491.1401 11.845638 $ 88,738
Oncore Value.............................................. 49,349.7616 11.963367 $ 590,389
Oncore Premier............................................ 149,563.3049 11.865119 $ 1,774,586
Oncore Xtra............................................... 1,352.1145 11.865119 $ 16,043
Firstar Oncore Value...................................... 1,440.8987 11.963367 $ 17,238
Firstar Oncore Premier.................................... 13,582.1647 11.865119 $ 161,154
JANUS ASPEN GROWTH SUBACCOUNT
Top I..................................................... 7,706.6564 11.657335 $ 89,839
Top Tradition............................................. 140,899.1550 11.657335 $ 1,642,509
Top Plus.................................................. 44,857.9544 11.661117 $ 523,094
Investar Vision........................................... 4,815.7947 16.412037 $ 79,037
Top Spectrum.............................................. 9,514.7848 16.412037 $ 156,157
Top Explorer.............................................. 151,546.5339 11.653548 $ 1,766,055
Oncore Flex............................................... 163,861.6926 16.385089 $ 2,684,888
Oncore Value.............................................. 364,524.6723 16.547829 $ 6,032,092
Oncore Premier............................................ 1,570,318.5421 16.412037 $25,772,126
Oncore Xtra............................................... 37,224.0204 16.412037 $ 610,922
Firstar Oncore Flex....................................... 17,862.7653 16.385089 $ 292,683
Firstar Oncore Value...................................... 45,332.4119 16.547829 $ 750,153
Firstar Oncore Premier.................................... 332,982.7979 16.412037 $ 5,464,926
JANUS ASPEN INTERNATIONAL GROWTH SUBACCOUNT
Oncore Flex............................................... 228,781.0129 17.719378 $ 4,053,858
Oncore Value.............................................. 47,710.8170 17.895206 $ 853,795
Oncore Premier............................................ 134,070.6983 17.748475 $ 2,379,550
Oncore Xtra............................................... 16,246.1845 17.748475 $ 288,345
Firstar Oncore Flex....................................... 103.3332 17.719378 $ 1,831
Firstar Oncore Value...................................... 825.4725 17.895206 $ 14,772
Firstar Oncore Premier.................................... 18,747.5262 17.748475 $ 332,740
JANUS ASPEN WORLDWIDE GROWTH SUBACCOUNT
Top I..................................................... 3,184.5992 13.225533 $ 42,118
Top Tradition............................................. 84,103.9890 13.225533 $ 1,112,320
Top Plus.................................................. 19,885.7167 13.229802 $ 263,084
Investar Vision........................................... 97,360.0362 16.718939 $ 1,627,757
Top Spectrum.............................................. 44,451.8431 16.718939 $ 743,188
Top Explorer.............................................. 33,157.7854 13.221258 $ 438,387
Oncore Flex............................................... 363,327.4600 17.009248 $ 6,179,927
Oncore Value.............................................. 305,606.7470 17.178057 $ 5,249,730
Oncore Premier............................................ 912,558.4929 17.037179 $15,547,422
Oncore Xtra............................................... 6,228.0851 17.037179 $ 106,109
Firstar Oncore Flex....................................... 7,330.4240 17.009248 $ 124,685
Firstar Oncore Value...................................... 14,111.1411 17.178057 $ 242,402
Firstar Oncore Premier.................................... 110,328.3002 17.037179 $ 1,879,683
</TABLE>
(continued)
154
<PAGE> 77
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
JANUS ASPEN BALANCED SUBACCOUNT
Top I..................................................... 9,739.4961 11.025619 $ 107,384
Top Tradition............................................. 60,253.1661 11.025619 $ 664,329
Top Plus.................................................. 48,822.7898 11.029199 $ 538,476
Investar Vision........................................... 232,501.0013 14.945572 $ 3,474,860
Top Spectrum.............................................. 168,998.6313 14.945572 $ 2,525,781
Top Explorer.............................................. 31,406.7719 11.022042 $ 346,167
Oncore Flex............................................... 96,016.6259 14.511033 $ 1,393,300
Oncore Value.............................................. 291,076.5804 14.655190 $ 4,265,783
Oncore Premier............................................ 1,278,972.6940 14.534895 $18,589,734
Oncore Xtra............................................... 6,425.7086 14.534895 $ 93,397
Firstar Oncore Flex....................................... 27,171.4633 14.511033 $ 394,286
Firstar Oncore Value...................................... 68,197.9558 14.655190 $ 999,454
Firstar Oncore Premier.................................... 488,866.1390 14.534895 $ 7,105,618
SALOMON BROTHERS VARIABLE CAPITAL SUBACCOUNT
Oncore Flex............................................... 22,316.3893 12.822212 $ 286,146
Oncore Value.............................................. 15,061.3061 12.949634 $ 195,038
Oncore Premier............................................ 48,410.0533 12.843310 $ 621,745
Firstar Oncore Value...................................... 176.4529 12.949634 $ 2,285
Firstar Oncore Premier.................................... 360.9661 12.843310 $ 4,636
SALOMON BROTHERS VARIABLE TOTAL RETURN SUBACCOUNT
Oncore Flex............................................... 4,262.9418 9.927581 $ 42,321
Oncore Value.............................................. 29,172.3088 10.026301 $ 292,490
Oncore Premier............................................ 104,876.9471 9.943926 $ 1,042,889
Firstar Oncore Value...................................... 212.3415 10.026301 $ 2,129
Firstar Oncore Premier.................................... 4,390.3183 9.943926 $ 43,657
SALOMON BROTHERS VARIABLE INVESTORS SUBACCOUNT
Oncore Flex............................................... 7,637.0180 11.137851 $ 85,060
Oncore Value.............................................. 7,740.9521 11.248581 $ 87,075
Oncore Premier............................................ 20,591.3978 11.156179 $ 229,721
Oncore Xtra............................................... 595.7237 11.156179 $ 6,646
Firstar Oncore Premier.................................... 3,895.0612 11.156179 $ 43,454
STRONG OPPORTUNITY II SUBACCOUNT
Top Tradition............................................. 1,268.4347 11.158443 $ 14,154
Top Spectrum.............................................. 118.3234 12.694022 $ 1,502
Top Explorer.............................................. 374.7290 11.154825 $ 4,180
Oncore Flex............................................... 3,803.2515 12.673177 $ 48,199
Oncore Value.............................................. 42,101.5604 12.799099 $ 538,862
Oncore Premier............................................ 164,057.5372 12.694022 $ 2,082,550
Firstar Oncore Value...................................... 1,842.3172 12.799099 $ 23,580
Firstar Oncore Premier.................................... 16,251.7443 12.694022 $ 206,300
</TABLE>
(continued)
155
<PAGE> 78
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
STRONG SCHAFER VALUE II SUBACCOUNT
Top Tradition............................................. 371.6809 10.284400 $ 3,822
Top Plus.................................................. 1,392.3937 10.287746 $ 14,325
Oncore Flex............................................... 2,014.9968 8.982623 $ 18,100
Oncore Value.............................................. 15,955.9657 9.071960 $ 144,752
Oncore Premier............................................ 19,061.9690 8.997405 $ 171,508
Firstar Oncore Flex....................................... 1,481.5272 8.982623 $ 13,308
Firstar Oncore Value...................................... 737.3269 9.071960 $ 6,689
Firstar Oncore Premier.................................... 17,003.5694 8.997405 $ 152,988
STRONG MID-CAP GROWTH II SUBACCOUNT
Top I..................................................... 1,509.6402 12.916791 $ 19,500
Top Tradition............................................. 15,603.5461 12.916791 $ 201,548
Top Plus.................................................. 5,045.1508 12.920972 $ 65,188
Investar Vision........................................... 1,270.9128 21.584486 $ 27,432
Top Spectrum.............................................. 374.1113 21.584486 $ 8,075
Top Explorer.............................................. 14,858.2299 12.912611 $ 191,859
Oncore Flex............................................... 19,020.8819 21.549079 $ 409,882
Oncore Value.............................................. 141,224.8199 21.762989 $ 3,073,474
Oncore Premier............................................ 446,689.2989 21.584486 $ 9,641,559
Oncore Xtra............................................... 9,304.8313 21.584486 $ 200,840
Firstar Oncore Flex....................................... 1,322.0055 21.549079 $ 28,488
Firstar Oncore Value...................................... 9,237.7017 21.762989 $ 201,040
Firstar Oncore Premier.................................... 58,503.2694 21.584486 $ 1,262,763
MORGAN STANLEY UNIVERSAL FIXED INCOME SUBACCOUNT
Oncore Flex............................................... 30,259.2291 10.120748 $ 306,246
Oncore Value.............................................. 36,367.5348 10.221395 $ 371,727
Oncore Premier............................................ 194,186.8821 10.137397 $ 1,968,550
Oncore Xtra............................................... 975.7929 10.137397 $ 9,892
Firstar Oncore Value...................................... 14,676.5681 10.221395 $ 150,015
Firstar Oncore Premier.................................... 135,853.5135 10.137397 $ 1,377,201
MORGAN STANLEY UNIVERSAL US REAL ESTATE SUBACCOUNT
Top Tradition............................................. 2,245.1975 10.146637 $ 22,781
Top Plus.................................................. 1,072.0214 10.149941 $ 10,881
Top Spectrum.............................................. 3,269.8629 8.687826 $ 28,408
Top Explorer.............................................. 197.1736 10.143343 $ 2,000
Oncore Flex............................................... 523.0088 8.673554 $ 4,536
Oncore Value.............................................. 12,694.2055 8.759824 $ 111,199
Oncore Premier............................................ 25,702.5009 8.687826 $ 223,299
Firstar Oncore Flex....................................... 1,174.7203 8.673554 $ 10,189
Firstar Oncore Value...................................... 672.2738 8.759824 $ 5,889
Firstar Oncore Premier.................................... 2,719.5526 8.687826 $ 23,627
MORGAN STANLEY UNIVERSAL VALUE SUBACCOUNT
Oncore Flex............................................... 4,534.2658 8.506511 $ 38,570
Oncore Value.............................................. 11,661.5696 8.591085 $ 100,186
Oncore Premier............................................ 83,613.7461 8.520515 $ 712,432
Firstar Oncore Premier.................................... 6,198.5690 8.520515 $ 52,815
</TABLE>
(continued)
156
<PAGE> 79
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
MORGAN STANLEY UNIVERSAL EMERGING MKT DEBT SUBACCOUNT
Oncore Value.............................................. 5,639.6427 8.645671 $ 48,758
Oncore Premier............................................ 12,095.4295 8.574587 $ 103,713
Firstar Oncore Value...................................... 263.7158 8.645671 $ 2,280
Firstar Oncore Premier.................................... 2,947.4306 8.574587 $ 25,273
GOLDMAN SACHS VIT GROWTH & INCOME SUBACCOUNT
Top I..................................................... 80.6364 10.502077 $ 847
Top Tradition............................................. 2,420.2744 10.502077 $ 25,418
Top Explorer.............................................. 14.9702 10.498657 $ 157
Oncore Flex............................................... 32,934.3714 9.183018 $ 302,437
Oncore Value.............................................. 66,092.1691 9.274350 $ 612,962
Oncore Premier............................................ 173,292.3394 9.198141 $ 1,593,967
Firstar Oncore Value...................................... 4,501.4475 9.274350 $ 41,748
Firstar Oncore Premier.................................... 20,972.4987 9.198141 $ 192,908
GOLDMAN SACHS VIT CORE US EQUITY SUBACCOUNT
Top Tradition............................................. 6,750.6129 10.924941 $ 73,750
Top Plus.................................................. 1,588.9386 10.928488 $ 17,364
Top Spectrum.............................................. 9,482.1655 12.485861 $ 118,393
Top Explorer.............................................. 3,760.7009 10.921392 $ 41,072
Oncore Flex............................................... 31,465.4134 12.465356 $ 392,228
Oncore Value.............................................. 82,120.9562 12.589226 $ 1,033,839
Oncore Premier............................................ 235,168.5453 12.485861 $ 2,936,282
Oncore Xtra............................................... 7,269.5828 12.485861 $ 90,767
Firstar Oncore Value...................................... 1,078.5413 12.589226 $ 13,578
Firstar Oncore Premier.................................... 8,318.3691 12.485861 $ 103,862
GOLDMAN SACHS VIT GLOBAL INCOME SUBACCOUNT
Oncore Flex............................................... 13,311.3877 10.301425 $ 137,127
Oncore Value.............................................. 8,472.4519 10.403879 $ 88,146
Oncore Premier............................................ 38,850.6331 10.318388 $ 400,876
Firstar Oncore Premier.................................... 13,246.6428 10.318388 $ 136,684
GOLDMAN SACHS VIT CAPITAL GROWTH SUBACCOUNT
Top Tradition............................................. 7,406.8802 11.178377 $ 82,796
Investar Vision........................................... 24,840.9638 14.522089 $ 360,743
Top Spectrum.............................................. 31,012.5892 14.522089 $ 450,368
Top Explorer.............................................. 526.4069 11.174753 $ 5,882
Oncore Flex............................................... 6,937.6843 14.007791 $ 97,182
Oncore Value.............................................. 28,310.0209 14.146953 $ 400,501
Oncore Premier............................................ 212,314.1648 14.030812 $ 2,978,940
Oncore Xtra............................................... 37.0613 14.030812 $ 520
Firstar Oncore Flex....................................... 1,683.7059 14.007791 $ 23,585
Firstar Oncore Premier.................................... 4,558.6813 14.030812 $ 63,962
</TABLE>
(continued)
157
<PAGE> 80
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
ACCUMULATION UNITS VALUE PER UNIT VALUE
------------------ -------------- -----------
<S> <C> <C> <C>
LAZARD RETIREMENT EMERGING MARKET SUBACCOUNT
Top Tradition............................................. 7,037.4599 12.512192 $ 88,054
Investar Vision........................................... 32,336.4784 11.482079 $ 371,290
Top Spectrum.............................................. 11,355.8703 11.482079 $ 130,389
Top Explorer.............................................. 67,419.5358 12.508143 $ 843,293
Oncore Flex............................................... 2,965.5590 11.476404 $ 34,034
Oncore Value.............................................. 6,708.5963 11.510559 $ 77,220
Oncore Premier............................................ 19,871.2906 11.482079 $ 228,164
Firstar Oncore Premier.................................... 1,603.4553 11.482079 $ 18,411
LAZARD RETIREMENT SMALL CAP SUBACCOUNT
Top Tradition............................................. 874.9037 10.538021 $ 9,219
Top Plus.................................................. 298.7037 10.541450 $ 3,149
Top Explorer.............................................. 712.4710 10.534599 $ 7,506
Oncore Value.............................................. 1,274.7400 9.311327 $ 11,870
Oncore Premier............................................ 11,325.7393 9.288255 $ 105,196
PAINEWEBBER STRATEGIC INCOME CL I SUBACCOUNT
Oncore Value.............................................. 1,755.8847 10.004230 $ 17,566
Oncore Premier............................................ 9,653.8847 9.979456 $ 96,341
Firstar Oncore Flex....................................... 782.4520 9.974528 $ 7,804
Firstar Oncore Premier.................................... 420.3636 9.979456 $ 4,195
PAINEWEBBER GROWTH & INCOME CL I SUBACCOUNT
Oncore Flex............................................... 1,344.9908 10.503936 $ 14,128
Oncore Value.............................................. 2,476.9725 10.535221 $ 26,095
Oncore Premier............................................ 47,669.3273 10.509120 $ 500,963
Firstar Oncore Flex....................................... 5,966.1445 10.503936 $ 62,668
Firstar Oncore Premier.................................... 574.1680 10.509120 $ 6,034
PAINEWEBBER TACTICAL ALLOCATION CL I SUBACCOUNT
Oncore Flex............................................... 84,698.0996 10.464132 $ 886,292
Oncore Value.............................................. 8,361.4022 10.495301 $ 87,756
Oncore Premier............................................ 111,032.1881 10.469307 $ 1,162,430
Oncore Xtra............................................... 2,260.5126 10.469307 $ 23,666
Firstar Oncore Premier.................................... 885.7320 10.469307 $ 9,273
PAINEWEBBER SMALL CAP CL I SUBACCOUNT
Oncore Flex............................................... 116.3357 10.784880 $ 1,255
Oncore Premier............................................ 11,819.4513 10.790213 $ 127,534
</TABLE>
(4) RISK AND ADMINISTRATIVE EXPENSE
ONLIC charges the Account's assets at the end of each day, equal to 0.25% on
an annual basis, of the contract value for administrative expenses, based on
premiums established at the time the contracts are issued.
Although variable annuity payments differ according to the investment
performance of the Accounts, they are not affected by mortality or expense
experience because ONLIC assumes the expense risk and the mortality risk
under the contracts. ONLIC charges the Accounts' assets for assuming those
risks, based on the contract value at a rate presently ranging from 0.65% to
1.25% for mortality and expense risk on an annual basis.
The expense risk assumed by ONLIC is the risk that the deductions for sales
and administrative expenses provided for in the variable annuity contracts
may prove insufficient to cover the cost of those items.
(continued)
158
<PAGE> 81
OHIO NATIONAL VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The mortality risk results from a provision in the contract in which ONLIC
agrees to make annuity payments regardless of how long a particular annuitant
or other payee lives and how long all annuitants or other payees as a class
live if payment options involving life contingencies are chosen. Those
annuity payments are determined in accordance with annuity purchase rate
provisions established at the time the contracts are issued.
(5) CONTRACT CHARGES
No deduction for a sales charge is made from purchase payments. A contingent
deferred sales charge ranging from 0% to 7% may be assessed by ONLIC when a
contract is surrendered or a partial withdrawal of accumulation value is made
before the annuity payout date.
A transfer fee is charged for each transfer from one subaccount to another.
The fee is charged against the contract owner's equity in the subaccount from
which the transfer is effected.
State premium taxes presently range from 0% to 2 1/2% for these contracts. In
those jurisdictions permitting, such taxes will be deducted when annuity
payments begin. Elsewhere, they will be deducted from purchase payments.
Each year on the contract anniversary (or at the time of surrender of the
contract), ONLIC will deduct a contract administration charge of $30 from the
accumulation value to reimburse it for the expense relating to the
maintenance of the contract. Total contract administration charges for the
Account amounted to approximately $390,000 during 1999.
(6) FEDERAL INCOME TAXES
Operations of the Account form a part of, and are taxed with, operations of
ONLIC which is taxed as a life insurance company under the Internal Revenue
Code. Taxes are the responsibility of the contract owner upon termination or
withdrawal. No Federal income taxes are payable under the present law on
dividend income or capital gains distribution from the Fund shares held in
the Account or on capital gains realized by the Account on redemption of the
Fund shares.
(7) DOW TARGET FUNDS
Dow Target 10 January Period from January 4, 1999 date of commencement of
operations
Dow Target 10 February Period from February 1, 1999 date of commencement of
operations
Dow Target 10 March Period from March 1, 1999 date of commencement of
operations
Dow Target 10 April Period from April 1, 1999 date of commencement of
operations
Dow Target 10 May Period from May 3, 1999 date of commencement of operations
Dow Target 10 June Period from June 1, 1999 date of commencement of operations
Dow Target 10 July Period from July 1, 1999 date of commencement of operations
Dow Target 10 August Period from August 2, 1999 date of commencement of
operations
Dow Target 10 September Period from September 1, 1999 date of commencement of
operations
Dow Target 10 October Period from October 1, 1999 date of commencement of
operations
Dow Target 10 November Period from November 1, 1999 date of commencement of
operations
Dow Target 10 December Period from December 1, 1999 date of commencement of
operations
Dow Target 5 September Period from September 1, 1999 date of commencement of
operations
Dow Target 5 October Period from October 1, 1999 date of commencement of
operations
Dow Target 5 November Period from November 1, 1999 date of commencement of
operations
Dow Target 5 December Period from December 1, 1999 date of commencement of
operations
159
<PAGE> 82
OHIO NATIONAL VARIABLE ACCOUNT A
INDEPENDENT AUDITORS' REPORT
The Board of Directors of
The Ohio National Life Insurance Company
and Contract Owners of Ohio National
Variable Account A:
We have audited the accompanying statements of assets and contract owners'
equity of Ohio National Variable Account A (comprised of the Equity, Money
Market, Bond, Omni, International, Capital Appreciation (formerly Small Cap
Growth), Small Cap, International Small Company (formerly Global Contrarian),
Aggressive Growth, Core Growth, Growth & Income, S&P 500 Index, Social
Awareness, Strategic Income, Firstar Growth & Income (formerly Stellar),
Relative Value, Blue Chip, Equity Income, High Income Bond, Capital Growth, Dow
Target 10 January, Dow Target 10 February, Dow Target 10 March, Dow Target 10
April, Dow Target 10 May, Dow Target 10 June, Dow Target 10 July, Dow Target 10
August, Dow Target 10 September, Dow Target 10 October, Dow Target 10 November,
Dow Target 10 December, Dow Target 5 September, Dow Target 5 October, Dow Target
5 November, Dow Target 5 December, Fidelity Investments -- VIP Growth, Fidelity
Investments -- VIP Equity Income, Fidelity Investments -- VIP High Income, J.P.
Morgan Trust II -- Small Company, Janus Aspen Series-Growth, Janus Aspen
Series-International Growth, Janus Aspen Series-Worldwide Growth, Janus Aspen
Series-Balanced, Salomon Brothers Variable Series-Capital, Salomon Brothers
Variable Series-Total Return, Salomon Brothers Variable Series-Investors, Strong
Variable Funds-Opportunity II, Strong Variable Funds-Schafer Value II, Strong
Variable Funds-Mid-Cap Growth II, Morgan Stanley Universal Funds-Fixed Income,
Morgan Stanley Universal Funds-US Real Estate, Morgan Stanley Universal
Funds-Value, Morgan Stanley Universal Funds-Emerging Market Debt, Goldman Sachs
VIT Growth & Income, Goldman Sachs VIT Core US Equity, Goldman Sachs VIT Global
Income, Goldman Sachs VIT Capital Growth, Lazard Retirement Emerging Market,
Lazard Retirement Small Cap, Series Trust PaineWebber Mutual Funds-Strategic
Income Class I, Series Trust PaineWebber Mutual Funds-Growth & Income Class I,
Series Trust PaineWebber Mutual Funds-Tactical Allocation Class I and Series
Trust PaineWebber Mutual Funds-Small Cap Class I subaccounts) (collectively, the
Account) as of December 31, 1999 and the related statements of operations and
changes in contract owners' equity for each of the periods indicated herein.
These financial statements are the responsibility of the Account's management.
Our responsibility is to express an opinion on these financial based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1999, by correspondence with
the transfer agents of the underlying mutual funds. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Ohio National Variable Account
A as of December 31, 1999, and the results of its operations and its changes in
contract owners' equity for each of the periods indicated herein in conformity
with generally accepted accounting principles.
KPMG LLP
Cincinnati, Ohio
February 18, 2000
160
<PAGE> 83
OHIO NATIONAL VARIABLE ACCOUNT A
Form N-4
PART C
OTHER INFORMATION
<PAGE> 84
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
The following financial statements of the Registrant are to be included in Part
B of this Registration Statement:
Independent Auditors' Report of KPMG LLP dated February 18, 2000
Statements of Assets and Contract Owners' Equity dated December 31, 1999
Statement of Operations and Changes in Contract Owners' Equity for the Years
Ended December 31, 1999 and 1998
Notes to Financial Statements dated December 31, 1999
Schedules of Changes in Unit Values for the Years Ended December 31, 1999
and 1998
The following consolidated financial statements of the Depositor and its
subsidiaries are also to be included in Part B of this Registration Statement:
Independent Auditors' Report of KPMG LLP dated January 29, 1999
Consolidated Balance Sheets dated December 31, 1999 and 1998
Consolidated Statements of Income for the Years Ended December 31, 1999,
1998 and 1997
Consolidated Statements of Equity for the Years Ended December 31, 1999,
1998 and 1997
Consolidated Statements of Cash Flows for the Years Ended December 31, 1999,
1998 and 1997
Notes to Consolidated Financial Statements dated December 31, 1999, 1998 and
1997
The following financial information is included in Part A of this Registration
Statement:
Accumulation Unit Values
Consents of the Following Persons:
KPMG LLP
Exhibits:
All relevant exhibits, which have previously been filed with the Commission and
are incorporated herein by reference, are as follows:
(1) Resolution of Board of Directors of the Depositor authorizing
establishment of the Registrant was filed as Exhibit A(1) of the
Registrant's registration statement on Form S-6 on August 3,
1982 (File no. 2-78652).
(3)(a) Principal Underwriting Agreement for Variable Annuities
between the Depositor and Ohio National Equities, Inc. was
filed as Exhibit (3)(a) of Form N-4, Post-effective Amendment
no. 21 of Ohio National Variable Account A (File no. 2-91213).
-1-
<PAGE> 85
(3)(b) Registered Representative's Sales Contract with Variable Annuity
Supplement was filed as Exhibit (3)(b) of the Registrant's Form
N-4, Post-effective Amendment no. 9 on February 27, 1991 (File
no. 2-91213).
(3)(c) Variable Annuity Sales Commission Schedule was filed as Exhibit
A(3)(c) of the Registrant's registration statement on Form S-6
on May 18, 1984 (File no. 2-91213).
(3)(d) Variable Contract Distribution Agreements (with compensation
schedules) between the Depositor and Ohio National Equities,
Inc. were filed as Exhibit (3)(d) of the Registrant's Form N-4,
Post-effective Amendment no. 23 on April 27, 1998. (File no.
2-91213).
(4) Combination Annuity Contract, Form 93-VA-1, was filed as Exhibit
(4) of the Registrant's Form N-4 on May 6, 1993 (File No.
33-62282).
(5)(a) Single Purchase Payment Tax-Qualified Variable Annuity
Application, Form V-4891-A, was filed as Exhibit (5)(a) of the
Registrant's Form N-4 on April 25, 1996 (File No. 33-62282).
(6)(a) Articles of Incorporation of the Depositor were filed as Exhibit
A(6)(a) of Ohio National Variable Interest Account registration
statement on Form N-8B-2 on July 11, 1980 (File no. 811-3060).
(6)(b) Code of Regulations (by-laws) of the Depositor were filed as
Exhibit A(6)(b) of Ohio National Variable Interest Account
registration statement on Form N-8B-2 on July 11, 1980 (File no.
811-3060).
(8) Powers of Attorney by certain Directors of the Depositor were
filed as Exhibit (8) of the Registrant's Form N-4,
Post-effective Amendment no. 22 on March 2, 1998 (File No.
2-91213) and Exhibit (8)(a) of the Registrant's Form N-4, Post-
effective Amendment no. 2 on March 2, 1999 (File no. 333-43511).
(13) Computation of Performance Data was filed as Exhibit (13) of
the Registrant's Form N-4, Pre-effective Amendment no. 1 on
April 10, 1998 (File no. 333-43511).
-2-
<PAGE> 86
ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
<TABLE>
<CAPTION>
Name and Principal Positions and Offices
Business Address with Depositor
- ---------------- --------------
<S> <C>
Trudy K. Backus* Vice President, Individual Insurance Services
Thomas A. Barefield* Senior Vice President, Institutional Sales
Howard C. Becker* Senior Vice President, Individual Insurance
& Corporate Services
Ronald L. Benedict* Corporate Vice President, Counsel and
Secretary
Michael A. Boedeker* Vice President, Senior Investment Officer
Robert A. Bowen* Senior Vice President, Information Systems
Roylene M. Broadwell* Vice President & Treasurer
Dale P. Brown Director
36 East Seventh Street
Cincinnati, Ohio 45202
Jack E. Brown Director
50 E. Rivercenter Blvd.
Covington, Kentucky 41011
William R. Burleigh Director
One West Fourth Street
Suite 1100
Cincinnati, Ohio 45202
Victoria B. Buyniski Gluckman Director
2343 Auburn Avenue
Cincinnati, Ohio 45219
Christopher A. Carlson* Vice President, Senior Investment Officer
Raymond R. Clark Director
201 East Fourth Street
Cincinnati, Ohio 45202
David W. Cook* Senior Vice President and Actuary
Ronald J. Dolan* Director and Senior Vice President and Chief
Financial Officer
Michael J. Ferry* Vice President, Information Systems
Michael F. Haverkamp* Vice President and Counsel
John W. Hayden Director
7000 Midland Boulevard
Batavia, Ohio 45103
John A. Houser III* Vice President, Claims
</TABLE>
-3-
<PAGE> 87
<TABLE>
<CAPTION>
Name and Principal Positions and Offices
Business Address with Depositor
- ---------------- --------------
<S> <C>
Charles S. Mechem, Jr. Director
One East Fourth Street
Cincinnati, Ohio 45202
James I. Miller, II* Vice President, Marketing Support
Thomas O. Olson* Vice President, Underwriting
David B. O'Maley* Director, Chairman, President and Chief
Executive Officer
James F. Orr Director
201 East Fourth Street
Cincinnati, Ohio 45202
John J. Palmer* Director and Senior Vice President, Strategic
Initiatives
George B. Pearson, Jr.* Vice President, PGA Marketing
J. Donald Richardson* Senior Regional Vice President
D. Gates Smith* Director and Senior Vice President, Sales
Michael D. Stohler* Vice President, Mortgages and Real Estate
Stuart G. Summers* Director and Senior Vice President and General
Counsel
Dennis C. Twarogowski* Vice President, Career Marketing
Oliver W. Waddell Director
425 Walnut Street
Cincinnati, Ohio 45202
Dr. David S. Williams* Vice President and Medical Director
</TABLE>
*The principal business address for these individuals is One Financial Way,
Montgomery, Ohio 45242.
-4-
<PAGE> 88
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
THE OHIO NATIONAL LIFE INSURANCE COMPANY/CINCINNATI
A MUTUAL LIFE INSURANCE COMPANY INCORPORATED UNDER THE LAWS OF OHIO
- --------------------------------------------------------------------------------
<S> <C>
- ------------------------------- -----------------------------
ENTERPRISE PARK, INC. OHIO NATIONAL EQUITIES INC.
A GEORGIA CORPORATION A BROKER/DEALER
REAL ESTATE DEVELOPMENT COMPANY CAPITALIZED BY ONLI @ $30,000
CAPITALIZED BY ONLI $50,000
- ------------------------------- --------------------------------
Pres. & Dir. M. Stohler Chm. & Dir. D. O'Maley
V.P. & Dir. R. Dolan Pres. & Dir. J. Palmer
Secy. & Dir. J. Fischer VP & Dir. T. Backus
Treas. & Dir. J. Sander VP & Dir. J. Miller
Vice Pres. C. Carlson Sr. VP T. Barefield
Secretary & Dir. R. Benedict
Treasurer & B. Turner
Compliance Officer
Asst. Secy. M. Haverkamp
Asst. Treas. L. Weiler
- ------------------------------- --------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
THE OHIO NATIONAL LIFE INSURANCE COMPANY/CINCINNATI
A MUTUAL LIFE INSURANCE COMPANY INCORPORATED UNDER THE LAWS OF OHIO
- -------------------------------------------------------------------------------------------------------------------
S E P A R A T E A C C O U N T S
--------------------------------
A B C D E F
--------------------------------
<S> <C> <C>
- ------------------------------- ------------------------------ -------------------------------------
OHIO NATIONAL INVESTMENTS, INC. THE O.N. EQUITY SALES COMPANY OHIO NATIONAL LIFE
ASSURANCE CORPORATION
AN INVESTMENT ADVISER AN OHIO CORPORATION AN OHIO CORPORATION
CAPITALIZED BY ONLI @ $10,000 A BROKER/DEALER A STOCK LIFE INSURANCE COMPANY
CAPITALIZED BY ONLI @ $790,000 CAPITALIZED BY ONLI @ $32,000,000
INCORPORATED UNDER THE LAWS OF OHIO
- ------------------------------- ------------------------------ ------------------------------------
Pres. & Dir. C. Carlson Chm. & Dir. D. O'Maley Chm./Pres/.CEO & Dir. D. O'Maley
Sr. VP & Dir. R. Dolan
VP & Dir. M. Boedeker Pres. & Dir. J. Palmer Sr. VP & Dir. J. Palmer
Sr. VP & Dir. S. Summers
VP & Dir. M. Stohler V.P. & Dir. D. Twarogowski Sr. Vice Pres. T. Barefield
Sr. Vice Pres. A. Bowen
Dir. D. O'Maley Secy. & Dir. M. Haverkamp Sr. Vice Pres. D. Cook
Sr. Vice Pres. G. Smith
Dir. J. Palmer Treasurer & Vice Pres. & Treas. R. Broadwell
Compliance Dir. B. Turner Vice President M. Boedeker
Treasurer D. Tancy Vice President T. Backus
Vice President G. Pearson
Secretary R. Benedict Vice President M. Stohler
Vice President D. Twarogowski
VP S. Komrska Vice Pres. J. Houser
Vice Pres & Secy. R. Benedict
VP J. Martin Asst. Secy. J. Fischer
Asst. Actuary K. Flischel
- ------------------------------- ------------------------------
SEPARATE ACCOUNT
-----------------------------------
R
---
<CAPTION>
<= Advisor to Advisor to =>
--------------------------------------------------------
<S> <C> <C>
- ------------------ -------------------------------- --------------------------------
ONE FUND, INC. O.N. INVESTMENT MANAGEMENT CO. OHIO NATIONAL FUND
A MARYLAND CORPORATION AN OHIO CORPORATION A MARYLAND CORPORATION
AN OPEN END DIVISIFIED A FINANCIAL ADVISORY SERVICE AN OPEN END DIVERSIFIED
MANAGEMENT INVESTMENT COMPANY CAPITALIZED BY ONESCO @ $145,000 MANAGEMENT INVESTMENT COMPANY
- ----------------------------- -------------------------------- --------------------------------
Pres. & Dir. J. Palmer Pres. & Dir. J. Palmer Pres. & Dir. J. Palmer
Vice Pres. M. Boedeker VP & Dir. G. Smith ----- Vice President M. Boedeker
Vice Pres. T. Barefield VP & Dir. D. Twarogowski Vice President T. Barefield
Treasurer D. Taney Treasurer B. Turner Treasurer D. Taney
Secy. & Dir. R. Benedict Secretary & Dir. M. Haverkamp ------Secy. & Dir. R. Benedict
Director R. Love Director R. Love
Director J. Bushman Director J. Bushman
Director G. Vredeveld Director G. Vredeveld
Sr. Vice Pres. T. Barefield
- --------------------------------- -------------------------------- ---------------------------------
</TABLE>
<PAGE> 89
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR
REGISTRANT
The Organization Chart showing the relationships among the Depositor, the
Registrant and their affiliated entities is on page 4A hereof.
ITEM 27. NUMBER OF CONTRACTOWNERS
As of March 20, 2000, the Registrant's contracts were owned by 28,199
owners.
ITEM 28. INDEMNIFICATION
The sixth article of the Depositor's Articles of Incorporation, as amended,
provides as follows:
Each former, present and future Director, Officer or Employee of the
Corporation (and his heirs, executors or administrators), or any such person
(and his heirs, executors or administrators) who serves at the Corporation's
request as a director, officer, partner, member or employee of another
corporation, partnership or business organization or association of any type
whatsoever shall be indemnified by the Corporation against reasonable
expenses, including attorneys' fees, judgments, fine and amounts paid in
settlement actually and reasonably incurred by him in connection with the
defense of any contemplated, pending or threatened action, suit or
proceeding, civil, criminal, administrative or investigative, other than an
action by or in the right of the corporation, to which he is or may be made
a party by reason of being or having been such Director, Officer, or
Employee of the Corporation or having served at the Corporation's request as
such director, officer, partner, member or employee of any other business
organization or association, or in connection with any appeal therein,
provided a determination is made by majority vote of a disinterested quorum
of the Board of Directors (a) that such a person acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best
interests of the Corporation, and (b) that, in any matter the subject of
criminal action, suit or proceeding, such person had no reasonable cause to
believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself create a presumption
that the person did not act in good faith in any manner which he reasonably
believed to be in or not opposed to the best interests of the Corporation,
and with respect to any criminal action or proceeding, he had reasonable
cause to believe that his conduct was unlawful. Such right of
indemnification shall not be deemed exclusive of any other rights to which
such person may be entitled. The manner by which the right to
indemnification shall be determined in the absence of a disinterested quorum
of the Board of Directors shall be set forth in the Code of Regulations or
in such other manner as permitted by law. Each former, present, and future
Director, Officer or Employee of the Corporation (and his heirs, executors
or administrators) who serves at the Corporation's request as a director,
officer, partner, member or employee of another corporation, partnership or
business organization or association of any type whatsoever shall be
indemnified by the Corporation against reasonable expenses, including
attorneys' fees, actually and reasonably incurred by him in connection with
the defense or settlement of any contemplated, pending or threatened action,
suit or proceeding, by or in the right of the Corporation to procure a
judgment in its favor, to which he is or may be a party by reason of being
or having been such Director, Officer or Employee of the Corporation or
having served at the Corporation's request as such director, officer,
partner, member or employee of any other business organization or
association, or in connection with any appeal therein, provided a
determination is made by majority vote of a disinterested quorum of the
Board of Directors (a) that such person was not, and has not been
adjudicated to have been negligent or guilty of misconduct in the
performance of his duty to the Corporation or to such other business
organization or association, and (b) that such person acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best
interests of the Corporation.
-5-
<PAGE> 90
Such right of indemnification shall not be deemed exclusive of any other
rights to which such person may be entitled. The manner by which the right
of indemnification shall be determined in the absence of a disinterested
quorum of the Board of Directors shall be as set forth in the Code of
Regulations or in such other manner as permitted by law.
In addition, Article XII of the Depositor's Code of Regulations states as
follows:
If any director, officer or employee of the Corporation may be entitled to
indemnification by reason of Article Sixth of the Amended Articles of
Corporation, indemnification shall be made upon either (a) a determination
in writing of the majority of disinterested directors present, at a meeting
of the Board at which all disinterested directors present constitute a
quorum, that the director, officer or employee in question was acting in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of this Corporation or of such other business
organization or association in which he served at the Corporation's request,
and that, in any matter which is the subject of a criminal action, suit or
proceeding, he had no reasonable cause to believe that his conduct was
unlawful and in an action by or in the right of the Corporation to procure a
judgment in its favor that such person was not and has not been adjudicated
to have been negligent or guilty of misconduct in the performance of his
duty to the Corporation or to such other business organization or
association; or (b) if the number of all disinterested directors would not
be sufficient at any time to constitute a quorum, or if the number of
disinterested directors present at two consecutive meetings of the Board has
not been sufficient to constitute a quorum, a determination to the same
effect as set forth in the foregoing clause (a) shall be made in a written
opinion by independent legal counsel other than an attorney, or a firm
having association with it an attorney, who has been retained by or who has
performed services for this Corporation, or any person to be indemnified
within the past five years, or by the majority vote of the policyholders, or
by the Court of Common Pleas or the court in which such action, suit or
proceeding was brought. Prior to making any such determination, the Board of
Directors shall first have received the written opinion of General Counsel
that a number of directors sufficient to constitute a quorum, as named
therein, are disinterested directors. Any director who is a party to or
threatened with the action, suit or proceeding in question, or any related
action, suit or proceeding, or has had or has an interest therein adverse to
that of the Corporation, or who for any other reason has been or would be
affected thereby, shall not be deemed a disinterested director and shall not
be qualified to vote on the question of indemnification. Anything in this
Article to the contrary notwithstanding, if a judicial or administrative
body determines as part of the settlement of any action, suit or proceeding
that the Corporation should indemnify a director, officer or employee for
the amount of the settlement, the Corporation shall so indemnify such person
in accordance with such determination. Expenses incurred with respect to any
action, suit or proceeding which may qualify for indemnification may be
advanced by the Corporation prior to final disposition thereof upon receipt
of an undertaking by or on behalf of the director, officer or employee to
repay such amount if it is ultimately determined hereunder that he is not
entitled to indemnification or to the extent that the amount so advanced
exceeds the indemnification to which he is ultimately determined to be
entitled.
ITEM 29. PRINCIPAL UNDERWRITERS
The principal underwriter of the Registrant's securities is Ohio National
Equities, Inc. ("ONEQ"). ONEQ is a wholly-owned subsidiary of the Depositor.
ONEQ also serves as the principal underwriter of securities issued by Ohio
National Variable Accounts B and D, other separate accounts of the Depositor
which are registered as unit investment trusts; and Ohio National Variable
Account R, a separate account of the Depositor's subsidiary, Ohio National Life
Assurance Corporation, which separate account is also registered as a unit
investment trust; and ONE Fund, Inc., an open-end investment company of the
management type.
-6-
<PAGE> 91
The directors and officers of ONEQ are:
<TABLE>
<CAPTION>
Name Position with ONEQ
---- ------------------
<S> <C>
David B. O'Maley Chairman and Director
John J. Palmer President & Chief Executive Officer and Director
Thomas A. Barefield Senior Vice President
Trudy K. Backus Vice President and Director
Ronald L. Benedict Secretary and Director
Barbara A. Turner Operations Vice President, Treasurer and Compliance Officer
James I. Miller II Vice President and Director
</TABLE>
The principal business address of each of the foregoing is One Financial Way,
Cincinnati, Ohio 45242.
During the last fiscal year, ONEQ received the following commissions and other
compensation, directly or indirectly, from the Registrant:
<TABLE>
<CAPTION>
Net Underwriting Compensation
Discounts and on Redemption Brokerage
Commissions or Annuitization Commissions Compensation
- ----------- ---------------- ----------- ------------
<S> <C> <C> <C>
$6,658,441 None None None
</TABLE>
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
The books and records of the Registrant which are required under Section 31(a)
of the 1940 Act and Rules thereunder are maintained in the possession of the
following persons:
(1) Journals and other records of original entry:
The Ohio National Life Insurance Company ("Depositor")
One Financial Way
Montgomery, Ohio 45242
-7-
<PAGE> 92
Firstar Bank, N.A. ("Custodian")
425 Walnut Street
Cincinnati, Ohio 45202
(2) General and auxiliary ledgers:
Depositor and Custodian
(3) Securities records for portfolio securities:
Custodian
(4) Corporate charter, by-laws and minute books:
Registrant has no such documents.
(5) Records of brokerage orders:
Not applicable.
(6) Records of other portfolio transactions:
Custodian
(7) Records of options:
Not applicable
(8) Records of trial balances:
Custodian
(9) Quarterly records of allocation of brokerage orders and commissions:
Not applicable
(10) Records identifying persons or group authorizing portfolio transactions:
Depositor
(11) Files of advisory materials:
Not applicable
(12) Other records
Custodian and Depositor
ITEM 31. MANAGEMENT SERVICES
Not applicable.
ITEM 32. UNDERTAKINGS AND REPRESENTATIONS
Representation pursuant to Section 26(e)(2)(A) of the Investment Company Act of
1940, as amended, was furnished in the Registrant's Form N-4, Post-Effective
Amendment no. 9, on April 25, 1997.
-8-
<PAGE> 93
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the registrant, Ohio National Variable Account A certifies that it meets
the requirements of Securities Act Rule 485(b) for effectiveness of this
registration statement and has caused this post-effective amendment to the
registration statement to be signed on its behalf in the City of Montgomery and
the State of Ohio on this 25th day of April, 2000.
OHIO NATIONAL VARIABLE ACCOUNT A
(Registrant)
By THE OHIO NATIONAL LIFE INSURANCE COMPANY
(Depositor)
By /s/ John J. Palmer
------------------------------------------
John J. Palmer, Senior Vice President,
Strategic Initiatives
Attest:
/s/ Ronald L. Benedict
- ------------------------------------
Ronald L. Benedict
Corporate Vice President, Counsel
and Secretary
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the depositor, The Ohio National Life Insurance Company, has caused this
post-effective amendment to the registration statement to be signed on its
behalf in the City of Montgomery and the State of Ohio on the 25th day of
April, 2000.
THE OHIO NATIONAL LIFE INSURANCE COMPANY
(Depositor)
By /s/ John J. Palmer
------------------------------------------
John J. Palmer, Senior Vice President,
Strategic Initiatives
Attest:
/s/ Ronald L. Benedict
- ------------------------------------
Ronald L. Benedict
Corporate Vice President, Counsel
and Secretary
<PAGE> 94
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>
/s/David B. O'Maley Chairman, President, April 25, 2000
- --------------------------------- Chief Executive Officer
David B. O'Maley and Director
*/s/Dale P. Brown Director April 25, 2000
- ---------------------------------
Dale P. Brown
*/s/Jack E. Brown Director April 25, 2000
- ---------------------------------
Jack E. Brown
*/s/William R. Burleigh Director April 25, 2000
- ---------------------------------
William R. Burleigh
*/s/Victoria B. Buyniski Gluckman Director April 25, 2000
- ---------------------------------
Victoria B. Buyniski Gluckman
*/s/Raymond R. Clark Director April 25, 2000
- ---------------------------------
Raymond R. Clark
/s/Ronald J. Dolan Director April 25, 2000
- ---------------------------------
Ronald J. Dolan
Director
- ---------------------------------
John W. Hayden
*/s/Charles S. Mechem, Jr. Director April 25, 2000
- ---------------------------------
Charles S. Mechem, Jr.
/s/James F. Orr Director April 25, 2000
- ---------------------------------
James F. Orr
/s/John J. Palmer Director April 25, 2000
- ---------------------------------
John J. Palmer
/s/D. Gates Smith Director April 25, 2000
- ---------------------------------
D. Gates Smith
/s/Stuart G. Summers Director April 25, 2000
- ---------------------------------
Stuart G. Summers
*/s/Oliver W. Waddell Director April 25, 2000
- ---------------------------------
Oliver W. Waddell
</TABLE>
<PAGE> 95
*By /s/ John J. Palmer
-------------------
John J. Palmer, Attorney in Fact pursuant to Powers of Attorney,
copies of which have previously been filed as exhibits to the Registrant's
registration statement.
<PAGE> 96
INDEX OF CONSENTS AND EXHIBITS
<TABLE>
<CAPTION>
Page Number in
Exhibit Sequential
Number Description Numbering System
- ------ ----------- ----------------
<S> <C>
Consent of KPMG LLP
</TABLE>
<PAGE> 97
INDEPENDENT AUDITORS' CONSENT
The Board of Directors of
The Ohio National Life Insurance Company and
Contract Owners of
Ohio National Variable Account A and
Ohio National Variable Account B:
We consent to use of our reports dated February 18, 2000 for the Ohio National
Variable Account A and Ohio National Variable Account B and January 28, 2000 for
The Ohio National Life Insurance Company and subsidiaries as included herein for
Ohio National Variable Account A and The Ohio National Life Insurance Company
and as incorporated by reference herein for Ohio National Variable Account B and
to the reference to our firm under the heading "Independent Certified Public
Accountants" in the Statement of Additional Information included herein.
KPMG LLP
Cincinnati, Ohio
April 25, 2000
